Co-Authored by: Ashley Lynn Qua, Senior Manager Electrification Transportation, Research and Industry Strategy, and Drake Moran, Senior Analyst, Research and Industry Strategy
Fleet electrification is not just on the horizon but also at our doorstep. The U.S. market for electric light-duty vehicles (LDVs) is projected to see substantial growth, with sales expected to increase to 9.6 million vehicles by 2030 and 12.5 million vehicles by 2035, a significant rise from the 1.4 million vehicles sold in 2023​​. As light-, medium-, and heavy-duty vehicles become electrified, the increase in electricity use will account for 14.2% of the total U.S. electricity demand by 2035. In parallel, fleet operators are evolving from small commercial customers into large energy users, propelling utilities into the pivotal role of facilitating, managing, and enabling those seeking to electrify their fleets.
Figure 1: This chart shows responses from SEPA’s Snapshots Utility Survey conducted earlier this year, in which SEPA asked utilities about the status of their commercial customer fleet electrification services or support. Utilities that indicated they were in the "planning or designing" phase could be working on pilots or full-scale program implementation.
To better understand the complexities of this transition, the Smart Electric Power Alliance (SEPA) embarked on a year-long project exploring the dynamics between utilities and fleet operators. Participating utility partners included American Electric Power, Duquesne Light Company, Holy Cross Energy, Hoosier Energy, Orlando Utilities Commission, and the Tennessee Valley Authority. Through a series of interviews, collaborative workshops, and case study exploration, SEPA identified best practices for utilities to adopt to ensure a more seamless transition for themselves and their customers.
The final report, Preparing for Customer Fleet Electrification: A Utility Framework, explores the complex relationship between electric utilities, fleet operators, and charging providers. Recognizing that utilities cannot shoulder the transition on their own, the report examines both utility and collaborative actions and provides a framework to guide utilities. The project identified best practices and key strategies, listed below, to support seamless fleet electrification.
BEST PRACTICES
Utility Actions:
The following actions highlight strategic approaches that utilities can employ to fulfill the role of an energy provider, as well as a proactive partner, in the electrification of fleets.
Understanding Fleets in Your Service Territory: Recognizing and comprehending fleets' unique needs and operational patterns are critical. This involves proactive engagement, data analysis, and developing strategies that align with the unique requirements of different fleet categories, ensuring utilities are partners in the electrification journey.Â
Creating Clear Utility Processes: Streamlining utility processes, from program design and application to management and communication, is crucial. Clear, efficient, and transparent processes facilitate smooth operations and enhance customer experience and trust.
Providing Tools: Utilities are encouraged to equip fleet operators with the necessary tools and resources to manage and optimize their operations, including offering technical support and continuous performance tracking.Â
Internal Fleet Electrification & Education: Utilities can lead by example, embarking on their own internal fleet electrification and fostering a learning environment. By adopting practices internally and ensuring employees are well-educated on fleet electrification operations and management while enhancing internal processes, utilities gain valuable first hand insights into fleet operator challenges.
Collaborative Actions:
The following collaborative actions are crucial for overcoming challenges and maximizing the potential of fleet electrification. These actions ensure that all parties are aligned and working cohesively towards a sustainable, electrified future.
Increasing Stakeholder Dialogue: Open dialogue between utilities, fleet operators, and other stakeholders is essential for navigating challenges and devising mutually beneficial solutions. This involves creating platforms for dialogue, prioritizing stakeholder input, and designing and implementing collaborative strategies.
Growing Role of EVSPs: Establishing partnerships with Electric Vehicle Service Providers (EVSPs) and streamlining processes will facilitate seamless coordination for large scale charging projects and allow fleet operators to access comprehensive and efficient charging solutions.Â
Navigating Regulatory Barriers: Active participation in regulatory discussions and advocacy for frameworks supporting and facilitating electrification is crucial. Utilities should engage in dialogues to advance policies and frameworks conducive to rapid electrification.
Future Proofing: Proactive planning, infrastructure development, and preparation to manage the future demands of fleet electrification involves strategic planning and technology adoption.
It is imperative that fleets receive adequate support to fully capture the benefits of an electrified future. The surge of electric fleets from now through 2030 will require a shift in how utilities operate, necessitating partnerships between key players. We encourage all interested parties who are a part of this transition to leverage the Framework as they navigate their electrification journey. Download the full report here.Â
Looking forward, SEPA remains committed to advancing innovative solutions for transportation electrification. Ongoing projects include exploring Residential Smart Panel Thought Leadership, Equitable Access to EV Charging, and the State of Managed Charging in 2024 report, which will be published in the Fall of 2024. We invite interested stakeholders to stay connected with SEPA and become informed as we roll out these projects. Please contact Drake Moran at [email protected] or Ashley Lynn Qua at [email protected] for more information.