“When commercial fleets electrify, the benefits are very substantial” is one of the ideas advocated by Steven Schoefs, an international expert in vehicle fleet management and mobility for businesses.
With 63 million vehicles, commercial vehicle fleets in Europe account for 20% of the total vehicle fleet and cover more than 40% of the total number of vehicle kilometers driven. As a result, fleets are the largest contributor to CO2 emissions, accounting for more than half of total road transport emissions.
Precisely because commercial fleets pollute more than private vehicles, national governments are trying to encourage the transition to electrification of transport. Numerous studies and reports support that electrifying vehicle fleets is the most efficient way to consolidate sustainable mobility. Prioritizing fleets or “fleet-first” will ensure greater and faster global impact.
Commercial fleets have a great potential driver in the transition to electric mobility that will favor a low-carbon economy. In this context, the most critical point of the delivery and commercial transportation processes known as the “last mile” is especially important: the final and closest part to the consumer in urban environments, which is also the most costly and complex.
The following identifies 5 of the most relevant benefits of using electric fleets of light-duty vehicles in urban environments that prove Steven right.
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1. Operational characteristics suitable for electrification
Not all fleets are the same, so managers are responsible for analyzing the feasibility of electrifying them according to their characteristics and operational needs. Light-duty vehicles in urban environments have two factors favorable to electrification: predictability of routes and ease of recharging during the workday.
That is, the routes follow standard routes between warehouses and stores or depots and stations. The predictability of routes and mileage facilitates the use of intelligent recharging based on breaks, delivery points or stops, reducing redundant times and making the most of the advantages of the urban environment, without making autonomy an issue.
2. Cost savings
There are three main sources of cost savings from a fleet of electric vehicles:
- Service, maintenance and fuel costs are cheaper than those of combustion vehicles.
- Operating costs and business risks are increasing for gasoline- and diesel-powered fleets. For example, non-electric vehicles pay more than 14 euros per day in the UK? to be able to transit through the low emission zone (ZBE), where most of its customers are located. Using an electric delivery motorcycle would save 3,000 euros in one year.
Taxation: the higher the CO2 emissions of a vehicle, the higher the tax rate. Electric vehicles enjoy a much lower tax rate.
3. Commercial opportunity with great potential
It is estimated that the electrified car fleet will increase 24-fold by 2030, which will mean more than 40 million electric vehicles on the road. In this context, urbanization and the continued growth of e-commerce are causing the demand for goods delivery to continue to increase. Given that fleet-first has already begun, fleets are changing the rules of the game by being the protagonists of the shift towards sustainable mobility.
The commercial value will be for the first and most agile movers in the market. Stakeholders are aware of this and are developing solutions to address barriers to the transition: utilities are partnering with charging point operators and leasing companies.
Another major factor driving demand has to do with public perception: brands are in their vehicles and benefit significantly in terms of reputation when their fleets are electrified.
4. Environmental and health benefits
The traffic reduction and closures that accompanied the COVID-19 pandemic in 2020 have made a compelling case for transportation decarbonization. There is evidence of the positive effects of cleaner air on the natural environment and on health. According to the World Health Organization, some European cities recorded reductions in nitrogen oxides (NOx) from traffic of between 50% and 70% compared to pre-closure values.
The case for the decarbonization of road transport is reinforced by the more than 238,000 premature deaths that occur each year in Europe due to fine particulate matter in the air. The annual costs of combating the health consequences of road transport pollution are estimated at between 67 and 80 billion euros.
The tangible effects of fleet electrification in urban environments on air pollution and health highlight the inherent and long-term societal value of accelerating electric mobility.
5. Favorable regulatory context
Policymakers and regulators have been adopting a carrot-and-stick tactic to promote a low-carbon economy and mobility for months now: on the one hand, they are discouraging combustion vehicle fleets, while on the other, they are driving the adoption of electric vehicles, with a particular emphasis on cities. Polluting vehicles are being driven out of urban environments due to the detrimental impacts on public health and air quality from emissions and particulate matter. In 2019, Europe already had 300 EPZs and by 2025 there will be more than 500.
The use of light electric vehicle fleets in urban environments has numerous benefits that will, in turn, create unprecedented value in the transportation market. In addition, they prove to be the greatest catalyst for promoting the transition to decarbonization in cities.