Small Fleet Management Workshop - Green Jobs, Green ... Fleet Management Workshop Advanced Transportation Technologies Susan Romeo Director, Marketing and Communications ... – IC/Enova

Small Fleet Management Workshop

Advanced Transportation Technologies

Susan RomeoDirector, Marketing and Communications

July 2007

Clean TransportationSolutions SM

Copyright WestStart-CALSTART 2007

Mission Statement

WestStart-CALSTART is dedicated to the growth of an advanced transportation technologies industry that will:

• Create high-quality jobs;• Clean the air;• Reduce dependence on foreign oil; and

• Prevent global warming


WestStart-CALSTART’sUnique Position

WestStart-CALSTART is in a unique position to monitor and support the advanced transportation technology industry

• Close to end-users / understand the day-to-day issues and challenges facing fleet managers

• Work closely with companies developing state-of-the-art technology – we know what’s being worked on, where the technology is today, and where it may be tomorrow

• Helping companies today to sell advanced vehicles and fuels – aware of the challenges of today’s marketplace

• Healthy relationships with policymakers at federal, state, and regional levels – strong sense of where regulations are heading

No other organization has this array of relationships


WestStart-CALSTART Focus Areas(current programs)

Vehicles and Technologies

Innovative Mobility

Bus Rapid TransitFirst Mile

MyGo-PasadenaBikestation Seattle

CA E85 NetworkBiomethane Task Force

HydrogenBiofuels

Hybrid Truck Users ForumNational Fuel Cell Bus

Tech ProgramLNG and Hybrid Electric

Yard Hostlers

California Secure Transportation Energy Partnership

HTUF Incentives WG

Industry Support

Participant ProgramTechnical Advisory Committee

ConferencesPublications

5-Year Goal: To Develop Vehicles, Fuels

and Systems that Can Reduce Petroleum Use 20%

by 2020

Policy

Consulting Services

Fleet AFV ChoicesStrategic Partnering

Market Analysis

New Fuels

Poly-fuel; poly-technical


Trends Affecting Fleets

• Rising fuel prices• Government regulations requiring decreased

emissions – cleaner engines, cleaner fuels, idle management laws

• Fuel efficiency – result of desire to decrease costs of fuel in business operations

• Global concern about climate change – impact of CO2 build-up in environment– Some fleets going “carbon neutral”


Why Hybrids Are Gaining Traction with Fleets

• Rising fuel costs: Optimizing urban truck drivelines is becoming critical for fuel efficiency, emissions

• Major engine changes – and increased cost/complexity – coming in 2007-2010 to comply with EPA emissions requirements

• Trend toward integrated engine/drivelines in trucks• Increasing electrical power needs in heavy vehicles

and equipment• Idle Management is a growing issue• Productivity/performance complaints from cleaner

engines


Current Development Status

• Most major truck and engine makers developing hybrids: International, Peterbilt, Kenworth, Mack, Volvo, Freightliner, Oshkosh, Ford (with Azure), Caterpillar, Hino, Isuzu

• Several major system makers moving into or toward commercial production: Eaton, Allison, Azure, ISE, Enova, Bosch-Rexroth, Arvin-Meritor, Parker, BAE, Lockheed

• Major first-mover US fleets starting to adopt early units

• Still strongly US/North American technology leadership - but not assured


Recent Heavy Hybrid News

– International launches first hybrid production: Sept 2007 – Peterbilt testing Class 8 hybrid with Eaton system– ArvinMeritor signs WalMart agreement for Class 8 hybrids– Oshkosh unveils hybrid refuse truck at HTUF meeting– Peterbilt introduces Class 7 hybrid truck for customer trials– International builds its first production-line hybrids in Nov 06– Freightliner unveils Class 7 utility hybrid truck on M2 chassis– IC/Enova roll out hybrid electric shuttle bus– Azure agreement with StarTrans on producing hybrid shuttles– Eaton developing hybrid system for Class 8 OTR trucks– UPS testing advanced series hydraulic hybrid prototype– Bosch-Rexroth buys Dana hydraulic hybrid drive unit– Misubishi-Fuso Unveil Hybrid work truck (Cl 4-5 delivery)– Wright Group, ISE building 50 advanced hybrid buses for Las

Vegas (62-foot articulated series drive)– Volvo announces hybrid heavy trucks for 2009 production– Peterbilt completes second hydraulic hybrid refuse truck


Timeline to Commercialization: Hybrid Tech Still Early in Trucks

DevelopmentPre-Production

Production IntentEarly Production

Test prototypes and systems

Field pilot assessments (10-50 vehicles)

Assembly line builds of 100+

Initial commercial volumes – still high incremental cost

TO

OL

S:

R&D Support

Pre-Production Deployment Support (HTUF)

Purchase Incentives


• Not Yet at “Tipping Point” for hybrid commercialization – but making strong progress– Have sped commercialization process by 1-2 years

• Two truck makers entering production-intent manufacturing process– Still behind automotive curve – but business case is driver– Need assistance to cross cost gap to first production– Must increase early volumes

• Hybrids are one of several critical “wedge” strategies to boost fuel economy, reduce GHG– First targets urban vocational trucks– Will likely also have Class 8 impacts– Enabling technology for many future advancements – Expect yearly volumes to exceed 1-2-thousand in next 3 years

• Need targeted incentives: Federal and State– Partnership of fleets, manufacturers and government– Structured to work in commercial, not consumer, market– Also need regional incentives and “aligned” incentives across regions

Conclusion:Status of Hybrid Truck Development


Hybrid Truck Users Forum (HTUF)

• User-driven process to commercialize medium- and heavy-duty hybrid trucks in North America

• Joint WestStart-U.S. Army program (RDECOM-TARDEC-NAC)

