In recent years the transportation industry has begun to shift seismically towards more sustainable practices. It’s becoming increasingly important that small businesses and large companies alike reduce the level of impact they have upon the environment, while also optimising their operations.
An answer to these current issues is fleet electrification, an idea that is accelerating due to its growing relevance. So that you can get an understanding on the subject, we’ve put together this fleet electrification guide, which explains exactly what it is, the benefits, challenges, and how you can plan for the future.
What is Fleet Electrification?
Fleet electrification refers to the process by which an organisation replaces its internal combustion engine (ICE) vehicles with electric vehicles (EVs). Simply put, it's the transition of a vehicle fleet from petrol or diesel power to electric power. Fleet electrification applies to a wide array of commercial vehicles, including trucks, buses, light goods vehicles (LGVs), and heavy goods vehicles (HGVs).
Why is Fleet Electrification Important?
Fleet electrification is important owing to its impact on reducing the carbon footprint of vehicle fleets. Specifically, by moving away from a reliance on conventional fossil fuels which release harmful greenhouse gases (GHGs), electrification enables the use of a cleaner and more sustainable energy source - often generated, at least in part, by renewable energy such as wind or solar.
The Benefits of Fleet Electrification
Fleet electrification brings a host of benefits, including:
Reduced CO2 emissions
The primary advantage offered by fleet electrification is the significant reduction in fleet CO2 emissions, as EVs do not rely on petrol or diesel. This comes with the added benefit of improved air quality, helping to decrease pollution and combat climate change. Transport is the largest emitting sector of GHGs, comprising nearly a quarter (24%) of the UK’s total, so addressing negative contributions is essential.
Lower total cost of ownership
While electric fleets may appear more expensive on the surface, they ultimately lead to an improved total cost of ownership because electrification eliminates the need for fleets to spend on fuel, traditionally one of their biggest expenses. Moreover, EVs incur lower maintenance costs due to having fewer moving parts (e.g., there is no need for timing belt replacements), resulting in less wear and service requirements.
Increased compliance and brand reputation
In today’s society, substantial environmental awareness has led to stricter regulations. Therefore, when fleets embrace electrification, they not only demonstrate a commitment to sustainability, but also find it easier to ensure compliance with tightening emissions standards. This, in turn, strengthens their ESG credentials and enhances an organisation’s brand image in the eyes of customers, investors, and stakeholders.
The Challenges of Fleet Electrification
Despite fleet electrification offering remarkable benefits, it's important to acknowledge certain challenges:
- Initial cost: EVs typically imply higher upfront costs as opposed to standard ICE vehicles, despite long-term cost savings.
- Charging infrastructure: There is still a need for more charging infrastructure for EVs, especially when compared with the accessibility of petrol and diesel stations.
- Vehicle range: Concerns about whether EVs can meet the daily mileage demands of commercial operations remain a barrier.
- Energy supply: Charging needs place pressure on the electricity grid’s energy capacity, particularly during peak hours.
When taking the disadvantages of fleet electrification into account, it should be emphasised that the underlying technology is continuously advancing. EV fleets are relatively new, and it's expected that we will see improvements in areas such as battery capacity and the expansion of charging points coupled with vehicle-to-grid (V2G) integration - which allows EVs to return excess energy to the grid - in the near future.
Commercial Fleet Electrification Strategy
The collective switch to EVs is now a reality. Even considering that the ban on the sale of ICE vehicles has been pushed back to 2035, fleet electrification is inevitable, meaning it’s advised that you plan ahead. What’s more, early adopters of electric fleets are entitled to government incentives which help with cost control, effectively making the change practical for more organisations.
In order to set out your commercial fleet electrification strategy, you’ll need to undertake EV vehicle selection, re-evaluate route planning, assess charging logistics, and accustom yourself to the particular needs of EVs.
We at MICHELIN Connected Fleet make the transition to a greener fleet seamless by factoring all of this into your organisation’s structure before establishing a comprehensive strategy. We fully believe in clean energy for fleets and have developed EV fleet management solutions to make electrifying your fleet more attractive than ever. If you’re interested in speaking to an expert, then be sure to make an enquiry today.
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