Why an electric fleet is good for business

 In Fleet Sustainability

Sustainability is no longer a catchphrase or passing fad. It’s now gone mainstream and corporations globally are embracing it. Sustainability now forms a part of most businesses core processes.

A lot of it has to do with government policies driving enforcement of sustainability practices, whether it be energy consumption, waste management, water management, etc. Yet, there are also other drivers for this change. New technologies that threaten to disrupt traditional businesses as we know it. Consumers are also more aware of the impact businesses are having on the environment. Thereby putting businesses under pressure to change the way they conduct their business and realign their processes to be more environmentally friendly.

Then, of course, there’s the major driver of a reduction in operating cost. Resources are becoming more expensive. Whether it be energy, water, or material inputs into product manufacturing or business services. Managing a business more efficiently and producing more with less is becoming the new norm.

Electric vehicles (EVs) a few years ago were mainly owned by wealthy urban eco-warriors wanting to do their part, no matter the cost. However, technology in the EV space has developed by leaps and bounds in recent years. It’s on the verge of going mainstream as prices are falling and the technology developing. This is especially true when it comes to the energy storage component.

In the past, a major limitation to EVs was the limited range. But, with the advent of Lithium-ion batteries and fast chargers. An EV can be charged within a matter of minutes and drive up to 542 km on a single charge. The Tesla Model S takes the winning cup on this one.

Let’s take a look at how an electric vehicle fleet can benefit a business.

Cost savings with environmental benefits

‘Cash is king’ as they say in business, and it’s all about the bottom line. Tracking water, energy usage, and waste have never been more important as it is today because of escalating input costs. SMART metering technologies have been developed that allow one to track energy initially and now even water consumption in real-time. This data can be analyzed to identify specific areas of wastage and take action to reduce wastage.

Electric vehicles have great potential for reducing a company’s primary energy costs. The electric motor is more efficient than the internal combustion engine. An internal combustion engine burns fuel and uses that energy to drive a motor – there will always be energy losses in any system. An electric motor, though, uses stored energy to drive an electric motor, there are fewer energy losses in the system. At the end of the day, it means you can travel further with less energy used. The end result is lower fuel costs for your electric vehicle fleet when looking at it at a macro level.

A recent study compared the efficiency of an electric vehicle with a hydrogen fuel vehicle and a conventional internal combustion vehicle. The study showed the electric vehicle had an efficiency ratio of 73% vs only 13% for a conventional gasoline car. What does that mean in layman’s terms? It means the other 87% of the energy used in a gasoline car is going to waste. That’s money literally going up in smoke, pardon the pun.

Source: Durham Case Study

EVs also have less moving parts than the conventional internal combustion engine, meaning less can go wrong and less maintenance is required. An EV has three main components, an electric motor, an inverter, and the battery system. EVs also use regenerative braking, meaning less wear and tear on the brake pads.

The TCO or Total Cost of Ownership on EV’s is much less than conventional gasoline vehicles and EV’s overall have a much longer lifespan!

Additional savings can be achieved by using big data collected via Fleet Management software. These software tools collect and analyze data on EV usage looking at trends and identifying areas to achieve further efficiency.

Improve employee engagement

In today’s world, people like to think they are a part of a solution and this especially rings true when it comes to sustainability. Employee’s want to be apart of something that promotes goodwill in the environment and companies that are leaders in sustainable business practices. Companies that align themselves with sustainability-driven goals and not only profit-driven goals encourage employees to contribute towards finding solutions to sustainability challenges.

A good example is Unilever, their catchphrase is “simple actions make a big difference.”

Employee’s at a tea bag factory in the UK suggested reducing the size of the end seals of each tea bag by 3 mm. What was achieved from this simple action? 15 reels of paper could be saved every shift. Since 2015 US $67,343 has been saved and 9.3 tons of paper. All this through a simple factory floor suggestion box.

Greater innovation

A Deloitte report stated that corporations that are leaders in sustainability are more than 400% more likely to be considered innovation leaders. One doesn’t need to look far though to see proof of this, just look at Google or Apple as examples.

Environmental regulations are increasingly becoming more complex and stricter. Corporations are starting to see these constraints as opportunities more than a hindrance. This also spurs creativity in organizations to be more creative. Companies also start looking beyond the horizon. Looking further down the value chain in terms of how services are delivered or processes are executed. Innovation tends to have a snowball effect. Once started there’s no stopping as corporations start looking for improvements everywhere. This could lead to the discovery of new markets or new value applications.

Once a company culture of innovation has been firmly entrenched, it can be expanded to other purposes.

Improve your brand perception by going electric

Global warming is the largest threat to mankind’s existence in today’s world and one of our largest challenges. Since the industrial revolution carbon emissions have slowly been increasing to an all-time high of 403 ppm measured in 2017. The burning of fossil fuels is a major contributor towards CO2 emissions. Corporations large and small are responsible for these emissions as well as individuals.

The transition to a low carbon economy where energy efficiency, renewable energy, and EVs are used are becoming the new norm for corporations. Many of these corporations are leaders in sustainable business practices. Replacing gasoline vehicle fleets with EVs and using renewable energy to power these EVs. These approaches don’t go unrecognized by the customers of these company’s, but rather create brand loyalty and awareness recognized a company in today’s world that practices sustainability sets them apart from their competitors.

Corporations have already started to move to becoming more energy efficient and using renewable energy. It’s only natural that the next step is a move towards replacing existing gasoline fleets to EVs.

A sustainable fleet benefits the whole community

The benefits to sustainably sensitive business practices move beyond the boundaries of the corporate boardroom and shareholders. It’s no longer just profit driven but protecting the future interests of business, reducing negative environmental impacts, creating new sources of economic opportunities is sustainability and improving the health of local communities.

Benefits are both tangible and intangible. Investing in sustainability leads to creating a demand for sustainable services and technologies, leading to increased economic growth and employment opportunities.

Transportation is a major form of global CO2 emissions. Transportation alone contributes towards 14% of total global carbon emissions according to an EPA report.

The Rotterdam municipality is embarking on an EV car fleet migration project over a 5 year period. Starting in 2015 they purchased 5 EV’s, with an overall goal to have 22 EV’s in operation by 2019. Early results already show 33 tonnes of C02 savings per an annum per a car.  Reduced CO2 emissions in communities lead to improved air quality and reduce health-related issues.

Conclusion

It’s no longer business as usual for global corporations, change is in the air! Sustainability is becoming a major strategy for corporates large and small around the globe. Facing increased pressure from both governments and the consumer, corporates are seeing sustainability as an opportunity.

Global warming can no longer be ignored, and for corporations, the benefits of implementing sustainable business practices are numerous.

A company needs to be looked at within its boundaries initially, such as its energy and water usage. Including waste to landfill and how they can mitigate the impact on the environment. Change can be technology driven such as migrating gasoline vehicle fleets to EV’s, using renewable energy and being more energy efficient. It can also include reducing wastage wherever possible and introducing more efficient business processes.

Following this, companies can look externally and include their entire value chain. Change starts off with small steps before growing in leaps and bounds. Finally impacting entire communities, businesses, cities, and countries.

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