If you’re a fleet owner or manager, you’ve probably thought about whether fleet electrification would be the right choice for your company. A long-term fleet electrification strategy isn’t only about getting started. It should incorporate ways to keep going forward by scaling slowly over time.
In this post, we’ll discuss why you should electrify your fleet, how to get started without breaking the bank, and how to maintain profitability as you scale your fleet upward. Here are several ways to build your fleet even as you reduce costs.
1. Research the Case for a Fleet Electrification Strategy
Businesses (and non-profit organizations, too) must keep operating costs to a minimum to stay afloat. Whether your goal is to make a profit or provide dependable services to your community, your success depends on reducing expenses.
Electric Fleet Vehicles Have a Lower Total Cost of Ownership (TCO)
Using EVs in your fleet saves money, as Trio Advisory’s Hanna Dancey points out. From passenger vehicles to heavy-duty buses and semis, EVs have a lower total cost of ownership (TCO) than their internal combustion engine (ICE)-powered counterparts.
For example, a typical delivery van with an internal combustion engine might cost only $48,180 at the outset. However, with $45,011 in fuel and maintenance costs you’ll pay over the vehicle’s lifetime, the total cost of owning it will amount to $93,191, as a Flipturn report shows.
Compare that to that van’s electric counterpart. Although it might cost $58,215 to purchase it, the $16,254 required to fuel and maintain it over its lifetime results in a TCO of only $74,469. That’s a savings of 18,722 over the vehicle’s lifetime. Imagine what those savings would look like across your entire fleet.
EV Fleets Provide More Breathable Air for Your Community and Passengers
The transportation industry’s vehicles are the largest contributors to atmospheric pollution, comprising 29% of the United States’ greenhouse gas emissions, according to an EPA report. But that’s not all.
Passengers, too – including fleet drivers – breathe in the toxic fumes those vehicles emit. Those risks can evaporate when fleets begin to switch to electric cars, buses, and trucks.
Better air and more savings? Those factors alone make the case for fleet electrification.
2. Take Your First Steps Down the Road Toward Fleet Electrification
Start small. Introduce one electric vehicle at a time – or only a few, if you can afford them. But before you do, plan to succeed. Here’s how.
Track Data on Your Existing Fleet Vehicles
Look at the data on your current fleet. Track their age, vehicle type (light-duty vs. medium- or heavy-duty), and the routes they travel, as the US Department of Energy (DOE) recommends.
Older, less fuel-efficient vehicles should usually be the first ones you think about replacing with electric models. However, if the routes they travel don’t provide enough charging stations to meet their needs, you might need to go with a “Plan B” and replace another ICE-powered vehicle with an EV if there are ample charging opportunities along its routes.
Look at Availability Before Choosing Which Vehicles to Replace
There’s another factor you need to consider when choosing which vehicle you need to replace first, as the DOE article points out: availability. Since EVs are relatively new in the fleet vehicle world, you might find that you can’t find a suitable electric vehicle in your area to replace the ICE vehicle you first chose. Again, have a “Plan B” in place to move forward.
Explore EV Fleet Funding Sources
If money is an issue, you might explore funding, either from state and local governments or even utilities (after all, their profits will increase as commercial fleets consume more electricity).
Have a Charging Plan in Place Before the Launch
Secondly, have a charging plan in place before putting your EV fleet vehicles into service. If you can, integrate battery storage or renewable energy sources so that your fleet can continue operating even during outages.
These backup sources can also save you money when you switch to them during peak usage hours. If your vehicles and charging stations are capable of bidirectional charging, your company or agency can even earn passive revenue with vehicle-to-grid (V2G) charging, an emerging technology that allows you to feed energy back into the local electrical grid.
Don’t forget about the costs you’ll incur while installing your charging equipment. Permitting fees, construction materials, and labor costs all add up to a significant cash outlay. Ensure that your budget can handle all the improvements before you break ground or buy a single vehicle.
Mobile Charging Solutions
If your budget doesn’t have room for onsite charging infrastructure, there are mobile charging solutions that can come to you. Having that option allows you to add more vehicles without extensive infrastructure upgrades.
