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BYD electric trucks in Shenzhen, China. Photo by Kyle Field, CleanTechnica.

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Electrifying Trucking from Delhi to Shenzhen & San Francisco

How Lessons Learned Around the Globe Can Accelerate the Electrification of Road Freight

Courtesy of RMI.
By Jessie Lund, Samhita Shiledar, & Zhe Wang

Across the world, the sheer volume of goods being moved over highways, roads, and city streets grows by the day. Global road freight demand, driven by GDP and population growth, is expected to increase by more than 45 percent over the next two decades — leading to over 60 trillion ton-km by 2040.

And while freight movement plays a critical role in economic development and quality of life, it also has adverse consequences for public health and carbon emissions. This is due mostly to the pollution from diesel and gas used to fuel these vehicles, which ends up in our atmosphere and our lungs. And it’s particularly true in cities — many of which already have poor air quality.

Thankfully, electric vehicles have emerged as an opportunity to move goods with substantially reduced CO2 emissions and drastically reduced noxious air pollutants. But they’re not only cleaner, they also typically have lower operating costs for fleets than gas or diesel-powered vehicles. And model availability is increasing rapidly. There are now over 215 zero-emissions commercial freight vehicle models available globally — a number expected to rise to over 240 by 2023.

These vehicles couldn’t be hitting the market at a more opportune time. Global commercial vehicle sales are expected to nearly double by 2040, to almost 29 million units annually. But ensuring that those commercial vehicles are electric won’t happen on its own. It will require support from stakeholders across the industry — fleets and vehicle manufacturers, utilities and charging providers, and policymakers and regulators. We must overcome challenges including high up-front purchase cost, insufficient charging infrastructure, and a general lack of confidence on the part of the industry around performance compared with their fossil fuel-powered counterparts.

This means working together, across borders and across oceans. Although the details of specific solutions may be unique to different geographies, the global trucking industry now has an opportunity to co-create solutions together and to learn from what has been tried in leading countries.

As part of the Electric Truck Bootcamp virtual education series, RMI and the North American Council for Freight Efficiency (NACFE) recently hosted a session on “Global Perspectives” on trucking electrification. During the training, experts from RMI, CALSTART, and ICCT shared learnings from around the world. We offer the following insights from China, India, and the United States.

Leading with Charging Infrastructure in China

The city of Shenzhen, in southeastern China, is the global pioneer of electric logistics vehicles (ELVs). Shenzhen began to implement a policy framework to support ELVs in 2015, increasing the share of ELVS from less than 1 percent to over 30 percent. This is due in part to the near-ubiquitous charging infrastructure that has been installed across the region.

In addition to incentives for the purchase and use of ELVs, Shenzhen has a framework to incentivize and support the construction of electric vehicle charging infrastructure, which includes installation subsidies, preferential electricity pricing for charging stations, and free parking for charging vehicles.

  • Charging Infrastructure Installation Subsidy: In 2013, the Shenzhen municipal government instituted a program to subsidize the high costs of charger construction and spur growth in the charging market. From 2013 to 2015, the subsidy covered 30 percent of the charger cost.
  • Preferential Electricity Pricing for Charging Stations: Since July 2018, grid-connected public charging facilities with at least a 150-kW capacity are eligible for lower volumetric electricity prices and demand charge exemptions.
  • Free Parking for Charging Vehicles: EVs enjoy two hours of free parking per day in public parking lots and one hour of free road-side parking per day. This applies to ELV parking when making deliveries — enhancing their convenience and overall value proposition.

Industry & Government Collaboration in India

As urban freight demand in India grows, the government is introducing various initiatives to transition from fossil fuels to electric vehicles. Key policies like Faster Adoption and Manufacturing of EVs provide a roadmap and incentives for EVs. Additionally, policies on charging infrastructure and advanced battery technologies are targeting the manufacturing and the build-out of the supporting infrastructure. In addition to the national-level initiatives, 16 states have already released their own EV policies.

Delhi was one of the first states to announce a policy with a strong focus on freight electrification. Delhi’s EV policy — one of the most progressive and inclusive sub-national policies in India — aims to achieve 25 percent EV sales penetration by 2024. It offers up-front purchase incentives, exemptions from road tax and registration fees, reduced interest rates, a favorable electricity tariff for charging, and incentives on EV chargers.

This has resulted in a total cost of ownership of electric light-duty vehicles equal to that of their fossil fuel-powered counterparts. Just within the first year of the policy launch, share of EVs in total vehicle registrations has tripled.

One of the key reasons for the policy’s early success was the Delhi government’s continuous engagement with the private sector to design and implement the policy. RMI and the Delhi government hosted several stakeholder consultations to gather feedback on the policy while designing the incentive structures and their implementation plans. The Delhi Government and RMI also collaborated with 40 private sector companies to launch a pilot called “Deliver Electric Delhi” to deploy electric vehicles for final-mile deliveries.

Following the same change model, RMI is currently working with 7 states and union territories in India to inform the design and implementation of their policies through an initiative called State EV Policy Accelerator.

Stories from the American Road

The United States has also made progress with respect to electric truck adoption. For example, over 137,000 zero-emissions freight vehicles have been deployed or ordered to date.  Much of this progress has been thanks to industry leadership and collaboration.

In order to address the challenge around industry confidence in electric freight vehicle technology, stakeholders across the United States have been working together to share learnings about the realities of owning and operating these vehicles. This has been done through industry webinars and workshops, working groups, and most recently, the Run on Less – Electric (RoL-E) demonstration event that kicked off earlier this month.

RoL-E features 13 electric freight vehicles driving real routes, carrying real freight, and shares daily metrics and real-world “stories from the road” online. Through RoL-E, participating fleets, manufacturers, and drivers are sharing their experiences with and lessons learned from early electric truck deployments.

And as part of the lead-up to RoL-E, NACFE and RMI hosted a 10-part virtual Electric Truck Bootcamp to increase industry awareness of electric trucks. The Bootcamp convened stakeholders across the electric truck ecosystem to discuss key opportunities and challenges as they plan for future deployments of electric vehicles, including charging infrastructure, incentives, maintenance, and financing. Nearly 50 industry experts, including equipment manufacturers, fleets, utilities, policymakers, and charging providers shared their perspective with over 1,200 peers, and the content remains available online for others to learn from.

Collaboration for the Long Haul

Freight electrification is clearly happening across the globe—although the transition is not happening fast enough with each country – and sometimes state or city – going it alone. In order to advance electric freight vehicle adoption at the pace required to avoid the worst impacts of climate change we’ll need everyone behind the wheel, driving solutions to accelerate adoption together, as an industry. This is why collaboration and knowledge sharing across geographies is crucial.

That is why RMI is moving beyond working in individual geographies to supporting initiatives like the Mission Possible Partnership (MPP). MPP convenes high-ambition global stakeholders to drive emissions out of the world’s highest-emitting industries, including trucking. The upcoming UN Climate Change Conference, COP26, also promises to bring together world leaders to drive bold commitments to climate action. This global collaboration can help enable even more ambitious commitments and ensure the transition is done in a way that makes sense not just for people (public health) and the planet (zero-emissions), but also for profits. And in any language, that’s what we call a win-win-win solution!

 
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Written By

Since 1982, RMI (previously Rocky Mountain Institute) has advanced market-based solutions that transform global energy use to create a clean, prosperous and secure future. An independent, nonprofit think-and-do tank, RMI engages with businesses, communities and institutions to accelerate and scale replicable solutions that drive the cost-effective shift from fossil fuels to efficiency and renewables. Please visit http://www.rmi.org for more information.

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