TCO comparison of truck decarbonisation pathways in Europe

In the European Union, heavy-duty vehicles contribute significantly to greenhouse gas emissions from road transport, with diesel engine technology dominating the sector. Despite the European Commission's efforts to regulate emissions, diesel trucks still constitute over 95% of new sales. The Commission has proposed more stringent CO2 standards for heavy-duty vehicles (HDVs) in response to emerging alternative truck technologies. However, there is a consensus that improving diesel engine technology alone may not suffice to meet the EU's ambitious climate targets.

Alternative Truck Technologies

Several alternative truck technologies, including battery electric and hydrogen fuel-cell trucks (considered zero-emission trucks), show promise in reducing GHG emissions, especially when powered by renewable electricity. Another emerging technology is the hydrogen internal combustion engine (ICE). The proposed HDV CO2 standards set ambitious targets for tailpipe emissions reductions, emphasizing the necessity of large-scale deployment of zero-emission trucks. However, some stakeholders advocate for counting alternative fuels like synthetic diesel, hydrotreated vegetable oil, and bio-compressed natural gas toward compliance.

Source: TCO comparison of truck decarbonisation pathways in Europe | The ICCT

Total Cost of Ownership (TCO) Analysis

Recognizing the price sensitivity of commercial vehicle consumers, this study focuses on the TCO as a crucial factor influencing the adoption of alternative technologies. Building on previous research, the analysis extends to cover various truck classes, considers additional alternative technologies and fuels, and projects the analysis until 2040. The study also updates fuel and energy costs to reflect changes between 2020 and 2023.

Source: TCO comparison of truck decarbonisation pathways in Europe | The ICCT

Key Findings

Battery Electric Powertrains:

   – Expected to be the most cost-effective technology before 2030.

   – Already at TCO parity with diesel counterparts for medium- and light-duty urban trucks.

   – TCO parity with heavy-duty long-haul trucks anticipated between 2025 and 2026.

   – Potential for cost-effective solutions even for challenging long-haul cross-border applications before 2030, contingent on a high-power MW public charging infrastructure.

Hydrogen Fuel-Cell Powertrains:

   – Projected to become cost-competitive with diesel trucks by 2035.

   – Anticipated TCO parity with diesel for medium- and light-duty urban trucks by 2030.

   – Unlikely to match economic performance of diesel trucks in long-haul segment before 2035.

   – Long-term TCO 10% to 20% higher than battery electric trucks.

Conventional Trucks with Alternative Fuels:

   – HVO, e-diesel, and bio-CNG not expected to reach TCO parity with diesel before 2040.

   – TCO 15% to 45% higher than zero-emission counterparts by 2030, depending on truck class.

   – E-diesel and bio-CNG struggle to match TCO of zero-emission and diesel trucks in the long term.

   – Trucks running on 100% HVO may record better TCO than e-diesel and bio-CNG by 2030, but still 20% to 30% more expensive than battery electric trucks.

Hydrogen Combustion Trucks:

   – Unable to match economic performance of zero-emission or diesel counterparts.

   – Expected to record better TCO than conventional trucks powered by e-diesel and bio-CNG in the long term.

   – 25% to 45% more expensive than battery electric trucks by 2040, driven by the price of green hydrogen fuel and higher fuel consumption.

   – Economic performance surpasses conventional trucks powered by e-diesel and bio-CNG, with up to 15% lower TCO for long-haul trucks.

Source: TCO comparison of truck decarbonisation pathways in Europe | The ICCT

Conclusion

The study provides a comprehensive TCO analysis for various truck classes and powertrain technologies in Europe. The findings underscore the cost-effectiveness of battery electric powertrains in the short term, with hydrogen fuel-cell technologies becoming competitive by 2035. Conventional trucks using alternative fuels face challenges in reaching TCO parity, while hydrogen combustion trucks, though more expensive than battery electric counterparts, may outperform conventional trucks using certain fuels. The results offer valuable insights for policymakers and industry stakeholders as they navigate the transition to more sustainable heavy-duty vehicles.

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