Urban Logistics

A large part of air and noise pollution in cities can be linked to urban freight transport by diesel vans/trucks delivering goods from suburban transport hubs to the inner city. Substituting these with electric vans/trucks can effectively contribute to better air quality and less noise pollution.
This use case focuses on opportunities and barriers for sustainable e-mobility in urban logistics, including practical user aspects, economy, environment and legal framework. By cooperating closely with original equipment manufacturers (OEMs) and charging infrastructure operators, the use case helps pave the road for the creation of a new and sustainable business model for e-mobility in urban logistics.

Demonstration Action

The Høje Taastrup Transport Center (HTTC) is located in the Municipality of Høje-Taastrup (HTK), and includes several larger Danish freight & logistic companies which daily commute in and out of Copenhagen. HTK worked as a facilitator between transport companies, OEMs and charging infrastructure operators in order to create pilot cases in urban freight and logistics. HTK facilitated the companies’ participation by dealing with their possible concerns regarding risk, economic costs or any other challenges that could arise during the pilot testing.
Pilots involved testing zero-emission/low noise last mile freight transport from a suburban transport centre to Copenhagen inner city using electric vehicles. 6 established transport companies tested relevant electric van/truck models in the market, under real-life conditions. Various OEMs (Renault, Volkswagen, Nissan and Mercedes) provided those electric van/truck models for a free trial period of 1 to 3 months. The vehicles were delivered to the logistics companies and driver training was implemented.

Vehicle testing included different driving patterns and daily routines of regular day to day delivery as well as special goods delivery. As a response to the various technical and economic challenges, the project created new business cases with adapted routines, for example a pilot with the French company L’Oréal focussing on pooled deliveries of generic commodities and high-end products that are optimized for the range and capacity of the e-vans.

Infrastructure partner E.ON provided decentralized AC chargers (for charging when out of operation) at the companies’ parking lots, and also granted access to its charging network in and around Copenhagen. A centrally located DC fast-charger (for charging during operation) was installed at HTTC to supply business and private EV owners. The project granted participating companies full access to daily charging free of charge.

The demonstration action is analysed and monitored with a view on practical aspects, financial implications, environmental impact and legal framework.

Results, lessons learnt and recommendations

The Municipality of Høje-Taastrup successfully engaged multiple business case scenarios, including normal express day-to-day delivery, specific goods delivery and exclusive products on special routes. An overall strategy for charging infrastructure of e-vehicles in Høje-Taastrup Municipality has been developed, including lessons learnt from the pilots.
Testing of different driving patterns, daily routines and routes has allowed to assess feasibility of business cases and to discern several lessons learnt:

  • Adapted charging infrastructure is critical to secure as many hours of operational time on the road as possible. Access to quick charging is crucial in order to enable full-day operation of vehicles. As the cost of this is too high for individual business at the moment, subsidized quick chargers placed strategically in transport centers or reserved for light commercial vehicles are needed to start the transformation.

  • The last-mile logistics market is challenged when it comes to turning to green deliveries and e-vans. The business has very low margins and profits. Due to their shorter range, the 1:1 exchange of diesel vehicles by e-vehicles is very challenging, and a higher amount of e-vans would be necessary compared to a diesel fleet. At the moment high investment costs of e-vans (approximately double the price of diesel vans) pose a hindrance for procuring additional vehicles. It is a challenge to advance towards zero emissions freight without either political, financial or business strategies in place.

  • For both transport companies and OEMs to become involved, a project must be easily understandable, easily accessible, and require low upfront involvement. Risks should be limited and handled by a facilitator. This is important to emphasize since the margins are quite low, and the business is optimized business is very marginal and optimized in all areas. One of the incentives provided in this Use Case was to offer free charging of vehicles, allowing participating companies to save on the cost of “fuel”.

  • Pilot projects need “first movers”, and networks of municipalities can play an important role in that sense. The approach should always include local authorities, and the “story” to be told should be one of cooperation between municipalities, companies and network partners – all together in a common effort. Since the municipalities have transportation and business networks, they can also facilitate and initiate meetings between parties with similar interests. Municipalities can also be front-runners in the procurement of zero-emission delivery services.

  • Due to various technical and economic challenges, simply replacing diesel vans by electric vehicles will not yield a strong business case. Instead it is recommended to create a scenario where both the logistic companies and the customers agree on “trying something new” – e.g. investing in zero emission delivery, ecological groceries etc. Municipalities can provide initial co-funding and assist with expertise during the startup phase. It is particularly important to understand the business of logistics and at the same time understand the challenges of operating EVs. Without professional help, networking and financial support, the challenges will overcome the initial interest. Since many fleet owners or sales Directors do not have an overall understanding and knowledge of this new market, it is especially important to be able to support them in the initial phase.

  • Implementing new technology takes time, changes working processes as well as daily operations, and therefore the cultural part of this transition is not to be underestimated. Stakeholders are often reluctant to implement change and prefer to work within their comfort zone. A common understanding and continuous exchange of all parties involved on the terms, requirements and associated challenges of investing in e-logistics is crucial in order to overcome initial hurdles.

Key recommendations are summarized in a theme-specific Action Checklist for Municipalities, local and national Politicians.

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