Charging-as-a-Service (CaaS)
Another solution is hiring a charging-as-a-service (CaaS) company to handle your charging infrastructure. These companies often offer mobile and off-grid charging solutions, but they can also install permanent on-site infrastructure. Using CaaS to handle your charging frees you from the hassle of permitting, lengthy construction processes, and hiring in-house teams to handle the charging equipment.
3. Take Your First Plunge
Once you’ve selected the first electric vehicles for your fleet, there are some strategies you can put into place to ensure a smooth launch.
Train Your Drivers Before They Take to the Road
Before putting your new vehicles into service, train your drivers to operate and charge your initial electric fleet vehicles, as Witricity’s Eric Cohen recommends. As they become comfortable with the ease of driving those vehicles, they’ll likely build enthusiasm among your fleet’s driver pool.
Track Expenses to Document Project Success
Track your first fleet EV’s fueling and maintenance expenses versus those of comparable gas- or diesel-powered vehicles in the same class. Presenting this data to your leadership team can help make the case to purchase more of them. These figures could also help you obtain more funding from private investors or grants as you contemplate adding more electric vehicles to your fleet.
4. Finally, Plan for Long-Term Fleet Electrification
As your electric vehicles prove their worth, you’ll want to expand your fleet with more of them. Enthusiasm is great – but as Cohen advises, wait until your charging infrastructure has expanded to accommodate them.
No matter how tempted you are to plunge in with electrification at scale, build a strategy that allows you to expand your electric fleet one step at a time.
Partner with Your Utility to Ensure Energy Availability
Work with your local utility beforehand to ensure that it has the capacity to accommodate your needs as you contemplate purchasing more EVs for your fleet. Some utilities, as well as state and local governments, offer grants or other incentives to help fund your fleet electrification project. Take advantage of every bit of assistance your utility offers.
Learn about any demand response programs your utility offers to help stabilize your grid and ensure charging availability for your fleet vehicles when you need them the most. These programs can help reduce the high demand charges that EV charging often incurs.
Demand charges are fees that utilities impose on customers when they use a large amount of electricity in a single moment. Charging vehicles – especially large vehicles with enormous power requirements – does just that. Having a program that can minimize those charges considerably can help you maintain profitability.
Purchase Enough Chargers to Serve an Expanded Fleet
The more EV fleet vehicles you have, the more chargers you’ll need to keep your fleet running. Ensure that your budget can accommodate both the charging infrastructure and vehicles you’ll need to scale up the EV portion of your fleet.
Consider V2G-Capable Equipment When You Scale
To help fund the vehicles and chargers you’ll need to grow your EV fleet, consider buying chargers and vehicles capable of sending electricity back to your local grid while they’re not rolling down the road.
That move can help you recoup at least part of the funds you spend to add EVs to your fleet. And with that capability, your new vehicles can continue to earn passive revenue for your fleet as long as you have them.
5. When You’re Ready to Expand, Make Your Case
Here’s when your data comparing your electric vehicles’ performance and total costs to those of your ICE-powered vehicles can come in handy once again. Studies showing the health benefits of EVs versus internal combustion-powered fleet vehicles can also be helpful when you make your pitch to your executive board or other governing authority.
If you manage a municipal fleet, you’ll want to refer to those figures when you ask your city council or local voters for the funds to expand your EV inventory. Since city councils and other government agencies must promote the well-being of their residents, make sure to emphasize the health risks associated with keeping your remaining ICE-powered vehicles.
On the other hand, if your fleet serves a private company, emphasize the savings they’ll pocket by switching even more vehicles to electric ones. The prospect of having a healthier workforce can also help motivate them to upgrade their fleet to an all-electric one.
Discover More Ways to Make Your Fleet Electrification Strategy Last
Learning from other fleet electrification experts who’ve walked in your shoes can help you tweak your own fleet electrification strategy. At the EV Charging Summit & Expo, we dedicate an entire track to commercial and municipal fleets. There, you’ll hear from successful fleet managers and the charging professionals that serve them about the latest developments in the field.
Don’t let this opportunity to sail ahead of your competitors pass you by. Register for your place at the Summit today!