– Also supported by Hewlett Foundation, DOE

• HTUF focuses on commercializing hybrid trucks with dual-use benefits

– Speed commercialization and reduce overall costs by creating common fleet requirements, joint purchase commitments, increasing volumes


HTUF Moving Rapidly

• Working Group Activities‒ Utility Vehicle

• All 24 International/Eaton trucks deployed; data being gathered

• Trucks generally operating well and with excellent user acceptance

• Data acquisition system issues have caused delays in getting viable performance information

• Preliminary fuel economy improvements 9 – 55% depending upon duty cycle; some vehicles being moved to “better”applications

• Subsequent 100 truck “production-intent” order filled by International – trucks delivered by summer

• International/Eaton “early production” then to begin this fall (capacity – 1000 trucks/year to start)


HTUF Moving Rapidly

• Working Group Activities (continued)‒ Refuse Vehicle

• RFP responses due mid-May• Targeting 10+ pre-production trucks

‒ Hydraulic Hybrid Parcel Delivery• Revised RFP being developed• Hydraulic tech not as far along as hoped

‒ Small Bus• Spec info being gathered from fleets

‒ Plug-in Hybrid Truck (PHET)• Successful workshop at CHDV conference in Feb.• Next steps‒ Develop a PHET business case‒ Define best target vehicles and applications‒ Select fleets and regions that can be “first-movers”


HTUF Moving Rapidly

Working Group Activities

‒ Incentives WG• Effort launched after HTUF & CHDV conference feedback• Initial focus is to motivate IRS to act on EPAct 2005 Heavy

Duty Hybrid Tax Incentives• Secondary focus is improving future incentives• More than 50 involved companies: fleets, manufacturers

‒ Class 8 Over the Road and Regional Delivery• Being initiated after announcements by Eaton and Arvin

Meritor concerning their hybrid development work with Wal-Mart

• Cooperation with EPA SmartWay Program• Preliminary interest now expressed by FedEx Ground,

UPS, Purolator, Westar Transport, ConWay and Wal-Mart


Hybrid Business Case

Operational Savings– Fuel (the higher fuel goes, the shorter the

payback)– Maintenance – Extended engine life

Productivity Gains– Faster Launch from Stop, More Effective Braking– Idle Reduction – engine shut off

Emission ReductionsIncentives

– EPAct HD hybrid incentives– Regional/state funding grants and incentives


Hybrid Choice Criteria

Know your duty cycle (driving and work components)– Type of driving– Idle time, in traffic and work site

Understand your key costs– Fuel and fuel delivery– Maintenance

What is value of performance gains to your mission?– More pickups per day?– Quiet operation at work site?– Additional emission reductions?

Payback should be looked at based on total cost of ownership, not simple payback

Leadership


What’s Needed?

• Trucks are different than passenger cars!– Hybrid concept similar; business case, volumes and

technology availability different• No commercially available electric steering, braking, HVAC

– Development transition 5+ years behind• Industry could benefit from:

– support for R&D – energy storage, electrified components; – funding to field pre-production fleets (10-100 vehicles per

application); – enhanced commercially-focused purchase incentives

• Purchase incentives need to last longer, provide assistance to broader range of fuel economy benefits

• First-mover fleets ideally need up-front purchase cost reduced (tax credits not ideal tool for commercial vehicles)


EPAct National HD Hybrid Tax Credits

• Administered by the IRS• Available to fleets who buy, lease qualifying vehicles• Credit is based on weight of vehicle and fuel

efficiency gains of hybrid system• Provides increasing credit for greater efficiency• Limits incremental cost in calculating credit; increases with weight • Credit available for five years starting in 2005; available through 2009

$12,000$9,000$6,000>26,000 lb

$6,000$4,500$3,00014,001 - 26,000 lb

$3,000(based on 40% of incremental

cost of $7,500)


cost of $7,500)


cost of $7,500)

8,501 –14,000 lb

Maximum Tax Credit for 50% Fuel Economy Increase*



Vehicle weight

* based on maximum qualified incremental cost


California: Carl Moyer Program

• NOTE: this is not just for hybrids; for all AFVs

• Administered by local air districts; apply through them, CARB

• Fleets should have at least 75% of the vehicles’ miles traveled in California; local air districts have other operation requirements too

• Funding is for incremental costs; some local air districts set maximum award caps

• Primary selection criterion: cost-effectiveness (annual cost of project divided by annual emissions reductions)

• Hybrid trucks must be CARB “certified” – interim certification procedures


Partnership to Make Incentives Stronger

• CALSTART – Environmental Defense Fund –HTUF Incentives Working Group

• Initial focus is to motivate IRS to act on EPAct2005 Heavy Duty Hybrid Tax Incentives

• Secondary focus is improving future incentives

• More than 50 involved companies: fleets, manufacturers

• Contact: Bill Van Amburg [email protected]• Hybrid Trucks Financial Incentives Guide –

www.environmentaldefense.org/hybridincentives


HTUF National Meeting 2007: SeattlePartners with Clean Vehicles Now!

• Join us in Seattle September 19-21

• 3-day event

– Features light-duty on day 1 as part of Clean Vehicles Now!

– HTUF National Meetings day 2 & 3

• Technology and market progress

• Incentives getting special focus

• Special session on regional hybrid coalitions and incentives

Meetings and HTUF Ride and Drive at

Qwest Field

HTUF National Meeting Host/Sponsor:

Co-Sponsor:

Clean Transportation Solutions SM

www.weststart.orgwww.calstart.org

Advanced Transportation Technologies SM

Documents

Small Fleet Management Workshop - Green Jobs, Green ... Fleet Management Workshop Advanced Transportation Technologies Susan Romeo Director, Marketing and Communications ... – IC/Enova