Setting the File Straight on the ICCT’s Trucking Price Evaluation

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Editor’s word: Within the curiosity of open debate, we’re publishing the article beneath from the ICCT. That is a part of a debate the ICCT is having with Michael Barnard. You’ll be able to learn Michael’s articles on the subject right here, right here, right here, and right here.

By Felipe Rodríguez, Director Heavy-Responsibility Automobiles on the ICCT

There’s been loads of curiosity within the ICCT’s examine on the entire value of possession (TCO) for the subsequent technology of European vehicles. Our evaluation concluded that battery electrical vehicles are all the time essentially the most value efficient (in comparison with some other truck know-how) in any situation we checked out. The ICCT stands by the methodological rigor of our examine. Sadly, a number of misinterpretations are swirling within the present dialog. Particularly, there’s confusion round electrical energy prices and charging costs, across the impression of the kind of client on electrical energy prices, and round our use of Energy Buy Agreements (PPAs) to estimate the price of producing inexperienced hydrogen. This submit clarifies that confusion.

Charging value vs electrical energy value

First, charging value is what truckers see after they cost their battery-electric truck; it’s extra than simply uncooked electrical energy value. Charging costs are set by Charging Level Operators to get well capital expenditures associated to charging infrastructure and grid upgrades, to cowl the working expenditures (a considerable a part of which is electrical energy consumption), and to offer a revenue margin. They’re influenced by the anticipated low utilization charges of charging hubs, notably within the early phases of market adoption, which provides to the general prices.

It’s additionally necessary to notice that gasoline cell vehicles are a lot much less environment friendly than battery electrical vehicles. A protracted-haul battery electrical truck in 2030 will go about 2.7 instances additional on one unit of electrical energy than a gasoline cell truck. Due to this fact, one would possibly anticipate the price of working a gasoline cell truck to be a minimum of 2.7 instances greater than its battery-electric equal. Nonetheless, as a result of variations in electrical energy prices, and contemplating the infrastructure value and utilization of charging and hydrogen refueling stations, we discovered that the power prices had been solely about 2.2 instances greater. These nuances are defined additional beneath.

Electrical energy prices differ by client kind

Electrical energy prices have three important elements: power cost, demand cost, and stuck cost. Including taxes and levies generates the electrical energy value customers see. Our evaluation utilized a constant framework for grid charges and taxes to each inexperienced hydrogen manufacturing and battery-electric truck charging. Regardless of this uniformity, important variations emerge in demand charges as a result of contrasting load profiles. The inexperienced hydrogen manufacturing in our mannequin is characterised by a gentle 1 MW load, whereas the battery-electric truck charging hub we analyzed, with its nameplate capability of 20 MW, operates with the next and extra variable load. This disparity impacts demand charges and the general value construction. Furthermore, as highlighted in Eurostat knowledge, electrical energy costs considerably range by client band (e.g., between a small depot and a big charging hub), relying on annual client consumption. These components end in barely completely different electrical energy prices for inexperienced hydrogen manufacturing in comparison with these for truck charging hubs.

Inexperienced hydrogen manufacturing PPAs

Our inexperienced hydrogen manufacturing mannequin assumes producers use PPAs to show the usage of renewable electrical energy, according to EU necessities. Basically, we can’t mannequin grid-average electrical energy for these electrolyzers; it comes with the danger that the hydrogen produced wouldn’t be low carbon. Due to this fact, we assumed that the producers’ electrical energy value is the sum of the levelized value of electrical energy, grid charges, and taxes, to characterize the underlying value of renewable electrical energy plus supply prices. The ICCT’s assumed PPA value is according to knowledge on EU PPA costs, although we additionally included grid charges and taxes.

We’re persevering with to work to refine PPA value estimates, notably with new inexperienced hydrogen guidelines in Europe mandating “additionality.” EU hydrogen producers should quickly align new, extra renewable electrical energy use with manufacturing hourly, although the price impression of that is unclear. They could adapt to renewable power’s variability by decreasing capability or including secure electrical energy sources. Researchers are assessing potential value implications; we’re engaged on their integration into future value fashions.

Nonetheless, our examine features a vary of eventualities that fluctuate by a number of parameters. The price of power is only one of them. For inexperienced hydrogen, our central situation constantly falls inside the dearer vary famous within the scientific literature from authoritative sources resembling Argonne Nationwide Laboratory and the Nationwide Renewable Vitality Know-how Laboratory. The central 2030 and 2040 hydrogen manufacturing prices on this examine (unbiased of refueling station value) fall on the higher vary of manufacturing value estimates from Concawe, DNV GL, IRENA, and BloombergNEF. The ICCT’s method is according to most hydrogen value analyses.

Nonetheless, given the curiosity in our examine, we’re working to develop our evaluation to incorporate a further situation to mannequin a PPA for the MW charging hub and the smaller truck depots. This situation will discover the implications of utilizing a PPA for battery-electric truck charging, probably resulting in decrease electrical energy prices than these projected in our central situation.

Conclusion

We stand by our work. These subjects are complicated, notably when forecasting and evaluating completely different power pathways with distinct traits and necessities. However our dedication on the ICCT is evident: to offer rigorous, unbiased, unbiased analysis that informs policymakers. To that finish, we welcome continued dialogue.