by Julian Spector
February 13, 2020

FONTANA, CALIFORNIA — The truck accelerated with barely a whisper, easily lost in the rush of wind funneling through Cajon Pass.

“Listen to that,” said one trucking professional, standing by the side of the track.

“To what?” his colleague replied.

For a vehicle with a 24-foot container box appended to its rear, this one took off with the flighty zip that only electric motors deliver. Into the first bend of the speedway, simply lightening up on the accelerator pulled down the speed thanks to forceful regenerative breaking. But after rounding another bend to the straightaway, I jammed that pedal and pushed headlong into the same winds that blew actual tumbleweeds over the highway divider and had nearly shoved my sedan off the road on the way over.

Volvo Trucks has an electric truck now, closely modeled on its VNR regional haul tractor. I know it’s real because I drove one. I’ve never driven a commercial truck before, but this one didn’t handle much differently than the diminutive Volkswagen e-Golf I test-drove at a conference previously. This truck impresses all the more for packing the agility and quiet of an electric sports car into a far bulkier and more powerful body.

The manufacturer says the electric VNR will enter commercial production by the end of the year. It’s not saying how much it will cost, and the details of the final design are still being worked out. But the manufacturer has dispatched five pilot units to the Los Angeles metropolitan region for a grant-funded, highly collaborative project called LIGHTS, which aims to figure out the details necessary for a wholesale electrification of short-range and regional trucking.

There’s a lot of missing data to fill in, on account of nobody really using electric trucks for shipping so far. The LIGHTS partners will study driver behavior, the charging needs of the trucks, how they perform on their routes, how the total emissions compare to the status quo, all while navigating the banal but essential trials of local permitting and community input for charging infrastructure.

“We're not talking about research that was done in a laboratory,” said Idine Ghoreishian, senior manager of OEM integration at Greenlots, the charging software partner for LIGHTS. “We're talking about actual use cases that ran for two years...and what that means to make sure that, at scale, this is going to be a solution for you.”

Should this effort succeed, trucks will join the growing list of demand sources for high-quality battery packs. And as high-voltage charging depots proliferate, they will drive demand for stationary storage to mitigate strain on the grid and expenses for site owners.

This market opportunity won’t really arrive for a few more years, but it’s closer than many realize.

Why trucks go electric

Individual drivers can go electric because it’s cool, but fleet operators need a hard economic case to make the switch.

Electric trucks require significantly less maintenance, measured in both cost and downtime. If they charge in utility territories with favorable policies, the cost of fuel can be lower than the status quo, too.

The vehicles also deliver workplace improvements for drivers and loaders: They don’t emit exhaust, they don’t rattle and hum, they don’t leave you smelling like diesel, and they’re zippy and fun to drive. These items get weighed in the calculus, but total cost of ownership rules the decision.

Looks cool, drives well, but what about the grid? (Credit: Julian Spector)

Informally polling the Volvo truck distributors and customers that had flown to the Inland Empire to see the unveiled trucks, I couldn’t find anyone who thought this truck would be cost-competitive when it hits commercial production. Volvo’s steadfast avoidance of price discussion bolsters that assessment. But Volvo already says it’s at work on a next-generation model with better energy density. It’s likely to start at a price premium and drop with each coming year.

But early buyers won’t pay full price. In California, at least, a lengthy list of grant programs will defray the cost of conversion. California also funded LIGHTS, with $44.8 million from cap-and-trade, buying down half the cost of the program. And in certain jurisdictions, regulation is forcing conversion by demanding zero-emission fleets in the coming years.

Trucking company reps onsite also cited an intangible benefit: the sense of “doing the right thing” by making an early jump into electric vehicles, which lets them tell a certain story to their own customers.

Grid demand to jump

Mass adoption of electric trucks would constitute a potent force for grid planners to consider, and the test sites of the LIGHTS program offer a glimpse of that future.

Broadly speaking, the purpose of LIGHTS is to eliminate emissions from the trucking network that carries goods from the coastal ports to depots across the Los Angeles Basin, where items then get distributed to the city and beyond. The program is putting chargers at several sites along that distribution chain.

