Urgent action is needed to electrify the UK’s half a million heavy-polluting HGVs if the government’s net zero transport targets are to be met, according to a report from the Green Finance Institute (GFI).
The report, Delivering net zero: unlocking public and private capital for zero emission trucks, is published in the same week world leaders meet at Cop28 in Dubai to stocktake global progress on reaching net zero targets.
The report points to research which shows that HGVs are among the UK’s most polluting vehicles and account for approximately a fifth of the UK’s transport emissions – equivalent to the carbon footprint of domestic and international air travel, buses and domestic shipping combined.
It argues that electrifying all HGVs would be the same as removing 12 million cars from the road and calls for operators to be provided with finance to acquire zero emission trucks (ZETs) and to speed up the roll out of electric charging infrastructure.
It outlines ten financial mechanisms needed to decarbonise the freight sector, including using utilisation linked financing (ULF) to de-risk investment in charging infrastructure, either through a loan or asset finance; shared charging infrastructure agreements so operators can pool resources; and using government or third party-backed residual value (RV) guarantees to reduce operators’ finance costs.
The report highlights organisations bucking the trend and taking advantage of electric HGVs. These include Westminster City Council, which is electrifying its refuse collection trucks; supermarket Tesco, which is deploying the UK’s first electric articulated HGVs as part of their heavy duty haulage fleet; Amazon, which launched electric HGVs in their delivery fleet for the first time last year; and Cambridge-based SME Welch Transport, which is operating its first ever electric HGV alongside a new state-of-the-art supercharger, which is available for use by other operators.
The report notes the importance of decarbonising smaller operators. It states: “Around half of the trucks in the UK are owned by small businesses, many of which lack access to the additional finance needed to transition to more expensive Zero Emission Trucks or install the necessary infrastructure – like chargepoints.”
Lauren Pamma, Green Finance Institute programme director, said: “There is a £100bn investment opportunity that we can unlock through innovative finance products, providing a massive opportunity to decarbonise the HGV sector before the government’s target of phasing out diesel trucks by 2040.”
Chris Ashley, RHA head of policy for environment and vehicles, welcomed the report. He added: “The GFI has provided a framework that allows industry to navigate and debate the investment conditions needed to deliver a sustainable Net Zero.”
Toby Poston, British Vehicle Rental and Leasing Association corporate affairs director, said operators are “crying out” for tax incentives and regulatory certainty. “For a successful HGV transition the government needs to play its part. HGV operators desperately need a technology roadmap, the longstanding issues with grid connections to be resolved, and an accessible charging network that meets the specific needs of HGV fleets,” he added.
Dr Chris Jones, Connected Places Catapult ecosystem director for integrated infrastructure, said technology must go hand in hand with policy and investment if the UK’s HGV fleet is to be successfully decarbonised. He added: “This report proposes mechanisms for driving widescale adoption of zero emission HGVs. It is essential reading for every policymaker in this space.”
