Sustainability. Without a doubt one of the most used words in business this decade and without doubt the macro-economic trend for the next 20 – 30 years.
As business leaders, we face a hugely challenging situation. A climate crisis, talent shortage, huge rises in energy costs, investors prioritising highly rated ESG stocks along with customers and consumers demanding environmental and social progress.
So, plenty of issues which can keep any senior leader awake at night. The good news is that a truly effective sustainability strategy can drive business performance if fully integrated into a business strategy. I go into this in detail in my book “Sustainability, Delivering Business Performance” which will be published by Bookboon later this year, but in summary, done well sustainability increases profit, engages people (customers, investors and employees) and benefits the planet.
The carbon emissions from generating grid electricity have reduced by 63% since 1990, but transport emissions have reduced by only 4.6% in the same period.
When it comes to carbon emissions in the U.K. and many other developed economies globally, transport is the biggest offender. The carbon emissions from generating grid electricity have reduced by 63% since 1990, but transport emissions have reduced by only 4.6% in the same period. And transport (including upstream refining emissions) accounts for over 40% of the UK’s carbon emissions. Similar patterns are replicated in other ‘western’ economies.
From a financial perspective, diesel prices have hit an all-time high, averaging over £1.80 per litre at the pump in the U.K. driven by global price increases. And employees are being hit by high inflation driven by essentials such as energy and food.
So hopefully you agree that any solution which can help reduce transport emissions, address high fuel costs and help employees’ financial wellbeing should be a priority for every business?
One such solution is electric vehicles. Electric cars have the lowest total cost of ownership of any fuel type, have the lowest whole-life carbon impact (an advantage which only grows as grids further decarbonise) and in the UK have benefit in kind taxation rates of 2%.
This means that providing employees with an electric car (rather than a diesel company car, car allowance or inflation matching pay rise) is almost always cheaper for the employer and better value for the employee, as well as addressing the biggest source of carbon emissions.
And with overnight EV charging tariffs available at as low as 7.5p/kWh, the cost per mile can be below 2p - compared to around 15p for a reasonably efficient diesel vehicle.
So why are less than a third of new fleet cars Battery Electric Vehicles? And why are Fleet sales of cars lower this year than prior? There is clearly a whole range of reasons, but a big one is a lack of understanding. People think this is hard to do, costly for the business, that EVs don’t have the range, that employees won’t accept them and that there isn’t enough infrastructure.
The reality is very different. Once employer and employee alike understand the financials and what is actually available they are equally keen to switch – usually as soon as possible! Vans are also increasingly at the point where they stack up financially as well as environmentally and of course, a mixed fleet can be transitioned as an integrated whole, making the business case strong.
Range Anxiety
Range is probably the single biggest concern people have about EVs. There is still a perception that EVs can only do a hundred miles or so. This is far from true - ranges are much improved with a lot of electric cars now having real-world ranges of 250 miles+.
One of the factors which has a huge impact on the actual range that you get from an electric car is driver behaviour. This is no surprise as we know from Brightmile’s client base that implementing a solution which improves drive behaviour (delivering safety improvements as well as reducing harsh acceleration and braking) reduces fuel consumption by over 15%.
So, it follows the same efficiency benefit would be true for electric vehicles, but actually, it is even more important. EVs use ‘regenerative braking’ to turn the speed back into battery charge as they slow down, this means you rarely need to use the brake pedal in an EV if driving well and looking ahead.
Therefore, when you transition to electric vehicles if you combine this with a solution which improves driver behaviour you will further improve efficiency and range, benefiting the planet, your people and business profit.
For more information contact Simon King by emailing or connect with Brightmile.
