Author: Jonathan Ingram, Senior Manager at Raftelis (Email)
Some elusive questions remain in the local government and utility space though. Just how can EV conversions be effectively implemented at fleet level scale and what are the true financial, operational, service level, and environmental implications of EV conversion?
Over the past two years, Raftelis has worked closely with the Pinellas County, Florida government on continuous improvement assessments across multiple service areas. Following a detailed operational assessment of the fleet and fuel management operation, the County asked Raftelis to develop a cost benefit assessment and implementation plan for EV conversion in the County.
The goal of this assessment was to delve beneath the headlines to inform the Board of County Commissioner’s policy deliberations and chart an actionable path forward that ensures daily service delivery to the public would be continuous. That assessment yielded several important conclusions.
Many of us may think that EV conversion is as simple as running an extension cord out of the kitchen window in an environmentally conscious revival of The Beverly Hillbillies. Though this image is not far from the truth for the average daily driver, things get a bit more complicated at the fleet level scale.
To implement EVs, it is first necessary to ensure that staff have access to charging stations at convenient locations. It is also important that charging requirements do not disrupt daily service delivery. A one hour charging requirement in the middle of a workday would have cascading negative impacts on service levels and staff efficiency.
In Pinellas County, this means that it was necessary to install charging stations with shorter charging times at a 1:1 charging station to EV ratio. This service level requirement in turn necessitated electric service retrofits and upgrades at those City facilities where charging stations would be installed. The County operates from over 90 facilities and the expense associated with these upgrades across all facilities would be excessive. This operating and financial reality meant that the focus of EV conversion had to be targeted to those vehicles operating from six major operating/administrative facilities. Ultimately, infrastructure availability drives EV conversion opportunities; this is the first and most important operating challenge that must be resolved.
The electric vehicle market is a relatively new global market. Though the first modern electric car was produced by General Motors in 1996, it was largely displaced by the development of hybrid vehicles that combined ICE and plug-in electric motors/batteries to power automobiles. This is because EV implementation required a substantial investment in new infrastructure to support charging needs and accommodate the average daily driver. However, government and business entities began concurrently advancing EV technology and infrastructure to support wide-scale production of electric vehicles. That market development has largely focused on compact cars, sedans, vans, and, only recently, light-duty pick-up trucks. We are only now seeing initial prototype models for heavy-duty trucks and equipment.
By focusing on light-duty EV implementation in the near term, Pinellas County can begin making progress on its policy goals with tested technology while simultaneously developing internal expertise in EV implementation management. This will position the County to quickly take advantage of new EV technology for heavy equipment as it evolves which, based on the pace of current trends, could have already happened!
In every utility or local government, there are going to be operating characteristics that are unique or, at least, unusual. Each of these has the inherent ability to drive or constrain EV implementation viability. For example, shift schedules, parking limitations, geographic coverage areas, and vehicle sharing/pooling practices can all impact EV implementation viability. In Pinellas County, one of the most significant of these factors to consider was the weather.
If you have ever watched a broadcast of a news anchor leaning into pelting rain and wind, chances are, they were in Florida. The ever-present threat of tropical storms and hurricanes means that any EV implementation plan must ensure access to charging resources when the power grid is down. Unfortunately, this “disaster event” charging technology is relatively undeveloped. Given this limitation, the primary focus of EV conversion in Pinellas County needs to be on those departments and programs that do not have a direct role in disaster response. In addition, it will also appropriate to purchase a series of high output diesel generators to provide additional electricity generation capacity during power outages.
Though the EV market has developed significantly over the previous 10 years and absorbed a greater share of the automotive industry market, that growth has not yet resulted in the economies of scale necessary to create parity in purchase price between EV and ICE vehicles. In Pinellas County, an EV will cost about $11,800 more on average than a comparable ICE vehicle.
As average American consumers, we each have access to tax incentives which diminish or eliminate these additional costs, but local governments and utilities do not yet have access to comparable incentives. So, for now, these costs must be absorbed.
These additional costs are, of course, offset by reductions in fuel and operations and maintenance costs. Electric vehicles require no petroleum-based fuel. However, those cost savings are partly eaten up by increases in electric/energy expenses. In Pinellas County, the conversion of 655 light-duty vehicles is estimated to reduce fuel/energy expenses by 57%. Parts costs are expected to decline by 75% and the number of labor hours dedicated to regular preventive maintenance will be substantially reduced. This is currently insufficient to fully offset annual increases in operating costs associated with purchasing EV vehicles; however, this market will continue to rapidly evolve to the point that operating cost savings can be consistently realized.
The primary goal of fleet electrification is to reduce or eliminate the emission of greenhouse gases into the atmosphere, particularly carbon dioxide (CO2). Replacing an ICE vehicle with an EV substitutes the use of gasoline as an energy source for electricity. The degree to which fleet electrification reduces greenhouse gas emissions is dependent on the source of electric generation in a given area.
According to the U.S. Department of Energy, approximately 86% of the electricity generated in the State of Florida is derived from burning fossil fuels. The remaining 14% is derived from nuclear or solar energy. Based on the CO2 output estimates associated with this electricity generation profile, Pinellas County stands to reduce its CO2 emissions associated with direct vehicle use by about 64%. This is certainly a sizable reduction in CO2. However, there are other factors to consider.
The manufacturing and decommissioning process for EVs is more environmentally intensive than that of ICE vehicles. Taking these factors into account, fleet electrification is estimated to result in a 23% net reduction in CO2 emissions over the life cycle of a vehicle. Though this is less grandiose than headlines may sometimes suggest, this is still a substantial reduction in greenhouse gas emissions. In Pinellas County, this will result an estimated 810,000 pounds equivalent of CO2 emissions reduced per year, which is the equivalent of the annual CO2 emissions for 70 ICE vehicles. Further, as manufacturing/decommissioning processes and green energy production initiatives advance, this positive impact should grow. This is no small feat.
There is a financial cost associated with EV implementation in Pinellas County. EV conversion will require significant capital investment in charging infrastructure, and it will take time to realize annual operating savings. However, there are also significant environmental benefits. Efficiency matters but so does leadership.
The Pinellas County Board of County Commissioners and leadership team are embarking on a thoughtful and deliberate effort to positively impact the environment. Raftelis worked closely with them over several months to develop a fact-based, collective understanding of EV conversion implications to fully inform the decision-making process and advance policy goals, while managing risk and building internal capacity.