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September 26, 2011

Corporate Fleets Beginning to Go Electric

FritoLay Electric Truck

At the recent AltWheels Fleet Day conference in Norwood, Mass., I had the opportunity to take a ride in fleet operator Derek Taveres's giant Frito-Lay delivery truck that runs on 100 percent electricity. With 176 all-electric trucks made by Smith Electric, Frito-Lay currently operates one of the largest corporate fleets of electric delivery trucks in the nation. Gino Porter, Frito-Lay's Northeast Regional Fleet Manager, told me that it only costs 13 cents a day in electricity to power each vehicle as compared to about $300 per truck per week for their gasoline-powered trucks. With those savings, even with the money spent on the vehicles and the charging units, Porter said the return on investment is fast.

I asked why Pepsico, which owns Frito-Lay, doesn't use electric delivery trucks for Pepsi. Porter and his colleagues said that there are likely two reasons: 1. Frito-Lay trucks are delivering chips, which are lighter than cola bottles that may be too heavy for certain all-electric trucks; and 2. Frito-Lay trucks average about 70-75 miles per day, which is perfect for an electric vehicle (which may get about 80-100 miles per overnight charge). Cola is often faster to deliver (no time necessary to set up chip displays), so the Pepsi trucks often travel more than 100 miles a day.

Frito-Lay isn't the only type of company starting to do the math and determine that electric vehicles will save money, fuel, and emissions for their fleets. At the AltWheels conference, Mike Payette, Staples' Director of Fleet Equipment, described his company's enthusiasm for going electric. "Thirty-five to 70 mile routes are perfect for EVs," he said. "We didn't have to alter our route structure at all" with Staples' acquisition late last year of more than 40 electric delivery trucks.

Recently, Staples partnered with researchers at MIT to determine that plugging fleets into the grid can actually generate revenue. This vehicle-to-grid (V2G) technology works by using the battery power of electric vehicles that are plugged in to the electric grid as a source of energy that the company can sell back to grid operators. The MIT report found (pdf) that companies could earn $1250 to $1400 per year per vehicle (9-11 percent) through vehicle to grid efforts as well as savings in fuel and maintenance.

Coca-Cola, which claims the largest heavy-duty fleet of hybrid electric trucks in North America, is also dipping its toe into all-electrics.  It recently announced that later this month it will start operating six eStar electric delivery vehicles in San Francisco, New York City, Washington, DC, Hartford, and Los Angeles. Coca-Cola and eStar say these vehicles can reduce greenhouse-gas emissions by as much as 10 tons annually.

Delivery giant UPS recently announced that it is purchasing 100 all-electric delivery vehicles for use in California. Electric Vehicles International, which is manufacturing these vehicles, estimates that a switch to these trucks will eliminate the need for 126,000 gallons of fuel annually.

The largest corporate fleet announcement to date by far came last year from General Electric, with plans to purchase and operate 25,000 electric vehicles by 2015.  General Electric Corporate Fleet Services recently conducted a study of 105 corporate fleet managers and found that 28 percent of these companies were planning to introduce electrics into their fleets within a year.

Government fleets are also starting to electrify or otherwise green their fleets. In March, the Obama Administration announced that managers of federal fleets would be instructed to buy 100-percent alternative fuel, hybrid, or electric vehicles by 2015. The federal government operates a fleet of more than 600,000 vehicles, and buys 60,000 to 70,000 cars annually. Companies such as Azure Dynamics, which partners with Ford to produce the Transit Connect EV delivery van, has announced that it has already secured contracts in at least 15 states and many municipalities for its vehicle. However, the federal government has so far only purchased about 100 electric vehicles.

Six or 100 or 176 electric vehicles are a great start for corporate and government fleets, but with 16 million corporate and government fleet vehicles on the road today, this is only a very modest beginning. If companies want to improve their bottom line and reduce their carbon footprint and oil depedence, they would be smart to consider investment in fleet-wide electrification.

-- Gina Coplon-Newfield, Sierra Club's Senior Campaign Representative for Electric Vehicles

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