I saw one at TEC Equipment, a truck dealer and leasing shop across the street from the Fontana Speedway. If you start in downtown L.A. and drive due east on the 10, you get there in about an hour without traffic, before San Bernadino and the desert beyond.

The initial Volvo truck models pack 200 and 300 kilowatt-hours in their battery packs, meaning they’re geared for local and regional deliveries but not long-haul trucking. TEC Equipment is using the e-truck to distribute equipment among its locations, and built out two 50-kilowatt chargers in a hangar and one 150-kilowatt charger outside. ABB supplied the equipment, which will be governed by charging network software from Shell-owned Greenlots.

Notably, those chargers put together roughly match the peak consumption of the rest of the facility, which resembles a large car dealership where all the cars are trucks. Public fast-charging networks like EVgo and Electrify America have adopted 50-kilowatt units, but the outdoor charger at TEC pushes into new territory.

“The 150[-kilowatt charger] is a big deal; there are not many cars or vehicles that will accept that,” said Brian Baird, director of energy and sustainability at Core States, the engineering firm that designed the installation.

Charger manufacturers are already pushing up to 350-kilowatt chargers, which will quickly outstrip the demand of a host site, Baird added.

That mismatch between a customer’s historical grid usage and consumption for an electrified fleet is only going to expand as truck and bus batteries get bigger, and as fleet operators move from piloting a few to swapping out dozens at a time.

That creates stress for both the distribution grid and the cost of charger interconnections.

“In dense urban areas where you want these chargers, sometimes there’s not enough power there,” Baird said. “Or it’s going to be two years and a big check.”

Storage opportunity: Proceed with caution

That threat to the pocketbook has inspired many observers to comment that stationary energy storage will play a meaningful role in minimizing the unwanted costs associated with high-speed charging. This conclusion reminds me of the assertion that vehicle-to-grid technology will naturally follow from the proliferation of electric vehicles on the roads: Both sound nice, but the glowing vision falls apart under scrutiny.

Nobody I spoke with at the Volvo event anticipated actually needing batteries alongside EV chargers in the near future. First, fleet operators need to buy a critical mass of electric trucks, which are not yet on the market.

“Once you start reaching scale, that’s where you see the value become very, very clear,” said Greenlots Chief Technology Officer Harmeet Singh.

Let’s say heavy-duty vehicles reach that point in a couple of years. Then the dreaded bogeyman Demand Charges rears its frightful head. Suppose a commercial property with a 300-megawatt peak load is suddenly sucking up 1 gigawatt at a time for vehicles; surely the demand charges would force an adoption of batteries?

Perhaps, if there were any certainty about rate changes within the useful life of the battery. But TEC Equipment found a different route: Its utility, Southern California Edison, instituted a new EV rate that eliminates demand charges altogether through 2024. If a company sets up its chargers on that rate, the time-based price signal for storage disappears.

Where it persists, software can help — to a point. Greenlots has software that can identify impending peaks and throttle down the rate of charge. This technique can also avoid exceeding an interconnection limit for a charging site.

The problem with software-based throttling is that it slows the charging rate for vehicles. That can throw off driver schedules, and generally breeds disgruntlement, as when airlines sell more seats than an airplane actually contains.

Long-term, the stationary storage opportunity here will be serving the sites that want to charge beyond the threshold allowed by the interconnection agreement, and by extension, the local grid. There could even be a microgrid opportunity, which could ensure that high-throughput charging sites have sufficient power by producing it locally.

The embattled commercial storage industry, which has largely abandoned standalone batteries in favor of supplying solar projects with storage, won’t enjoy a boost in interest for charging station batteries any time soon. But the charging infrastructure offers a new source of business for the engineering and construction firms that used to handle battery deployments.

“We’re seeing a slowdown in the behind-the-meter stationary battery market,” Baird said. “A lot of talent and contractors and attention are shifting to this electric vehicle space. I’m seeing new business models popping up to support that market.”

This could work out better in the end.

EV charging will ultimately present a bigger market opportunity than commercial batteries, Baird said, especially given the vehicle electrification policies set by California and Los Angeles.

“You’re talking thousands and thousands of vehicles that need to be electrified — and the charging infrastructure to support them,” he said.