It is often said that where America leads, Europe follows. And if that’s going to be the case with electric trucks, we can learn some lessons from recent developments in California.
Formed in 1967, the California Air Resources Board (CARB) is an agency in the state government that aims to reduce air pollution. While it does concern itself with CO2 emissions and global warming, its main emphasis is on air quality.
It has recently turned its attention to trucks, introducing some of the most stringent regulations yet. In 2020, CARB introduced the Advanced Clean Trucks (ACT) regulation, which requires OEMs to sell an increasing percentage of zero- tailpipe-emissions trucks as the years progress. Then, in 2023, it switched its attention from supply to demand, announcing details of its Advanced Clean Fleets programme. This was a series of phased regulations culminating in all trucks operating in the state having zero tailpipe emissions by 2045.
The first stage, which was set to be implemented on 31 December 2023, would have seen a ban on new internal combustion-engine heavy trucks being added to the state’s drayage registry. In other words, operators purchasing new trucks to transport containers and bulk loads to and from California’s seaports, and intermodal railyards would have to invest in zero-tailpipe- emissions trucks. The problem with that plan, however, was the limited choice of electric or fuel-cell heavy-duty trucks on sale. What’s more, the vehicles are eye-wateringly expensive, as is the provision of charging. While there are healthy grants available in California for purchasing both the vehicles and chargers, the processes of applying are complicated and time-consuming.
Not surprisingly, the California Trucking Association wasn’t happy with the situation. It filed a federal lawsuit seeking to block the imminent regulations, declaring that CARB had a “make-believe view” of what could be achieved with the current technology and infrastructure.
The backlash had the desired effect, and in the 11th hour, CARB withdrew the ruling – for now. But the reprieve is only temporary, and some forward- thinking Californian operators are already future-proofing their fleets.
NFI
With nearly 5000 tractor units, 14,000 trailers, and 6,500,000m2 of warehousing, NFI is one of North America’s largest third-party logistics providers. And, since acquiring California Cartage (Cal Cartage) in 2017, it has also become one of the nation’s biggest drayage providers.
“Our purchase of Cal Cartage first started the discussion around electric trucks,” explains Brian Webb, NFI’s president of port services. “The incentives California provides to reduce your carbon output, and the services Cal Cartage was providing, meant it was clear that we needed to invest in electric truck technology.”
NFI uses three truck suppliers, Volvo being one of the more prominent. By coincidence, in 2019, the truck-maker was about to embark on the Volvo LIGHTS project, which would see it putting its first battery-powered trucks into real fleets. Under the scheme, NFI took delivery of a pair of VNR Electric tractors.
Jim O’Leary, NFI’s vice president of assets, explains that there were initially one or two teething problems – the 176km range from the four- battery trucks in particular. “We said, ‘That won’t work’, so they immediately designed a six- battery truck to meet that need.”
The scheme was a resounding success, giving NFI the confidence to invest further. When we visited earlier this year, it had 40 electric tractors on its Californian drayage fleet, a mix of Volvo VNRs and Freightliner eCascadias. By the end of 2024, this will have risen to 90, two- thirds being Volvos, giving it one of the largest zero-tailpipe- emission fleets in the United States.
NFI has gone down three separate funding routes to acquire these trucks. While the incentives reduce the purchase cost, there is still a significant difference between the price of electric- and diesel-powered vehicles.
According to O’Leary, purchasing the trucks was the easy part. “When we first started, I thought, ‘Just give me a truck and we’ll plug it in and go!’ But we soon realised it’s all about the infrastructure. That’s where the rubber meets the road.”
NFI’s electric truck investment coincided with a decision to move its drayage team from Chino to Ontario, several kilometres north. It owns a warehouse in the area, and a 1.6ha site next door was purchased and earmarked for electric truck charging.
“We are installing 38 350kW dispensers with 19 power cabinets, and each one can support two chargers. These are capable of charging two trucks each, so the power will be split,” O’Leary tells us. NFI will have the ability to bring in 7MW of power which, to put it into perspective, is roughly the same amount of electricity that’s needed to power the Empire State Building.
The clever bit: NFI has also installed a pair of batteries, giving it 7.7MWh of storage. This means it can draw from the grid off-peak and avoid the expensive 4pm to 9pm peak-load period. It has also installed 1MWh of solar panels on the building’s roof next door.
O’Leary explains that the whole process was fraught with obstacles, and while it was initially supposed to have been completed by the end of 2022, it won’t be fully up and running until this August.
While this represents a significant six-figure investment, NFI’s cost has largely been limited to buying the trucks, the land, and preparing the facilities. The chargers, batteries and solar panels have been the subject of multiple external funding programmes. The entire project, including the real estate acquisition, has cost in the region of US$45 million ($72.5 million).
O’Leary explains that while the financial incentives have certainly helped and made the project viable, there is still a significant gap between the actual cost of operating electric trucks and the incentives provided.
“Our customers are demanding that we do these things, but they aren’t necessarily willing to pay for them. Customers have zero- emission targets, but due to the cost, they are looking at other parts of their supply chain to reduce emissions ahead of transportation. If regulators heard this, perhaps they would apply the brake pedal a little,” he says.
