How state grants are easing the switch to electric for Oregon trucking companies

Last month, the Oregon Department of Environmental Quality announced more than $13 million in grants to help expand electric vehicle charging infrastructure in the state. But these aren’t your typical EV chargers for drivers to pull up to, located near major highways or tucked inside parking garages or strip mall parking lots. The charging equipment targeted by these grants are designed to power up fleets of vehicles such as delivery vans, buses and large trucks hauling freight bound for same or next-day delivery.

Most heavy and medium-duty vehicles run on diesel and account for nearly a quarter of Oregon’s greenhouse gas emissions, according to the DEQ. In 2021, the agency adopted the Advanced Clean Truck Rule which requires manufacturers to sell an increasing percentage of zero-emission medium and heavy duty vehicles in Oregon starting with the 2025 model year. Joining us to talk about the opportunities and challenges of electrifying their trucking fleet are executives from two Portland-based companies. Randy Carpenter is the director of development at Airport Drayage Company, and Keith Wilson is the president and CEO of Titan Freight Systems.

Note: This transcript was computer generated and edited by a volunteer.

Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. Medium and heavy duty vehicles–think buses and 18 wheelers– account for nearly a quarter of greenhouse gas emissions in Oregon. State and federal regulations are in place to reduce emissions from diesel engines. But the next big step is electrification. The Oregon Department of Environmental Quality (DEQ) recently awarded more than $13 million in grants to incentivize this switch. Portland-based Airport Drayage Company got one of those grants to put in EV (electric vehicle) charging systems. Randy Carpenter is the director of Development at Airport Drayage and joins us now along with Keith Wilson. He is the president and CEO of Titan Freight Systems which won an earlier grant from DEQ to purchase EVs and charging infrastructure. Randy Carpenter and Keith Wilson, welcome to Think Out Loud.

Keith Wilson: Thank you.

Randy Carpenter: Thank you, Dave.

Miller: Randy, first. So your company is called Airport Drayage. What exactly is drayage?

Carpenter: Drayage is the transportation of cargo to and through port terminals That’s where it started. An Airport Drayage started here in Portland back in 1959 as a third generation family owned business.

Miller: So what’s a typical trip that one of your trucks might take in terms of length and cargo?

Carpenter: Well, we offer a mixed fleet so we offer heavy duty trucks as well as medium duty trucks. Our medium duty trucks are route trucks that are typically running about 100 miles to 150 miles round trip. In most of those cases, the heavier duty class seven and class eight trucks are running closer to between 100 and 250 miles.

Miller: But that’s as opposed to a longer haul truck that could go 600 miles in a day or something like that?

Carpenter: Sure closer to 500 miles in a day with the current hours of service rules.

Miller: You got, as I noted, more than $1.3 million from DEQ in this latest round of grants. What is this money going to allow you to do?

Carpenter: It’s going to allow us to set up an infrastructure, charging stations to support a transition, moving to electric vehicles where they make sense in our fleet. So, as you noted and so properly noted, long haul or over the road trucks, there’s not a good source solution for those today.

Miller: A good electrical solution?

Carpenter: A good electrical solution, correct. And we’re taking in the portions of our fleet that can be transitioned and having this infrastructure set up transitioning the right equipment for the right route to use electric.

Miller: This is the shorter haul hanging fruit of trucking.

Carpenter: Correct.

Miller: Keith Wilson, what about you? What’s your sector of the trucking world? What does that look like?

Wilson: So there are generally three sectors in transportation. You have a package and so you’ll think of UPS or Fedex bringing a package to your home.

Miller: A package that was maybe brought from an airport or some distribution center?

Wilson: That’s right.

Miller: Not that long a trip?

Wilson: Yeah, generally packages from 1 to 100 pounds. And then you have the LTL (less than truckload) segment, which is generally from 100 to 10,000 pounds. Then you have your truck load segment which is generally 10,000 to 40,000 pounds. We play in that center or the middle, which is generally 100 pounds to 10,000 pounds. And then a typical customer could be like Rodda Paint in North Portland. Their manufacturing facility will give us 20 skids a day…

Miller: What’s a skid?

Wilson: Pardon me. It’s a pallet of freight of paint, if you will.

Miller: Okay.

Wilson: And then we bring it back to our distribution center in Portland and we will have line haul operations going to our seven service centers located around Oregon, Washington, Idaho. Now that might be going to 20 different stores. So we’ll put it on a variety of different line halls going to their end destinations and then we’ll unload them, put them on the route delivery trucks and then the delivery begins and then we make pickups in the afternoon and it’s this 24 hour complex cycle that just continues to move throughout the day.

Miller: I noted earlier that your company got an earlier grant both to put in charging infrastructure and to get some electric trucks to the vehicles themselves. Now why is it that you thought EVs would be a good fit for part of your business?

Wilson: So to Randy’s point, our medium duty fleet generally travels about 100 miles per route. Perfect opportunity. I have two types of truck, medium and heavy duty. My medium fleet is 100 miles, but my line haul operation, it’s going to do 600-700 miles per day with slip seating. In other words, that truck is operating 20 hours a day with two shifts.

