Most of us Down Under have driven behind a heavy vehicle and seen this sign: Without trucks, Australia stops; and it is so true. A recent examination of the Electric Vehicle Council and the Australian Trucking Association data by Savvy finds that to meet the country’s CO2 emissions reduction targets and reach net-zero by 2050, Australia needs to electrify its national vehicle fleet. Transport emissions account for 19% of CO2 emissions and road freight creates a third of those.
The 2030 goal being set is 30% of new truck sales being electric and 100% by 2040. Savvy recommends government subsidies to achieve this because an electric truck can cost up to $200,000 more than a diesel truck and 70% of truck operators only own a single vehicle.
Trucks consume 23% of all road transport fuel — despite only travelling 8% of all road vehicle kilometres and comprising 4% of the entire Australian road vehicle fleet. The average age of a truck is between 10–15 years in Australia. In France, it’s 9.3 years; in Germany, 9.5 years; and in Austria, 6.4 years. The sector is ripe for change.
With climate change challenges now a pressing concern, a widespread adoption of electric trucks could reduce air pollution and associated health concerns; create new employment opportunities; encourage sustainable transport solutions; reduce transport costs and therefore the cost of goods for consumers and businesses; ensure our energy security; and contribute to our national commitment for net-zero carbon emissions.
Australia uses about 500,000 rigid trucks and 100,000 articulated trucks, with two thirds of freight in urban areas carried by rigid trucks, and two thirds of freight carried by articulated trucks in regional or non-urban regions. Rigid trucks are smaller and carry less freight. However, they should be first to transition toward electrification due to urban-specific needs.
Reducing costs by transitioning to electric will make the industry more profitable, particularly for the smaller operators. Fuel costs represent 20% of short-haul operator costs and 35% of long-haul operator costs.
Freight by electric truck is the sustainable choice for Australia, as parcel volumes have grown significantly, according to James Dixon, General Manager of Networks for the Australia Post.
Electric trucks have upsides in fleet efficiency. As electric trucks are quieter, it means they can be used later at night and avoid urban or suburban “truck curfews” — policies introduced to curb noise pollution. This would also have a flow-on effect for commuters, as it would reduce peak hour traffic and congestion. With all environmental and health benefits combined, it’s estimated that an electrification of both articulated and rigid trucks could save the Australian consumer $324.8 billion by 2050.
Only two oil refineries exist in Australia — half of what was available in 2019. Our dependency on imported fuel threatens our fuel security and economic growth.
Looking at a 22-tonne truck covering 300km without freight, the cost in diesel at current prices (24 March 2022) would arrive at $189.61. The cost of powering an electric truck, in comparison, would be between $14 and $42, based on off-peak tariffs for a depot-based fleet. This represents an incredible savings of 77.8%.
With 24% of Australia’s total electricity generation coming from renewables — and that percentage set to increase — Australian electric trucks could increasingly be powered by sustainable and renewable sources.
At the moment, only 14 out of the 58 available truck models available in North America, China, and Europe can be used in the Australian market. According to the Australian Trucking Association, this is due to current policy rules.
The policies in place at the moment restrict importation and use of trucks due to steer axle mass and width. The ATA says the government should provide a one-tonne concession for electric trucks, taking the battery weight into consideration. They also say widths should be increased to align with the standard width used by major supplier economies.
The government’s Euro VI emissions standards for heavy vehicles take effect in Q2 2027, according to the draft Regulation Impact Statement. The ATA believes bringing this forward to 2024 will incentivise greater take-up of electric trucks.
There is an urgent need for government at all levels to review their policies with a view to make it easier for the trucking industry to go electric.
Government policy must also support the infrastructure around electric trucks. Australia is unique in how far apart our urban areas are — 870 km lies between Melbourne and Sydney, for example — and electric charging stations would need to be installed at key destinations, hubs, and stops. As of writing, the Janus Electric truck conversion has the longest range of any legal and available truck in the Australian market, 400–500 km.
They are following the good example of California, which 7,500 zero-emission truck and bus vouchers.
The Australian government would be wise to introduce purchase incentives. Governments should also exempt zero-emission trucks from stamp duty, if possible.
The future of trucks means the future of making parts and maintenance. These need to be supported by government-funded training to upskill or qualify people entering or already working in the sector.
Savvy is one of Australia’s largest online financial brokers, focusing on personal and commercial financial products. It was founded in 2010. Savvy is a proud supporter of Kids Under Cover, a charity assisting homeless and at-risk youth to strengthen their bonds to community and education.
For full report with graphics, click here.
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