Electric trucks already in financial “sweet spot” and should be on our roads

Battery electric freight trucks could be financially viable on Australian roads “even today,” a new report has found, if they were deployed in the right applications and backed by the right leadership, collaboration, and investment.

The report from the Queensland Transport and Logistics Council (QTLC), in partnership with specialist consultancy Mov3ment, warns that “significant deployment” of zero emission trucks will be required to meet state and federal government net-zero targets.

That’s because in Queensland, alone, transport is the third largest contributor to the state’s greenhouse gas emissions, at 13%, and heavy vehicles are the second contributor to that amount.

On the flip-side, QTLC CEO Lauren Hewitt says Queensland’s freight sector is in a good position to provide early deployment opportunities for zero emissions trucks – as long as governments and industry get on board and the right “sweet spot” of technology and deployment is found.

According to the report, the right technology for the rapid decarbonisation of freight transport are battery electric vehicles – hydrogen fuel cell trucks are unlikely to be commercially viable by 2025 or even 2030, the analysis concludes.

Battery electric trucks, meanwhile, could be financially viable right now in the right application, the report finds, namely for first-mile and last-mile delivery in urban areas, and high engine hours/low kilometre travel like some waste operations.

“There is a lot of focus on hydrogen for heavy vehicles. While it is technically suitable, we don’t see that being commercially viable by 2025 or even 2030 without significant government subsidies,” said Mov3ment director Mark Gjerek.

“But the report shows battery electric trucks can be financially viable even today in the right application – including urban delivery, low frequency waste compactors and regional haul.”

That said, QTLC’s consultation with fleets and transport precincts highlighted a market that is underdeveloped due to a range of market maturity and cultural barriers – some of which would require significant leadership, collaboration, and investment to surmount.

“Of the many barriers identified in the project, model availability and compatibility, economic suitability, and confidence-building reliable information remain the main stumbling blocks,” the report says.

In particular, says Gjerek, “we need to get beyond limited trials of one or two vehicles to achieve mainstream adoption.”

As things stand, zero emission trucks, and alternative fuels more broadly, represent a fraction of the new truck market in Australia, sitting at well below 0.5% market share even at their peak over the last decade, the report shows.

“While there was a slight uptick in sales in 2020, the Australian market is yet to exceed more than 100 sales per year for all alternative fuelled and powered trucks including hybrid, CNG, LNG, EV and hydrogen.”

For governments, the report points to a number of policy levers available to all levels of governments to support the electrification of the transport and logistics sector, starting with firm emissions targets and extending through to funding, incentives and leading by example with government freight contracts.

For the industry, the report recommends developing zero emissions zones and precincts as catalysts for change.

“Freight movements are often concentrated in precincts and industrial zones, which can be used to support early adoption collaborations to build industry confidence,” the report says.

Traditional freight hubs such as ports, industrial parks, rail heads, and intermodal terminals – that can support higher numbers of ZE trucks – could aggregate demand for fuel/energy and offer opportunities for collaboration, it theorises.

To that end, QTLC has committed to support investment in into the establishment of zero emission transport hubs and precincts, by rolling out a program for these high traffic areas over the next couple of months and then share the learnings with all fleets, industry and government.

“We look forward to collaborating with our members, fleet precincts and their customers to provide something that delivers both lower emissions and reduced costs for the sectors,” said Hewitt.

In the meantime, the key message of the report is that there are already technical and economic sweet spots for battery electric trucks, and that’s a fine place to start.