Fleet benefit guide to EV vs. Hybrid in the switch to low/zero emission mobility
Battery Electric Vehicles (BEV) vs. Plug-in Hybrid Electric Vehicles (PHEV)
Do PHEV’s have a place in your fleet?
By Alex Baker, CEO CleanCar.io
If you check out the sales of “Electric Vehicles” (at the time of writing), the Mitsubishi Outlander is way out in front for Sales.
This PHEV claims on its website: Save up to £10,000 in Company Car Tax, With just 41g/km CO2, the Outlander PHEV is only 13% BIK, saving you thousands, Official fuel economy: 156.9mpg (EU Combined).
On the face of it, how could you say no? As a company car driver with access to this vehicle you will save a fortune on BIK company car tax and the company will save a fortune with such amazing MPG, it will never need fuel. The problem is this picture is unrealistic for many company car drivers.
Things you need to consider with PHEV such as Mitsubishi Outlander (many others are Available):
- You are unlikely to ever see MPG close to the officially claimed figures unless you fit into a very small sweet spot where you will benefit mainly from the battery part of the vehicle.
- A PHEV is suitable for just about anyone, i.e. it’s going to be practical to use, however the sweet spot range to see savings is much narrower. The driver needs to be regularly benefitting from the battery only range with the occasional long trip. Not your typical company car essential user, but maybe a perk user.
- A PHEV is often a heavy car; after all, it has an engine, a motor and a load of batteries. If you are not using it efficiently, i.e. only doing lots of motorway driving, then you are carrying around a lot of extra weight. Many drivers who are not using the car properly will see MPG at around 20% of the claimed MPG rate at best.
- If the car is not being used properly and as a fleet, you are paying for the fuel, it could end up being much more expensive than an equivalent petrol or diesel.
- Many drivers love the PHEV because of the reduced BIK, this will change and while they will benefit, you, as a company, will often find that costs increase.
- Some companies we have come across have drivers who ordered a PHEV and never installed a charger thereby gaining a pure BIK advantage, but no cost-benefit from reduced fuel usage.
- The second hand value may well be the sting in the tail with these PHEV’s as given the BIK tax break as the main ‘buy decision’ often means that the electric powertrain has not been properly used and the (smaller) ICE engine consequently over used. This is resulting in poor resale condition vehicles with a disappointing residual value that have a negative impact on balance sheet asset values and will inevitably influence higher Fleet lease and finance costs!
In a nutshell: PHEV are great for many people such as those who do a 20-mile commute most days and the occasional long trip (not the only example), but for many traditional company car drivers, they are the wrong choice, and a low CO2 Petrol or Diesel may be a far better choice. So you need to think carefully about who chooses them and why to get a truly accurate cost benefit picture.
Fleets need to look for potential pockets of Pure EV usage – such as a department or team who have the right ‘sweet spot’ profile.
As an avid fly fisherman, I sometimes spend hours on a boat in an Irish Lough and can catch very little, but then we come across a spot where the fishing is great, we catch every other cast, and the sense of fun is restored. My father in law and I like to call these chocolate spots.
To expand on this analogy only slightly more, go where the fishing is good.
Right now for most fleets in the UK, the available vehicle range and technology means a switch to EV is unlikely for your whole fleet but that does not mean you won’t have pockets of vehicles that are perfect for this switch.
A very good real life example is BAE systems who were looking for opportunities to switch and save money so they looked at their naval base in Portsmouth where 50 – 60 vehicles seemed to fit the vehicle usage profiles that would be ideal to switch to EV’s. Seer this link for the detailed case study xxxxx
So have a think about your own fleet; do you have any of the following?
- A regional or geographical sales/service/maintenance team within a defined area
- A specific project or customer (NHS Hospital, Local Council) that require a local presence.
- Any of the above that have a regular long trip but are mostly location specific
- PERK drivers who take a company car but spend five days a week in the office, just a stone throw from their home.
What behaviours need changing to make the usage profile ‘fit’ to switch?
Often when working with fleets in trying to find this ideal profile of drivers, we come across certain behaviours that make an EV impractical. Examples are:
- The driver has to attend a monthly sales meeting at the head office 200 miles away.
- The driver has to deliver something occasionally to a customer 150 miles away
Often these events occur only once a month and affect only a few members of the team, but it’s worth thinking what behaviours could be changed to address these events that impact the switch decision.
- Challenge why everyone has to attend a monthly meeting at HQ, could there be a monthly meeting via video conferencing and a quarterly meeting somewhere that’s easily accessible via train
- If most of the users are on one site, would it be a possibility to retain a pool van/car that can be used for the occasional long trip, especially if the savings are significant even with the addition of a pool vehicle?
