UFP Magazine

In recent years, the pickup truck market has been considered by many in the utility industry as the “holy grail” for fleet electrification.

That’s because pickups comprise the most significant percentage of many utility fleets. So, the more of those trucks you can switch to plug-in electric powertrains – whether all-electric or hybrid – the greater the impact you can make in reducing greenhouse gas emissions.

But the challenge with electrifying pickup trucks has been cost, making it difficult for utility fleets to come up with a compelling business case to invest aggressively in the technology.

That is, until recently. As battery prices continue to plummet and the business case becomes more attractive, some utility fleets are taking a more aggressive stance with their fleet electrification efforts.

Take, for example, San Antonio-based CPS Energy, the nation’s largest municipally owned natural gas and electric company.

In April, CPS Energy announced the purchase of 34 plug-in hybrid electric Ford F-150 pickup trucks, which, according to XL (www.xlfleet.com) – a provider of connected vehicle electrification systems for commercial and municipal fleets – represents the largest purchase of plug-in hybrid F-150s by any utility or private company to date and the first in Texas to use the vehicles.

It wasn’t long ago that relatively low fuel prices put the brakes on momentum for alternative fuels. But electric vehicles (EVs) appear to be defying that trend, even as conventional fuel prices remain low.

Consider the recent headlines. Norway intends to ban the sale of new diesel- and gas-powered cars and trucks in favor of EVs by 2025. China is planning to follow suit by 2030, with France and the U.K. each setting their targets for 2040. And, as of press time, the state of California is considering its own ban on non-EVs, which could have a huge ripple effect throughout the U.S. market.

Then there are major automakers – beyond Tesla – pushing the pace toward electrification. In October, General Motors announced that it’s pursuing an “all-electric future,” with 20 new fully electric models to be launched by 2023. Volvo, Aston Martin and Land Rover have introduced similar plans.

And according to a recent report by Bloomberg New Energy Finance, EVs could represent the majority – 54 percent – of new car sales by 2040.

So, what’s driving this momentum toward EVs? Here are three factors.

While a growing number of utility fleets are purchasing electrified passenger cars – like the Chevrolet Volt and Nissan Leaf – and bucket trucks with plug-in electric power takeoff capabilities, one vehicle segment still seems out of reach for electrification for most fleets: light-duty pickup trucks.

But there have been some new developments in this space that could have important implications for utility fleets. Workhorse Group says that it will unveil a concept electric truck this May at the ACT Expo in Long Beach, Calif. Earlier this year, Ford announced that it would offer a plug-in hybrid-electric version of the F-150 pickup. And XL Hybrids recently introduced a plug-in hybrid system designed for half-ton pickups.

So, what exactly are the prospects for electrified pickup trucks in North America? What are some of the key challenges to widespread fleet adoption? And when can we expect electrified pickups to become more cost-competitive with conventional-fueled trucks?

UFP recently spoke with Scott Shepard, senior research analyst with global market research and consulting firm Navigant Research (www.navigantresearch.com), to get his outlook.

If your fleet operates plug-in electric vehicles (EVs) – or is planning to do so – there’s an emerging technology you’ll want to put on your radar that could impact your vehicle selection and charging infrastructure decisions within the next year or two.

It’s wireless EV charging, which proponents believe holds the key to widespread transportation electrification.

That’s because one of the friction points of operating EVs is the inconvenience of charging with a conventional cord and plug-in system, said David Schatz, vice president of business development and sales for WiTricity (http://witricity.com), a firm that develops wireless charging systems for EVs, headquartered in Watertown, Mass.

Schatz cites a major automaker’s internal study that found that 70 percent of all plug-in hybrid electric vehicle (PHEV) owners never plug in and opt for fueling only with gas because of the “inconvenience” of plugging in their vehicle.

The idea here is that if you cut the cord, you make EV charging more acceptable to a larger market because you’re not forcing users to change their behavior. “PHEV and EV drivers simply park over a charging pad in their garage, or at work, or at a shopping center and charge up with no hands, no effort,” Schatz said.

Despite the recent trend toward lower fuel prices, vehicle electrification is a hot topic right now among utility fleets, as highlighted at the recent Electric Utility Fleet Managers Conference (EUFMC) held in Williamsburg, Va. The Edison Electric Institute (EEI), an association of investor-owned utilities, is leading the electrification effort and, according to some fleet managers we spoke to at the conference, many public utilities are following suit.

The EUFMC general session opened with a keynote address delivered by Jim Piro, president and CEO of Portland General Electric, who said that from the utility CEO perspective, expanding the electric vehicle (EV) market is a strategic initiative to increase demand for a specific utility product – electricity.

Piro went on to say that the challenge for electric utilities is slow growth in retail loads. If this trend doesn’t change, utilities may be forced to ask regulators for a rate increase, and such requests usually don’t go over well with the public. So, how can utilities increase retail demand and keep rates affordable?

The solution, Piro said, is to promote transportation electrification.

In an effort to reduce fuel costs, extend replacement cycles and lower greenhouse gas emissions, an increasing number of utility fleets now operate electric vehicles (EVs). In fact, in November 2014, the White House and Edison Electric Institute announced that more than 70 U.S. electric utility companies have plans to devote at least 5 percent of their fleet acquisition budgets to buying plug-in EVs and related technology. Their investments will total approximately $50 million each year.

With fewer moving parts and less reliance on oil to lubricate and help cool the engine parts that do move, EVs represent a sound investment, over time, for many utility fleets. In addition to lower fuel costs and fewer emissions, others benefits of operating EVs include reduced noise levels, exportable power and lower total cost of ownership.

