2018 Feasibility Assessment for Drayage Trucks

As required under the San Pedro Bay Ports 2017 Clean Air Action Plan (CAAP) Update, this report provides a 2018 Feasibility Assessment for Drayage Trucks, characterizing the overall feasibility of zero-emission (ZE) and near-zero emission (NZE) Class 8 trucks of various leading fuel-technology platforms to perform drayage service at the San Pedro Bay Ports. The timeline of this Assessment is 2018 to 2021.

For purposes of this Assessment, feasibility refers to the ability of alternative fuel/technology drayage trucks to provide similar or better overall performance and achievement compared to today’s baseline diesel drayage trucks when broadly used for all types of drayage service. The following five key parameters were applied to qualitatively and collectively assess overall feasibility.

• Commercial Availability
• Technical Viability
• Infrastructure Feasibility
• Availability of Infrastructure and Fuel
• Economic Workability (Key Economic Considerations and Issues)

Five core ZE or NZE fuel-technology platforms were initially screened for this Assessment:

1. ZE Battery electric or direct-grid electric
2. ZE Hydrogen fuel cell electric
3. NZE Advanced diesel internal combustion engine (ICE)
4. NZE Advanced natural gas (or propane) ICE
5. NZE Hybrid-electric (electric drive hybridized with an ICE using any fuel; may incorporate grid electricity)

Two feasibility parameters – Commercial Availability and Technical Viability – were used to initially screen these five core ZE and NZE fuel-technology platforms. Any fuel-technology platform that today meets basic considerations for these two parameters (or appears very likely to do so by 2021) was then further assessed by applying the three remaining feasibility parameters (Operational Feasibility, Infrastructure Availability, and Economic Workability).

Results and findings of this 2018 Feasibility Assessment for Drayage Trucks are summarized below. Importantly, this Assessment represents a snapshot in time and is not intended to preclude or discourage expanded development, demonstration, and deployment of ZE and NZE fuel-technology platforms that have not yet reached sufficient technological and commercial maturity to be deemed feasible.

Summary of Findings for Commercial Availability

As of late-2018, one ZE and one NZE fuel-technology platform are sold by OEMs in commercially available Class 8 trucks suitable for drayage. Specific findings are as follows:

• ZE battery-electric technology is commercially offered in one Class 8 truck model by a single company, start-up OEM BYD. This is effectively an “early commercial” launch.
• NZE natural gas ICE technology is the dominant commercially available Class 8 truck platform that utilizes either a ZE or an NZE system. All six major OEMs are offering Class 8 NZE trucks powered by the 12-liter Cummins Westport ISX12N natural gas engine.
• The other three core fuel-technology platforms that were evaluated – ZE fuel cell, NZE hybrid electric, and NZE diesel ICE platforms – did not meet the basic criteria and considerations to be deemed commercially available in late 2018, nor do they appear (at this time) to be on that path by 2021.

In summary, OEMs have significantly accelerated their efforts to develop and commercialize ZE and NZE Class 8 trucks suitable for drayage. As described in detail, early commercial and pre-commercial demonstrations are now underway that are expected to play a critical role to expedite sustainable commercialization and wide deployment of ZE and NZE drayage trucks.

Summary of Findings for Technical Viability

Along with Commercial Availability, Technical Viability is the second parameter used to screen the five core fuel-technology platforms for overall feasibility. To gauge this, Technology Readiness Level (TRL) ratings were assigned to the five core ZE and NZE platforms (late-2018 status). The table below summarizes assigned TRL ratings for 2018, as well as “educated prognoses” for how those TRL ratings will upwardly evolve by (or before) 2021.

Key findings are summarized as follows:

• Class 8 ZE battery-electric drayage trucks are currently at TRL 6 to 7 (demonstration and initial systems conditioning). The educated prognosis is they will achieve TRL 8 by or before 2021.
• Class 8 NZE natural gas trucks are rated at TRL 8 today. The educated prognosis is they will achieve TRL 9 by or before 2021.
• No other ZE or NZE fuel-technology platform–including advanced diesel ICE technology, which has yet to demonstrate NZE status – currently achieves a TRL rating above the 5-to-6 range.

Per this Assessment’s methodology, only the fuel-technology platforms shown to achieve both screening parameters (Commercial Availability and Technical Viability) were further characterized for their overall feasibility. Thus, the three remaining parameters (Operational Feasibility, Infrastructure Availability, and Economic Workability) were applied to evaluate the overall feasibility of the ZE battery-electric and NZE natural gas ICE platforms, using detailed criteria for each parameter.

Summary of Findings for Operational Feasibility

Operational feasibility analyses were performed on the two Class 8 platforms that were determined to be commercially available and technically viable (as of late-2018): ZE battery-electric and NZE natural gas ICE.

