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Reducing global emissions requires strong actions to decarbonize transportation, including dedicated efforts for electrification of fleets, both public and private, and especially those composed of medium-duty and heavy-duty vehicles (MDHDV).
Fleet operators face three predominant challenges when contemplating the transition to electric vehicles. The first is the inevitable complexity of understanding and planning for a new fuel source. The second is market barriers, noticeable in the significant upfront additional capital needed to purchase and deploy the electric vehicles and associated charging infrastructure. Finally, there are operational challenges to progressively transitioning the fleet while ensuring its smooth and robust daily service.
Fleet electrification involves more than swapping one fossil-fueled vehicle for another electric vehicle. To ensure a successful transition to a zero-emissions fleet, operators must think through and plan the integration and coordination of several pieces:
Engage cross-functional players who can offer end-to-end solutions to manage technology selection, site planning, and supplier relationships.
At the same time, the emerging landscape of electric vehicles is still quite fragmented. In this complex, ever-shifting ecosystem, fleet operators thinking of transitioning to electric vehicles may need to work with multiple suppliers and vendors, each with distinct offerings, to assess and select technology options that best fit their transportation needs.
Transitioning to electric vehicles requires nontrivial capital investment upfront, to cover both the incremental additional cost of electric vehicles compared to fossil-fuel vehicles as well as the costs of charging stations and any electric grid upgrades for energy supply.
Tap into local, state and federal programs to help finance the transition to electric vehicles.
To ease that burden, several funding options currently exist by federal and local governments, as well as utilities, to subsidize both the electric vehicles and associated charging infrastructure.
However, finding the right funding option and submitting a competitive application can be challenging for fleet operators. In addition, as the market for e-mobility solutions expands, many innovative ownership-and-operation business models are emerging. These models aim to minimize the upfront cost by converting it into recurring annualized expenses, which fleet operators can afford to pay over time while enjoying the savings from fueling and maintenance costs. Some of these innovative business models include what is commonly referred to as “energy-as-a-service” (the fleet operator owns the vehicles whereas an external entity owns the charging and energy infrastructure) and “mobility-as-a-service” (an external party, not the fleet operator, owns both the vehicles and the charging infrastructure).
Despite their huge potential, several of these financing models are offered by nascent players and are yet to be proven effective on a large scale.
A fleet electrification project may take months, if not years, to implement, potentially disrupting the entire transportation system. For large MDHDV fleets, the transition might occur in phases. Some vehicles and routes may be fully electrified and operational, others might be in the implementation stage, while others might still be in the planning phase.
With both electric and conventional vehicles running every day, the hybrid interim state of the fleet operation can be challenging. Furthermore, while electric vehicles are usually easier to maintain and operate, effectively running the electric fleet might require specialized training for staff and drivers. Workforce development and training are sometimes overlooked, resulting in operational inefficiencies.
ENGIE Impact partnered with Grossmont Union High School District (GUHSD), one of the largest school districts in San Diego, California, to plan the electrification of the district’s fleet of more than 50 diesel-powered buses.
There is an increasing momentum for fleet electrification happening on both the public and private levels. As climate urgency escalates, environmental strategies to reduce emissions become a source of resilience and competitive advantage. Lowering emissions to a manageable level, however, requires the ability to move from a theoretical embrace of the goals to detailed, actionable plans for getting there. The solutions may not always be simple, but they are available now for organizations with the will to get started and the expertise to succeed.
Contact us to create an actionable EV blueprint today.
