E-Mobility: Opportunity or Inconvenience for the Commercial Operators of Parking Places?

E-Mobility: Opportunity or Inconvenience for the Commercial Operators of Parking Places?

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The number of electric vehicles in Hungary is rising. In response to this, the National Building Regulation of Hungary (OTEK) has established new requirements for the provision of recharging points, with a January 1, 2019 deadline. Although these new rules have had some visible results, there is significant delay in establishing full compliance. Those who fail to meet the requirement may anticipate the imposition of penalties.

OTEK requires that stores trading daily consumer products covering over 300 square meters such as food chains, mini-markets, hypermarkets, shopping malls, supermarkets, and wholesalers are obliged to establish at least two recharging points for every existing 100 parking places (or part thereof), as are the operators of parking meter zones (such as parking garages). For example, a parking garage with 110 parking places must provide four recharging points. With respect to the construction of new parking places, the requirements are even greater: Cabelling for at least 10 recharging points must be provided for every 100 parking places (or part thereof), so that, if operation of these recharging points becomes necessary (or mandatory) later, they can be made functional easily, without wrecking the road surface. With these provisions, the Hungarian legislator advanced ahead of EU law: the provisions were adopted in 2016, prior to the similar rules in the EU’s Clean Energy Package of 2018, and they are also more demanding than the EU’s law on recharging stations, which covers only newly-built parking places. 

With regard to already-existing parking places, the deadline for stores and operators affected by the law – approximately 130 supermarkets and thousands of hypermarkets across Hungary in cities like Budapest, Gyor, Debrecen, and Kecskemet – to meet the requirement of establishing the necessary number of recharging points was January 1, 2019. Some of them have, in fact, already fulfilled their obligation. For instance, most of the shopping malls in Budapest offer complex solutions for EV owners, and the international supermarkets are constantly developing and extending their recharging capacities.

However, the vast majority of stores – many of which could not meet the requirement in time – are still only at the beginning of the process. They penalties they can anticipate, however, will not relieve them from the obligation; they will still have to establish the required number of recharging points irrespective of paying the penalty.

The implementation of the Regulation may be boosted by the fact that the Hungarian legislation covering e-mobility has become more elaborate in the past few years. And besides the Regulation there is a Government Decree on e-mobility that sets out the framework for the operation of recharging points. Based on these rules, most petrol stations have turned to the commercial operation of recharging points by setting payment conditions to their e-mobility services. This may offer new perspectives for the stores and parking meter zone operators as well. Additionally, there are tax benefits attached to e-mobility as the large majority of the costs of their establishment can be deducted from the corporate tax base and the public utility providers’ special tax on recharging point operators. 

All the above actions were made necessary by the rising demand for “green plate cars” (i.e., cars that are hybrid or fueled completely by renewables). In September, 2018, there were 7916 green plate cars in Hungary, of which 3522 were in category 5E (the category of pure electric vehicles (EVs)). At the end of the year, there were around 10,000 and 3,700, respectively. This fits to the projections of the Ministry of National Development of Hungary, which predicted approximately 200,000 EVs and 20,000 recharging points by the year 2030. Therefore, Hungary may anticipate an increase in the number of recharging points (there are around 550 at present), and the affected stores and operators can play a huge role in that. However, the fact that the return on investment of recharging points is not yet clear is causing some reluctance on the side of the investors.

Ultimately, it is still a chicken and egg question in Hungary: it is not clear whether the number of recharging points will lead to the penetration of EVs, or au contraire, whether the demand for EVs will result in new recharging points.

By Laszlo Kenyeres, Partner, and Adam Lukonits, Associate, Wolf Theiss Hungary

This Article was originally published in Issue 6.4 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.