In three years, electric trucks will be a cheaper option than diesel - Cambridge Econometrics analysis

A new study finds more stringent EU emissions targets are required to decarbonise
road freight transport by 2050.

*The total cost of purchasing and maintaining electric trucks in Europe will be
lower by 2025, and hydrogen-powered fuel cell trucks by 2030, than using
traditional diesel-fuelled vehicles, according to the latest analysis by
Cambridge Econometrics, using numbers for Italy, Poland and Spain. This can
contribute to both achieving climate targets for the sector and creating
energy independence from Russian fossil fuels. Infrastructure developments
will be needed to make the transition.*

In a series of three studies on Italy,  Poland and Spain,  research consultancy Cambridge Econometrics has recently analysed how full
carbon-free operation could be achieved in freight transport – a sector
that accounts for nearly 7% of global CO2 emissions. The European
Commission’s latest REPowerEU package, which, because of Russia's invasion
of Ukraine, aims to make Europe independent of Russian fossil fuels well
before 2030, adds further relevance to the research topic. Part of the
transition to net zero in freight transport could include reducing the
dependence on oil by replacing diesel trucks.

Commissioned by the European Climate Foundation, the analysis examined the
possibilities of technological implementation necessary to achieve the
climate goals based on modelling the truck fleets of Italy, Poland and
Spain, with several of the findings also applying to Central and Eastern
Europe, where Cambridge Econometrics also has an office, in Budapest.

To achieve environmental targets set by the EU, manufacturers should reduce
CO2 emissions from new trucks by 15% by 2025 compared to 2019-2020 levels
and by 30% by 2030. The EU targets apply to new vehicles only, suggesting
that fleet-level emissions will be decreasing more slowly, as used lorries
will still be used in fleets after that date. This is expected especially
in Central and Eastern European countries where the proportion of used trucks
is generally higher in fleets.

According to Cambridge Econometrics modelling, because of this fleet
effect, total emissions in the sector would only decrease by 28% in Poland
and by 31% in Italy and Spain by 2050, if the emission reduction targets of
15% and 30% are followed. Moreover, even if the sale of new non-zero trucks
were completely banned from 2040, the sector would still not function
carbon-free in 2050: emissions would remain around a fifth of 2021 levels
in Eastern Countries, and around 6 per cent of the current CO2 emissions
would still be released on Italian and Spanish roads compared to the target
net zero levels.

“*Necessary emission reduction targets can be achieved in several ways: by
increasing the efficiency of existing diesel vehicles, by increasing the
share of biofuel and by spreading zero-emission vehicles,*” said Dóra
Fazekas, director of Cambridge Econometrics' Budapest office. *Electric and
hydrogen-powered trucks are more efficient; they have lower energy
requirements. However, for them to spread, it is also essential to build
the right infrastructure, which is different for each technology.*”

Another advantage of electric and hydrogen-powered trucks is that not only
do they have zero direct emissions, but they also have lower total
emissions than conventional vehicles, considering indirect emissions
associated with the production of electricity and hydrogen.

*Expected lifecycle cost of heavy transport vehicles (Italy, Poland and
Spain)*

*Abbreviations**: ICE: Internal Combustion Engine; BEV: Battery Electric
Vehicle; BEV-ERS: Battery Electric Vehicle-Electric Road System; FCEV: Fuel
Cell Electric Vehicle*

*Note**: Private infrastructure refers to the cost of such installations as
electric charging stations in warehouses and logistics centres, while
public infrastructure involves the construction of hydrogen/electric
charging stations and overhead power lines next to motorways, for example.*

The EU recently presented its Alternative Fuels Infrastructure Regulation  (AFIR
<https://www.transportenvironment.org/wp-content/uploads/2021/11/20211004_AFIR_Briefing.pdf>)
proposals that aim to provide adequate infrastructure for electric and
hydrogen-powered lorries along the main European routes (TEN-T network
<https://transport.ec.europa.eu/transport-themes/infrastructure-and-investment/trans-european-transport-network-ten-t_en>

According to the proposals, for fully electric trucks (battery electric
vehicles – BEV), chargers must be built at logistics centres and depots,
and fast chargers along main roads. While charging generally takes longer
than refuelling, with adequate sizes of batteries charging can be linked to
the mandatory resting intervals of drivers. Electric trucks equipped with
pantographs (BEV-ERS) have smaller batteries than BEVs, but, like the
railway, they are connected to the overhead power line with a pantograph,
and they can charge on the fly. Of course, this requires a major
infrastructure developments – an example is an electric motorway section
currently being tested near Frankfurt.

For spreading the use of fuel-cell vehicles (FCEV), building a network of
charging stations will be key, as is the case with battery electric trucks.
Hydrogen could be produced locally at the charging stations, using
electrolysis, or be transported there via wire or fuel trucks from a
central production unit.

Cambridge Econometrics’ study also points out that the total cost of
ownership (TCO) – including purchase, maintenance and operation – of
electric trucks and vans will be lower than that of internal combustion
engine trucks by 2025, or within three years only. While their purchase
price may remain higher, better efficiency and lower fuel prices and
service costs will make zero-emission trucks cheaper to use than
traditional vehicles.

The cost of hydrogen production is expected to fall drastically in the coming
years due to a spread in their use, making fuel cell heavy goods vehicles
cheaper to own and operate than internal combustion trucks by 2030. In
addition, the cost of fuel for diesel vehicles in Europe may be further
increased if the current tax advantages in several countries are abolished.
Under the EU’s new “Eurovignette <https://www.europarl.europa.eu/RegData/etudes/BRIE/2017/614625/EPRS_BRI(2017)614625_EN.pdf>”   directive, tolls on European roads will also depend on vehicle emissions,
which will further increase the cost of operating internal combustion
trucks. The cost of fossil fuels is also expected to rise if the European
Emissions Trading System (EU-ETS) will be extended to transport and
buildings in 2025.

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