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2008 Green Fleet Conference
The First Annual Green Fleet Conference was held Sept. 15-16, 2008 in Chicago. The conference was designed for fleet managers as a unique forum to develop innovative solutions to “green” their fleets and improve the overall operation of them. Speakers and panel members consisted of fleet managers in both the government and corporate sectors.
Panel experts discussed alternative fuel vehicles (AFVs), the effect of greenhouse gases (GHG) and carbon dioxide (CO2) emissions on the environment, maintaining and remarketing hybrid fleets, funding for green fleets, telematics, and more. Many of the topics applied to both police fleets and commercial fleets. The following is a synopsis of the conference.
Alternative Fuel Vehicles (AFVs)
Mike Antich, editor of Automotive Fleet Magazine, gave a sneak peek at the fuel-efficient and emissions-reducing models of the future. Antich talked about the AFVs being offered by the big three U.S. manufacturers (Chrysler, Ford, General Motors), as well as other domestic and foreign car manufacturers.
The 2009 Dodge Durango Hybrid from Chrysler is a Hemi-Hybrid with a two-mode powertrain. It can run on electric only, engine only, or electric and engine together. Its sister vehicle is the Dodge Aspen. The Dodge Sprinter Plug-in Hybrid is being used as a test vehicle for the New York Times delivery fleet. It has a 20-mile range in electric-only mode.
The 2010 Dodge Ram 1500 Hybrid truck features a Hemi V-8 engine. The Dodge Zeo can travel up to 250 miles on its fuel cell. Dodge’s ENVI (short for environment) division also includes the Chrysler ecoVoyager, which runs on a lithium-ion battery and allows fuel cell trips up to 300 miles. The Jeep Renegade has a 400-mile range in battery and electric mode. Chrysler is set to expand its hybrid line with the 2013 Dodge Avenger and the 2013 Dodge Journey. All the above vehicles were concept cars at the 2008 Detroit Auto Show.
New for 2008, the Crown Victoria Police Interceptor (CVPI) now comes standard with flexible fuel (E85) capability. The CVPI can be filled with E85, gasoline or any combination of the two. E85 is a fuel that contains 85% ethanol and 15% gasoline. Using ethanol produces fewer greenhouse gas emissions; E85 cuts them a good 20-30%.
Ford’s AFVs also include the 2009 Escape Hybrid, 2009 Mercury Mariner, 2010 Fusion Hybrid and the 2011 Mercury Milan Hybrid. They also have a propane-powered F-150 truck with Roush® engineering. Test vehicles include: Escape Hybrid E85, which gives off 25% fewer CO2 emissions than gasoline hybrids. The Explorer America Concept and the Edge HySeries, which debuted at the Washington, DC Auto Show, feature Ford’s “EcoBoost” engines.
The Edge HySeries runs on electricity that can be recharged by a fuel cell. It uses no petroleum-fueled power, so it is pollution free. It can be plugged into an ordinary household outlet to recharge. Generating that electricity creates some pollution, but less than a gasoline-power vehicle. The HySeries powertrain can operate on all electric power with a range of 25 miles. It will go another 200 miles on the hydrogen stored in a high-pressure tank.
In addition, Ford’s E-Series Hydrogen ICE Shuttle has a V-10 engine and is currently being used in Las Vegas and at SeaWorld in Orlando. Ford’s Airstream Concept car was unveiled at the 2007 Detroit Auto Show.
The 2009 Chevrolet Tahoe Hybrid is considered a “two-mode” hybrid. It was named the “Green Car of the Year” at the Los Angeles Auto Show. The 2009 GMC Yukon Hybrid features 50% improved fuel with a 6.0 V-8 Auto Stop mode. The battery can be repowered and it has a 6,200-pound towing capacity.
The 2009 Chevy Silverado features 20% improved overall fuel economy and 40% improved city driving mpg. The 2009 GMC Sierra Hybrid has a 6.0L V-8 engine. As the first luxury hybrid, the 2009 Cadillac Escalade Hybrid features two-mode technology with 20 mpg city, and 21 mpg highway.
Saturn’s 2009 Aura Hybrid is another AFV. The 2009 Saturn VUE Green Line two-mode hybrid runs on lithium-ion batteries. The Saturn Plug-in Hybrid is set to debut in the future.
Now available in China, the Buick LaCrosse Eco-Hybrid sports 15% better fuel economy. It will debut in the United States later this year. The Buick Riviera Concept car also has hybrid capability. The Chevy Volt Concept car is set to come out in November 2010, according to USA Today.
Chevy’s Equinox Fuel Cell is part of “Project Driveaway” and is currently being driven in southern California and Washington, DC as a hydrogen fuel cell vehicle.
