Editor’s Note: Analyst Liz Morrison takes over from Transport Weekly while Katie Fehrenbacher is on leave. This essay is taken from the newsletter. Subscribe to receive it on Tuesdays.
Last summer, Katie Fehrenbacher wrote about the âState of Sustainable Fleetsâ report published by the Gladstein, Neandross and Associates (GNA) research team. A few weeks ago, GNA updated its report, with some important developments over the past nine months that have led the authors to proclaim 2020 “a historic year for the clean fleet industry”.
As per the 2020 report, the data covers the use and development of four clean vehicle technologies: propane-powered transmissions; compressed natural gas; batteries; and hydrogen fuel cells. The report also covers all sectors – from municipal delivery to urban delivery to long-haul – and includes data for fleets that have never used one of the four clean vehicle transmissions. The authors said this perspective helped them learn about perceived or actual barriers to adoption of clean fleet technology.
Here are nine high-level findings that will change the landscape of clean fleets for 2021:
- Clean trucks and buses are becoming more and more competitive. Clean fleets are increasingly able to compete on the key indicators considered to be the most critical for fleet managers: operational performance; interval; and the total cost of ownership. Notably, all long-haul, delivery, and large-scale fleets (defined as fleets operating more than 100,000 vehicles) interviewed for the report said they plan to increase their use of clean vehicle technologies.
- New changes in state and national policies are driving the adoption of electric vehicles. Two major announcements have accelerated the urgency of sustainable fleet transformation over the past year: California’s announcement of a goal to ban sales of light combustion engines by 2035 and phase out completely medium and heavy duty combustion engine vehicles after 2045; and the Biden administration’s goal of installing 500,000 electric vehicle chargers by 2030. Additionally, California’s Advanced Clean Truck (ACT) rule, approved in 2020, requires the sale of vehicles for the first time. zero emissions (ZEV) by OEMs, and the Advanced Clean Fleets Rule project (expected in 2021) will regulate purchases of ZEV fleets.
- The focus is increasingly on energy efficiency technologies. A number of OEMs are striving to improve fuel economy through products such as trailer skirts and tractor aerodynamics for Class 8 trucks. Some companies are designing trucks to show how several technologies efficiency can be combined to dramatically improve fuel economy. Technologies such as low rolling resistance tires and efficient driving practices prove to be very effective. For example, the North American Council for Cargo Efficiency’s (NACFE) “Run on Less” roadshow showed an improvement in fuel efficiency of 7 to 10 miles per gallon (mpg).
- The use of renewable diesel and biodiesel is increasing. The production of renewable diesel (RD) saw an increase of 7% in 2020 compared to the previous year. Recent investments have the potential to produce 3.8 billion gallons per year in the United States by 2025. According to this report, six oil refineries in the United States are being transformed into renewable diesel plants and two existing factories are expanding.
- The momentum for propane adoption is waning. General Motors exited the liquefied petroleum gas market last year, cutting the number of mid-weight propane vehicle models on offer by half. As a result, propane delivery vehicle orders in 2020 fell 1,300 units (66%) from the annual average for the previous five years. It is important to note this, as the adaptability of vehicles is cited as the main challenge in adopting this low cost and renewable alternative fuel. The momentum could shift away from propane to renewable natural gas (RNG), as it continues its meteoric rise as a primary source of sustainable fuel.
- The growth of renewable natural gas is accelerating nationally. One advantage that many fleet managers see in natural gas-powered fleets is increased flexibility of routes and the lack of refueling en route, as opposed to electric vehicles, which currently require relatively frequent recharging. RNG, from organic waste streams, is produced in 29 states in the United States and offers the best benefits in terms of reducing greenhouse gas emissions compared to other renewable technologies. The use of RNG in road transportation increased in California from 69% to 92.5% of the total volume from 2018 to 2020.
Last year, RNG took a significant step forward by becoming the first widely used renewable fuel to achieve negative carbon status in the California Low Carbon Fuels Standard regulatory program. This report predicts that California’s RNG carbon intensity will continue to decline due to an increasing supply of ultra-low carbon dairy and pig manure. Two other predictions: RNG is likely to completely saturate the national natural gas vehicle fuels market by early 2024, and the weighted average energy carbon intensity of bio-CNG in California is expected to dip to nearly – 200 by the end of 2023.
- Charging infrastructure is increasingly available. Utilities nationwide are increasingly investing in fleet-focused electric vehicle charging infrastructure programs. For example, the New York State Civil Service Commission ordered its major utilities to spend more than $ 700 million on public infrastructure until 2025, nearly doubling California’s 2019 tenure.
- But the development of infrastructure remains a major obstacle. California predicts it will need 1.5 million electric vehicle chargers by 2030, three times the amount the Biden administration has committed for the entire country in the same period. In addition to the shortage of charging stations, fleet owners are concerned about the availability and reliability of electricity due to the increased risks of electricity supply due to natural disasters, such as blackout. grid in Texas due to the cold.
- The overall cost remains the main challenge to adoption. Vehicle pricing is the biggest challenge reported by more than three-quarters of electric truck users. Costs (before incentives) are typically two to three times that of a new diesel vehicle, and batteries remain a high component of the overall vehicle price. Although technological advancements in EV batteries have reduced the cost in recent years, it remains the biggest barrier to adoption.