“Customers have been willing to try it, but without any additional fees,” adds Jessica Cordero, NFI’s VP of drayage operations. But she says this is starting to change, thanks to South Coast Warehouse Actions and Investments to Reduce Emissions scheme. This complicated legislation financially penalises companies for the number of diesel truck visits to their warehouses.
“Now customers are realising that if they pay a little over here, they won’t pay as much over there,” she tells us.
The whole project has certainly represented a steep learning curve for the entire NFI management team. “You have to hold the hand of the project all the way, whether you’re deploying two trucks or 50 trucks,” says O’Leary.
“Lawyers, real estate, financing, fleet, operations … Everybody needs to be all-in. It’s not for the faint of heart!”
That said, all involved are convinced that it’s been worth the effort and are confident of reaping the rewards in the future.
“Having had conversations with customers, we are in an absolutely great position to continue to grow our business,” says Webb.
“The work the team has done at the ground level is paying dividends for us. We have absolutely made the right choice.”
GRILEY AIR FREIGHT
Located next to Los Angeles’ LAX Airport, Griley Air Freight is a fourth-generation, family-run trucking company specialising in air freight, working for some of the big worldwide freight-forwarding companies.
Assignments are collected from and delivered to LAX. Most product is stored in its secure 2973m2 warehouse, before distribution to customers in the Los Angeles region. Other loads are shipped directly to customers’ warehouses.
Although airports aren’t considered drayage, CEO Katie Griley knows that it’s only a matter of time before regulations relating to the use of electric trucks at LAX will be introduced. With this in mind, two years ago, she decided to get some valuable experience with the vehicles and added a Volvo VNR Electric to the company’s 90-strong, mainly Freightliner fleet. The truck has been leased from Zeem Solutions, which also takes care of the charging.
“We run a lot of Freightliners, but the eCascadia didn’t come out until after we had acquired the Volvo. Anyway, we are very happy with Volvo,” explains Katie.
So happy, in fact, that last year, the company took delivery of another VNR Electric. Unlike the first truck, which only had four batteries and a 240km range, this one had two additional batteries on the external cab wall, increasing the range considerably.
While this second truck was purchased outright, Griley Air Freight still chose to partner with Zeem Solutions for charging. “They offer parking and charging at their location just down the street,” Katie tells us.
“It’s been seamless. The drivers drop them off, and go home in their personal cars, which have been left there during the day. Zeem then charges the trucks overnight and takes care of everything.”
While one is leased and the other purchased outright, both trucks have been part-funded by grants. Katy describes the process of applying for funding as “tough”, but believes it needs to be that way to ensure that the money goes to deserving companies.
“If those grants weren’t in place, this would never have happened,” admits dad Tom Griley, who is shocked to learn how small some European grants are in comparison.
The trucks are coupled to tandem-axle semi-trailers and do between two and four runs to the airport per day. Loaded to 18 tonnes the older truck does about 160km per day, whereas the six-battery VNR Electric can manage 320km or more at full payload, allowing it to be double-shifted.
“We intentionally chose drivers that might be more receptive to them,” explains Katie. “For instance, one of them drives a Tesla.”
Drivers Sam Mauro and Mario Benavides admit to having had some reservations to start with. “I didn’t know if it would have the power,” admits Sam, “but it does, and I love it. I wouldn’t go back to diesel now, as they’re too shaky. When I have a full load on it feels good – nice and smooth.”
These are sentiments echoed by Mario, who reckons some of the other drivers are jealous. “On the hill to Ontario, I was loaded with 19 pallets, and thought I’d be stuck in the inside lane with my flashers on. But instead, I was passing diesels.”
The electric trucks have been well received by the public, and the company has received letters of support. Katie explains that as part of the infrastructure grant subsidy requirements, Griley Air Freight was required to seek support from the local community.
The trucks have received full support from customers, too. Consequently, Griley Air Freight has been able to pass on the increased costs associated with running electric trucks by charging customers a higher freight rate.
“Of course, we might not be lucky enough to be able to do that in the future,” admits Katie, referring to a time when rivals also operate electric trucks. “But for now, we have something to offer that our competitors don’t, and we have even gained two new clients as a result.”
When we visited Griley Air Freight earlier this year, news had just reached the team that Korean Airlines is to start giving loading/unloading priority to zero-tailpipe-emission trucks. With waits of two to four hours commonplace at LAX, this was welcome news indeed. “This is something we weren’t expecting, and it could save us US$100 (about $160) per trip to the airport,” reckons Tom. “And if more airlines follow suit, then this will be a big cost-saving for us,” adds Katie.
Griley Air Freight will ramp up its electric fleet in the coming years in line with the legislation. According to the ACT rule, 10% of its fleet will need to be electric by 2027. With this in mind, a third battery-powered truck will be added to the fleet later this year, with more to follow.
“We have had to learn a lot very quickly, but we are eager to be a part of the sustainability movement,” concludes Katie. “And we plan to keep on trucking.”