The Saturn Flextreme E-Flex Concept Car debuted at the 2008 North American Auto Show. It features a 34-mile range on battery alone, with a three-hour recharge time. The onboard generator is diesel powered. GMC’s new Denali XT Concept Truck gives up to 50% improved fuel economy.
Toyota’s next-generation Prius is called “Concept X” and is debuting at the 2009 Detroit Auto Show. A lot of fleets are already using the Prius as an AFV. In addition, there is a big demand for the 2009 Camry Hybrid. The Lexus Hybrid is the first dedicated with Prius plug-in technology. Other AFVs include: Highlander, Lexus GS 450h, Lexus LS 600h.
Toyota’s concept cars include the IQ Concept Mini-car, which is in production in 2009. The 1/X Concept is made of exotic composite materials with a four-gallon tank, which translates to hundreds of miles. Another concept car from Toyota is the A-BAT, which stands for Advanced Breakthru Aerodynamic Truck. The Lexus LF-Xh SUV Concept and the Toyota FT-MV (Future-Minivan) Concept Profile debuted at the 2007 Tokyo Auto Show. The Hi-CT Concept has a 1.5L engine with plug-in capability.
Honda’s AFVs include: 2009 Civic Hybrid, 2009 Civic GX NGV (Natural Gas Vehicle), 2009 Insight Concept. Honda’s small hybrid sport vehicle is the 2015 Fit Hybrid. Some celebrities are currently driving the Honda FCX Clarity, a hydrogen fuel cell vehicle.
Other OEM hybrids include: 2010 Audi Q5; BMV X5 Diesel Hybrid; BMW 7 Series; 2012 All-Electric Mini-Cooper, which will debut at the L.A. Auto Show in November, along with the 2010 Hyundai Sonata Hybrid. The 2009 Mazda Tribute Hybrid and the 2009 Mazda 5 Premacy Hydrogen Hybrid have been road tested in Japan and feature gasoline and compressed fuel for a 124-mile cruising range.
Locating, applying for, and securing incentives and grants for green fleet initiatives can be challenging. John Walton of the Forest Preserve District of DuPage County, IL spoke at the conference about how his agency obtained funding. In 2001, a referendum passed to convert Walton’s fleet to 100% hybrid vehicles in 10 years. Those hybrid vehicles can include CNG, E85 and electric models.
Through the “Midwest Clean Diesel Initiative” the DuPage Forest Preserve received a $612,000 grant with the goal of reducing pollution and using alternative fuels. Currently, the DuPage Forest Preserve is using gasoline, as well as biodiesel and compressed natural gas (CNG).
Officials also have a future goal of not having any gasoline available at their site. In other words, employees would have to go offsite for that fuel for wholesale prices. They are currently running Scag motors on their LPGs (liquefied petroleum gas) vehicles and are looking to convert everything.
The Illinois Environmental Protection Agency (EPA) offers rebates of up to $4,000 for any vehicle purchased that is an alternative fuel vehicle (AFV). In addition, there are rebates for fuel if using E85 and biodiesel. Some tax rebates offer 50 cents per gallon. The state of Illinois will give you money back, up to $450 per vehicle. More information can be found at www.illinoisgreenfleets.org.
According to Walton, the energy problem is important, but it’s not critical yet. He suggests talking to congressmen, state representatives and senators for funding. Federal loans are low interest, and agencies can use them to convert their vehicles. They can afford to pay back the loan while they are making up the money on AFVs. This is a huge incentive for fleet managers.
According to J.D. Schulte, fleet manager of the city of Moline, IL, there is a differential in the cost of hybrid vehicles. Agencies can use rebates up to three consecutive years. A lot of funding comes out of Washington, DC from organizations like the National Association of Fleet Administrators (NAFA). Turnaround time on rebates can take several months. If an agency puts in for funding in January, it may receive it in July.
According to Schulte, using the media for funding requests is effective. Schulte advised fleet managers to take any opportunities with the EPA when they are in your area or with the mayor of your city to get good press on it. For example, the first time Schulte filled his fleet with E85, he invited the local press and legislators for the event and received positive media feedback. The story about exploring new technologies appeared on the front page of the local newspaper.
Schulte also stressed the importance of making sure your constituents know you’re researching alternative fuels. “You’re doing good instead of just spending money,” he stated.
Stephen Russell from the city of Keene, NH, said he used B20 fuel seven years ago. B20 is made up of 20% biodiesel, 80% petroleum diesel. Currently, the city of Keene is setting its own 10,000-gallon tank of E85 because “biodiesel is very seamless,” Russell commented.
