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How Electric Vehicles Are Reshaping Facilities Management
In a world where maintenance and engineering managers are optimizing operations and improving their organizations’ bottom line, many also are increasingly aware of the need to look beyond traditional issues. Managers need to commit to measuring their facilities’ social and environmental impact, and they need to commit to financial performance rather than solely focusing on generating profit.
As the emphasis grows on the triple bottom line of three Ps – profit, people, and the planet – sustainability has evolved from a buzzword to the modus operandi for most organizations.
Enter electric vehicles (EV). As companies work to be more sustainable and environmentally responsible, EVs have become more popular among facilities and the general public. EV sales are surging due to several factors, such as policy support, improvements in battery technology and cost, increase in the charging infrastructure footprint, and new compelling models from automakers, according to BloombergNEF’s Electric Vehicle Outlook.
What does this evolution mean for managers and their organizations as they continue to operate and endeavor to reach their sustainability goals? Let's look at the way this surge in EV market penetration can benefit facilities and challenge managers and their organizations.
As a cleaner alternative to traditional vehicles, EVs are an important step in sustainable transportation. Notable for their fuel efficiency, EVs can be a cost-effective way to reduce operating expenses across an organization’s fleet. Rising fuel prices and a push for greener initiatives have led many organizations to adopt EVs for their fleets.
Besides lower fuel costs, EVs also serve as a greener alternative to gasoline and diesel vehicles. By eliminating exhaust, they reduce a fleet’s greenhouse gas emissions. This advantage helps businesses stay sustainable and compliant with government guidelines.
Managers must take other issues into consideration when comparing the environmental impact associated with internal combustion engine (ICE) vehicles and that of EVs. The pollution caused by ICE vehicles is not limited to the exhaust coming from their tailpipes. The process of extracting oil, refining it into fuel, and transporting it to gas stations also generates a large amount of air pollution. Even though modern ICE manufacturers have lowered their carbon dioxide emissions, the manufacturing process continues to harm the environment.
But EVs aren’t exempt from scrutiny as it pertains to environmental impact. The production of EV batteries creates upstream emissions. In fact, the production process for EVs can be more taxing on the environment than that of ICEs. Still, EVs remain the cleanest option for transportation because their entire life cycles are much more sustainable overall. Due to their use of electricity as fuel, the benefits of driving them make up for their higher manufacturing emissions. On average, an EV produces one-half of a conventional vehicle’s carbon emissions over its lifetime, completely outperforming from a sustainability standpoint.
Spotlight on challenges
Although the increased penetration of EVs into the market offers many benefits, challenges remain. These challenges relate to a manager’s ability to use EVs in the organization’s fleet and to providing services that allow customers to also use EVs.
Consider the available EV charging infrastructure. Rather than being refueled at a typical gas station, users must charge EVs at electrical outlets. Many EV owners charge their vehicles at home using a special wall-mounted charger. This arrangement works for most people because the average person drives 29 miles per day. This distance is well within the range of today’s EVs, most of which can travel 150-250 miles on a charge. But two major difficulties arise.
First, for drivers who live in apartments, parking garages are rarely equipped with charging outlets, and installing such infrastructure might be cost prohibitive for facility managers. Second, there is also the additional problem of the electric costs incurred at common outlets. Because regular EV charging consumes more energy than most other residential uses, managers need a mechanism to monitor EV charging to ensure the driver of each vehicle pays for his or her own electricity use.
Second, EVs need expanded charging infrastructure to make long-distance trips that require multiple stops for charging. When it comes to longer trips, EV owners can experience range anxiety, which is the fear the vehicle will run out of power before reaching a suitable charging station.
Surveys show that concerns about range and charging availability place important limits on consumer purchases of EVs. Fifty-eight percent of respondents cited running out of power as their top reason for not purchasing an EV, and 49 percent cited low availability of charging stations, according to a 2018 Harris poll.
Given these challenges, will managers be able to provide charging infrastructure to their tenants and stakeholders, especially as it pertains to the amount of power needed accommodate charging the number of EVs that are entering the market?
Managers also must address the issue of the issue of grid capacity. Introducing a fleet of EVs means that millions of people will depend on the electric grid in new ways, so power generation capacity will need to increase to accommodate EVs without straining the grid.
The U.S. Department of Energy (DOE) predicts a 38 percent increase in electricity consumption by 2050, mostly due to a high penetration of EVs. This increase in electricity consumption has the potential to affect building operations in a major way unless organizations make significant investments to enhance the grid’s capability.
How many chargers does a manager need to have installed in and around facilities to ensure users are satisfied? EV charging behavior differs from the refueling behaviors of owners of ICE vehicles. About 80 percent of EV charging occurs at home, according to the DOE. Regardless, many EV customers are uneasy about the prospect of long charging times at public stations — like those managers would have to install in and around their buildings — on longer trips that exceed the range of their vehicles. This issue has the potential to degrade customer satisfaction if not addressed properly.
Beyond these issues, EV charging stations can be expensive to install, and all chargers are not created equal. For practical purposes, many chargers are divided primarily into two classes – level 2 chargers and DC fast chargers. A level 2 charger can fully charge a typical EV in about eight hours. By comparison, DC fast chargers can charge a typical EV to 80 percent in 20-40 minutes and to 100 percent in 60-90 minutes. The issue is that installation costs associated with level 2 chargers average around $2,500 with equipment and labor, while installation costs associated with DC fast chargers can average 10 times or more than that amount, depending upon the equipment.
Managers need to ensure that tenants have the appropriate number of chargers available to them. They can accomplish this by periodic tenant surveys to understand how many drive EVs, as well as to account for a certain proportion of parking spots being allocated to EV charging. Depending on the locale, this proportion can be 3-6 percent. For example, in an area where EV adoption is high and a more pronounced demand for charging exists, a building with 100 parking spots would dedicate six spots to charging. Managers also need to make accommodations for EV users with disabilities.
The popularity of EVs seems likely to increase. Passenger EV sales are set to increase sharply in the next few years, rising from 3.1 million in 2020 to 14 million in 2025 globally. Managers who equip their fleets with more environmentally friendly EVs can enhance their corporate performance. To achieve these goals, infrastructure must improve, and policy will have to satisfy the needs of EV users in and around facilities.
Will managers be ready for this challenge? To succeed, they need to prepare now by taking all these factors into consideration. However the issue evolves, this will be an exciting journey as managers prepare to embrace an EV future.
Darrell X. Rounds, FMA, C.E.M., leads electrical and mechanical engineering for General Motors’ facilities organization, Sustainable Workplaces. Rounds has more than 21 years of facilities management and engineering experience, and he has led operations and maintenance activities for facilities with more than 53 million square feet and $7.2 billion in asset replacement costs.