Bloomberg NEF Summit - The future of powertrain and the adoption of electric

The ever-increasing interest in alternative fuels continues to prompt questions as to what the future of transport will look like and how this will shape our world. Speaking at the 2019 Bloomberg New Energy Finance Summit in New York, New York, Julie Furber, Vice President - Electrified Power at Cummins, shared her thoughts on the impact electrification has had in industrial and commercial vehicle markets. Although Furber can’t see into the future, she can share how Cummins is preparing itself for the changes ahead:

“We [Cummins] want to partner with our customers to get the right solution for them and we’d like to partner with the regulators to ensure that regulations are consistent, clear and leave flexibility around technology.”

Photo of Julie Furber at BNEF conference
Julie Furber at the BNEF Summit.

Furber makes it clear that Cummins’ strategy will be to develop the most efficient powertrain solutions that comply and push regulations forward, so Cummins can fulfill its customers’ requirements and minimize the impact to the environment. Offering alternatives to its customers will be key to Cummins’ success as the path to a fully electric-powered world is not a straight one; it’s filled with twists and turns and there are multiple challenges that need to be overcome. As an example, Furber mentions some of the challenges faced by natural gas, where the slow adoption of this alternative fuel source in North America has sparked a chicken or the egg debate as to whether refueling infrastructure comes first and sales of natural gas vehicles follow or vice versa. 

Speaking of eggs, Cummins can’t put them all in one basket. The adoption of electrification is reliant on multiple factors: battery prices, the development of charging infrastructure, subsidies and financing options and, above all, regulations, which could circumvent these challenges and force adoption quickly. As Furber explains, electrification is one of many fuel sources and a one-size- fits-all approach is not the right strategy to take, since the choice of power will be “dependent on the application and on the region the vehicle or equipment is operating in.” 

Electrification is the natural next step for Cummins, a company that pioneered the use of diesel engines and has since transformed itself into a powertrain supplier of choice. With an eye to the future, Furber makes it clear that Cummins will leverage its 100-year tradition of innovation to continue excelling and to partner with original equipment manufacturers, customers and regulators to offer the best solution in the market and to advocate for consistent, technology-neutral regulations worldwide.

No matter the power source, Cummins will be in the driver’s seat of the powertrain evolution.

Cummins Office Building

Cummins Inc.

Cummins is a global power leader that designs, manufactures, sells and services diesel and alternative fuel engines from 2.8 to 95 liters, diesel and alternative-fueled electrical generator sets from 2.5 to 3,500 kW, as well as related components and technology. Cummins serves its customers through its network of 600 company-owned and independent distributor facilities and more than 7,200 dealer locations in over 190 countries and territories.

The Future of Fleets: The four keys to electrification – Part 4

Future of Fleets Zero Emissions

When it comes to battery electric vehicles, there are four keys to adoption within the commercial vehicle sector. In Part 4 of our four-part blog series, we look at the final hurdle a new technology must overcome: Policies and regulation. 

In this fourth preview blog, we look at how policy and regulations regarding commercial EVs must be carefully developed in collaboration with industries and institutions. Sustainability, after all, is not an issue limited to any one sector, and only by drawing on the insight of experts in the technology, infrastructure, and economics of EVs, as well as end-users and other policymakers, will successful incentives to adoption be designed. 

If you are reading this series for the first time, you can find part one here, part two here and part three here. 

Regulatory surety

Finding the right focus will require ongoing conversation, consultation, and collaboration with stakeholders from across the mobility space. The range of routes here is broad: long-term zero-pollution targets will set the overall direction of travel for industry; cross-industry working groups will establish proven technological standards; policies which fund, and remove barriers to, infrastructure rollout will create progress on usability; sustainability stipulations in contracts put out to tender will demonstrate economic viability and create a market for sustainable vehicles; collaborative work on data sharing will improve monitoring and efficiency; and linking tax rates with emissions will improve return-on-investment. 

While the range of options is daunting, there are already examples of best practice emerging across the world. A recent report from the environmental research group Bellona, for example, details the nature of some policy initiatives which are already seeing positive outcomes in construction, which currently accounts for 23% of global carbon dioxide (CO2) emissions.  

In the Norwegian capital of Oslo, for example, the city’s municipal developer has operated a series of initiatives involving setting minimum standards for bidders on contracts it puts out to tender. The developer adopted the policy that ‘what can be run on electric, shall be run on electric’ – creating the potential for a market for electrified construction equipment. Looking ahead, the city anticipates that by 2025 all public construction sites will operate emission-free machinery and transport. 

Part of the success of Oslo’s initiative, besides the determination of stakeholders to make it work, may be in the phrasing of its policy. By using the phrasing ‘what can be run on electric’, the city avoids forcing construction firms into inappropriate adoption (such as electrifying what is not yet suitable to be electrified) and opens a dialogue with them about what can and cannot be electrified, working cooperatively on progress towards sustainability. 

