The pressure on businesses to decarbonise is mounting. In 2022 the UK Government unveiled a £200m (US$247m) programme to build the country’s zero-emission heavy-goods vehicle (HGV) fleet over three years. Alongside this, regulation is needed to drive further investment in public charging infrastructure across the UK to complement the private charging points which businesses will need to install at their depots. Data from Shell’s “Decarbonising Road Freight: Getting Into Gear” shows eight out of ten commercial road transport leaders believe there needs to be more well-designed regulatory incentives to achieve cost parity between conventional fuels and electrification solutions.
“It’s a challenging landscape, with businesses facing a range of barriers as they move to decarbonise their fleets,” says Chris Thornton, Commercial Road Transport Manager at Shell UK. “For example, it will take some time to change the way they operate, especially if fleets aren’t confident that they can access the infrastructure they need to refuel and recharge.” This is the case for 80% of sector leaders, who see insufficient access to fast battery charging and hydrogen refuelling stations as a limiting factor for their decarbonisation ambitions. Putting that infrastructure in place will take time, and Thornton suggests “businesses need to get moving.”
There is no one-size-fits-all solution for decarbonising the heavy-duty sector. Fleets are actively exploring a range of technologies, including battery electric, hydrogen fuel cells and hydrogen internal combustion engines (ICE). “Ultimately, the individual needs of each business will determine the alternative fuel solutions they move towards. Elements like fleet size, makeup and routing will all play a role in driving the decarbonisation decisions that fleet operators make,” notes Thornton. This is where data-driven solutions like telematics can help businesses to analyse their operations and identify the best route to reducing emissions while improving fleet efficiency.
He is also keen to point out that businesses will generally gravitate towards solutions they can rely on, and infrastructure is critical to that. “For fleets looking to electrify their vehicles, depot charging is an effective solution because businesses can be confident it meets their specific operational needs,” he says. That said, many will still need an expansive on-the-go network of EV charging points that enable drivers to refuel while out on the road. Thornton adds that “using fuel cards like the Shell Card, to access a robust on-the-go refuelling and EV charging network will also be vital in giving drivers easy, reliable access to a variety of mobility solutions.”
Tailwinds
Regardless of their decarbonisation path, zero-emission trucks must be commercially viable and must enter the fleet at scale by the late 2020s if the sector is to contribute to meeting the goals of the Paris Agreement.. “There’s no waiting for tomorrow to get started,” Thornton tells Automotive World. “However, the changes we’re talking about will require major investment from businesses, so subsidies on infrastructure—even for private depots—will be vital. The timeframe for change also means we need to develop infrastructure in the smartest way possible. In the future, sharing charging facilities available at private depots between local transportation businesses will ensure charging solutions are available at scale for everyone. This could even help unlock new revenue streams for operators.”
Seven out of ten sector leaders describe the lack of demand for decarbonisation from the market and from customers as a major barrier to them
Thornton also suggests that operators need to change their mindset around fully refuelling or charging trucks every time they plug in: “If they’re able to shift their focus on balancing capacity with their operational needs, they’ll find it easier to access the EV charging infrastructure at their depots and on-the-go that’s right for them.”
New vehicle trials are an essential step at this point as well. Research by Imperial College London shows that fleet operators should be running new vehicle trials by 2025 with a view to driving low-carbon options and replacing their remaining heavy-duty fleet by 2035. “The sector will need to step up its research and development efforts to meet these timelines,” Thornton warns.
First-movers
While the HGV industry has historically proven a technology laggard, that could be changing. There is an opportunity for fleet operators to become first movers on electrification, provided they act quickly. “Real change will take time,” he emphasises. “When it comes to making that start though, fleet operators can only become first movers if there’s the ambition to do so in the wider business. The company must have an overarching ambition for fleet electrification with senior stakeholder buy-in and alignment. Otherwise, fleet operators will struggle to get the support and investment they’ll need for a successful EV transition.”
An important way for them to gain stakeholder support is to overcome some of the misconceptions around electric trucks. For example, concern around range anxiety can be alleviated through a process of analysing fleet operations. “Fleet managers need to consider how much battery power their EV trucks really need in a day based on their data – it’s often less than they expect,” Thornton observes. Fleet operators will also need to convince the wider business that the numbers add up. This is where support with financing for hardware can be effective—something that a partner like Shell can provide—not to mention the wealth of operational data that can be gathered on fleet efficiency and decarbonisation using telematics.
For now, the sector remains in a ‘chicken and egg’ scenario. Someone needs to move so the others can follow, and OEMs need to meet the demand for EV trucks. “It’s easy to get hung up on what comes first between building infrastructure and improving alternative powertrain technologies,” Thornton says. Also, many businesses are reluctant to move first when there’s no guarantee it’ll give them a competitive advantage. UK government figures show that seven out of ten sector leaders describe the lack of demand for decarbonisation from the market and from customers as a major barrier to them.
The long-term view
At the end of the day, the benefits for cleaner fleets could be substantial. “By achieving their emission-reduction goals, operators can also attract ambitious customers that have committed to their own net-zero goals,” says Thornton.
Ultimately, no single organisation can deliver this transition alone. “We all need to work closely with strong partners that have the same goals—including government organisations, automakers and energy providers,” Thornton asserts. Working with experienced industry partners to realise the benefits of decarbonisation can help fleets tap into existing infrastructure and find tailored solutions for their specific business needs. He points to Shell’s acquisition of SBRS, geared at helping it grow in new segments, including the European e-truck charging market. The acquisition will enable Shell to offer more end-to-end charging solutions to business customers to electrify and decarbonises their fleets, from depot charging equipment, to charge point management and supplying cleaner energy.
For all fleets, Thornton drives home the importance of moving quickly. “Starting now means buying yourself enough time to move without rushing, learning and making improvements as you go, and building up confidence among your stakeholders including senior executives and drivers,” he adds. “The long-term view is also the way to look at spreading investments and reducing the total cost of ownership.”
