The Volvo Group and FedEx are among the major corporations advancing electric vehicle fleets, and company officials on Wednesday stressed the need for a coordinated approach between electric utilities and the transportation sector in order to further expand the electrification of commercial fleets.
Now is the time to start solidifying real plans, said Keith Brandis, vice president of partnerships and strategic solutions at Volvo, who spoke on a panel at the Edison Electric Institute’s 2020 Virtual Leadership Summit on Wednesday.
The future is already being written and, as Russell Musgrove, managing director of Global Vehicles at FedEx stated during the panel discussion, stakeholders are needed to align on the issue of getting things to scale, building a fleet electrification ecosystem, and perhaps most importantly, finding workarounds for what various stakeholders might not align on.
But both agreed the time to move forward is now.
“Electricity is the most efficient energy source for a vehicle fuel that we could find,” Musgrove said.
That said, the journey has been long. Volvo started about a decade ago, focusing on electrifying transit buses – an appropriate starting point, owing to their shorter routes and generally lower speeds and weights. The company took them through hybrid versions, but gradually over time, batteries became reliable enough to allow for full battery electric units. From there, Volvo turned to medium-duty trucks and more, refining the technology to better understand it and better address customer needs.
“We’re listening to our customers to help us with this journey,” Brandis said. “How can we make the truck more productive? What does the driver expect from an electric vehicle? Should it operate the same as a diesel truck, or can we make it better?”
Flash forward to today, Volvo is running a public-private partnership named Volvo LIGHTS (Low Impact Green Heavy Transport Solutions), a collaboration between the South Coast Air Quality Management District in California, Volvo Trucks, and 14 other organizations including Southern California Edison, focused on the successful commercial production of electric trucks and equipment over three years. The goal: heavy-duty, battery electric trucks and equipment capable of reliably moving freight between major ports at Los Angeles and Long Beach and warehouses without emissions.
The program will put 23 pilot trucks at four sites, according to Brandis. It will also bring across-the-board replacements: electric forklifts instead of propane ones, electric tractors, and new solar and charging infrastructure.
But infrastructure remains a major hangup. Despite the sheer efficiency of electricity as a vehicle fuel, Musgrove noted that a common problem is that there isn’t enough energy to power all of FedEx’s vehicles when it begins cramming several hundred into a building for charging. That has forced a bit of creativity on its part to make things work.
“We really want to scale, to get to tens of thousands of vehicles as quickly as possible,” Musgrove said. “There’s a lot of moving pieces to that. The utility of that is what I’m most focused on now.”
Like Volvo, FedEx chose California as its ground zero for scaling. However, the company found itself working, through its partner utilities, with a complex industry that is a mix of regulation and deregulation, in the midst of a pandemic that has significantly slowed indoor construction of charging stations. Musgrove said that despite desires to scale up, the company has been forced to scale down until it can get the proper number of upgrades that would allow an entire facility to use electricity as a vehicle fuel.
There is the big lesson in Brandis’ view: businesses like these two have greater needs than electric utilities may be accustomed to meeting. Infrastructure covers a large topic, encompassing things that will affect and are affected by overall energy usage, energy offsets caused by solar and wind energy, and more.
“We can’t have the typical ‘you’re not talking to the right department,’” Brandis said. “We need one account manager. The customer is driving this decision, and they want to have the power on at this date.”
A dedicated fleet program is needed, Musgrove said, which companies like FedEx can approach to help assess business plans.
Another factor is rates, something that varies significantly place by place. Stabilizing electricity as a vehicle fuel when it comes to rate support is huge in Musgrove’s view, potentially requiring some out-of-the-box thinking to stabilize energy costs. Eventually, he said, electricity is likely to be taxed in some way given it’s used as a vehicle fuel, and companies need to get stable energy costs and rate structures in place before then.
“Part of it is understanding what we need, part is understanding what we can do to support you,” Musgrove said.