In this article, Nia Blackwell, Associate Solicitor at JB Leitch Real Estate, provides an update on her previous article from late 2022 covering the subject of EV charging – and the practical implications for landlords and managing agents to consider.
Since our previous article the energy landscape has begun to settle – we are finally seeing stabilisation and the start of wholesale prices falling for electricity and gas supply, with the government recently announcing a lower energy price cap that will benefit millions of households from April this year and hopefully mark only the beginning of a sustained rebalancing.
Alongside this, the drive to move away from dependency on fossil fuels continues.
The government recently set out its world-leading path to reaching zero emission vehicles by 2035, which will require 80% of new cars and 70% of new vans sold in Great Britain to be zero emission by 2030.
In October 2023, new laws were passed to make charging an electric vehicle in public easier and quicker with access to transparent, easy-to-compare pricing information, simpler payment methods and more reliable charge points. The government also continues to support the rollout of charging infrastructure in local areas. Applications are currently open to local authorities in the first round of the £381 million Local EV Infrastructure Fund, which intends to deliver tens of thousands more charge points and transform the availability of charging for drivers without off-street parking.
With the trajectory of change moving at pace, it is worthwhile to revisit the impacts for landlords and managing agents, where there will be greater expectation on making EV charging facilities part of the core facilities available to residents.
From June 2022, all new build homes with associated parking (including those undergoing major renovation) required installation of EV charging infrastructure during construction.
The move tied in with the government’s goal to transition from petrol and diesel vehicles to electric vehicles, but the regulation did not apply to new developments, provided the work started on site before 16 June 2023. With a greater onus on transparency and data management introduced on the recent regulations, new electric car charging points must be pre-configured with smart behaviour and be able to measure, record and transmit usage, both in minutes and as units or energy. The law affects anyone charging an electric vehicle at home or work in England, Scotland and Wales.
With regard to leaseholders and leasehold developments or blocks, it remains likely that the majority of existing and older leases will not make provision for this relatively new technology and that each residential site will present individual logistical challenges that require bespoke solutions for both individuals and wider groups of residents.
The question of cost also remains salient – who pays for licences to alter, installation and maintenance, and manages the proportionate use of electricity.
Key points of consideration that are worth revisiting – and reiterating – include that if a parking space is included within the demise of the property it may be possible install a charging unit in that parking space subject to the appropriate consent being granted by the freeholder. However, parking spaces often form part of the freeholder’s title or leases may restrict the construction of additional structures necessitating a licence for alteration before any charging unit can be built. In some situations, a lease may require variation to mitigate any potential breach of lease terms and to factor any new covenants or easements in relation to the installation.
An additional point to revisit and raise is whether leases contain an obligation on leaseholders to pay the building owner’s fees in relation to any consents or licences, variations to the lease or the potential cost of works. If the installation of EV chargers either by individual leaseholders or freeholders as a communal facility breaches “absolute” covenants, then it is possible that any landlord granting a licence to alter could be subject to legal challenge.
Consideration should also be given to whether communal parking facilities would require engagement – it may be advisable to initiate a section 20 notice and consultation process to outline the intention to install, the cost (service charge) implications and to garner resident feedback.
A point we have raised previously is whether the works involved amount to an improvement. If they do, the lease will need careful perusal to ensure that improvements are recoverable via the service charge mechanism. If they are not, the costs attributable to the improvement stand as irrecoverable from lessees. In summary, landlords and managing agents should note that any necessary third-party permissions (such as from a freeholder or managing agent of a block of flats) must be obtained before an installation occurs. This will be needed for rented or leasehold properties where it’s the renter or the leaseholder applying. Where an installation requires cabling or other parts of the installation to be placed in or on another person’s property, or public land, access rights and permissions must be agreed by all parties using legally binding arrangements, such as legal covenants, before an installation begins.
In a wider context, with significant changes being proposed in the Leasehold & Freehold Reform Bill, and via ongoing introduction of building safety regulations, the case for EV charging needs to be carefully considered, costed and communicated to all parties – particularly given the need for permission, potential disruption and the proportion of costs to be distributed.
Should you wish to discuss this article further, please contact me: n.blackwell@jbleitch
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