UAE is set to introduce new unified fee structure plans for Electric Vehicle (EV) charging indicating all service providers should charge at least Dh1.20 VAT per kilowatt-hour for an ‘express’ charging service and should cost at least Dh0.70 VAT per kWh in the case of a ‘slow’ charge.
The service fees have been indicated in cabinet resolution no. 81. Surprisingly, it is not easily discernible as to when the new unification of fees will apply or even how they will be assessed, however according to the cabinet resolution, the implementation of the new fees will be 60 days from publication in the Official announcement. The decision will, therefore, be effective from September 6, legal expert Abdulrahman Nabhan opined.
Nabhan, the chief financial officer at Yandex, who examined the new amendment, said fees stand to be applied to electric cars based on the type of charging.
This decision has been made under the government’s target to control or provide standardization of charging point networks for EV. Presently, the rates of charging stations are quite high, although some of them offer their services for free. The Council of Ministers has also kept the rights to alter these fees as necessity arises, the Council of Ministers can also add, reduce or make any further changes to the fee structure.
The first EV charging network that is fully operated by the government of UAE was inaugurated in early this year with a target of establishing one hundred fully charging stations in the country.
Same in April, another fuel company, the ADNOC group, had also planned to add over 500 new fast and super-fast chargers within the next few years. Globally, use has soared particularly in the application of EVs that recorded an astonishing sales increase of nearly 300% in 2023 in UAE.
Appreciated move
Legal professionals and other professionals in the industry have applauded the decision saying that it is a good development. Mostafa Hegab of Mansoor Lootah Advocates and Legal Consultants drilling down the crux of the resolution noted that the resolution intends to control the use of service by the electric vehicles. “
“It is a step to prepare the ground for creating a new vector of the use of renewable energy sources as a stable second type of energy.”
As per a UAE official in 2023 the country would formulate a pricing model to start levying electricity to the EVs.
Hegab continued that the decision enhances a lot within the industry. “The passed resolution will compel investors in the industry to invest more in such renewable resources as the solar systems,” he said.
He also said that, yes the free users of the charging services would now be charged, but it will not fully affect them.
“Even if one would be given a new law on the announcement of the product, the consumers would still prefer it because it is cheaper and more affordable than fossil fuel,” he added.
Some online forums with owners of electric vehicles have applauded the decision stating that it will help in avoiding congregation at superchargers, meanwhile; guaranteeing that chargers in the highways and cities would always be available when required.
Guaranteed accessibility
While speaking to EV owners we got an insight of how Shiraaz, gets affected with the increase in expense but he was happy.
“Sometimes, I saw people charging their devices in those areas when they did not need them to, just because there was free Internet,” she said. “I have spent several hours waiting in line just to charge for 10 minutes so that I had enough charge to get home while others would be charging up to 100 percent.”
This new fee structure is just one step towards the green economy being adopted as a long-term goal in the UAE.
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The country had also approved the national policy to construct the infrastructure of electric vehicle charging points in the country in the previous year. It is believed that this policy will help in bringing down the probability of energy use in transport by 20 percent.
