SMART FREIGHT CENTRE PUBLISHES WHITE PAPER ON HOW TO OVERCOME CHALLENGES TO DEPLOY ELECTRIC TRUCKS
Smart Freight Centre, in collaboration with CALSTART and the Government of the Netherlands (RVO), published this week a paper on how to overcome challenges to ramp up the deployment of electric trucks. The paper is part of a series of discussions on financing the transition to electric trucks.
For reference, the road freight sector is responsible for 20% of GHG emissions globally but, in recent years, battery electric and hydrogen fuel cell electric trucks have become market ready with successful pilots being deployed. However, the paper argues, there are still several structural barriers for their deployment, such as high deployment costs, lack of charging infrastructure and the challenge of adapting existing business models to reward sustainable transport.
The paper provides solution to these barriers that are hampering electric trucks deployment, suggesting, for example, for public authorities and institutional investors to play a role to provide attractive loans, thereby allowing financing solutions to reduce the financing costs of the vehicles. In parallel, public financing should be focused on upgrading the grid, as well as facilitating and accelerating the process of adapting the infrastructure to charging needs. In addition, the paper indicates that legislations such as RED II and the EU ETS for Road, are going to address the energy costs of electricity or increase the cost of fossil fuels.
However, current subsidies and fiscal incentives may not be sufficient to convince SMEs with low profit margins. Such obstacle can be overcome by new electric truck ownership models or value-added services, such as truck-as-a service, truck leasing, and battery financing, as they could play a role to undertake the asset risk. Finally, there is still a significant gap in awareness on the advantages of electric trucks, which still deters some carriers. This is why more work in required to inform and guide them, which could be done by public-funded organisations and non-profit organisations.
The full paper can be downloaded at this link.