Requirements for ChargePoints at Office and at Home
I have heard Charge Point manufacturers say that every person who uses an EV needs 2.3 ChargePoints. One at Home, one in the office and some public charging in between…but of course, they would say that they are trying to sell ChargePoints after all!
Ion this basis then I use about 1.2 ChargePoints for my Nissan Leaf; mostly charging at home and the occasional public charge.
I know some businesses that use 0.5 chargers per vehicle, i.e. they have a bank of chargers at the office or depot, where vehicles charge when they need to operate two vehicles per charge point.
Each instance is different, and your requirements will be unique. However I think in the short term it’s better to be conservative and robust in your requirements.
- Be Conservative: By this I mean don’t push the boundaries too far and look for the easy wins. I would recommend switching drivers to EV who at most require the vehicle to be charged at home or office no more than each night (or day if night shifts). I would not recommend looking for the drivers who need to charge 2 or three times per day to make an EV work. The technology is improving and very soon those drivers will fall into the once a day charging profile. So focus on the easy wins and keep an eye on the changing technologies and reassess every few months.
- Be Robust: Through our analysis, we often help fleets to understand how many ChargePoints they will require for the EV’s they intend to buy or lease. If for example, our analysis shows they require a minimum of 24 x 7kw for their 50 Electric vans, we would always recommend they go a little higher and plump for say 27 chargers. The cost impact is minimal to the overall cost benefits and it improves the user experience and caters for the occasional high use periods.
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NOTE: Just because we recommend 27 ChargePoints it does not mean it is always possible. The ChargePoint installers will need to check the site first and check it has the grid capacity to operate this number of ChargePoints or outline the works required to bring it up to this capacity and capability.
- Improvements in public charging network, however still cannot be relied upon.
Often when we speak to fleets, we get questioned about utilising the public charging network as the sole and only way of charging. If this is something you are considering, I would strongly urge you to think again.
As an EV driver, I love the public charging networks, there are some favourites I like to use when I park in the city, and the fast chargers at the services have been a godsend over the years.
Note on home charging:
It’s important to check that your employee has a home suited to a charge point. Otherwise there may not be the option to install one. Things to consider:
- Does the employee own their home?
- Do they have approval from a landlord to fit a charger?
- Is their home in a suitable location, i.e. is it a 3-story flat or a terraced house?
- Are they in temporary accommodation or about to move to a new house?
- Are there any restrictions such as being listed or in a conservation area?
- Is there off street parking and suitable location for a charge point install?
- Is there any other reason why a home charger is not an option?
- Also, if they stop being your employee, or move house you should be clear in what happens to the charge point. If you are insisting on recovering your kit then this could cause problems with a house move and surveyor reports etc.
The issues with range vs. range anxiety.
It’s a funny thing when you first drive an EV, as there is no doubt that you, like most people, will get range anxiety. You will see 20 miles of range left, which, if in a petrol or diesel car, would bring you out in a cold scary sweat. But, you just kind of get used to it and to be honest these days I only start to worry if I hit 7 miles or less.
Let’s not underestimate the impact though, as diesel car today will do 500 miles on a full tank yet an EV will do maybe around 100 and this difference takes some getting used to. That’s why we use the CleanCar process with our customers (more below), so we can understand how someone really uses a vehicle and what their journey profile actually means when it comes to range requirements. We can then explain and display this accurate usage profile to them in a simple to understand way and prove that an EV works for their specific usage requirements.
Range Anxiety in many respects is like learning to drive. You start out, and you must think about everything such as changing gear, using the pedals, the indicators etc., but before long its normal and you don’t even think about it. Range anxiety is something you can’t avoid, you just have to get on with it but it soon disappears, especially with planning, knowledge and experience.
In the future, range anxiety will be a forgotten phrase, a bit like the noise of a phone modem connecting; you had to be there for the very short time when it mattered. https://www.youtube.com/watch?v=gsNaR6FRuO0
Experts in the EV sector may pick up on my use of terminology in this guide; I make no excuses for sometimes not using the correct terminology. The Electric Vehicle space is confusing enough without the use of dozens of acronyms that only an ‘EV industry stalwart’ understands. But I have designed this guide for those individuals who have direct and indirect responsibility for making decisions about Fleet vehicle procurement and logistical management. So this guide is designed with those roles in mind and a belief that the information, guidance and advice should be presented in a straightforward and helpful format. Hence I have tried to avoid the jargon but you can find links at the bottom of this guide to some very useful glossaries for clarity around industry buzz words.