Miller: So, and it’s important to talk about the current distance that you can travel the range with the sort of most recent versions of electric trucks. Randy, what is it right now at the high end?

Wilson: Well, at the high end, the latest update with Tesla, in particular, they have trucks that they’re touting as 500-mile range electric trucks. Here we’re very fortunate to have Freightliner in our backyard building these very electric trucks.

Miller: On Swan Island?

Wilson: On Swan Island and in their plant in Troutdale in the East Portland area. They have a plant out there as well, I believe. So, the range on the Freightliners, as I understand it, is around 250 miles right now and technology is advancing so fast. We expect that to continue to grow.

Miller: What’s the price difference, Keith, for an electric truck or a comparable diesel-powered truck?

Wilson: You bet. So a diesel engine vehicle, a class 8, is going to cost about $130,000. The electric vehicles I have are three times that cost. Significant increase!

Miller: Ok. So that’s a gigantic difference in upfront cost.

Wilson: Huge.

Miller: What about operational costs? How does that break down?

Wilson: So operationally, there are half the moving parts on an electric truck. We expect just using that reference about half the cost of a per mile maintenance cost.

Miller: Because you’re not changing the oil as much?

Wilson: Right.

Miller: So, the maintenance is a big saving. What about the “fuel” itself, either buying diesel or getting the battery charged?

Wilson: In Oregon we’re fortunate to have what’s called the Oregon Clean Fuels program. So for all intents and purposes, because I’m replacing diesel with electric, my energy cost is going to be close to zero. So I’ll pay 14 cents per kilowatt hour and the Clean Fuels Program will credit me right around 14 cents per kilowatt hour. So the energy cost is zero. So when you think about the incentives in Oregon– this is only available in Oregon and California because of our low carbon fuel standard–it’s a game changer for us because it’s free energy.

Miller: And that’s specifically because you’re swapping out a new electric truck for an old diesel one. If you were just adding electric one to your fleet, you wouldn’t get those same electricity savings?

Wilson: You get that savings because you’re not using diesel.

Miller: Ok, so every time you add an electric truck you get. How long will you get electricity for free?

Wilson: I think that at this point that’s unlimited because the Clean Fuels program is a long-lived program that is managed through the Oregon legislature.

Miller: Randy, how do you think about the economics of this because it’s pretty complicated. I mean, it’s three times more expensive upfront to buy the vehicles and you didn’t get a grant to buy the vehicles, you got a grant to buy the chargers, you’re going to buy the vehicles on your own, but as Keith has laid out, there are significant savings in terms of operations. Does it overall make it cheaper?

Carpenter: We believe that it does, Dave. And that’s why Keith and I are both here today to really share and represent to the industry that there’s a great opportunity out there. For the person who is not going after taking advantage of some of these grant funds that are being provided and offered by the state, it’s going to be a tall hill to climb. That’s the reality, but by taking advantage of the opportunities that are out there to help promote bringing electric vehicles to the streets of the state, it is very advantageous to do that. Just as Keith noted about the maintenance service, that’s a big piece of it. The Clean Fuels Program that’s out there. Actually, my understanding of it is that it’s a program that allows us to, to build carbon credits if you will, because we’re using electric vehicles, those are traded and sold then refunded back to us, which then pays for the electric to charge the truck, put in simplest form.

Miller: I want to go back to something you just said. It’s the reason the two of you are here which seems like you want to talk to other members of the industry. It makes me think that there are colleagues of yours who are running other trucking companies who are not on board with the electrification of their fleets. Is that a fair way to put it?

Carpenter: I wouldn’t say not on board. I would say that we all have our perceptions of what change looks like or is expected to look like. We’re here today to help try to clear some of that perception. Doing a grant application can seem long and deep and very intimidating to the common person, but not if you partner with the right folks and you know who to speak to. I’m going to make a point to reference Michael Graham at the Columbia-Willamette Clean Cities program; they are just very important contacts to work with and have played a significant role in our ability to complete the application process and get down this path.

Miller: So we’ve been talking about the grants which we could think of as a kind of carrot in the state’s approach, but there is a stick as well if I’m not mistaken. DEQ passed a mandate recently requiring that by 2035, depending on the size of the trucks we’re talking about, at least 40% and as many as 75% of the big work trucks that we’re talking about that are sold in Oregon need to be electric. Randy Carpenter, what’s it going to take to get there?

Carpenter: Well, I would say it’s going to take programs like we have been offered today to get our fleets into the position where we can transition the vehicles that can be replaced. We cannot replace all of our vehicles because of the miles we travel with electric, but we can replace those. And that’s a start. But we just need to continue to take advantage of these grand opportunities and not sit back and wait.

Miller: Keith Wilson, I noted that you got that grant now a couple of years ago from DEQ. Does that mean that you have chargers up and running and electric trucks running on roads right now?