Regarding the return on investment (ROI), Russell said he currently has two hybrids in his fleet. He looked at how long it would take to recoup the cost of the Honda Civic Hybrid. It doesn’t use many miles, so it takes longer to get the ROI. All the speakers advised fleet managers to talk to people who have already secured funding for information and advice. The Department of Energy Web site is a good place to start.
Russell also said he works with the local college because it often has a lot of money to spend on new research and technology. He also uses free items from the police department, such as abandoned cars from drug raids. City of Keene employees also ride bikes when going between facilities / different buildings.
Lori Pampell from the North Central Texas Council of Governments said the Department of Energy offers funding through its Clean Cities program. Applications are due in January, and awards are typically given in the spring. Local chapters of Clean Cities gives money to colleges and universities’ fleet managers and also offers funding for using alternative fuels.
According to Pampell, President Barack Obama shows strong support in investing more money in alternative fuels. However, one complication is that a lot of money used locally comes through the Federal Transportation Bill, and those funds will be reauthorized. Still, Obama supports plug-in hybrid demand vehicles. Pampell said there was a funding initiative for $6 million—$3 million for fiscal year 2009 and another $3 million for fiscal year 2010.
Pampell calls funding that is awarded to an agency that can’t use it funding that’s “left on the table.” In some cases, information isn’t passed on to the appropriate person, so the funds are never used. Pampell’s organization will work with that company to use up the money. It helps to involve the purchasing department, fleet department, or the local school board or city commissioner.
USPS: Strategies to Build a Green Fleet
The United States Postal Service (USPS) has 219,000 vehicles in its operation, covering 3,600 post offices. Han Dinh, director of fleet services, spoke about the USPS alternative fuel vehicle program. With the largest civilian fleet in the country, Dinh said USPS is on track to replace nearly 90% of its fleet with environmentally conscious, less petroleum-dependent vehicles.
According to Dinh, in 2007 the USPS had 147 million delivery points. It adds more than 2 million new addresses per year. In 2007, the USPS spent $1.6 billion in fuel, with 2008’s total expected to be at $3.3 billion. USPS currently has 142,000 long life vehicles (LLVs) and 37,000 flexible fuel vehicles (FFVs).
The USPS Alternative Fuels Program includes: light-duty and medium-duty hybrid electric vehicles; electric; flex fuel; clean diesel; biodiesel; natural gas; propane; and hydrogen fuel cells. The biodiesel usage from 2000 until now included no conversion cost necessary, and the cost is comparable to regular diesel fuel.
With CNG, the conversion cost is $2,000 to $3,000 per vehicle. Advantages are very clean emissions; cheaper-than-gasoline fuel costs; longer-lasting engines; and extended oil change intervals (up to one year). Dinh said the payback on CNG averages seven years.
With the E85 ethanol, USPS saw a 29% reduction in fuel economy. However, it has a limited infrastructure, mostly in the Midwest, due to a limited choice of ethanol engines. In states like California and Washington, DC, you can’t buy ethanol anywhere.
The USPS has 35 vehicles using propane in its fleet. From 1990 until now, the conversion cost has been $3,000 per vehicle. It is an “old technology” according to Dinh. It is very reliable, emissions are good, and the fuel cost is competitive with gasoline.
The USPS has 30 electric vehicles in its fleet. Dinh said the incremental cost is high, double of diesel. However, they are reliable and used for short distances. The USPS is testing a light-duty Hybrid Toyota Prius. Dinh said it passed 24,000 miles of accelerated durability on a postal driving schedule and showed an increase of 117% in fuel economy.
The Ford Escape Hybrid is also being used by the USPS. Since 2005, officials have been testing in Los Angeles and San Francisco. Mileage is enhanced, but payback time is 10 years. “It’s too early to conclude the savings,” Dinh commented.
Testing in Illinois since 2005, the USPS has 10 Jeep Liberty vehicles in its fleet. Fuel economy improvement is 5% over gasoline. Officials are also testing an International truck that was converted to diesel. It has shown a 25% improvement in miles per gallon over standard gasoline.
Other green fleet initiatives at USPS include expanding walking delivery routes; replacing vehicles with bikes; utilizing software optimization of delivery routes to reduce idling, left-hand turns, U turns, etc. These changes showed a 12% reduction in fuel costs.
Dinh said CNG is a reliable conversion option today at $2 per gallon, compared to a few years ago. In the next five to 10 years, Dinh believes hybrids will be mainstream, although no alternative fuel vehicle program can be successful without internal infrastructure. The timeline for replacing 180,000 vehicles at USPS is estimated to cost $3-5 billion. It will take five to seven years to replace all of them, Dinh said.
