EVS AND THE TRANSITION TO A NEW FLEET ‘NORMAL’
David Savage, Geotab’s associate vice president, UK and Ireland, talks to EV Fleet World Digital about the issues fleets are facing when moving to EV vehicles and how to overcome them.
With the ban of ICE vehicles by 2030, how proactive do fleets need to be to reach this target?
On average, internal combustion engine (ICE) vehicles stay on the fleet for approximately four years. This means that operators have a maximum of two fleet cycles to consider battery electric vehicles (BEVs), slightly longer for plug-in hybrid electric vehicles (PHEVs). Either way, it is fair to say that planning should have already started. Furthermore, the considerations for electric vehicles are different. Fleets will need to consider what vehicle range they require, for example, and what type of charging infrastructure would suit them best. These considerations are new, and it is important to partner with a provider that can begin to answer some of the unknowns.
We know the cost of electric vehicles (EVs) across most segments are declining and are set to reach price parity with ICE vehicles in the near future. With that said, government grants and incentives are available today to help reduce the financial burden of transition. The recent reduction in grants may have caught fleet managers by surprise, with the announcement that vehicles over £35,000 are no longer eligible for the grants. Certain car manufacturers, such as Vauxhall and Nissan, have reduced the sticker price of certain models so they remain eligible. These government grants will not last forever, so it’s important for fleets to secure this support while they are still available.
In summary, planning should be on the agenda today. There are now case studies and expert advice available to the market on EV transition. Be clear on the insights you require and develop partnerships where it makes sense.
What considerations do fleets need to make when making the move to electric?
There are many things that fleet managers should consider when making the move to electric. As mentioned, the upfront costs of EVs are higher than ICE vehicles, however, the savings from EVs come from the total cost of ownership. The key is to find the fleet vehicles that drive just enough on a daily basis to start hitting the EV range limitations -- this will ultimately provide an optimal total cost to help to offset the initial outlay due to operational savings in fuel and maintenance.
Furthermore, businesses will need to consider what charging infrastructure set-up makes sense for them, taking into account where the vehicle will be located to charge. If the majority of the vehicles will operate during the day and charge at night in a centralised location, fleet operators will need to consider the level of chargers required, and whether the grid connection is up to the task. Building home charging infrastructure and/or public chargers will require alternative solutions, and possibly incentive schemes to support the drivers.
Grey fleet and company car drivers can also take advantage of Benefit-in-Kind (BiK) rates – designed to encourage drivers to choose vehicles with lower CO2 and NOx emissions. The introduction of Clean Air Zones (CAZ) in the cities in which you operate could force your hand to switch to electric, based on the economics. Each fleet will have their own challenges to overcome, but it is important to exhaust all the options available to them while planning for electrification.
What will happen to fleets that are going to struggle to meet the deadline?
The good news is that telematics can help ICE vehicles become more sustainable with data-driven insights and a few mitigation tactics. Insights into driving behaviour, idling periods and maintenance metrics can all impact fuel consumption, which in turn affects the environmental impact of each and every vehicle.
In most cases, the transition to EVs is not an overnight activity, it is a gradual process over a number of months or even years. Therefore, identifying which vehicles in the fleet can go electric – based on duty cycles and the total cost of ownership – is a good first step. The EV market is continuously developing and evolving, with new models being introduced in various segments, including heavy-duty vehicles, models with longer-range batteries, and models with a more affordable price tag. While some businesses may not be able to transition today, this will change over time as the market evolves to include more viable options.
Telematics plays a key role in the electrification of fleets, Geotab’s Electrical Vehicle Suitability Assessment (EVSA) can help identify internal ICE vehicles that could be replaced with electric vehicles by analysing existing telematics data and creating an EV recommendation that would be a suitable replacement. This allows businesses to assess which vehicles in their current fleets could be switched to electric, to help make a start on their journey to electrification.
The costs of charging vary massively. How can fleets tackle this?
It’s important that people understand the cost of charging based on infrastructure type. In fact, a recent study revealed that EV drivers can pay more than four times as much for the same amount of electricity when they use different public chargers. Charging a BMW iX3 with an 80kWh battery from 10% to 80%, for example, could cost between £9.32 and £40.66, as a result of the different tariffs and charges offered across the UK charging network.
Among the tariffs, the cheapest was the BP Pulse 7.4kW pay-as-you-go option, with a charge costing £9.32 for the iX3, at a cost of £0.18 per kWh. While other providers were found to offer cheaper kWh rates, they often required a subscription fee or one-off payment, which inflated prices. But charging up at home emerged as the cheapest option, with the 10% to 80% boost for the iX3’s batteries costing £7.25.
Not every fleet is the same; fleet managers will need to consider whether drivers will take the vehicles home, whether they will have a centralised depot, or whether they will take advantage of public changing facilities.
In the public space, and now crossing into commercial premises, the visibility of charging providers’ data is helping managers to make more informed choices for their fleets. This data includes whether chargers are available, and what the level/power of the chargers are, allowing managers to better adapt their services to the new normal.
Will there be a need for a new fleet policy for EVs? If so, what measures should be in it?
There are already a number of measures and fleet management policies in place that have proven to be successful in the initial EV adoption phase. These include purchase grants, exemption on road tax, parking levies, Benefit-in-Kind rates and more. To continue the success of EV adoption, we don’t necessarily need to create new policies, but will need to place further emphasis on those that already exist.
We need to look beyond policies to think about what will encourage wide-scale EV adoption. Financial incentives will play a huge part in encouraging drivers to make the switch to EVs, so continuing support with procurement and charging infrastructure and installation will be key.
Educating the masses on how to procure and manage EVs effectively is also crucial to success, since it doesn’t follow the same process as internal combustion engine vehicles.
From getting an EV, to charging and servicing, we’re going to have to relearn all we know about running a vehicle.