This post follows another of similar subject where I discussed the various solutions available to fleet operators to charge their fleet as they move it from fossil to electric.
I concluded that CAAS (like OneWedge’s Electric Plazas) offerings were a useful complement to in house solutions like Depot, Home and Public charging; however Charge-As-A-Service solutions must obey the law governing ANY investment, i.e. they must provide an adequate return on the capital invested.
The denomination “Electric Plaza” encompasses in reality three different solutions:
- HCV – day: a Plaza targeting Class8 heavy trucks, providing the highest possible power at the gun, so that the charging needs of the truck are fulfilled in 60-90 minutes
- HCV – night: a Plaza targeting Class8 trucks, where the day’s charging needs are fulfilled during the night
- LCV: a Plaza targeting vans under 3.5 tons, where the day’s charging needs are fulfilled during the night
With this distinction in mind, OneWedge has developed a “Digital Twin” model for Electric Plazas, allowing us to simulate the costs to derive the price at which the service must be offered to achieve the desired financial performance.
Capital & Operating expenditures
The main items of capital expenditure (capex) making up an Electric Plaza can be summarized as follows:
- the land where the Electric Plaza will be built
- all the civil works that are required (ground slab, fencing, access control, excavations, charging stations plynths, etc.)
- the charging station hardware of adequate power to provide the desired service
- the electric backbone needed to distribute energy within the plaza
- a grid connection of sufficient power
When building a typical Profit & Loss statement for an Electric Plaza we will therefore need to:
- amortize the above capex
- offer a market-competitive return for the money invested (imagine we take out a loan from a Bank…)
- pay for the electricity re-sold to the fleet operator
- pay for other operating costs (e.g. personnel employed in the Plaza)
- generate a profit
The client expectations
While transportation companies are developing a keen eye for sustainability, they remain a thin-margin business: in considering ways to improve their sustainability picture, they also monitor closely both capex and opex; while with the CAAS solution they don’t have to worry about the former, the latter certainly remains the subject of close scrutiny. As a first approximation we can safely assume that no solution where the fuel kilometer cost is WORSE than the current values obtainable with diesel vehicles will have much hope of success.
The Electric Plaza Digital Twin allows us to evaluate all the above consideration in an information-dense chart, where we have chosen a vertical logarithmic axis to better appreciate what happens close to the axes’ origin.
The two axes we have chosen are the cost of the charging service (i.e. the price at which the electricity is resold to the fleet operator – VERTICAL) and the occupancy rate (i.e. the ratio between the sold and the sellable energies – HORIZONTAL). The horizontal axis of course is related to the number of vehicles being served, but also to the number of charging slots that are available, esp. for the “Day” charging scenario.
Finally, we also plotted the diesel fuel cost for each class of vehicle (dashed black lines), to identify the break-even points for each scenario.
To assess if the size of the Plaza matters, we applied the Digital Twin to 20, 80 and 150-stalls Plazas (for LCV) and 5, 10 and 20-stalls for HCV, and you can immediately see that while size drives differences, these are negligible when compared to the difference between the scenarios.
The second observation which can be made is that the green and red scenario have very similar behaviours with significantly different breakeven points: this is logical because 20 trucks need 20 guns to be charged during the night, while they can be charged by many fewer, by staggering the sessions, during the day. True, the night chargers need less power (and therefore are cheaper), but the more efficient use more than compensates for this. Staggering the sessions however might be incompatible with the organization of transportation missions, so the two solutions offer pros and cons.
The impact of land cost
The above example uses values valid for the Italian market, but a similar infographic can be derived for ANY country. This is especially important when evaluating the impact of land cost, which can greatly vary from country to country, but also from one position to another in the same country: in this example, we have simulated moving a plant from a low land cost zone to a high land cost zone, resulting in a very different distribution of Capex (blue columns):
Of course, Opex distribution (red columns) is also impacted, but to a much lesser extent; the absolute value of the “low” Capex column is roughly €3M lower than the “high” Capex column.
Conclusions
We conclude that there are occupancy thresholds below which we will “miss” one (or more) of our objectives, and therefore building an Electric Plaza is either not possible unless one of the three parties (Client, Operator or Investor) renounces its expected benefit:
- we do not offer lower fuel costs to our clients
- we do not offer adequate return to our investors
- we do not achieve our target profit
These thresholds will depend primarily on the cost of land, and therefore will be higher or lower according to the value of this variable.
OneWedge 