“While you pay more for a plug-in, the overall cost of ownership is significantly lower,” said David Meisel, senior director of transportation and aviation services at Pacific Gas and Electric (PG&E), explaining that payback for the company’s fleet usually ranges from two to seven years. “For our bucket trucks, we’re looking at paybacks in 24 to 30 months. Some of our light-duty applications pay back in five years or less. And some of our pickup trucks see payback in seven years.”

When it comes to electric vehicles (EV), what usually garners headlines are consumer cars, like the Toyota Prius, Nissan LEAF and the eye-catching Tesla Model S sport sedan. But the future expansion of the EV market will likely be driven by commercial fleets, including electric utility companies, which are stepping up investments in all-electric and hybrid-electric vehicles.

In November 2014, the White House and Edison Electric Institute, which represents investor-owned utilities, announced that more than 70 electric utility companies have committed at least 5 percent of their annual fleet acquisition budgets to purchasing plug-in EVs and technologies. This adds up to total investments of approximately $50 million per year, or $250 million over five years, starting in 2015.

Support Grows for EEI White Paper on Utility Fleets and Electrification
As part of an effort to advance sustainability through fleet adoption of electric vehicles, the Edison Electric Institute has released a white paper, “Transportation Electrification: Utility Fleets Leading the Charge,” that focuses on the electric power industry’s effort to accelerate the expansion of electric transportation in commercial and retail markets, beginning with electric utility fleets.

ACT Expo Highlights
Nearly 200 alternative fuel and clean transportation industry leaders were on hand at the Alternative Clean Transportation Expo in May to present information on key advancements in alternative fuels and clean vehicles, including electric, hybrid, hydrogen, natural gas, propane autogas, clean diesel and renewable fuels technologies.

EPA 2014 Renewable Fuel Standards Proposal Reaffirms Commitment to Biofuels
The U.S. Environmental Protection Agency has proposed the levels of renewable fuels to be blended into gasoline and diesel. The proposal for annual volume requirements, developed with input from the U.S. Department of Energy and U.S. Department of Agriculture, is required under the Energy Independence and Security Act of 2007 for all motor vehicle gasoline and diesel produced or imported in 2014.

CALSTART and its industry partners have helped pass legislation in California aimed at enhancing short- and long-term funding for clean trucks, buses and cars. These measures that are expected to have a nationwide impact include:
• Assembly Bill (AB) 8 that will extend and expand funding for advanced vehicle and fuel demonstrations and deployments through 2023, for a total of more than $2 billion. The funds will continue and enhance funding of the current AB 118 program demonstration and incentive projects, including the Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP).
• Senate bills 95 and 359, which fill a funding gap in the HVIP voucher program for hybrid and electric trucks and buses, and rebates for clean passenger cars for 2014.
Visit www.calstart.org.

Bills Aim to Equalize LNG Fuel Tax
The LNG Excise Tax Equalization Act of 2013 introduced in the U.S. Senate seeks to equitably tax liquefied natural gas (LNG) as a transportation fuel. Similar legislation has also been introduced in the U.S. House of Representatives.

Purchasing fuel-efficient technology may be one of the best options utility fleets have to reduce costs. Now, significant and easily accessible funding is becoming more readily available.

Registration is now open for the work truck industry’s educational forum on clean vehicle technologies – the Green Truck Summit that kicks off The Work Truck Show 2013.

HTUF REPORT
Held in mid-September in Charlotte, N.C., the 11th Annual High-Efficiency Truck Users Forum served again as an educational and networking event for manufacturers, suppliers, fleets and government officials interested in learning the latest about high-efficiency truck technology.

It is a case of mutual interests combining resources and expertise, says Matt Gilliland, fleet services manager at Nebraska Public Power District (NPPD). “In 2006 to 2007, when Chevrolet was researching and developing the technology it would eventually use in the Chevrolet Volt,” he explained, “the OEM wanted to partner with utility fleets to deploy vehicles and evaluate their performance and function in actual operations.”

The result was an extensive program managed by the Electric Power Research Institute (EPRI), the nonprofit center for electricity and environmental research, that put demonstration Volt models on the road at 64 U.S. and Canadian utilities. For the three-year demonstration project, which officially began in 2011, NPPD is operating one of those vehicles.

Featuring a larger expo hall where a wide range of vehicle systems in or nearing production for electric, plug-in hybrid, hybrid electric, hydraulic hybrid and work-site electrification were on display, the newly renamed Hybrid, Electric and Advanced Truck Users Forum (HTUF) held its annual meeting in Baltimore this past fall. The 2011 HTUF conference also had very significant participation from hybrid and electric truck manufacturers and suppliers, as well as fleets.

Freightliner Custom Chassis Corporation (FCCC) and Morgan Olson LLC launched the next generation vehicle with new exterior and interior body styling for its successful all-electric walk-in van (WIV). The MT-EV WIV boasts a lightweight, aerodynamic design for improved efficiency. Conceived and developed with a contemporary fresh automotive approach, the vehicle maintains the hardworking heritage customers expect while ultimately contributing to the bottom line.

FCCC first introduced its plug-in, all-electric WIV chassis, the only one domestically engineered and the first in the industry to be completely all electric in North America, earlier this year. Following that launch and continuing in its legacy of designing alternative fuel products, FCCC partnered with Morgan Olson to develop a ground-breaking body style to provide further benefits to the delivery van owner, as well as the driver.