Bringing it all together 

All over the world, progress is being made through hard work to bring the technological capabilities of EVs up to the level where they meet the requirements of commercial applications. 

This requires us to understand their infrastructural requirements and make them clearly actionable, to bring their total cost of ownership down to a level where they compete with and exceed conventional vehicles, and to produce policy which incentivizes their adoption. 

For Cummins, the process of finding the right solution is always a collaborative effort. Getting it right means having conversations across stakeholders in industry and policy, as well as end-users, to deeply understand the issues and ensure successful roll-out. 

To learn more, please visit our ‘Future of Fleets’ whitepaper, which looks at the four keys to electrification, with insights from a range of industry experts including Addison Lee, dg:cities and Nuvve. 
 

Download the 'Future of Fleets' report (PDF)

Cummins Office Building

Cummins Inc.

Cummins is a global power leader that designs, manufactures, sells and services diesel and alternative fuel engines from 2.8 to 95 liters, diesel and alternative-fueled electrical generator sets from 2.5 to 3,500 kW, as well as related components and technology. Cummins serves its customers through its network of 600 company-owned and independent distributor facilities and more than 7,200 dealer locations in over 190 countries and territories.

The Future of Fleets: The four keys to electrification – Part 3

Electrified Power - Future of Fleets - Economic Reality BP 3

When it comes to battery electric vehicles, there are four keys to adoption within the commercial vehicle sector. In Part 3 of our four-part blog series, we look at the third hurdle a new technology must overcome: Economic feasibility. 

 

At present, EVs are often more expensive than their conventionally-powered equivalents. One reason for this is inherent material costs, with battery manufacture requiring large quantities of lithium. Yet, as processes are refined, efficiencies are found, and scale increases, the manufacturing costs of lithium-ion (Li-ion) batteries are expected to reduce – and the reduction of this cost will be a major enabler for early commercial electric vehicles (EVs) adoption.

In this third part of the ‘Future of Fleets’ whitepaper preview series, we look at the economic considerations for electrification. If you are reading this series for the first time, you can find part one here and part two here.

Economic reality 

Today, the economic decision-making involved in purchasing commercial vehicles is familiar to anyone involved in fleet management. It can be broadly divided into capital expenditure (the up-front cost of the vehicle and infrastructure), operating expenses, and the day to day costs of running the vehicle such as fuel and maintenance requirements. 

EV adoption can involve significant outlay, which varies widely depending on application. While the growing availability of on-street charging points can be leveraged for some commercial vehicle fleets, such as last-mile delivery vans, for other applications, such as buses, owned infrastructure is necessary. New electric fleets may, in fact, demand entirely new configurations of buildings. Charging points can however be shared, meaning that the upfront cost can be reduced. In this way, large electrification projects can deliver a better return on investment than smaller projects.  

From an operational perspective, the two main cost areas are energy and maintenance. Energy costs for EVs are dependent on electricity prices, much as fuel costs today are ultimately dependent on oil prices. Maintenance costs may be minimized through the use of telematics to monitor wear and tear and accurately predict when servicing is required. 

While major capital expenditure is clearly involved, through a combination of falling prices over time and efficiency savings from vehicles sharing charging points, EVs can be – and in the case of delivery trucks already are – economically competitive with diesel options.

How does policy and regulation impact electrification of commercial vehicles? Find out in next week’s ‘Future of Fleets’ blog series.

Download the 'Future of Fleets' report (PDF)

Cummins Office Building

Cummins Inc.

Cummins is a global power leader that designs, manufactures, sells and services diesel and alternative fuel engines from 2.8 to 95 liters, diesel and alternative-fueled electrical generator sets from 2.5 to 3,500 kW, as well as related components and technology. Cummins serves its customers through its network of 600 company-owned and independent distributor facilities and more than 7,200 dealer locations in over 190 countries and territories.

The Future of Fleets: The four keys to electrification - Part 2

Electrified Power - Future of Fleets - Infrastructure

When it comes to battery electric vehicles, there are four keys to adoption within the commercial vehicle sector. In Part 2 of our four-part blog series, we look at the second hurdle a new technology must overcome: Infrastructure.

 

Much of the infrastructure required to practically use an electrified vehicle (EV) is already in place: roads, traffic lights, car parks and systems of vehicle registration are all agnostic as to how the vehicles they accommodate are powered. 

The way energy is delivered to vehicles, however, must change in tandem with the move to EVs, replacing the well-developed network of oil-based fuel delivery we currently rely on with charging points and a power grid that can support them. In this second preview blog of the ‘Future of Fleets’ whitepaper, we look at how work on infrastructure will enable electric commercial vehicle adoption. If you are reading this series for the first time, you can find part one here.  