Key findings on this important parameter are summarized as follows:

• ZE battery-electric trucks outperform diesel trucks in terms of power, torque, and gradeability, but they are currently only applicable to a subset of drayage operations due to limitations on vehicle range, weight, and recharging times. Questions remain as to the adequacy of the service supply chain.
• NZE natural gas trucks are the closest direct replacement for diesel trucks in terms of operational feasibility. Basic performance metrics, range, fueling frequency and speed, driver comfort and safety, and maintenance support are generally comparable to diesel trucks. Maintenance support is expected to be scalable with increased deployments of natural gas trucks through the use of existing truck and engine dealerships.

Summary of Findings for Infrastructure Availability

Operational feasibility analyses were performed on the two Class 8 platforms that were determined to be commercially available and technically viable (as of late-2018): ZE battery-electric and NZE natural gas ICE.

With the development ZE and NZE platforms progressing quickly, infrastructure has emerged as one of the most significant near-term barriers to the wide-scale adoption of these technologies. Results of the Infrastructure Availability analysis are summarized below for the two ZE or NZE fuel-technology platforms determined to be commercially available and technically viable for Class 8 truck platforms suitable for drayage.

• ZE battery-electric truck charging infrastructure is a rapidly changing landscape. Substantial progress has been made toward standardization, but competing standards remain, and no clear winner has emerged. It appears highly unlikely, if not impossible, to develop the full charging infrastructure needed by 2021, even if public access charging strategies and clarity on charging standards were resolved and no longer barriers to deployment.
• NZE natural gas trucks rely on well-known and proven fueling infrastructure currently in use in many heavy-duty vehicle applications. Still, the ability to build the required infrastructure at the pace needed to fully support the drayage fleet by 2021 remains in doubt.

Summary of Findings for Economic Workability

Operational feasibility analyses were performed on the two Class 8 platforms that were determined to be commercially available and technically viable (as of late-2018): ZE battery-electric and NZE natural gas ICE.

The drayage truck sector is generally a low-margin, low-asset base sector. Fuel-technology platforms are needed that can provide a cost of ownership similar to, or better than, baseline diesel ICE trucks. Results of the economic workability analysis are summarized below for the two ZE or NZE fuel-technology platforms determined to be commercially available and technically viable Class 8 truck platforms suitable for drayage.

• ZE battery-electric trucks have substantially higher upfront capital costs and require significant investments in infrastructure (see Infrastructure Availability). Fuel and maintenance savings can reduce the impact of the higher capital cost, but these savings do not make the total cost of ownership comparable to diesel trucks on a net present value basis.
• NZE natural gas trucks have higher upfront capital costs but an overall cost of ownership comparable to diesel trucks.

Looking Forward

As described in this report, all of the major truck OEMs and several new market entrants are developing ZE truck platforms. Of particular importance is that at least one major Class 8 truck OEM plans to begin offering a ZE battery-electric Class 8 truck by 2021, and additional OEMs have similar timelines. Examples of announcements by major Class 8 truck OEMs regarding ZE battery-electric truck offerings in the 2021 timeframe (and beyond) include the following:

• Daimler Trucks reportedly plans to enter into full-scale production of its Class 8 BE e-Cascadia truck by 2021.
• Navistar has announced its intention to commercialize and sell large numbers of battery-electric Class 8 trucks by 2025, although Navistar has not yet provided vehicle specifications.
• Volvo intends to sell battery-electric heavy-duty trucks in North America after an initial (2019) launch in Europe. (Note: at the time this report was being published, Volvo had just announced its intention to commercialize a battery-electric version of its VNR Class 8 truck in 2020.)
• Tesla has announced plans to commercialize a high-performance, long-range battery-electric tractor that – if able to achieve the claimed performance and cost metrics – could fundamentally improve the broad feasibility of ZE battery-electric platforms in drayage.

Similarly, strong progress is being made to build, test, and eventually, mass-manufacture Class 8 trucks powered by ZE hydrogen fuel cell systems. These include the following efforts:

• Start-up OEM Nikola Motors is testing two different hydrogen fuel cell tractor models and has received thousands of preliminary produce reservations from major Class 8 trucking fleets.
• Toyota’s decision to design and test heavy-duty hydrogen fuel cell powertrains for Class 8 drayage trucks could significantly augment and/or expedite commercialization of heavy-duty hydrogen fuel cell platforms. Toyota has stated that this is the heavy-duty “powertrain of the future” for on-road goods movement.
• Kenworth (in conjunction with Toyota) is working to develop and eventually commercialize Class 8 trucks powered by hydrogen fuel cell technology.

In summary, all the OEMs (existing and start-up) appear to be developing Class 8 tractors with ZE architectures. These OEMs will achieve true commercialization for such products on timelines that are commensurate with commercial maturity and according to what makes good business sense. The many demonstration programs that are already underway or planned will provide critical new information over the next two years; this will help OEMs and end users better understand technological and commercial maturity of leading ZE platforms and the associated market dynamics. Over the next three years, if at least some of these OEMs are able to achieve their stated goals on performance and cost metrics – and very critical infrastructure build-outs can move forward in proportion to vehicle rollouts – this could fundamentally improve the commercial availability and broad feasibility of ZE platforms in drayage trucking.