Vehicles powered by biodiesel, compressed natural gas, propane and powerful next-generation electric batteries present new servicing, storage and technology challenges. Panelists from across the country shared their experiences in tackling these challenges.
The city of Bellevue, WA has 1,000 vehicles in its fleet for police, fire, etc. According to Pat Spencer, fleet supervisor, Bellevue switched over to B5 fuel last June. It pumped out existing fuel from its tanks, cleaned them out, and put in B5. The city now has 300-hour intervals between changing filters on the fuel tanks themselves.
According to Spencer, Washington state offers tax incentives for biodiesel use. In addition, Spencer said the city is adding Chevy Tahoe Hybrids for police use. It typically turns over police cruisers after 18 to 24 months.
Bill Vanden Brook from the city of Madison, WI, said his mayor wants to go “green,” so there has been a lot of change in the past 10 years. Madison started at a 2–5% blend of biodiesel, an “ultra-conservative” approach. Most of the city’s vehicles are housed indoors, so the cold winters in Wisconsin are not an issue. According to Vanden Brook, they are using CNG pickup trucks with good results, as well as Honda Civic Hybrids, Ford Escape Hybrids, propane forklifts and Zambonis.
Madison’s main shop was built in 1954, so it was not designed for any other fuels but gasoline. According to Vanden Brook, when an agency changes fuels, it must often change its facility to keep the air quality good. For example, Madison put in the budget to upgrade the HVAC units.
Vanden Brook said “telematics” helps you know what your vehicles are doing and helps reduce idle time. Employees can’t let their vehicles run for a half-hour while they’re at lunch like they did in the past. Vanden Brook also said hybrid training for maintenance is important. Agencies can work with dealers and OEMs, even sending technicians to Honda or Ford for training at a minimal cost.
Larry Campbell from the city of Fort Wayne, IN, switched his fleet to B20 because of the cost, a $0.07 per gallon difference. Fort Wayne went from premium diesel fuel to B5 to B20. According to Campbell, tank monitoring and tank management solve any problems that could arise.
Fort Wayne is set to have 25 Ford Escape Hybrids by 2009. Training is through Ford Motorcraft Specialty tools with Ford software for laptops in shops for troubleshooting. About 40% of the city’s fleet runs on E85. Officials did experience issues on their older fleet with catalytic converters plugging up, but the police liked the better acceleration. The Fort Wayne Police Department currently has three T3s, all-electric three-wheelers that travel up to 27 mph.
Sherry Lewis is the fleet administrator for UCLA. Lewis said infrastructure is very important when preparing your shop to maintain AFVs. UCLA had two AFVs in 2002, but now one-third of its fleet is using clean fuel. UCLA’s GoGreen Program has a long-range plan of 50% clean fuel vehicles in its fleet by 2020.
According to Lewis, UCLA got rid of diesel vehicles in 1998. It now has 64 CNG vehicles; 253 electric vehicles; 39 flex fuel vehicles; and 23 hybrid vehicles, for a total of 379 alternative fuel vehicles.
Lewis advised agencies that are building their own maintenance shops to develop emergency plans, educate and train staff, and consider noise impacts / restrictions. Lewis said it’s important to get buy-in from the fire department for codes, etc. Other tips: Update equipment and diagnostics, stock parts, install fueling posts, develop schedule for station.
Climate Change Legislation
Congress will likely enact climate change legislation in the future that could affect transportation and thus, many fleets across the country. James Bruce of J.T. Bruce & Associates talked about Senator Boxer’s “Cap and Trade” bill. President Barack Obama is an advocate of Cap and Trade and favors auctions of carbon allowances.
The “Cap” statute sets a national cap on the quantity of available carbon allowances. The cap adjusts downward each year. Each covered greenhouse gas emitter must present a carbon allowance for every ton of carbon he emits annually. The government auctions to the highest bidder or gives carbon allowances out for free. The free market sets the allowance price.
The “Trade” allows holders to trade, bank or sell allowances. In contrast, transportation companies consume oil. One exception is the emissions reporting to the EPA, but HR6877 (Rep. Tammy Baldwin) would omit fleets with no obligation to purchase or present carbon emissions allowances.
Their actual emissions are not even counted. In addition, mobile sources do not sequester emissions. It is presumed that whatever fuels the oil companies sell become carbon dioxide. About 114 gallons of gasoline yield 1 metric ton of CO2.
Under Cap and Trade, transportation companies pay higher fuel prices as oil companies pass through the cost of the Cap and Trade program. As of July 2008, the oil crisis put a more severe restraint on greenhouse gas emissions from petroleum fuels than any climate change bill.
