Key Takeaways
The EU is enacting a law to remove 90 percent of carbon dioxide emissions from sales of new trucks by 2040, which is more rigorous than Biden’s EV truck mandate.
The Biden administration has proposed mandating 60 percent of new urban delivery trucks and 25 percent of long-haul truck sales be battery powered by 2032.
The push puts more stress on overloaded electric grids and the cost of upgrading them and adding numerous charging stations to truck routes.
A full charge of a long-haul truck’s batteries can consume as much electricity as 7 houses, and a charging plaza for trucks as much as a small city.
Costs for consumers will inevitably rise as residents of Europe and the United States pay more for goods moved by truck.
European Union countries gave their final approval to a law to cut carbon dioxide emissions from trucks, which will require most new heavy-duty vehicles sold in the EU from 2040 to be emissions-free. The law is designed to remove 90 percent of carbon dioxide emissions from new heavy-duty vehicles by 2040. Manufacturers will need to sell a large number of fully carbon-free trucks – including electric vehicles and those running on hydrogen fuel – to offset any sales of new vehicles that emit carbon dioxide in 2040. Most of Europe’s trucks run on diesel, producing a quarter of Europe’s road transport carbon dioxide emissions. Truck manufacturers will also have to reduce the carbon dioxide emissions of their fleets by 45 percent by 2030 – replacing an existing 30 percent target – and 65 percent by 2035. From 2030, 90 percent of new urban buses sold in the EU also will be required to have zero emissions, rising to 100 percent in 2035. For this policy to be feasible, 50,000 truck-suitable public electric charging stations are needed by 2030.
Because the truck policy has won approval from EU countries and the EU Parliament, it can pass into law. Only Italy, Poland and Slovakia opposed the policy and the Czech Republic abstained. Germany and center-right EU lawmakers, however, had wanted the policy to allow more combustion engine trucks to be sold beyond 2040 if they ran on carbon-neutral fuels. To win Germany’s backing, EU countries added a preamble to the law which said that the European Commission would consider developing rules in the future to count trucks running on carbon-neutral fuels towards the targets. The Commission does not have to produce rules, just consider them. The rules could allow countries to count more combustion engine trucks that run on carbon-neutral fuels towards the EU targets, as opposed to switching more of their fleets to electric vehicles.
Climate-neutral e-fuels, like e-kerosene, e-methane, or e-methanol, are made by synthesizing captured carbon dioxide emissions and hydrogen. These fuels are extraordinarily expensive, even in the United States which does not yet have Europe’s skyrocketing electricity prices from its heavy reliance on renewable energy. For example, in 2020 when oil prices slumped to near record lows because of Covid, the cost of e-kerosene in the United State was $8.80 per gallon, significantly higher than petroleum-based kerosene. The e-substitutes are very expensive, in part due to Europe’s extravagant electricity prices, as the e-fuels are energy intensive to manufacture.
The EU policy is more rigorous than President Biden’s requirement of requiring electric models to account for 60 percent of new urban delivery trucks and 25 percent of long-haul tractor sales by 2032. In the United States, Biden’s regulation will require about 1.4 million chargers to be installed by 2032, about 15,000 a month. It could take three to eight years to develop transmission and substations in many places to support truck chargers. An electric semi consumes about seven times as much electricity on a single charge as a typical home does in a day. Truck charging depots can draw as much power from the grid as small cities.
Whether it is the EU version or the U.S. version, consumers will be seeing increased costs as trucks move an enormous amount of goods and the cost of electric trucks are typically two to three times more expensive than diesel trucks. Further, in the United States alone, roughly $1 trillion in new infrastructure and grid improvements will be required to handle the increased electricity the EV trucks will need. And, productivity will be reduced as battery trucks lack the infrastructure, range and capability of their diesel counterparts and will require frequent long charging and idled equipment. Electric semis require bigger and heavier batteries, which means they must carry lighter loads to avoid damaging roads. Fleet operators will have to use more trucks to transport the same amount of goods, which will increase vehicle congestion, especially around ports and distribution centers.
The increased costs and lower productivity will be for naught as the carbon dioxide savings from Biden’s truck regulation are expected to be minimal. From 2027 to 2055, the savings are only expected to cover last year’s increase in emissions by China and India.
Conclusion
The EU is continuing its climate policies with a law to cut carbon dioxide emissions from trucks, which is considered by some the most ambitious in the world. It is more stringent than the Biden regulation mandating electric trucks that was released on Good Friday. The push for electric trucks will be extremely costly as they cost two to three times more than diesel trucks, the charging infrastructure and the associated grid capacity needed will be expensive to attain and the lost productivity with frequent and time-consuming charges will wreak havoc with the profitability of trucking companies. Consumers and taxpayers will have to pay for those costs as politicians provide subsidies to make it happen and consumers are left with buying the more expensive goods.
