A new report offers recommendations of what is needed to convert Australia’s diesel truck fleet to electric to help the nation achieve net-zero emissions by 2050, writes Gavin Dennett.

Trucks are the lifeblood of freight in Australia. As the nation moves towards its goal of net-zero emissions by 2050, increasing focus is placed on its national transport fleet. With transport accounting for 19 per cent of Australia’s carbon emissions, and 38 per cent of that coming from road freight, pressure is mounting on the industry to make the shift to electric trucks.

Australian financial broker firm Savvy has released a report on the national transport fleet, utilising data from the Electric Vehicle Council and the Australian Trucking Association (ATA). It has compiled its findings to make recommendations on what action Australia should be taking in the next two decades to convert its national diesel road transport fleet to fully electric vehicles.

One of the significant recommendations from the report, “The State of Electric Trucks in Australia”, is that Australia should be aiming for 30 per cent of its national truck fleet sales being electric by 2030, and 100 per cent by 2040.

“If you’ve been stuck behind a diesel-powered truck on a highway, you’ll know they’re slow to accelerate, they’re loud, and they pump out massive amounts of fumes,” says Savvy founder and automotive finance expert Bill Tsouvalas. “These may sound like minor gripes when commuting, but they have wider implications for Australia.

“Our report shows the current state of electric trucks in Australia, what economic opportunities abound, the current policies hampering their take-up, what the costs are, and what we as consumers and government stakeholders can do about it.

“Trucks consume 23 per cent of all road transport fuel in Australia despite only travelling eight per cent of all road vehicle kilometres, and comprising four per cent of the entire Australian road vehicle fleet.”

Australia has a fleet of ageing trucks – about 500,000 rigid trucks and 100,000 articulated trucks – with their average age being between 10 and 15 years. Compare that to European countries, with the average age in France being 9.3 years, in Germany it is 9.5 years, and Austria is 6.4 years.

“Widespread adoption of electric trucks could reduce air pollution and associated health concerns; encourage sustainable transport solutions; reduce transport costs; reduce the cost of goods for consumers and businesses; ensure our energy security; and contribute to our national commitment to net-zero carbon emissions,” says Tsouvalas.

“Rigid trucks are smaller and carry less freight. They should be first to transition towards electrification due to urban-specific needs.”

Small or family-owned businesses comprise almost 98 per cent of all trucking operations in Australia, with only 0.5 per cent of all operators using more than 100 trucks in their fleet. Seventy per cent of small operators only have one truck.

Diesel fuel is the most significant cost for a trucking operator, representing on average 20 per cent of short-haul operator costs, and 35 per cent of long-haul operator costs. However, while electric trucks are more efficient to run, this is somewhat counteracted by the fact they can cost up to $200,000 more to purchase.

“There is a need for Australia to invest in the transition away from diesel-powered road freight transport towards electric, but the issue is how much it’s going to cost and where the finance is going to come from,” says Tsouvalas.

“Before regular operators who own just one truck make the shift, they are going to have to be fully confident it makes financial sense.

“Electric trucks have upsides in fleet efficiency because they are quieter, meaning they can be used later at night and avoid urban truck curfews designed to curb noise pollution. Combining all the environmental and health benefits, it’s estimated the electrification of both articulated and rigid trucks could save the Australian consumer $324.8 billion by 2050.”

“Australia must invest in the transition away from diesel-powered road freight transport towards electric,” says Bill Tsouvalas from Australian financial broker firm Savvy. Photo: Supplied.

With current import restrictions in place on oil products from Russia due to the ongoing conflict in Ukraine, diesel prices have climbed around 35 per cent from an average of $1.63 in December 2021 to $2.21 in April 2022. Electric trucks offer immunity from global fluctuations influencing diesel costs, while the reduction of vehicular moving parts means cost reductions in maintenance.

“Looking at a 22-tonne truck covering 300km without freight, the cost in diesel at current prices would arrive at $189.61,” says Tsouvalas. “In comparison, the cost of powering an electric truck would be between $14 and $42, based on off-peak tariffs for a depot-based fleet. This represents an incredible saving of 77.8 per cent.”

According to the ATA, only 14 out of the 58 available truck models currently available in North America, China and Europe can be used in the Australian market due to government policies that restrict importation and use of trucks due to steer axle mass and width.

The ATA says the Federal Government should provide a one-tonne concession for electric trucks, taking battery weight into consideration. It also says truck widths should be increased to align with the standard used by major supplier economies. Additionally, the ATA states electric trucks should be exempt from urban curfews.

“Other policies that raise the barrier of entry into electric trucks are high stamp duty prices, which should be made exempt for electric or zero-emission trucks; a lack of incentive payments to reduce costs of public and private charging infrastructure; and no incentives to reduce the upfront purchase price of electric or zero-emission trucks,” says Tsouvalas. “Currently, the upfront purchase price of an electric truck is almost double its diesel equivalent.

“Government policy must also support the infrastructure around electric trucks. Australia is unique in how far apart our urban areas are, and electric charging stations would need to be installed at key destinations, hubs and stops. The Janus Electric truck conversion has the longest range of any available truck in the Australian market at 400km to 500km.”

Tsouvalas also believes a government purchase price incentive is required to equip small transport fleet operators for the transition to electric trucks.

“California has provided 7500 Hybrid and Zero Emission Truck and Bus Vouchers worth US$120,000 to purchase zero-emission vehicles,” he says. “In Germany, operators receive an 80 per cent price incentive for battery, fuel cell and trolley hybrid drive systems.”