Chairman Dingell’s climate change concept from September 2007 proposed a 50-cents-per-gallon gasoline tax plus a $50-per-ton-of-carbon fee phased in over five years. That would equal $3.80 per gallon by September 2012. However, nine months after Dingell’s proposal, gas was averaging $4.16 gallon. As a result, the bill was never introduced because it is too expensive in a recession.
Bruce talked about why we need a climate change bill. He called it the environmentalist’s trump card. The Supreme Court said greenhouse gases are pollutants covered by the Clean Air Act.
Without climate change legislation, the EPA will resolve greenhouse gases via the Clean Air Act.
However, the agency cannot do the Cap and Trade under the Clean Air Act. Nobody wants greenhouse gases regulated by 50 different state implementation plans. According to Bruce, if there’s no legislation, we will need 60 votes in the Senate to “defang” the Clean Air Act.
Texas oil tycoon T. Boone Pickens would like to take natural gas from electricity generation and substitute it for oil. Pickens believes we could generate electricity from wind instead of natural gas. Why? To make natural gas compete with oil, which is expensive, instead of coal, which is cheap. A hidden detail is that it would mandate fleet vehicles to use natural gas instead of petroleum.
One problem with this plan, according to Bruce, is that wind is not a reliable source for energy, since it doesn’t always blow, especially in the hot summer months. On the other hand, natural gas-fired electricity generation is always ready to produce electricity. Bruce said one solution is using flexible fuel vehicles, which are in use now. By 2012, half of the “Big Three” automakers’ production will be flex fuel models.
The EPA says fuel prices have doubled in the past two years, effectively $200 per ton of carbon tax. Senator Bingaman said they’ll make a climate change bill a “heavy lift” for Congress. The key that is not all fuel prices went up the same. The effect on the transportation infrastructure funding is that the Highway Trust Fund is nearly broke. The question is, how does Congress increase fuel taxes in the face of fuel price increases from the market and Cap and Trade? Cap and Trade as it is now structured, pre-empts funding of transportation infrastructure.
Prospects of government incentives for green vehicles include: alternative fuel tax credits are in play; free carbon allowances are possible but not likely; carbon offsets are not likely a problem of “additionality.” What will ultimately drive the likelihood and timing of climate change enactment is the state of the economy, fuel prices and the public perception of the effects of climate change. California is a progressive state in climate change legislation. Ideas on what to do include leaving oil out of climate change legislation. Bruce also suggested using a safety value for carbon allowance prices and subtracting on new gasoline taxes and further market price hikes.
Changing driver behavior is one of the fastest avenues to reducing fuel costs for any fleet operation. Telematics involves behavioral changes such as what vehicles fleet managers select to how fast the drivers step on the gas pedals. An example of poor driver behavior includes overloading vehicles.
Julie McDowell from Hospira, a global pharmaceutical company, said Hospira has fleet management driver manuals that each driver must read and sign. Likewise, according to Stephen Levine, Pfizer, a leading healthcare company, just introduced fuel cards and a safety program for compliance with their drivers.
Another global pharmaceutical company, Takeda has also taken steps to combat fuel costs for its fleet. Bivan Kischer said Takeda had primarily a sales fleet culture of “leniency” among its sales managers. Ideally, it would like its drivers to slow down, idle less, plan routes and maintain vehicles better, such as checking tire pressure, etc. Members of Takeda’s sales force often carry heavy products and drive many miles, so they need to find a vehicle that fits those needs. According to Kischer, Takeda now gives incentives to employees if they choose a more environmentally friendly vehicle. They don’t mandate vehicle choice, but they equip some of the smaller vehicles to be more attractive to the employee.
According to McDowell, Hospira is introducing an all-hybrid program by next year. Since the company sells environmentally friendly products to hospitals, it wants its salesforce to reflect that by driving environmentally conscious cars. In addition, Hospira mandated hybrids with four choices of cars.
McDowell said everyone wanted the Toyota Highlander, so now that vehicle is given only to managers. But more hybrids are coming out, so they may have more choices. Hospira also has weekly e-mails, newsletters with maintenance schedules for oil changes. Fuel prices are a direct cost to the sales force and are included in the Travel & Entertainment (T&E) budget.
Tools to encourage good driver behavior include giving incentives. Pfizer rewards safe driver behavior with gift certificates to restaurants. Part of Takeda’s safe driver program allows employees to upgrade their existing vehicles (leather, sunroof, etc.) if they go three years without an accident.
According to McDowell, Hospira advocates a “team effort” and doesn’t just point out bad driver behavior. It sets benchmarks and compare performances to motivate positive driving influence. Energy is a hot topic these days, so it’s important for fleet managers to tap into that desire to be green.