Infrastructural capacity  

For a typical electric passenger car, fully recharging from a standard U.K. power outlet will take over 10 hours. For commercial vehicles, this level of downtime introduces significant costs – exacerbated by the fact that commercial vehicles are often larger and heavier, and therefore require larger batteries which take longer to recharge. 

For situations where a certain number of vehicle-hours is mandated by the operation, this downtime factor has a range of consequences for infrastructure design. If the vehicles are being charged at a centralized hub, for example, each vehicle needs a parking space for the period of charging. Here, halving the charging time of a vehicle means halving the physical space needed by the recharging infrastructure, as well as halving the number of charge points which need to be purchased and installed. 

The energy for EV recharging, of course, also comes from somewhere. EVs will get their energy either from on-site power generation, such as solar and wind power, or from the national grid. For energy companies, this represents a challenge as, especially at peak charging times, the overall demand on power stations as more vehicles become battery-powered increases. One solution to this will be to use smart charging solutions, which supply energy overnight, when the electricity demand from households and industry is lower. 

Widespread adoption of EVs offers a surprising benefit: the large capacity of vehicle batteries creates the possibility for vehicles not currently in use to help balance national power supply with demand, which will become increasingly important as less predictable renewable energy sources become a more dominant part of our energy mix. Making this win-win possible requires further collaboration between commercial vehicle operators, utilities, legislators and technology vendors. 

Stay tuned for the next blog in our series, in which we will discuss how the economics of fleet ownership affect electrification. 

Download the 'Future of Fleets' report (PDF)

Cummins Office Building

Cummins Inc.

Cummins is a global power leader that designs, manufactures, sells and services diesel and alternative fuel engines from 2.8 to 95 liters, diesel and alternative-fueled electrical generator sets from 2.5 to 3,500 kW, as well as related components and technology. Cummins serves its customers through its network of 600 company-owned and independent distributor facilities and more than 7,200 dealer locations in over 190 countries and territories.

The Future of Fleets: The four keys to electrification - Part 1

Electrified Power - Future of Fleets - Technological Maturity

When it comes to battery electric vehicles, there are four keys to adoption within the commercial vehicle sector. In Part 1 of our four-part blog series, we look at the first hurdle a new technology must overcome: Technological maturity.

 

The world’s power needs are changing. By the end of the 21st Century, we will not have the same reliance on fossil fuels. A growing number of fleets are looking to diversify how they power mobility and heavy industry.

Battery electric vehicles (EVs) are becoming viable across a broad range of applications, and the potential to transform commercial fleets is clear. What’s less understood is how we can plot a course for adoption of these technologies, bringing them into greater use in the commercial automotive sector, while maintaining productivity and prosperity.

In Cummins’ ‘Future of Fleets’ whitepaper preview series, we’ll look at the same four keys which made the internal combustion engine one of history’s most successful inventions – technological maturity, infrastructural capacity, economic reality, and regulatory surety – and outline how they must be considered as fleets diversify in the commercial vehicle sector.

Technological maturity 

The first hurdle that a technology must overcome if it’s going to be adopted for any given purpose is its ability to perform the task at hand. For the internal combustion engine, first developed in 1859, this meant providing at least as much energy output as a horse in an equivalent or smaller amount of space. Today, the physical ability of EVs to perform the task at hand needs to be assessed on a case-by-case basis.

One technology has been the critical innovation which above all else has made modern EVs possible: the lithium-ion battery (Li-ion). Using batteries to provide power to a vehicle involves a key trade-off: movement over a large distance requires a lot of energy, but adding additional batteries also adds weight and volume, increasing the vehicle’s energy requirements even further. One of the key scientific challenges in creating batteries for vehicles, therefore, is maximizing the amount of energy they can hold in a given volume and weight; this is precisely what Li-ion batteries achieve.

As this progress continues, it will become possible to electrify more varied types of vehicles. Long-haul freight, for instance, demands a huge amount of stored energy, but adding additional battery units eats into the available storage space, making each journey less economically useful. By researching how we can store more power in a smaller space, we will enable new possibilities for electrification.

Technology is just one part of the electrification story, so stay tuned for more in part two of this blog series and download the full "Future of Fleets" whitepaper report below.
 

Download the 'Future of Fleets' report (PDF)

Cummins Office Building

Cummins Inc.

Cummins is a global power leader that designs, manufactures, sells and services diesel and alternative fuel engines from 2.8 to 95 liters, diesel and alternative-fueled electrical generator sets from 2.5 to 3,500 kW, as well as related components and technology. Cummins serves its customers through its network of 600 company-owned and independent distributor facilities and more than 7,200 dealer locations in over 190 countries and territories.

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