
The top 5 mistakes made by logistics companies when electrifying their fleets
Whilst the electric-only sales deadlines of 2035 for ≤26T and 2040 for >26T HGVs may seem some way off, many companies are acting now, at least on a small scale, to build experience operating e-HGVs.
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This is just as well, given that many indicators are starting to move a lot faster. For instance, research* shows that average battery prices are tumbling, from $148 per kWh in 2023 to $112 in 2024 and a projected $90 in 2025. This implies that e-HGVs will reach purchase price parity with diesels before 2030. Consider then that an electric truck costs just 39% as much to ‘fuel’ as a diesel when charging at the depot**, it is no surprise that many operators are investigating the practicalities of transitioning their fleet.
However, it won’t be possible to simply flick a switch, with significant planning needed to implement and optimise an all-electric operation. There are many things to get right and without strategic planning it is easy to make costly mistakes. These can manifest as wasted investment, long delays and even baking in a future operating model that makes the business uncompetitive.
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However, it won’t be possible to simply flick a switch, with significant planning needed to implement and optimise an all-electric operation. There are many things to get right and without strategic planning it is easy to make costly mistakes. These can manifest as wasted investment, long delays and even baking in a future operating model that makes the business uncompetitive.
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*Goldman Sachs, Wood Mackenzie, SNE Research, Average global battery pack prices 2019-2030
**REA (The Association for Renewable Energy & Clean Technology): Electrifying the Fleet – A Practical Resource for Fleet Managers – 2024
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Here are 5 of the top mistakes TransitionWise have seen being made by logistics companies as they rush to introduce e-HGVs without proper strategic planning:
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1. Lack of understanding of grid connection capacity
When warehouses were built, the vehicles intended to be charged from the mains were usually forklift trucks, not e-HGVs. Even after adding lighting and other demands a warehouse doesn’t traditionally use much energy. Hence the connection, even in recent builds, usually reflects this. It will then seldom be quick to upgrade, which can delay plans. Furthermore, an upgrade is a costly undertaking and something that should be done by the right amount, at the right time.
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A first step therefore is always to understand what capacity you have at each site and how much headroom this provides. This will then factor into your planning process so that you can determine at which point connection upgrades may be necessary. You will also know how much you have to manage with in the short term as well as having an early heads up of significant decision points around sites and infrastructure. It can be clear when a site doesn’t have capacity in its connection.
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2. Lack of understanding of energy needs
A fully electric fleet will take a lot of energy to operate and this likely means megawatt hours (MWh) of electricity per day once it’s reached a few vehicles in size. Whilst some logistics companies may simply check that they can operate the first electric truck or two they want to test, this could soon lead to problems as the fleet continues to expand. Before long it’s highly recommended that an evaluation of energy requirements is carried out across the whole fleet, modelling it as if it were all to electrify.
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This would provide significant insights into the fleet transition and perhaps show opportunities for efficiency in scheduling. One thing that companies realise as they start to electrify is that peak energy demand is far more important than total energy demand when considering infrastructure, as this dictates the load placed on grid connections and other requirements. Therefore, some level of modelling the future fleet and its energy use becomes essential.
3. Not matching charger to vehicle requirements in planning
Depot based charging can be AC at 22kW, or can be DC, from 50kW up to much higher rates such as 350kW. Understanding movements of vehicles when planning charging infrastructure is crucial, but it’s quite remarkable how many times this hasn’t been followed. Generally, the higher the charger power, the more expensive it will be to install and the fewer of them that can be installed for the power available. If vehicles need to charge within the two hours they are stopped to load or unload, the higher-powered chargers will likely be needed. If on the other hand they are sat overnight and have longer to charge, then a 22kW AC charger may be sufficient, and a fraction of the cost.
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As a rule, considering infrastructure so that it lines up with the needs of the fleet is key. Perhaps analysis shows pinch points where multiple vehicles arrive at a charger at the same time, each requiring charging, or a general lack of flexibility in infrastructure means the fleet ends up less versatile than it needs to be for the operations at hand. All these things need looking at together, such that vehicle movements and likely charging patterns, energy requirements and grid connection capacity are all understood.
4. Not considering software and data
As vehicles electrify, it not only changes the metrics, so for instance we now work in miles per kWh for efficiency, but it also brings digitalisation much more to the fore. The use of telematics, precise energy use for each part of the journey, route optimisation, TMS integration, carbon savings tracking, and a range of other digital metrics makes e-HGV fleet operation a very data rich environment.
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It is easy to simply plug in whatever comes with the vehicle and miss out on the opportunity to do more. However, with a little bit of foresight it is possible to build powerful dashboards and provide relevant insight, or make use of integrations into systems you may already have.
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The move to an electric fleet could be a great opportunity to simultaneously introduce your next level of digital capabilities, enabling real savings and efficiencies. However, to get the most out of this it needs some vision and planning in advance. As soon as these vehicles start driving around they are generating data and if you have systems set up you can be capturing a wealth of information. Getting started early is key.
5. Failure to consider building a high-quality energy base
Not so much a mistake as much as a missed opportunity, since this is evolving all the time. However, with the rapid pace of change driven by the energy transition, logistics companies increasingly have the chance to think about how they best acquire the power they need to supply their fleet as it starts to electrify. Some of this can come from doing deals with energy suppliers that provide electricity via the grid and larger fleets will command more leverage when it comes to securing good pricing.
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However, with the limited capacity of many warehouse grid connections, as already discussed, it may be important to think about other options open too. For instance, only 5% of warehouse roofs in the UK currently have solar panels on them, whilst the cost of panels has been falling significantly in recent years. The use of batteries to shift peaks in energy load and build resilience in supply is another aspect to be considered.
There are a lot of factors that come into play around what TransitionWise calls the energy base and would consider to be one of the most important factors in planning for your energy transition.
Come and talk to us now for a free consultation on how we can help you to start planning for the electrification of your operation!