The logistics industry continues to be a strong area of focus for government leaders hoping to reduce greenhouse gas emissions and slow the progression of transportation-related climate change. As a result, legislators are driving emission-cutting regulations forward at breakneck speeds.
In California, for example, the Advanced Clean Fleet rule requires a large percentage of fleets to stop purchasing trucks with internal combustion engines after 2023. The state’s zero-emissions regulations are particularly stringent when it comes to drayage.
“Starting Jan. 1 of next year, only [zero-emissions vehicles] can register in the CARB’s drayage registry. Vehicles with internal combustion engines that are on the road now can continue to operate through their ‘useful life.’ Those limits mean that when a drayage truck hits 800,000 miles, it can no longer be listed in the registry of drayage vehicles,” FreightWaves’ John Kingston reported earlier this year.
These state level regulations highlight a nationwide trend: electrification is shaping the future of trucking. Fleets should start preparing for that reality now, regardless of which states they operate in.
While electric trucks offer attractive environmental and long-term cost-savings benefits, it can be challenging for trucking companies to start making the transition from a traditional, diesel-dependent fleet to an electric one.
Global Head of Prologis Mobility Henrik Holland highlighted a couple of concerns expressed by fleet operators when it comes to EV adoption: Upfront capital investment and the complexity of charging infrastructure.
Upfront costs are one of the biggest hurdles stunting electric vehicle adoption. The good news is that high costs tend to be tied to the batteries that power EVs, and the cost associated with producing those parts is on the decline. Vehicle manufacturers are working hard to keep that trend going in order to drive down initial purchase costs.
In fact, the total cost to own an electric vehicle is expected to be 25% lower than the total cost to own a vehicle with an internal combustion engine by next year, according to global consulting firm McKinsey. This shrinking number can be attributed to the fact that electric vehicles have significantly lower maintenance costs than their conventional counterparts.
Even with more accessible pricing, however, purchasing EVs is not financially feasible for every – or even most – fleets. That is where government grant programs and other incentives can come into play.
The United States Environmental Protection Agency is also stepping up to make electric truck adoption more affordable.
“The Inflation Reduction Act invests $1 billion to replace dirty heavy-duty vehicles with clean, zero-emission vehicles, support zero-emission vehicle infrastructure and to train and develop workers,” according to the EPA website.
That funding will be distributed between spring 2024 and 2031.
Making it possible for fleets to purchase electric trucks is only the tip of the iceberg when it comes to facilitating a full scale EV transition. Even if they can afford to purchase vehicles, most fleets do not have the resources to build and maintain charging infrastructure in all the locations their trucks need to recharge.
The lack of available charging infrastructure is a major EV deterrent. Prologis is working to change that.
“For fleet operators, there is a tremendous amount of complexity – a new type of vehicle, a new type of fuel,” Holland said. “We believe it is important to make things really simple.”
In order to make the transition to EVs as simple as possible, Prologis offers fleets the ability to charge their trucks at both Prologis and non-Prologis warehouses and at hubs across the country without paying upfront fees. Much like filling up on diesel, fleets only pay for the energy they use when charging their trucks.
For example, the company installed two major charging stations in Southern California – Santa Fe Springs and the City of Commerce – late last year.
‘Two large installations are up and running, energizing a total of 38 new electric trucks that are reducing noise and emissions on Southern California roadways,” Prologis noted in a press release about the installations. “The projects provide more than four megawatts of total installed charging capacity.”
Prologis is in the process of developing dedicated charging hubs not tied to specific warehouses. These stations will be located in strategic locations – such as near busy ports – to provide additional flexibility for customers. Hubs also allow customers without the space for chargers onsite – or those with plans to move in the near future – with the ability to charge fleets and transition to EVs faster.
“If you think about what is important when it comes to EV charging, it is about location,” Holland said.
Prologis is dedicated to creating the partnerships necessary to bring vehicles, infrastructure and energy into harmony and continue to make EV charging more accessible across the nation.
“We realize it takes a community to make this happen,” Holland said.
Prologis is a leading global industrial real estate company. This expertise is precisely what sets the company apart as a top-notch EV transition and charging partner.
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