According to some estimates, for every hour a truck idles, a half-gallon of fuel burns, and the engine experiences the equivalent of 40 miles of wear and tear. Implementing idle-reduction programs that work is important for every fleet manager.
Matt Stewart is the senior automotive equipment analyst for the Department of Fleet Management for the city of Chicago. According to Stewart, Chicago and the state of Illinois require employees to shut off their engines after idling for five minutes. In addition, police are told to sit in inconspicuous areas and turn off their engines instead of idling in order to save fuel.
In some emergency vehicles, lighting needs to stay on, which used to drain the battery. However, a lot of vehicles now use LEDs, so they don’t draw as much from the battery. Chicago Police use corner LEDs instead of corner strobe lights, so the only lights on at a scene are LED.
In some cities, only the K9 police cars are allowed to idle. According to Stephen Russell, fleet superintendent of Keene, NH, some environmentally conscious citizens in New Hampshire who are stopped for speeding will even tell officers to turn off their vehicles!
Similarly, Polk County, FL implemented an “Idle Awareness” program for its employees. According to Bob Stanton, director of fleet management for Polk County, enforcing the program is a “slippery slope.” In government fleets, sometimes it is necessary to idle.
However, the easiest way to save money in any fleet is to turn off the vehicles. Stanton said it’s important to educate employees on the detrimental effects of idling. Polk County saw a 6% reduction in fuel consumption after the program was implemented.
Polk County also educates students in the area about idling and its direct effect on fuel costs. Parents often sit in their idling cars, waiting to pick up their kids from school. The students then remind their parents not to idle when they come to pick them up.
Stanton also said Polk County enforces a 55-mph speed limit on all county roads as part of a bigger fuel-conservation program. It also offers driver incentive programs for fuel savings, with positive feedback from the public and employees.
Some of ServiceMaster’s vehicles stay on all day long, according to Bob Anno, director of fleet maintenance. TruGreen is one of ServiceMaster’s branches, and its trucks need to run pumps. The company is now using electric vehicles so workers can turn off the engine and perform their duties while also recharging the batteries.
Re-engineering the trucks pays off in the long term, Anno said. ServiceMaster also asked drivers to stop “early-morning start-ups” to save fuel costs. In the hot summer months, employees would typically run the A/C for the lawn service vehicles all day.
ServiceMaster is also trying automatic shut-off systems on their vehicles. After excessive idling, or two- to four-minute intervals, the vehicle automatically shuts off. In addition, education and communication by local management reinforce policies to drivers.
The University of Michigan also has an idle-reduction program. According to Keith Johnson, general manager of Fleet and Garage Services, the university even puts up “No Idling” signs around campus. It also installed “preheaters” on its 40-foot transit coaches, which start one hour before the vehicle goes on its run. About 80% of its fleet is stored indoors.
Johnson said officials also put stickers inside the vehicles advising drivers to shut off the vehicles when not in use. U of M also worked with the city government to enforce no-idling zones for employees and vendors who visit the campus.
Cutting Fuel Costs
Soaring fuel prices could return at any time. There are proactive steps and policies for fleet managers to cut fuel costs while reducing emissions at the same time. Tom Hartner is the global fleet manager at Millipore Corp., a $1.6 billion global life sciences company. Hartner spoke about some of the steps Millipore is taking to cut fuel costs and reduce emissions. Hartner said Millipore is looking at providing shuttles for employees, as well as incentive programs for purchasing hybrids.
Millipore currently has 1,100 vehicles globally. Two years ago, it didn’t have any hybrid vehicles, no policies in place, no fuel cards, etc. Since March 2008, Millipore switched two-thirds of its fleet from Fords to Toyota Camry and Prius Hybrids. With that change, the company is not putting a million pounds of CO2 into the air, and it is saving money. The company also offers incentive checks to employees who choose hybrids as their vehicles.
Melinda Beffrey leads the fleet strategy at Kellogg Company. Beffrey said Kellogg is looking at 4-cylinder vehicles that are safe while lowering CO2 emissions by 32%. They are also looking at ways outside of vehicles to get the company’s needs met. Kellogg sells to Whole Foods stores, and Baffrey said they want to present an environmentally conscious image to them by having their salespeople drive hybrids.
Culligan International has a large truck fleet of 1,400 and 100 cars. According to Mel Pawlisz, fleet manager, realistically, truck hybrids do not exist. They cost $40–50,000 more to buy. That is not an easy sell to management because the return on investment (ROI) takes 10 or more years. Pawlisz also said it’s important to have “buy-in” from top management down to the drivers. “Everyone in the organization needs to understand the importance of the issue,” Pawlisz commented.
