Electrification is a trend transforming every significant corner of the industrial economy in the U.S. From power generation and transport to infrastructure and buildings, industry and businesses are seeking to become more efficient and resilient while producing fewer emissions. Policies and regulations driving this transformation are emerging at the state, local, and utility levels as well as from corporate commitments. Meanwhile, the technologies underpinning electrification are widely available and increasingly affordable.
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Electrifying transportation
Nowhere is the electrification trend more visible than in transportation. With Tesla’s stock reaching new highs on the NASDAQ and a new electric vehicle startup seemingly launching every day, it’s easy to forget that there are other segments of the transportation sector that are electrifying even faster than consumer vehicles. It’s electric trucks, buses, and light commercial vehicles that seem poised to break into the mainstream first. School districts and utilities are teaming up to deliver fleets of electric school buses and fleet managers and manufacturers are partnering to deliver thousands of electric vehicles to all types of fleets. Unlike renewable energy, however, electric vehicles have yet to reach cost parity with their traditional rivals and still rely on government policies and regulations. That said, total cost of ownership (TCO) is beginning to look more desirable than ever, and parity is finally on the horizon.
Again, California is leading the way in terms of emissions policies targeting the transportation sector. In the summer of 2020, the state adopted regulations that seek to drive emissions from light and heavy-duty trucks. By 2035, 55% of pickups and delivery vans, 75% of garbage trucks and buses, and 40% of big rigs sold in California must be zero emissions vehicles. This summer, 15 states, including California, announced a memorandum of understanding calling for 30% of new trucks and buses to be zero-emission by 2030 and 100% by 2050. While this MOU is not binding, it does send a strong message of support as these 15 states account for 50% of the U.S. economy and 40% of the goods moved by value.
With regulations beginning to drive electric vehicle adoption in various industries, no one EV technology is likely to fit every application. While batteries are a good fit for consumer and light commercial vehicles that travel relatively short distances, the size, weight, and cost of the batteries necessary to power tractor trailers on long trips is likely prohibitive. In these applications, hydrogen fuel cells may prove to be a more effective technology.
Reducing emissions on the water
One market electrifying faster than the regulations is the marine segment. While diesel emissions standards exist and can force some older vessels to install costly scrubbers to remove excess sulfur from their emissions, this market has not seen the same type of regulatory scrutiny as others. And it’s not difficult to foresee a future in which places like California treat marine vessels much like it’s currently treating trucks. Increasingly, ship operators and builders are seeing the need to lower emissions and operating costs, which is driving a shift from diesel engines to hybrid-electric technology.
Yet, moving away from diesel completely can be expensive and inefficient. Liquified natural gas (LNG) can be used as a lower-emissions alternative in newly built ships but it is not as energy dense as diesel — and converting existing ships to LNG can be cost prohibitive. However, marine hybrid power offers a better, more achievable solution. Hybrid power refers to either true hybrid propulsion or diesel-electric propulsion. In true hybrid propulsion, electric motors, combined with battery storage, are installed to supplement the existing diesel engine. The electric motors kick in to propel the ship when it is entering or exiting port, allowing the diesel engine to operate only at its most efficient cruising speeds. Diesel-electric propulsion, on the other hand, is when a diesel generator powers electric motors as the main source of propulsion. Battery storage can also be utilized so the diesel generator does not need to run at all times, leading to even more emissions reductions. In either setup, hybrid power allows the diesel engine or generator to run at its most efficient level, lowering emissions and operating costs.
Looking ahead
Electrification is not a waning trend. Rather, it’s one that’s gaining momentum and reaching deeper into the U.S. and global economies — a game-changer that’s disrupting, or poised to disrupt, large sectors like transport and buildings. As regulatory and corporate conversations accelerate toward addressing climate concerns and the urgent need to reduce carbon emissions, it’s increasingly critical to follow the various policies and regulations driving this trend as well as the technologies reinforcing it.
