It's electrifying: How do we speed up the transition to 100 percent EV fleets?
This article is drawn from the new Transport Weekly newsletter from GreenBiz, running Tuesdays.
Are corporate commitments to 100 percent electric vehicle fleets starting to gain traction?
At the Global Climate Action Summit (GCAS) in San Francisco last week, a handful of companies and cities made commitments to convert their vehicles entirely to electric. But such pledges are still relatively rare. While the Climate Group’s program to convince companies to adopt 100 percent clean energy (RE100) has 144 members, the non-profit’s 100 percent electric vehicle program (EV100) has just 23 organizations listed on its site.
The reality is while clean energy can be procured at a lower cost than fossil fuel-generated power in some regions in the United States, most battery-powered vehicles still remain more expensive than diesel-powered ones. That’s expected to change in the coming years.
At an event last week put on by CALSTART, a group of fleet managers and automakers explained some challenges associated with buying all EVs and manufacturing more EV truck models. Volvo Director of Sustainability Dawn Fenton said: "We’re going as fast as we can. . .There are other forces out there limiting this."
Such forces include the slow pace of tech development, the high costs of EV trucks, a lack of supporting policies and a lack of available charging infrastructure. The fleet manager for PepsiCo, Mike O’Connell, echoed these sentiments but also pointed to a lack of EV truck models that fit his company's needs and previous work with a fleet maker that subsequently went out of business.
However, at the CALSTART event, and during the GCAS program, IKEA emerged as an inspiring champion of aggressive EV fleet conversion. The company’s head of sustainable mobility, Angela Hultberg, put it like this: "We need to challenge ourselves a little bit." She said that one of the main reasons that IKEA is embracing EVs is because its customers care about sustainability.
IKEA CEO Jesper Brodin announced at the conference last week that IKEA plans to use EVs for 100 percent of its home deliveries by 2030. It will do so in Paris, London, Los Angeles, Shanghai and Amsterdam by 2020. Delivery vans represent one place where fleets are beginning to be electrified more rapidly, thanks to the fuel savings from predictable, last-mile delivery routes.
In the early(ish) stage of the fleet EV market, the sector will need leaders such as the IKEAs of the world to help it accelerate. Google, Facebook and Apple did similar early work when it came to making it easier for corporates to buy renewable energy. Now smaller companies are following in the path of the bigger internet companies, and corporate spending on clean energy is much more common.
The same needs to happen with corporate electric vehicle fleets. And it likely will, when companies are able to effectively identify the use cases where electric vehicles can save them money, and then share these use cases with the rest of the industry. (We'll be doing a webinar on this topic Sept. 25.)
We also have a half-day invite-only summit at VERGE 18 that's specifically focused on the challenges and opportunities with fleet electrification. (Request an invite here.) If you’re thinking about coming to VERGE, our early bird ticket rate (30 percent off the on-site ticket price) expires Friday.