The True Cost of Going Electric
With the rising cost of fuel and the pressure from regulatory agencies to reduce emissions, maybe it is time to reevaluate the cost of converting to an electric GSE fleet. The transition to electric though costly in the initial outlay of capital dollars can bring immediate savings to operational budgets. When planned and implemented correctly, the benefits of electrical equipment can also be seen in non-cash savings. Employee health, for example, will greatly improve because of the reduction of noise and gas emissions in the work environment. Another non-cash benefit of operating an electric fleet is the passenger’s positive opinion towards environmentally friendly companies.
Currently the most economical vehicles to electrify are Bag Tugs, Beltloaders, Narrow-body Aircraft Tractors, and Passenger Stairs. Add to that list, FMC’s Container loader and TLD’s Wide-Body Aircraft Tractor, that are currently under development and testing for operators of Wide-body fleets.
The easiest GSE fleet to electricity is the gate tractor and the beltloader. There are many vehicles available to fill these roles from Charlatte, Tug, TLD, Harlan, and others, and have been in successful operation for over a decade. These vehicles, when coupled with Fast Charging can maintain duty cycles equivalent to their internal combustion counterparts.
Cost of Vehicles
The up-front cost of electric vehicles on average is about 30 to 35 percent more expensive than their gas counterparts. If the decision to convert to electric is made purely based on the initial cost, then it would not make sense to convert, but the true savings comes in the operation of electric vehicles.
Cost of Infrastructure
In addition to the higher initial cost, electric vehicles also require charging infrastructure. This infrastructure is actually much less expensive that the corresponding infrastructure required to deliver gas to the airport, but since the gas infrastructure is already available at airports, that cost is rarely considered. If Airports took a proactive approach to providing the charging infrastructure in the same way they provide the fueling infrastructure, then many more airlines and ground handlers would be operating electric vehicles.
Charging infrastructure can be expensive at an airport with little power available, but there are new ways of extracting power for charging without the need for costly infrastructure upgrades. Bridge power sharing is one option that is available. A jet bridge only uses the power that is supplied to it 5 percent of the day; the remaining 95 percent could be used for charging.
Cost of the Fuel
Fuel is the single most volatile cost in operating a gas fleet. In the last 3 years fuel has been as low as $1.20 per gallon and as high as $3.20 per gallon. In the same time period, industrial electricity has averaged between 6.5 and 8 cents per kilowatt-hour.
The fuel cost to operate an average gas baggage tractor is about $13 per day. That assumes an average tractor runs 3.75 hours per day and consumes fuel at a rate of 1.5 gallons per hour and fuel costs $2.30 per gallon.
An electric vehicle with the same duty cycle consumes between 27.75 and 33.5 kilowatts, or $2.10 to $2.50 per day. To make a fair comparison, the price of the battery must be calculated, as it is part of the fuel system of an electric vehicle. Assuming a battery that costs $6000 and lasts 5 years amortized over the life would cost $3.29 per day. Adding the cost of the battery into the daily fuel cost equates to between $5.39 and $5.79 per day. That is a savings of between $7.21 and $7.61 per day.
Cost of Maintenance
There is a big debate in the airline industry about the cost savings of operating an electric fleet over a gas fleet. The basis of this debate comes down to the way maintenance is calculated. Most airlines calculate the cost of maintenance on a vehicle as “cost per hour of operation.” Most electric fleet operators will agree that the cost of maintenance per hour is as much or slightly higher for an electric than a gas.
When comparing gas and electric fleets, the cost per hour calculation is not a true comparison. Hours on a gas vehicle are measured as the motor is running. Hours on an electric vehicle are measured when the vehicle is actually moving or working. The difference between the two is idle time. An hour meter on a gas unit runs the entire time the unit is idling. The difference can be as much as 65 – 70 percent.
Consider the example above. The gas unit runs for 3.75 hour per day on average. The electric unit only operates for 1.3 to 1.9 hours, but accomplishes the same tasks. Therefore if you consider the cost per hour of a gas to be equal to the cost per hour of an electric, you will achieve 65 to 70 percent more work for the same amount of maintenance. Additionally, if Maintenance is scheduled by hours, a gas unit is maintained almost 2.5 times more often than an electric.
Total Cost of Ownership
As illustrated above, the initial cost cannot be the only determining actor when choosing an electric fleet over a gas fleet. To make the best fleet decision, one must consider the Total Cost of Ownership. In the case of a baggage tractor with a useful life of 15 years, the estimated fuel savings alone will be over $40,000 factoring in new batteries every 5 years. If maintenance costs an average of $2,000 per year for a gas unit, over the life of an electric the savings would add up to $18,000. Over the life of a tractor that is an annualized savings of $3,866 per year per unit.
For those who are considering making a switch from Gas to electric fleets, there are clear benefits not just financial but environmental and staff health.