Culligan looked at putting nitrogen in their vehicles’ tires, but on cross-country routes, you can’t always get it to refill. The benefit of nitrogen is that it doesn’t leak like air, and drivers don’t check air pressure very often.
The city of New York got into alternative fuels in the mid-1990s. Legislation was passed requiring one-half of light duty vehicles to be alternative fuels. According to Steve Weir, director of fleet administration, New York City did CNGs first, but those had limited number of sites at which to fill up (only seven in NYC). The problem with ethanol and B20 is there aren’t any commercial filling stations except city garages.
New York City’s first motivation for using AFVs is public health. Mayor Bloomberg’s goal is to reduce greenhouse emissions by 2017. He worked with the EPA on the benefits of improving air quality in NYC, including conditions like asthma. Weir said officials are also looking at plug-ins, such as Toyota, Nissan, the Zen car. They are also researching having solar power in-house for plug-ins.
NYC currently has 384 Global Electric Motorcars (GEMs) in the Parks and Recreation department. They are used for picking up trash. Weir said the city received them as a donation for off-road applications.
According to Weir, the Prius is also a good investment for them because it is cheaper to maintain in an urban environment with a lot of stop-and-go, city driving. Weir added that since Sept. 11, it is difficult to justify take-home vehicles for NYPD employees.
Remarketing AFV and Hybrid Vehicles
As “green” vehicles reach the end of their service lives, what remarketing tools and strategies will achieve the best resale value? It’s best to look at the replacement parameters of hybrids; what is the optimal mileage to replace them? They follow the lifecycle of gas cars.
After 100,000 miles, the resale value drops off. However, some are resold for more than original cost. Some recommend recycling them between 80,000 and 90,000 miles, which is considered a “short cycle” to avoid maintenance issues, but so far not a lot of problems have occurred, even for a new type of vehicle.
GE’s Paul Seger said his hybrids typically have 90 to 90,000 miles on their hybrids. “The demand exceeds the supply,” Seger said. GE is getting higher returns than it put on its books a year ago. Geographic differences play a part in remarketing hybrids. Warm weather makes more sense for hybrids because in cold weather they operate more on the gasoline than the battery. Hawaii, Los Angeles and San Francisco are big markets. They also reported the Prius batteries holding up well after seven years.
Seger also said any AFV that attains 27 mpg get a “Go Green” sticker at auctions to leverage it for strong returns. How you market them on the Internet is important. In addition, some precautions must be taken when remarketing hybrids, such as towing on a flatbed truck because the rear wheels can’t drag since they generate electricity.
Seger suggested fleet managers make sure they are pricing the vehicles right to get the most market value. “Don’t price it too low!” Seger advised. He gave an example of a 2007 Prius with 13,000 miles resold for $24,300 and the original price paid for it was $22,000. When remarketing vehicles, the New York Police Department (NYPD) removes any indication that it was used in law enforcement.
According to a PHH Arval survey of public and private sectors, interest in environmental impact of fleet is high, but most companies are not measuring greenhouse gas emissions. Tips for getting started include building your team; knowing your corporate culture; getting buy-in from stakeholders; communicating; and building on success.
Reducing Fleet Emissions
A group of fleet managers who’ve been on the front line in the emissions-cutting battle offered tips and best practices based on their experiences. The challenge is to do it without increasing costs.
Duramed / Barr Pharmaceuticals has a fleet of 400 vehicles for its sales force and executives delivering samples. According to Don Sedia, senior corporate facilities and fleet manager, Duramed had already begun efforts to “green” its buildings by installing motion-sensor lights, brown-outs on weekends and at night. Before its Green Fleet Program, 70% of its fleet consisted of Chrysler Pacificas. It changed its fleet to RAV 4’s and Jeep Journeys.
Diane Lopez is responsible for Abbott’s U.S. Fleet Program. Abbott is a global healthcare company with 6,700 vehicles in the United States. Abbott’s overall goal with its fleet program is to reduce greenhouse gas emissions 30% by 2011. Lopez partnered with Environmental Defense and PHH Arval to offer many Abbott employees greener vehicle options.
Lopez said at first Abbott ruled out hybrids as an option because some of its sales reps needed minivans. The first year of the program, the company removed 4WD vehicles in non-snow areas. It also removed worst-performing vehicles and added “greener” vehicles. Results included a 4% reduction in GHG, 4% improvement in mpg and 4% reduction in lifecycle costs.
