How Efficiency Can Rev Up the Flagging Truck Industry

Rocky Mountain Institute

How Efficiency Can Rev Up the Flagging Truck Industry

What does the food in your refrigerator have in common with the clothes in your closet and the computer on your desk? Unless they were produced in your backyard (or in the case of Amory Lovins, in your home's greenhouse!), common items that appear on the shelves of our local stores arrived there by heavy truck.

Arguably one of the core elements of consumer society, trucking is widely regarded as the easiest and quickest means to get everything we need from supplier to seller to you.
However, while critical to our modern economy, the trucking industry is in serious trouble. More and more independent owner operators are going bankrupt, oil prices are increasingly volatile, and nitrogen oxides emissions regulations (the U.S. doesn't yet regulate carbon dioxide emissions) are coming down hard on the industry.

Few improvements have been adopted industry-wide to increase fuel efficiency. In 2008, freight trucking was the second greatest user of petroleum products in the United States. Trucks consume 2.4 million barrels a day, and greenhouse gas emissions from trucks have risen more than 50 percent since 1990. To put this in perspective, emissions from the light-duty vehicle sector have only increased by about 13 percent.

"Historically, emissions regulations have coincidentally encouraged solutions that sacrificed efficiency," says Hiroko Kawai, a principal with Rocky Mountain Institute's Mobility + Vehicle Efficiency (MOVE) Team. "However, efficiency improvements will always reduce vehicle emissions proportionately."

The recent economic downturn mixed with market uncertainty has made it difficult for fleet owners, who already operate on very slim profit margins, to make any investment in technologies that make their trucks more efficient. The industry indeed faces a crisis.

But, according to Kawai, crisis creates opportunity.

"The current economic climate presents a great opportunity for good design and technology to profitably transform the industry by reducing waste and increasing efficiency," she said.

Image by jpsdg

To keep this transformation moving, RMI organized and convened more than 40 trucking industry experts in Denver, Colo., from April 14 to 16, for our Transformational Trucking Charrette. Diverse participants, who ranged from vehicle technology experts (such as original equipment manufacturers (OEMs) and technology experts) and trucking operations stakeholders to those who work on mitigating environmental impact and implementing policy solutions, spent three days engaged in discussion and analysis. Although it is rare to get this combination of experts in a room together, they all came to work toward the same goal: doubling the efficiency (defined by the amount of energy required to haul freight) of the heavy trucking sector.

On the very first day of the charrette, Kawai extended a challenge. "Everybody needs to get on the truck," she said. "If we don't take urgent action on improving trucking efficiency, goods won't be transported, items will not be available, or we won't be able to afford them. Ultimately, we need to reduce or eliminate our dependence on fossil fuels."

The biggest challenge to transformation in a troubled and fragmented industry is alignment. RMI's MOVE Team believes that in order to accelerate the business case for fuel conservation, stakeholders need to consolidate the multiple, often-competing "visions" of what the future of trucking looks like. However, achieving this is harder than it seems. Here are a few reasons why.

There is No "Silver Bullet"

Like any complex issue, there is no single solution for achieving widespread trucking efficiency gains. Although the technologies that could help a heavy-duty truck achieve doubled efficiency are available, these technologies are not yet widely adopted. Charrette discussion revealed that a wide range of often interconnected barriers is stepping on the brakes.

Image by jpsdg

Efficient trucking faces the classic chicken-and-egg situation. How can a truckmaker with a new technology transform its assembly line and get it into the market successfully without solid projection for demand? On the other side of the coin, why would fleet owners or truck drivers demand technologies that they have little knowledge about, whose success and profitability are unproven?

Along with the technology conundrum are policies and regulations that are often contradictory and inconsistent on a state-to-state basis. There are many state and federal policies that seek to mitigate the environmental impact of the trucking industry. However, many regulations that seek to reduce particulate matter and nitrous oxide emissions do so by sacrificing efficiency.

Such barriers, while pervasive, are definitely not insurmountable. Many truck freight customers have begun to demand climate-friendly supply chains, and market forces are pushing energy efficiency in freight-goods transportation. So the question becomes: is the trucking industry's future bleak or bright?

What's Next?

"In spite of these barriers, the industry's future will be driven forward by true collaboration," noted Kawai on the beginning of day three, which focused on narrowing proposed solutions into actionable efforts. "More positive and simplistic solutions can come." System integration, aligned incentives, and government collaboration: all the proposed solutions came back to a whole-system approach and a common vision.

When asked the question "in ten years, what would you like to accomplish to overcome the barrier of competing policies?," group members were consistent and clear. The industry needs unified, prioritized, and maintained policy with an immediate and equal consideration of efficiency, as well as a way to get technologies into the marketplace and education for consumers on their effectiveness.

Three major initiatives -- all of which seek to perpetuate the collaboration and insight toward application solutions -- emerged at the charrette.

First, "Freight Without Borders" centers on creating an organization that could unify industry and government stakeholders and accelerate doubling freight efficiency while creating jobs in new energy research areas and business. Truckers face a hodgepodge of weight and size rules that vary between states or even counties; harmonization that allows long compound vehicles, as in some jurisdictions, could (with proper design) save lots of fuel while reducing congestion, road wear, and accidents.

Specifically, the initial goal is to convince policy makers that we need a "National Freight Strategy." Crafting such a strategy would allow influential individuals and organizations to understand and compile what knowledge exists, and to accurately inform policy makers as they craft a national strategy.

The second initiative, U.S. Council for Freight Efficiency (USCFE) -- centered on "credible, quantified information on truck technology," as MOVE consultant Mike Simpson put it -- could be an effort to establish an independent body like the U.S. Green Building Council's LEED system (Leadership in Energy and Environmental Design) for green buildings -- except in this case for trucks. A non-profit council could be established to deliver publicly accessible technology data in order to stimulate the adoption of efficient vehicles and vehicle components.

The third initiative centers on an actual truck. The "Transformational Truck Demonstration" will develop, demonstrate, and test a transformational truck that achieves at least twice the efficiency of a traditional truck. The demonstration will be designed to accelerate the development of efficient vehicles, their components and systems, and their profitable commercialization. This project will establish the true efficiency limits for long-haul Class 8 trucks using the above-mentioned USCFE's testing methodologies, which include application-specific, duty-cycle-specific efficiency scenarios. The Transformational Truck Demonstration project will leverage the research and networks from Freight Without Borders and USCFE while providing a test platform that can support the validation of new concepts from each. The project will also assist Freight Without Borders, proving to consumers and policy-makers the feasibility of transforming the trucking industry.

These goals, although ambitious, are not only important but necessary to move the industry toward a profitable and sustainable future. RMI's MOVE Team members continue to rally behind these initiatives, and to collaborate with influential parties in the freight and policy sectors. Their recently published Transformational Trucking Report provides more information on next steps and approaches.

More information on transforming the truck industry is available here.

Kelly Vaughn is an analyst with RMI's Communications Department where she focuses on communications strategy and initiative development. She has her MA in Communications from University of Dubuque and extensive experience in social marketing and PR.

Images by jpsdg.