Removing fossil fuels from the delivery of goods forever, from the long haul to the last mile, can go a long way in reducing carbon emissions on a significant scale. What is driving more companies to pursue electric fleets and what is preventing more of them from ditching diesel?
“We see almost everyday it seems, announcements of new products, partnerships, joint ventures, significant investments made,” said Ben Sharpe, senior researcher at the International Council on Clean Transport, at the conference. VERGE Electrify virtual event.
Manufacturers of large legacy platforms including Volvo, Daimler, Cummins and Peterbilt are aggressively bringing electric vehicles to market, as are a wide range of startups such as BYD, Proterra, Orange EV and GreenPower. Meanwhile, one of the Biden administration’s first big announcements this year was its goal of electrifying federal fleets.
Still, it’s still early days, with fewer than 1,000 electric trucks and buses sold today, representing about 1% of the zero-emission utility vehicle market, Sharpe said. Transit buses are leading the way, with more than 10% of those purchases being zero-emission vehicles.
“So for us, it’s very exciting,” he added. “Transit buses tend to be a kind of beachhead market where you see alternative fuels and advanced technologies hitting the commercial vehicle space first,” and their technologies are likely to spread in the trucks.
To understand the carrots and sticks of electrification for those working in the logistics industry, it helps to ask one of the early EV users who has around 30% market share for same-day deliveries to United States. FedEx began adopting electric vehicles a decade ago. The company predicts that half of its vehicles will be electric by 2025, reaching 100% by 2040.
“We’ve been in space since 2010 and have done a considerable amount of research,” said Russ Musgrove, Managing Director of FedEx Express. “We have millions of electric kilometers and we have made a conscious decision that we cannot wait forever.”
There are advantages to being an early adopter.
The initial charging infrastructure was relatively straightforward to set up, thanks to partnerships with ChargePoint and others, he added. Now FedEx is preparing for major infrastructure and construction projects.
“One of the lessons learned from moving from the science project to scaling was that… it’s one thing to put a new charger in your garage,” Musgrove said. “It’s another to take a warehouse and convert 45 or 100 vehicle spaces, basically building a subdivision in the building.”
Despite the configuration challenges ahead, Musgrove found that going electric made sense for FedEx in terms of total cost of ownership. “Now, if you can control the kilometers, you control your fleet and you are in a hub and spoke scenario, the [total cost of ownership] that is irrelevant, ”he added.
Word of mouth
That said, Sharpe described tension in the fairly conservative, competitive, low-margin truck business. The speed of EV adoption will therefore be driven not only by the speed of policymakers, but also by industry acceptance of new technologies, he said.
For the large-scale transformation of electric trucks to occur in the decades to come, trucks must fulfill their mission and deliver value. The charging infrastructure must also be reliable and proven, and good news must be spread by word of mouth in the industry, he added.
Rich Mohr, vice president of fleet solutions at ChargePoint and former chief technology officer at Ryder, already sees it. “Drivers love vehicles; feedback has always been overwhelmingly positive,” he said, noting the appeal of features like regenerative braking and driving to a pedal.
“Most of the conversations I had at Ryder were more about how the driver uses this vehicle, and less about the vehicle itself around what it can do. And that’s a big change in the industry, especially in the last mile. space and space of the last mile. “
Musgrove pointed out that well-designed electric vehicles appeal to FedEx delivery drivers, and the fact of the underlying technology is almost a side note. “I like to tell people that the fact that the vehicle is electric is irrelevant to the fact that it’s a good truck, and drivers absolutely see it that way. … I will say this experience from the point of view of use by the driver. possesses [received] extremely high marks, higher than any other vehicle we have in the world. “
Trucking fleets, particularly in North America, are made up primarily of small businesses and owner-operators. In addition, the vast majority of small fleets serve small operations such as florists, restaurants and small farms, Musgrove added.
Sharpe described support, incentives, funding and education for entrepreneurs and independent operators as essential to drive adoption of EVs.
According to Mohr, electric buses and electric trucks for last mile or “mid-mile” delivery offer a number of significant advantages to these players, who tend to have fixed routes that ultimately flow back to a site. origin for parking and refueling. In smaller fleets, for example, drivers can even take the work van or van home and charge it overnight.
“The fact that there is a tremendous amount of energy and a large number of drivers driving their vehicles home at night, especially on the vans side,” he explains, describing ChargePoint’s offerings for them. “We reimburse employees with their home electric bills to make sure they are paid for their energy.”
The advantage for the large companies involved is that there is no need to figure out how to deploy megawatts of load, Mohr added. “Electrification for (the) last mile can be simple, as long as you think about how you’re going to energize your vehicle and how you’re going to get that visibility and access control around your fleet.
On an even smaller scale, in terms of vehicle size, electric bikes and scooters can provide another layer for the last mile of deliveries from distribution centers to doorsteps. FedEx is spending hundreds of thousands of dollars on e-bikes around the world, which could reach $ 1 million by the end of 2022, Musgrove said. “At the end of the day, where they make sense from a productivity standpoint, they’re actually a very efficient way to deliver packages for cities,” he said.
However, it takes special work with cities to make delivery bikes workable on sidewalks or roads.
The utility factor
Less than a month ago, FedEx was running small EV pilot programs with no infrastructure issues. Still, moving forward with larger-scale infrastructure is proving more difficult, Musgrove said. For a utility, housing 10 EV chargers in one building is very different from hundreds of charging stations.
Among the more than 3,300 U.S. utility companies, there is a variety of support, or a lack of support, for scaling electric vehicle infrastructure. Musgrove said it made it difficult for him to sleep at night. For example, utility boards have expressed reluctance to offer their customers with fleets of electric vehicles a “free ride” that other customers subsidize.
Electricity has been one of the simpler technologies, compared to some of the changes that have taken place in diesel fleets over the past 20 years.
“Now granted, [a] utility is going to charge us in different ways, ”Musgrove said. But the reality is that there are benefits to being an early adopter. We are already in an ideal position due to our defined routes to make the electricity work for us. Now it’s about finding ways to make the utility understand how valuable we can be as a customer buying the product, basically from here for the foreseeable future, and then working with us to make up for it. this utility infrastructure. “
Other challenges for fleet managers on an electrification journey include the perceived complexity of coordinating charging systems with a utility, Mohr said. He asks customers to learn locally and deploy vehicles suited to their business. Also, ask questions and learn from companies that were very early on this path to electrification, such as: What does access to utilities look like? What do incentive grants look like? What kind of charge is needed? What is the visibility, access and control of the vehicle like? What is the right vehicle for the operation?
“But these are the things companies run into when trying to adopt new technology,” Mohr said. “Electricity has been one of the simpler technologies compared to some of the changes that have taken place in diesel fleets over the past 20 years.”
In addition to a favorable cost of ownership, each speaker underscored the great power of politics to accelerate change. Last year, California initiated a sales requirement for manufacturers to market zero-emission trucks, which other states are likely to replicate. Incentive funds can also help make the business case, said Sharpe, who hopes to see national regulations emerge to spur adoption of the electric vehicle fleet. He also noted how cities and municipalities offer additional incentives, such as preferential access for electric trucks at certain times of the day, parking benefits and even low-emission zones, although the latter have lower emissions zones. social equity issues.
Cities that work with utilities can give an extra boost to future corporate electric vehicle enthusiasts, Musgrove added. “We’re going to be everywhere, but the next step in your city depends on what’s on the table to help us get extra ROI, which is important,” he said.