The truth about fleet electrification – dispelling preconceptions with data insights
By George Hobbs, Consultant and Data Product Lead
We recently ran a webinar and showed our data findings from real-life fleets to shine a light on the facts of fleet electrification and dispel some of the concerns people may have.
The three preconceptions we tackled were about cost, vehicle range and power. You can get the follow-up slide deck here.
While fleets accelerate towards electrification, especially in the logistics and bus industries, some are treading on unfamiliar ground and can be influenced by negative consumer media stories about EVs.
That said, shifting from diesel to electric is no small task – it can be likened to the digital transformation business made in the past few decades. But it’s also a positive move towards our net zero goals and with the right approach, should be a positive financial and commercial transformation too.
Digital-First – your data insights will be the difference between success and failure
Fuel cards and spreadsheets are giving way to data insights and digital tools to optimise the performance of an electric fleet. The data inputs include routes, schedules, shift patterns, telematics, chargers, power sources, seasonality and energy use.
We analyse the data from our software platform, VEV-IQ, to firstly make the assessment on electrification readiness during the planning stage. Then when the EV fleet is operational, the platform manages and optimises the performance of the fleet to reduce demand from the grid and ensure required state of charge. This provides operational resilience and manages costs down
VEV can support with guiding a “no regret” transition so your fleet electrifies at the right pace to achieve net zero while optimising performance and cost.
Once electric, fleet operators and drivers don’t look back ….. smooth driving experience, clean depots and a beneficial business case.
Cost Preconception: “electrifying fleets is too expensive, and the business-case doesn’t stack up”
I can confidently state that this is not true. EVs do carry higher upfront costs – ranging from 25-100% more than diesel alternatives –and these should be factored into a holistic total cost of ownership (TCO) model.
In many use cases, EV TCO is lower than diesel, and this is only improving as vehicle range and technology improves. VEV can help you identify those vehicles from day one.
So, when you wrap the upfront capex into the TCO, how is this possible? There are a few reasons:
- Reduced maintenance: EVs have fewer moving parts, requiring less servicing which cuts repair costs. From our modelling, we’ve seen that running an electric fleet can unlock maintenance savings of up to 40%.
- Optimised energy costs and operational practices: through solar power, battery storage, and smart charging schedules, the cost of energy can be minimised. Carefully analysed route plans ensure vehicles are driven efficiently, while driver training also helps extend vehicle range – as much as 20% when done effectively. Our analysis has also shown that in some cases 60% savings can be made with electricity costs compared to fuel.
- Extended vehicle lifecycles: EVs typically use a longer capital cycle, spreading the investment over a longer time-period. Take Kent County Council’s Fastrack bus rapid transport (BRT) service, for which we are building the specialist pantograph charging infrastructure. In this project, the business-case for electrification is underpinned by a 15-year contract with the bus operator.
We have consistently seen these factors at play in our modelling. For instance, our analysis of a 500-van fleet showed that 47% of the fleet was ready to switch to electric, with a projected TCO saving of £2.6 million over a 7-year lifecycle.
Electrification-as-a-service can also offer an attractive model for businesses by shifting investment from capex to opex, making the transition more manageable over a suitable time-period.
Range Preconception: “electric vehicles lack the range needed for daily operations.”
This is a common perceived barrier to the EV shift, but many fleets can transition a large proportion of their vehicles cost-effectively today. The key is to plan a phased implementation based on available data to ensure the right vehicles are transitioned in the right timeframe.
Our modelling of real-life fleets demonstrates that EVs have fully sufficient range for many use cases – and we’ve seen an almost-100% rise in observed miles/kWh compared to first-generation vehicles.
By modelling in-depot DC charging to improve available range faster, we identified a strategy for an HGV and LCV delivery fleet to enhance its electrification readiness by a factor of 8.8.
Adjusting operations effectively can unlock even more range. Implementing intelligent route optimisation and charging scheduling, as well as assessing optimum battery capacity and weight for different journey-lengths, can go a long way to enhancing efficiency and reducing costs.
Much like the marginal gains approach of the British Cycling team championed by former head-coach Dave Brailsford, meticulous analysis of fleet data can unlock marginal gains that optimise an EV fleet’s performance! By optimising multiple parts of operation by as little as 1% you can achieve significant efficiency gains.
A digital-first approach to fleet electrification is therefore crucial. At the outset of the transition, informed decisions underpinned by core data from the current fleet need to be made – incorporating telematics, power and operations. Assessing power requirements, charging timing, and route-needs means that achievable plans for implementation can be made.
In the case of long-distance HGVs, planning for availability of infrastructure and technology at scale is crucial. As part of this, we are supporting the creation of ‘green corridors’ which include shared charging hubs developed by commercial organisations for heavy-duty vehicles making long journeys across the nation.
Power Preconception: “electrification will strain power grids and raise energy costs.”
It is true that the EV transition will hugely raise fleets’ power demands. This makes it a crucial consideration to address in the planning phase, with grid upgrades taking up to three years.
Nevertheless, an intelligent energy strategy can be implemented to decrease power demand. Many measures can be taken here to support fleets during the planning and operations phases.
- Installing microgrids with solar power and battery storage: on-site energy systems reduce dependence on the national grid – providing cost-efficient, off-grid power for use in the day and storing excess energy for later use.
- Implementing smart charging: scheduling and monitor power sources and tariffs to minimise costs during lower-tariff hours reduces both costs and demand on the grid.
Our energy analysis across multiple use-cases highlights the gains to be made here.
Recent modelling of a 25-vehicle HGV fleet demonstrated that with smart charging, the required grid connection could be reduced by 2.3 times, resulting in savings of £150,000. In another case, we explored how solar power allowed a business to electrify 30 vans on a grid connection originally intended for just 11.
Similarly, we planned and built a solar energy project for Tootbus, a sight-seeing bus operator, that is predicted to will generate 65,000kWh annually – enough to power their electric fleet for 60,000km a year.
The road ahead: lead or follow?
Fleet electrification is underway, and businesses that act now will gain a competitive advantage, becoming early adopters of new technologies and operational models. This leads to lower operational costs and unlocks entirely new operating models that their competitors will have to chase.
Fully electrified fleets offer lower energy costs, streamlined operations, and a better experience behind the wheel for drivers. Planning is essential for a successful shift, and fleets must be willing to embrace the change and adjust operations to achieve net-zero emissions.
Those that move early will emerge stronger, more resilient, and better prepared for the challenges and opportunities of a zero-emissions future.
Those that delay electrification could miss out on the chance to control their transition, potentially facing supply chain bottlenecks – which could nullify any lower costs anticipated by choosing to delay.