Widespread electric vehicle (EV) adoption is raising new questions about battery lifespan, resale value and smart charging habits. Argus spoke with Peter McDonald, director at UK charging technology firm Ohme, to discuss how home charging and battery health standards could shape EV demand.
The role of Standardising State of Health (SOH) certification is often discussed as key to building trust in the used EV market. How will this impact European OEMs?
Battery State of Health helps address information asymmetry in the used EV market. New BEVs typically come with generous warranties, giving first owners confidence. However, in mature markets, most vehicles are financed, with future value influencing lease rates and purchase prices. Since the battery is a major cost component, confidence in its long-term durability significantly affects a vehicle's lifecycle value.
Buyers increasingly want not only a snapshot of battery health but also a forecast of its future condition. This is especially critical in markets like Europe, where consumer finance is tightly linked to vehicle purchases.
As a result, battery durability may impact a vehicle's future value more than performance specs. OEMs are incentivised to encourage optimal charging habits to extend battery life. Batteries with high residual or scrap value may help offset concerns around SOH and depreciation.
Ultimately, transparency in battery health and projected performance is becoming essential to maintaining confidence and value in the growing used EV market.
What does a shift toward home charging mean for how and when batteries degrade and, by extension, demand for replacement cells or recycling?
Discussions with OEMs suggest AC (slow) charging is better for battery health than DC (fast) charging. As a result, OEMs prefer customers to charge at home or work where possible, preserving battery longevity.
Most early EV adopters—and around 16mn future UK households — can charge regularly at home or work, using DC fast charging occasionally for longer trips. Homes without off-street parking present challenges, but as demand grows, more scalable public charging solutions will emerge.
Widespread home and workplace charging supports more consistent battery health, leading to higher resale values and lower new purchase costs. Improved durability also extends vehicle life, reduces warranty and maintenance issues, and delays battery recycling needs.
We have seen carmakers are leaning on subsidised leasing to justify EV production volume. How does this distort demand and how should that shape investment in materials supply chains?
Two key factors drive this: OEM commercial dynamics and government policy incentives.
OEMs make inflexible production decisions and, to meet environmental regulations and attract investor confidence, many have committed to EV strategies. When EV supply exceeds demand, OEMs need demand levers. Lowering new vehicle prices is a blunt tool — most, except Tesla, avoid it as it directly impacts residual values.
In Europe, government EV incentives have focused on benefit-in-kind tax reductions, encouraging businesses and drivers to choose EVs over ICE vehicles. Fleet channels, with less transparent and fluctuating lease rates, now dominate EV uptake. This has created polarised demand and fuelled the rise of salary sacrifice schemes, attracting retail-intent buyers into fleet.
As a result, OEMs rely heavily on fleet sales, often via hidden discounts. Leasing companies have become major asset holders, concentrating EV ownership.
Strong EV demand exists — at the right price. Given lease rates are tied to residual value, buyers act rationally. This places high importance on battery state of health and sustaining post-mobility battery value.
What is Vehicle-to-Grid charging and how might that reshape the economics of battery packs, degradation rates, and materials circularity?
There are major financial and carbon-saving opportunities when consumers charge during low grid demand. Charging overnight, or when supply exceeds demand, offers the lowest-cost, lowest-carbon charging. Companies like Ohme, in partnership with energy providers like Octopus, make this smart charging simple and seamless.
Vehicle-to-Grid/House (V2X) technology offers even greater benefits. It allows customers to power their homes from their cars or profit from strategic charging and discharging — exporting energy back to the grid.
While high upfront costs have limited adoption, many OEMs are now committing to vehicles with two-way inverters, making V2X primed for mass uptake.
From a battery perspective, V2X can reduce charging costs, turn the EV into a grid asset, and enhance residual value — potentially increasing what consumers are willing to pay. It encourages EV adoption and aligns with home-based charging habits.
At scale, V2X could reduce the need for separate home batteries and industrial grid storage, lowering overall battery demand across the supply chain.
What challenges do carmakers and energy providers face in co-ordinating charging strategy and battery health?
The worlds are different. Carmakers face high upfront costs, intense competition and uncertain demand as they invest heavily in building a global electrified fleet. In contrast, with a few notable exceptions, energy retailers are typically national heroes, focused on local, highly regulated markets.
Collaboration between the two remains limited, despite clear mutual benefits: OEMs building great EVs, and energy providers supplying abundant, affordable power.
Ultimately, my view is that OEMs may have the greater influence in shaping future standards, as they design vehicles for multiple markets and global requirements, while energy providers remain more locally constrained.
