By Paul Minto, partner at legal firm HBJ Gateley

THE UK Government’s Vehicle Technology and Aviation Bill signals a significant shift in how Westminster has come to view the way we use energy. Set in the wider context of congestion charges, climate control and diesel scrappage schemes, it’s widely anticipated the majority of vehicles of the future will run on electricity, not fossil fuels, and the bill sets out many measures to help accelerate this change.

The statistical trend, as illustrated by the Society of Motor Manufacturers and Traders (SMMT), shows that new car registrations are already beginning to reflect a similar shift in attitude by consumers. The latest figures show the number of alternatively-fuelled vehicles (AFVs) registered in the UK in March increased by more than 30 per cent compared to the same month in 2016. So far this year there have been more than 33,405 new registrations for AFVs in total – an increase of 30 per cent compared to the same period in 2016.

Elon Musk, founder of electric car producer Tesla, whose vision is to change humanity by increasing sustainable energy production, is on track to produce 500,000 electric cars by 2018. When you consider BMW produced two million cars last year, it’s clear the tides are turning.

Electric vehicles will soon be the norm, rather than the exception, and the electricity infrastructure must adapt to meet demand.

According to the latest SSMT export figures, the UK motor industry enjoyed its biggest March since records began, with 562,000 new cars leaving the forecourts. British-built vehicles continue to grow in global popularity and play a significant role in generating export income to the UK.

As the industry continues to evolve the UK Government is likely to consider incentives to enable the sector to keep up with the pace of change and to ensure this figure continues moving in the right direction. With eight out of 10 cars being produced for international markets, and half of those going to customers within the EU, it will be of great strategic importance for our Brexit negotiators to secure a deal which not only minimises the barriers to trade but encourages the UK’s vehicle manufacturing sector to remain relevant in a post-Brexit and post-fossil fuel landscape.

In Scotland, the ambitious Climate Change Plan has set a target of a 66 per cent reduction in carbon emissions by 2032. Given that traffic is responsible for up to 80 per centof pollution in our cities, the wider climate strategy will inevitably help pave the way for legislation and incentives to accommodate more electric vehicles which will go a long way to meeting this target.

Increasing numbers of charge points for electric vehicles are another telling sign of both the Scottish and UK Governments’ commitment to a greener future. Government schemes like Plugged in Places and Go Ultra Low Cities are reducing “range anxiety” by increasing on-street infrastructure. Similarly, the Vehicle Technology and Aviation Bill is expected to encourage motorway services and large fuel retailers to provide electric charge points and hydrogen refuelling stations.

Advances in battery storage will also have a huge impact on how we store and consume energy. Major players are already throwing investment and research expertise into creating more efficient storage solutions as they jockey for pole position in the storage race.

Herein lies the opportunity for partnerships to be struck between electric vehicle manufacturers, corporates and large fleet operators, and renewable energy suppliers.

Exclusive contracts with renewable energy suppliers will allow companies to secure electricity directly from source; knowing their fleet of electric vehicles is being fuelled by green, clean energy. Similarly, the transport sector is a new source of revenue for renewable energy suppliers; where the price of electricity as a transport fuel compares very favourably with petrol and diesel. The emergence of the transport sector as an area where renewable electricity – green fuel – may be highly valued could provide some optimism for those renewable energy generators currently reeling from the withdrawal of UK Government subsidy.

The time is ripe for renewable energy generators and suppliers to consider the implications and opportunities of supplying a transport fuel. The market change also presents the vehicle suppliers and associated supply chain with a new challenge in forming relationships with electricity and hydrogen suppliers. Will your new vehicle arrive with its own electricity account? The transformation of the vehicle industry and the electricity supply infrastructure are creating this new sector and we are closely watching the quiet progress of the Vehicle Technology and Aviation Bill to steer our own clients in the right direction.

Paul Minto specialises in energy and climate change law, planning, procurement and environmental matters relating to renewable energy projects