SCANIA’S ELECTRIFICATION JOURNEY
2020 saw the launch of Scania’s first fully electric truck. As we celebrate this milestone we reflect on where we are in our electrification journey, and consider the opportunities and challenges ahead.
Electrification: the key to sustainable transport
Making transport sustainable depends on many tools and technologies. At Scania, our sustainable transport solutions range from biofuels to energy-efficient powertrains. Many of these tools are complementary, and each has an important part to play in the transition. However, of all of these technologies, none will have a greater long-term impact than electrification.
BEVs offer major environmental benefits compared with petrol and diesel vehicles. They produce no tailpipe emissions of harmful air pollutants such as NOx and particles. They also significantly reduce traffic noise. As well as having a positive impact on health and wellbeing, the quietness of electric machines also makes it possible for trucks to operate in cities at night, for safer, faster, and more efficient deliveries.
But perhaps the single biggest benefit of BEVs is their contribution to decarbonisation. A sustainable world depends on fossil-free transport – and realising this aim is a cornerstone of our strategy. We have committed to science-based targets to reduce our carbon footprint across our value chain, in line with the goals of the Paris Agreement. Tailpipe zero-emission vehicles are key to reaching our targets, and battery-electric solutions will be the first such technology to reach the market.
Of course, when measuring the climate footprint of an electric vehicle, tailpipe emissions tell only part of the story. For an accurate picture, we need to consider well-to-wheel emissions, in particular the carbon impact of producing the electricity that powers the battery. But even with the current electricity mix in Europe, which is still sourced from coal-fired power stations, BEVs offer clear carbon reduction benefits – and these will increase as the shift to renewable energy accelerates.
Buses, trucks, e-machines
Our own electrification journey is gathering pace. In September 2020 we took a major step forward, with the launch of our first commercially available, fully electric truck, together with a high-performance hybrid truck. The truck launch followed last year’s launch of our fully electric Citywide bus, offering speedy in-route charging and a battery capacity capable of covering most city routes. At the same time we are developing e-machines for other applications, and recently launched an electrified power systems concept for motorised heavy equipment.
We waited for the right time to do this. Battery performance, charging infrastructure, and cost issues have improved to the point where BEVs are now a viable solution for commercial transport providers. Charging time, charging cycles and economics per kg are improving rapidly. This means these solutions will become more cost effective, primarily in repetitive and predictable applications. As a result, the number and range of commercially available BEVs will increase rapidly over the next few years. We are committed to launching at least one new electrified solution every year from now on. By 2025, Scania expects that electrified vehicles will account for around 10 percent of our total vehicle sales volumes in Europe and by 2030, 50 percent of our total vehicle sales volumes are expected to be electrified.
Currently, Scania’s BEVs are focused on urban applications. However, advances in battery technology will soon make long-haul, heavy transport solutions possible. In a few years, we will introduce long-distance electric trucks capable of carrying a total weight of 40 tons for 4.5 hours, and fast-charge during the drivers’ compulsory 45-minute rest periods.
Investing in batteries
As production of BEVs ramps up, so will demand for batteries. To prepare for our electrified future, we are making major investments in battery production, testing, and deployment, to secure durability and safety, building on the flexibility of the modular system.
In 2020, we invested in a new battery laboratory at our research and development facility in Södertälje, Sweden. Expected to be up and running by autumn 2021, the 1,000 square metre lab will focus on testing battery cells, modules, and packs. Over the next few years, we will also invest well over 1 billion SEK in a battery assembly plant at our Södertälje production site. Construction will begin in early 2021, with the aim to be fully operational by 2023. For electrified transport to be truly sustainable, the industry needs sustainable batteries. Scania is working in partnership with battery specialist Northvolt to develop battery cell technology for heavy commercial vehicles. Northvolt was founded on a mission to build the world’s greenest battery cell, with a minimal carbon footprint and the highest ambitions for recycling.
Neither Scania nor the wider automotive industry can achieve this transition by ourselves. We need cooperation with other parts of industry and society to make it happen.
Great vehicles are crucial, but we also need a reliable, sustainable energy infrastructure to power them. To enable this, major investments are required to upgrade the current electricity grid infrastructure, and to shift to renewable energy sources to supply the grid.
Heavy vehicles have different charging requirements than passenger cars, and the transition demands a mega-charger infrastructure where trucks can recharge quickly in depots and along the roads. This could be combined with electric highway solutions, allowing vehicles on the busiest routes to charge on the move using overhead power lines. Scania is currently trialing this solution in Germany and Italy, in partnership with regional public authorities.
For our customers, finding the right charging solution can be a complex challenge. In 2020, we joined forces with the global energy group ENGIE and their subsidiary EVBox Group to provide a complete depot charging solution to transport providers in 13 European countries. The solution encompasses energy supply, charging hardware and software as well as installation, maintenance, and other related services adapted to customer’s specific needs.
Putting a price on carbon
Aside from infrastructure, the total cost of ownership is another key factor in achieving the transition. Switching to electric has to make good economic sense for transport customers – and that means ensuring at least parity between the total cost of operating a battery electric vehicle compared to a diesel-powered alternative.
The good news is that BEVs are decreasing in price, as batteries grow cheaper and more efficient. But to accelerate the transition and boost customer demand for greener vehicles, we also need to increase the cost of emitting CO2. Through multi-stakeholder partnerships such as the Pathways Coalition, we take an active role in advocating for an emissions trading system for road transport fuels, as well as road charges and energy taxation based on carbon emissions.
New challenges, new opportunities
Electric transport will bring huge sustainability advantages, but it can also create new challenges. For example, mining for the minerals used to make batteries often takes place in areas of the world experiencing conflict, and carries human rights and environmental risks. There are also questions about how to deal with used parts and materials at the end of the battery’s life.
As part of our commitment to responsible sourcing, we have contributed to a number of industry-wide risk assessments to create more transparency about battery raw materials in automotive supply chains. Based on the findings of these assessments, we have created a due diligence management system approach on high-risk raw materials, together with the Volkswagen Group. To create a more circular business for batteries, we are also exploring opportunities to reuse and resell batteries and battery components after their first use.
As electrification transforms the transport business, the disruption is bringing a lot of uncertainty. Who will own the vehicles? How will charging solutions and batteries fit into our business offering – and what does that mean for our overall business model? Scania is working with our customers to find answers to these and many other questions. For the time being, one thing is certain. The future of electrified heavy transport is an exciting place. And Scania will be at the forefront of it.
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