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Directions to a decarbonised world

Electrification blurs the boundaries between two historically separate industries: energy and transport. The transition to electric mobility gives us the opportunity to rethink and redesign the mobility system to improve sustainability and access for all socio-economic spectrums worldwide. The introduction of the electric bus fleet in Santiago de Chile, for example, was driven by the city’s desire to make its entire transportation system more efficient and improve service quality and accessibility for all segments of the population. On the industrial side, Volkswagen has set itself one of the most ambitious e-offensives,planning to launch up to 75 pure e-models to the market by 2029 and to sell more than 1.5 million EVs per year worldwide by 2025.

While transport contributes more than 23% of global emissions, individual solutions are only one part of the electrification puzzle. The greater mix of the two industrial sectors means that energy players as decision-makers are an additionally important piece of the puzzle of future mobility. This requires close cooperation and coordination between energy companies, vehicle manufacturers, providers of charging technology, and municipalities, among other players.

There’s no doubt that electrification is a must on the road to a decarbonised world.

Effects on the environment and clean power

Looking at the environmental balance, electrification has many advantages. Electric vehicles reduce the emission of greenhouse gases, thus contributing to a positive effect on local air pollution. The magnitude of the effect depends on the electricity mix used to charge the vehicle. The greener the energy mix in our electrical lines, the greater the environmental benefit. In addition, the low operating noise and operating heat from electric vehicles on the road, increases the general quality of life in cities and communities. 

Another exciting approach is to use electric vehicles to absorb excess energy in the power grid. This is because charging can be made relatively flexible, which can help to improve the cost-effectiveness of renewable energies. In this way, we can create a virtuous circle in which EVs charge with more renewable energy than fossil fuels, thereby increasing the demand for renewable energy, which in turn becomes even more affordable.

Challenges for electric mobility

Experts expect that in five to 10 years, the purchase of a single electric vehicle could be cheaper than buying a vehicle with a combustion engine. The costs of using these vehicles are already lower today due to the lower maintenance requirements and cheaper fuel and advances in battery and accumulator technology have made it possible to significantly increase the range. But without a suitable charging infrastructure, including customer-friendly and simple payment systems, EVs will have a hard time making their mark.

At the same time, countries also need to ensure there will be sufficient electricity production based on renewable energies nationwide to handle the infrastructure. This means conditions for solar and wind energy must be designed in such a way that they compensate for the loss of electricity production via fossil fuels and exceed this in the long term.

Mobility change in companies

On average, it takes about five to 10 years to convert a fleet, which means that its achievable that many companies can transition to  greener mobility systems within this decade. However, many electrification projects for corporate fleets do not take into account the complexity of installing an optimised and efficient charging infrastructure. There have been cases where fleet managers have ordered vehicles and charging stations but have not effectively planned how the charging stations are to be installed, for example. The electrical infrastructure must be carefully considered in its own right to facilitate the proper development of charging systems.

Regardless of the technical challenges, fleet managers must also think about electrification in a transformative way. It is not about a one-to-one shift from one vehicle technology to another. Rather, it is about changing behaviour, rationalising fleets, and engaging employees. A holistic approach is the key to a successful and profitable transition to a CO2-free mobility strategy.

Good preconditions, much uncertainty 

The challenges for electrification are enormous on both the municipal and the corporate side but with vehicle technologies continuously improving, there is huge potential for electrification in the near future. While electric cars are advancing rapidly, it is necessary to achieve higher performance in all vehicle categories – especially in the van and truck segments. Fleet managers, self-employed driver, and cities need flexibility so that they have wider options for vehicles that can perform a certain task.

The green transformation of the electricity market is progressing and now is the time to make use of the good conditions already created and to push ahead with the sustainability transformation in a concentrated manner. To achieve this, the transport and electricity industries must work closely together and public authorities must create the framework conditions for an accelerated transition.

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Written By

Mathias leads ENGIE Impact’s vision to accelerate the sustainability transformation for corporations, cities and governments around the world. A strategic leader with more than a decade of global experience in both the private and public sectors, his experience and understanding of energy and sustainability supports ENGIE Impact’s work to help clients improve their bottom lines, drive growth, satisfy stakeholders and make a positive impact on the environment. Mathias relocated from France to the U.S. in 2017 to join ENGIE Impact as President and CEO. Prior to that, Mathias worked for its parent company, ENGIE, as the head of its Green Mobility Program, where he harnessed ENGIE’s broad capabilities to expand the business unit’s reach around the world for the $400+ million enterprise. He also served as chief of staff for Isabelle Kocher, ENGIE’s CEO, where he was heavily involved in strategy, communication and overall transformation of the company. Mathias is trained as an engineer from the Ecole des Mines de Paris. He has completed his education with a post-graduate programme from the Ecole des Mines de Paris, to become a civil servant from Corps des Mines. Mathias is based in ENGIE Impact’s New York City headquarters.

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