Year 2 of Abbott’s program added Toyota Prius Hybrids as a selection for employees. They also replaced their existing sedans and SUVs with more fuel-efficient 4 cylinder models. Lopez also announced Abbott would be more “climate neutral.” Results in the second year included a 3% increase in mpg.
In the third year of Abbott’s program, they eliminated less fuel-efficient SUVs. They also implemented a personal use premium for less fuel-efficient vehicles, like SUVs and minivans. Results: 10% decline in vans; 15% decline in SUVs; 15% increase in hybrids.
Lopez said it’s best to implement change that won’t have a negative effect on your employees. Don’t worry about what other companies are doing. Even doing a little helps the world and makes a difference.
What’s the bottom line in operating a hybrid fleet? Steve Weir from the city of New York spoke again on his city’s green initiatives. In 2001, legislation forced New York City to go in the direction of green. Seven years later, New York City was named the 2008 Green Fleet of the Year (light and medium class) by NAFA.
New York has the largest hybrid fleet in the United States with 2,943 vehicles. They have another 2,000 vehicles running on ethanol, electricity and CNG, and approximately 1,000 trucks using biodiesel. Weir said a “beat-up” Prius recently got $4,700 at an auction, which is unheard of. According to Weir, that same car would’ve gotten $100 for it in 2001.
Pete Silva, director of Fleet Procurement for PepsiCo, also talked about his experiences running a hybrid fleet. PepsiCo has 38,000 vehicles in the United States. In 2005, they started converting 1,800 vehicles to hybrids. PepsiCo spent $1 million on the conversion, and the Prius and Impala have “broken even” with the investment. Silva reported the Priuses had trouble on icy roads in northern climates, so they have not put their sales force in those vehicles.
Silva said another thing to consider is the Prius and Civic Hybrids will cost more to repair—18% more to repair in accidents. They have more components like recovery coolant, etc. They’re from OEMs so it’s going to cost more to repair, replace parts. For example, a replacement bumper on the Ford Escape Hybrid costs $650.
Benchmark GHG and CO2 Emission Reductions
One of the first critical steps in implementing a green fleet initiative is establishing an emissions baseline regarding greenhouse gases (GHG) and carbon dioxide (CO2). A place to start is the Department of Energy Web site. There you can measure the amount of CO2 emitted.
Dow Chemical is a leader in environmental issues and GHG. Since 1990, Dow has reduced GHG by 20%. Their fleet has 3,000 vehicles, which average 16 mpg. According to Denise Keberlein, Dow worked with Wheels, Inc., a fleet management company, to get their fleet to 23 mpg by choosing different vehicles. Dow is also implementing a fuel card program. Keberlein also recommended engaging upper management for support.
Sanofi Aventis is the third largest pharmaceutical company with a U.S. fleet of 8,000 vehicles. According to Brian Wielgosz, Sanofi Aventis’ fleet goal is to reduce CO2 emissions by 7.5% in 2008. In 2006, they removed SUVs from their selector and added 200 Priuses to their fleet. Wielgosz said sales reps don’t need big SUVs to visit doctors’ offices.
Pfizer is another leading pharmaceutical company with a fleet of 33,000 globally. Fred Turco is the senior director of Global Fleet Services. According to Turco, in 2002, Pfizer set a goal for GHG reduction of 35%. They met that goal in 2007. Turco sends information to the field sales force to show how much they can save to drive different behaviors. Third-party software data packages can also measure metrics. Each 100 pounds equals a 2% reduction in fuel consumption. People don’t want power as much as performance.
Benchmarking fleet characteristics against peers or within your own company is helpful. Magazines can help do benchmarking too, as well as looking to the community for input. Turco said take-home vehicles might not be beneficial anymore to carry the cost.
Maria Williams oversees all fleet activities for more than 1,400 vehicles in the United States and Canada for USG Corp., the largest producer of wallboard panels for construction. Williams helped reduce fleet costs by more than $900,000 since 2006 by a selection of smaller, more fuel-efficient vehicles. USG has 1,500 vehicles in their fleet for sales. Their GHG reductions and mpg were driven by a mandate by an executive committee.
In 2005, USG eliminated large SUVs and went to crossovers. In 2009, USG will move to all 4 cylinder vehicles. They added the Toyota Camry Hybrid and Prius to the fleet, while restricting the number of pickup trucks. USG anticipates a 26% increase in mpg, and $800,000 in savings. Williams suggested fleet managers do cost analysis, obtain buy-in from execs to CEO for approval, present it, and gain acceptance.
Jennifer Gavigan has been writing for Police Fleet Manager Magazine for more than five years, providing readers with cutting-edge fleet technology information. She can be reached at firstname.lastname@example.org.
Published in Police Fleet Manager, Jan/Feb 2009
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