Making zero-emissions trucking possible

1. To achieve net zero by 2050, a swift, decisive move to zero-emissions trucks and a rapid rollout of infrastructure are needed.

The main road to decarbonising trucking will be developing and using new vehicles and drivetrains: battery electric trucks (BETs) and hydrogen electric trucks (HETs), powered with fuel cells. To achieve net zero by 2050 requires all trucks sold by 2040 to be either BETs or HETs.

Furthermore, stakeholders should put in place the market incentives, policy frameworks, continued vehicle development, and timely charging infrastructure necessary for this major transition.

2. Most ZETs are expected to reach TCO superiority with Diesel trucks between 2025 and 2034.

Battery and hydrogen trucks are increasingly cost competitive. ZETs typically have higher upfront costs but lower operating costs than internal combustion engine (ICE) trucks. As the upfront costs of ZETs keep decreasing, the ability to recoup the increased upfront investment is growing. Depending on usage and region, zero-emissions vehicles may achieve TCO superiority between 2025 and 2034.

3. Adoption of ZETs based on cost optimisation can substantially advance progress towards net zero.

This report models four scenarios for increasing ZET adoption. First is the Expected Adoption scenario as the TCO of BETs and HETs improves. The second is the Rapid Technology Improvement scenario, which is solely market based.

4. Policy can also help trucking achieve zero emissions by 2050.

The Accelerated Zero-Emissions scenario represents policy measures in which the cost of carbon affects the TCO of trucks powered by fossil fuel and other CO2e-emitting technologies.
While each MPP scenario assumes different policies and technological developments to reach zero emissions, reality will likely include elements of all three.

5. Achieving zero-emissions trucking is cheaper than continuing to burn fossil fuels. Higher vehicle costs will be more than recouped through lower operating costs.

A trucking sector that is zero emissions is both more sustainable than the status quo and also more economical. Compared with the total investment required in a “Do Nothing” diesel-dominated future, investments in ZETs are cheaper in all markets. Though BETs and HETs will usually have higher upfront costs, they more than make up for the difference from reduced fuel and operating expenses.

6. Financing the transition in developing economies will require more capital to enable a worldwide transition to zero emissions.

To enable a zero-emissions trucking industry, it will be important to mobilise financing in developing countries. Therefore, global multilateral financing bodies should align their financing portfolios with the needs of the trucking industry.

7. Innovative business models and financing instruments can leverage ZETs’ lower operating costs in order to mobilise capital to pay for their purchase.

The transition should include innovative financing and business models that can minimise economic harm to individual firms. Business models such as truck-as-a-service (TaaS) and battery-as-a-service (BaaS) are short-term leasing arrangements that can help small fleets gain access to these new and expensive technologies.

8. Enabling policy and coordination in the timing of supply and demand for both vehicles and refuelling infrastructure can reduce fleets’ risk during this transition.

Policymakers should ensure that they are catalysing the action needed from all parties (supply, demand, and infrastructure) and that any costs created by their policy portfolios to a particular party do not exceed the ability of that party to pay.

9. Operators need more public charging and hydrogen stations, a more mature ZET production value chain, and enough grid power for both charging and hydrogen production.

Putting the required infrastructure in place requires cooperation with governments and utilities, which must enable and support charging infrastructure availability, increased electricity generation, and grid upgrades. The development of green H2 production and distribution are also required to meet demand increases over the next decades.

10. The experiences of today’s fleets with ZETs should help identify the bottlenecks that must be addressed in the larger market in order to kick-start the transition to ZETs.

To reduce their carbon emissions in this decade, some of the world’s largest fleet owners are taking action by transitioning to ZETs. Their success can help identify the steps necessary to enable wider adoption of BETs.

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