Wilson. We don’t. Because it’s emerging equipment, it’s still not available. So we had hoped to have it in place about a year ago. We will receive our first three electric trucks next month.

Miller: Have you ridden in one of these yet?

Wilson: Yeah. Yeah, we’ve test driven. There have been road shows that Freightliner has had and other EV manufacturers where we’ve been able to test drive.

Miller: What’s the experience like from a driver’s perspective?

Wilson: It’s really a different experience. I think if you’ve got an electric vehicle, you know about regenerative braking. It uses all the motion to recapture so you rarely use the brake in an electric vehicle.

Miller: It’s a kind of active way to stop the vehicle and then capture the momentum and turn that back into energy to put it into the battery.

Wilson: Yeah. And as far as decibel, it’s maybe a quarter of the sound or volume.

Miller: Oh, in terms of the braking?

Wilson: Not just the braking. Overall it is quiet.

Miller: Oh, overall the entire operation because it’s not a giant diesel engine?

Wilson: That’s exactly right.

Miller: Those sound like positives, but what have you heard from drivers? I imagine these are people who are used to the sound of diesel and maybe don’t mind it or am I wrong about that? What have you heard from your drivers?

Wilson: It’s interesting that you say that when we converted from a manual transmission to an automatic transmission, we had pushed back until the drivers actually drove them and said, “I’m not giving you back your manual transmission.” And the same expectation I’m sure will probably be where drivers will be reticent, but once they drive the quiet, clean, fuel efficient vehicle, I bet you they just won’t give them back to us and they’ll want to stay in them versus their diesel powered unit.

Miller: Randy, let me put it this way and you can tell me if I’m totally off base here. Many of us as humans are apprehensive about change, but is there a kind of political layer here where because of some version of American politics, electric vehicles equals some kind of progressive liberal conspiracy? Is that something that you have to deal with?

Wilson: It’s not something that we’ve had to deal with because it’s not a political stance. It’s not saying you’re on one side or the other. It’s about doing what’s right and what’s best for the community and what’s best for the business. That’s what it is in running businesses and this is a great opportunity to take advantage and make change. It is better for all. It doesn’t matter what side you’re on. Those are the facts.

Miller: I want to turn back to this question about range and I should preface this by saying that who knows what kind of technological changes are on the way, but it’s likely that there’s still going to be some limit, some gulf between the battery’s range and what diesel engines can do, where you just pull up to a gas station and keep going. As long as a driver can do it, the truck can go 24 hours. It’s unlikely that electric vehicles are going to be like that. One possible societal change would be that we just get used to stuff taking a little bit longer to move around, which is not the direction that that society has gone over 100 years. It’s been faster and faster and faster and just-in-time logistics, but what do you think about the possibility of just as a global society saying when TVs arrive at the Port of Los Angeles, it’s going to take a day and a half longer for it to move from that port to a warehouse in Denver. Is that a change that you can imagine?

Wilson: That’s a tradeoff?

Miller: It’s a tradeoff, absolutely. Saying if we’re going to have all trucking become electric in 30 years, something has to give and what’s going to give maybe is that stuff doesn’t move 500 miles or 600 miles in a day.

Wilson: I appreciate that, but I don’t see any challenge with decarbonising transportation and then having to delay our logistics or infrastructure.

Miller: We can have it all as humans.

Wilson: Absolutely have it all. We’re going to integrate these six brand new electric trucks into our fleet. We don’t see any delay to our consumers, to our customers, at all. If anything, we think they’re going to be more proud to work with us because we decarbonised our transportation, but we don’t see any delay in service. We certainly don’t see any delay in transit whatsoever.

Miller: Do you think, say 30 years from now, there will still be diesel trucks on the road? Randy, what does your crystal ball say?

Carpenter: I suspect in some form. Today diesel trucks are used in farms all across the country, right? So how realistic is it to expect that they will be having electric trucks maybe by that time, 30 years.

Miller: I mean, but we could have this same conversation about electric tractors, right? The electrification issue is global and it’s irrespective of industry.

Carpenter: Sure. With the progression of electric out into the marketplace, the next 10 years are really important to catch the tail winds of the opportunities that are out there and keep moving forward. Thirty years from now, I suspect that the percentage of diesel fuel or fossil fuel vehicles on the roads is going to be a fraction of what it is today.

Miller: Alright, let me bring the time frame back to much closer to something you can have a solid way of predicting. When do you think you’re going to have your first electric trucks on the road?

Carpenter: Well, I would say at this point–based on the timeline that Keith has had and I’ve been working with Keith and his crew over at Titan on these projects and it’s been very helpful–approximately 18 to 24 months.

Miller: Randy Carpenter and Keith Wilson, thanks very much.

Wilson: Thank you.

Carpenter: Thank you.

Miller: Randy Carpenter is the director of development at Airport Drayage Company. Keith Wilson is the president and CEO of Titan Freight Systems. They have both received DEQ grants to electrify their operations.

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