This post also appeared as an Expert Column at Smart Energy Decisions.
Widespread adoption of medium and heavy-duty electric vehicles (EV) is beginning to take root thanks to companies and municipalities exploring innovative ways to achieve their sustainability goals. Vehicle manufacturers are also increasing choice and reducing costs for vehicles in this category. Companies such as Amazon, UPS, FedEx, Pepsi, and Anheuser Busch have made major commitments to electrifying their fleets. On the state and local side, the New York City Metropolitan Transit Authority (MTA) has pledged to spend $1.1 billion on electric busses and the State of California is committing to zero-emission buses by 2040. These commitments create a virtuous cycle of increasing scale and declining costs that will lead to more electrification in the coming years.
But transitioning to an EV fleet isn’t as simple as replacing gas pumps with charging stations. Businesses need to develop a full-scale solution to maximize the benefits of going electric, which includes charging infrastructure as well as onsite power generation and battery storage capabilities. Having such a system not only provides an energy source for EVs, but also allows businesses to operate fleets that are resilient to any grid disturbances.
Currently, the upfront cost of transitioning to an electric vehicle is not cheaper than purchasing a conventional vehicle. However, lower maintenance and fuel costs, combined with incentives, can drive the total cost of owning EVs lower than their internal combustion counterparts. Onsite energy infrastructure helps to ensure the “fuel” cost, or cost of electricity, is as low as possible. Generating power for EVs via an onsite solar installation can be more cost-effective than drawing the same amount of energy from the grid. This is especially true during peak hours when rates are highest, such as when fleets recharge during the middle of the day between routes.
Not all fleets, however, are available to charge during solar producing hours. Onsite battery storage allows this solar energy to be used when vehicles return to the charging depot. Battery storage also allows fleets to optimize energy use across the entire day, not just when vehicles are at the depot, potentially benefitting both energy charges and demand charges. In addition, customers will cut costs on a broader scale. Adding EV charging demand to a site can require upgrades to the local distribution system; rather than paying for energy system upgrades through their utility bills, large energy users can minimize the need for those upgrades with individualized power production at the vehicle depot.
Businesses with a comprehensive EV plan can even take advantage of the various credits and tax incentives for using clean energy. California and Oregon offer Low Carbon Fuel Standard or like credits, for example, which can be even greater if the power to charge these vehicles is generated by onsite solar. Businesses could also enter into PPAs with offsite renewable energy providers, taking further advantage of these incentives and achieving a higher level of sustainability.
The most notable benefits of a full-scale solution for a business are increased resilience and reliability. Consider the costs of any grid outage – due to weather, maintenance issues, or a deliberate shutoff – on an EV fleet. Even if the grid is generally dependable, an outage during critical business hours could be financially detrimental. With solely software-based EV charging management, the fleet would be unable to charge in this scenario. But employing onsite generators and battery storage as part of the EV infrastructure solution will ensure charging readiness regardless of the state of the power grid – keeping revenue losses to a minimum.
To be sure, upgrading from a conventional to an EV fleet can be a significant undertaking. But it isn’t as daunting as one might think and doesn’t require hiring specialized staff to build and manage. Third-party providers specializing in combined EV and energy infrastructure are ready to install onsite power generation, chargers, batteries, as well as the interfaces that tie it all together. These providers can also take care of system maintenance without obligating business owners to become acquainted with everything under the hood.
If a business really wants to meet its sustainability goals with an EV fleet while meeting its business obligations, managers need to think beyond just adding chargers and put into place a truly resilient charging infrastructure. From municipal transit agencies to large corporations, forward-thinking organizations are evaluating the optimal infrastructure solution as an equal decision to the vehicle purchase itself. Fleet managers can then be assured energy is going to be available regardless of whether the grid is there or not. The value of this peace of mind cannot be overstated when it comes to managing EV fleets. The transition will be well-worth the effort.
Shashank Sane, SVP at Invenergy, leads Invenergy Edge, which helps industrial facility and electric vehicle fleet owners capitalize on intelligent energy management through turnkey solutions. From onsite energy infrastructure to offsite renewable supply and the sophisticated software to pull it all together, Invenergy Edge helps customers take advantage of tailored solutions to achieve energy goals in simple, scalable implementations. A subsidiary of Invenergy, Invenergy Edge builds upon Invenergy’s reputation as the world’s leading privately held sustainable energy company.