What’s driving the net zero agenda for business transport?

With climate change firmly on the global agenda, and government net zero deadlines fast approaching, there is a pressing need for businesses to be accountable for their environmental impact. Corporate entities are responsible for nearly  20% of all CO2 emissions in the UK, so it’s no surprise that companies in all sectors are on a mission to do better. Importantly, as savvy consumers increasingly want to ‘buy green’, firms are fast realising that robust sustainability credentials aren’t just good for the planet, but for business too.

Accounting for around a third of the UK’s total carbon emissions, transport, and particularly road transport, is an obvious target for improvement. Indeed, as companies strive to decarbonise their transport fleet and freight emissions, the good news is that there are big strides being made in the development of green vehicles, with technical innovation continuing at pace.

But along with technical innovation comes discussion and debate—what will the future of clean transport look like? And, with electric vehicles (EVs), biofuels and hydrogen all on the menu, how do companies decide the best decarbonisation strategy for them?

Plugging into the future

Following the success of EVs in the consumer market, many businesses are keen to adopt EV technology for their own transport fleets. According to the Energy Saving Trust, EVs emit up to 66% less CO2 than their gasoline or diesel counterparts. Improved batteries, readily available charging infrastructure, and price parity with internal combustion engine (ICE) vehicles are all driving take-up of the technology. There are cost benefits to be had too—despite a greater initial outlay, EVs promise to be cheaper to use and maintain in the long-term and the savings will continue to increase as the electricity grid decarbonises between now and 2050.

Additionally, for those impacted by ultra-low emission zones, EVs will offer huge savings. In London’s ultra-low emission zone, EVs do not attract a fee, compared with the £12.50 (or £100 charge) applied per vehicle per day for other, more-polluting vehicles. With this in mind, going electric starts to look more appealing.

However, there are significant limitations alongside the benefits. Top of the list is range anxiety. Organisations also need to consider how their vehicles will be charged—whether they’ll need to return to a workplace or residential charging point overnight—and how this impacts on business operations. In addition, lengthy charging time and limited battery life are also causing concerns. Furthermore, the Treasury is sure to be considering a road-pricing mechanism to offset the loss in fuel duty revenues so motorists used to the current low-tax norm may be in for an unpleasant shock.

Additionally, while batteries are capable of efficiently running lightweight passenger cars, the same can’t always be said for heavy commercial vehicles and non-road mobile machinery (NRMM), which is so often used in heavy industry and construction. Indeed, companies (and manufacturers themselves) are fast reaching a tipping point where EVs simply aren’t fit for every purpose.

Green hydrogen: a key to reducing emissions

So, what’s next? Hydrogen is certainly one of the most abundant elements on the planet. Today, green hydrogen (which is produced from renewable energy as opposed to fossil fuels) is hitting the headlines and promising an alternative way for businesses to decarbonise their operations.

As well as driving a significant reduction in emissions, hydrogen fuel cell vehicles offer competitive advantages over EVs, powering heavier loads, longer driving ranges and shorter fuelling times. This makes them particularly attractive to the heavy-duty vehicle and NRMM segments. And the good news is that the effects are already evident in practice. Organisations are operating fleets of forklifts already running on hydrogen, for example. The technology is making an impact in plant management too, with heavy machinery already being powered in this way. It’s making its way into the market—currently to order in most cases rather than mass-produced, but that will come.

But hydrogen isn’t without its challenges. The hydrogen fuelling infrastructure is currently limited, the cost of producing and delivering hydrogen fuel to service stations is high at low volumes, and it is still far cheaper to produce hydrogen from fossil fuels than from renewable energy. Additionally, fuel cell vehicle production costs will have to drop considerably from their current levels. Significant private and public sector investment will be needed to make all this happen, and to ensure hydrogen vehicles are supported in the same way as their electric counterparts.

And to boost uptake, subsidies will be important too. The UK government’s recent Hydrogen Report sets out its commitment to make this happen, and demonstrates ongoing support for the technology. And on the other side of the coin, increases in taxes and duties for non-green vehicles will give many the push they need to harness green technologies.

While there are certainly choices to be made for companies who want to decarbonise their transport fleet, many will need to employ a hybrid approach using EVs where it makes sense and employing hydrogen fuelled technology as it becomes more feasible and for the applications where it is most useful. It’s important to note that the industry is innovating continually too, so limitations of both EV and hydrogen fuel cell technologies may well be overcome in the years ahead.

About the author: Gavin Bollan is Technical Director at ITPEnergised