On the road: building the next generation of fleet vehicles

How is Octopus helping companies to speed up the transition to zero emission vehicles?
The long-term damage caused by vehicle pollution is now becoming increasingly understood. In 2016, the Royal College of Physicians (RCP) and the Royal College of Paediatrics and Child Health (RCPCH) estimated that each year in the UK ambient air pollution causes approximately 40,000 premature deaths and over six million sick days, at an estimated total social cost of £22.6 billion annually. Out of 51 UK cities and towns listed in an air quality database, 44 fail the World Health Organisations’ (WHO) test for fine sooty particles that have been linked to heart disease and premature death. Globally, more than 80% of people living in urban areas that monitor air pollution are exposed to air quality levels that exceed the WHO’s limits.

Tackling the UK’s polluting road vehicles
There are various causes of air pollution but road transportation, particularly at a local level, is one of the greatest contributors. This has led to clean air zones being planned, as well as heavily taxing, or even banning, the biggest polluters. The Mayor of London has been one of the greatest supporters of reducing pollution from transport. On 23 October 2017, the £10 toxicity ‘T-charge’ began taxing older petrol and diesel polluting vehicles that enter central London. In 2019, a planned Ultra Low Emission Zone will take this even further by applying taxation to a broader range of polluting vehicles.

Transport for London (TfL) now requires all new black taxis purchased to be zero emission-capable. It also intends to transform its entire bus fleet into zero emission vehicles (ZEV) over the next 20 years. But knowing the health and environmental impacts of polluting diesel and petrol vehicles, is this transition coming soon enough? And are the targets placed on vehicle fleet operators to switch to ZEV realistic?

The transition carries complications for companies
Some companies will find transitioning to ZEV comes with its own set of concerns. Take battery electric vehicles, for instance. Not only are they currently more expensive to buy than traditional vehicles, but they have a reduced range of travel (at least currently) and require an appropriate and effective charging infrastructure. This doesn’t just mean the associated charging point. In order to deliver the charging power required energy networks will need to be upgraded, in turn requiring civils works, meaning significant investment.

Fortunately, the positives significantly outweigh the negatives – both from a social and a financial perspective. Not only do battery electric vehicles produce zero emissions at tailpipe, but as we increase electricity generation from renewable generation assets, the whole energy supply chain can become zero emission. Financially, as electricity is significantly cheaper than diesel or petrol, the vehicles are cheaper to operate plus there are fewer moving parts and, therefore in theory, less to fail. Finally, when not in use, the vehicles can be used as batteries to support the electricity grid, providing balancing services which can even be monetised to generate income in return for making the vehicles available for connection to the electricity grid.

How can companies make their fleets zero emission?
Clearly, to make this work you need both the vehicles and the infrastructure required to keep them on the road. And that’s exactly what Octopus is working towards. We’re currently exploring ways to provide a complete clean transport solution to support vehicle fleet operators and accelerate the transition to ZEV transportation. This includes:

  • Providing the funding for companies to replace their fleets with new clean vehicles
  • Providing the infrastructure to power the vehicles
  • Providing any energy network upgrades required. We can even incorporate other services such as maintenance, renewable energy, and energy grid balancing.

Transport as a service
What’s in it for the vehicle fleet operator? They get to keep control over their fleet and choose the vehicles they want. Our service pays for the vehicles and infrastructure over an extended period, matching the repayments to the vehicles’ actual usage, helping both cash flow and budgeting. In return, we ask for a cost-per-mile driven for a set number of miles before transferring ownership or replacing the vehicles. And this ‘pay as you use’ service doesn’t just apply to electric vehicles. Hydrogen or gas vehicles may be more appropriate to the operator’s needs, the principles of our offering remain the same.

We’re already working with bus, taxi and logistic companies to offer a complete solution that allows them to operate their own ZEV fleets. Maybe you know of an organisation that could also benefit with a little help to remove the emissions from their transportation? If so, please get in touch and we’d be happy to explain the services we offer.

Author
Octopus Group
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