The electric vehicle equation is stacking up for SMEs.

The number of electric light-commercial vehicles available in Australia is expected to more than double from 14 to 30 by the end of this year, as the business case for making the switch grows stronger.

EVs have become more affordable and efficient, with some newer vehicles able to reach distances around 600km on a single charge. And in recent years the market has expanded rapidly beyond passenger vehicles into vans and light trucks, with major brand Utes a few years off.

Helping drive the uptake are exemptions to fringe benefits tax, registration discounts and EV rebates of $6000 in Queensland and $3500 in WA. Some lenders, too, are offering reduced-rate finance for green vehicle and equipment such as EVs, charging equipment, batteries and solar. (See your broker for details.)

And the perks are not just for fleet operators. SMEs in Victoria and Queensland can apply to have up to half the cost of an EV charging station covered under destination grants designed to expand the charging network through popular rural tourism areas. Winery operators and moteliers have used these to literally put their businesses on the (charging) map and attract new customers.

At the same time as waving carrots, there are some sticks coming, with the Federal Government proposing new industry emission caps to push manufacturers to prioritise electric vehicles.

Electric vehicles are generally cheaper to run and maintain because their engines have significantly fewer moving parts - around 20 in an EV drivetrain, compared to around 2000 in a traditional petrol vehicle.

However, there are several downsides to consider. EVs are more expensive to buy, and repair and insurance costs can be significantly higher. A WhichCar comparison in 2023 found EVs were around 20 per cent more expensive to insure than comparable internal combustion vehicles.

Resale can also be an issue. Recent Australian used car sales data indicated the value of EVs plummeted after two years, with vehicles more than five years old retaining less than 25 per cent of their purchase value. This possibly stems from concern around battery life. While many manufacturers offer eight-year/160,000km guarantees over batteries, replacement costs can be high. A recent NRMA article estimated the price of new EV batteries in 2024 ranged from around $12,000 to upwards of $30,000.

In February, the sale of EVs in Australia hit an all-time high, accounting for nearly 10 per cent of all new vehicles sold, according to the Federal Chamber of Automotive Industries.

EV expert and educator Bryce Gaton says the leap in sales is a signal the country is fast approaching a tipping point, where take up will begin to accelerate exponentially.

"When that tipping point is reached, for businesses, in particular, it will almost happen overnight because anybody who keeps an internal combustion engine vehicle will be at a competitive disadvantage" he says.

Mr Gaton, who has science, education and electrical qualifications, has worked in the EV policy, planning and public education fields for more than 15 years and runs his own vehicle transition consultancy EVchoice. So, he's all too aware how easy it can be for business owners interested in making the switch to electric to feel overwhelmed.

He outlines a few basic steps to consider before bringing in paid consultants. 

1. Research and plan

The advantage to not being an early adopter is the opportunity to learn from the successes and failures of others, Mr Gaton says. Look up some EV events - both The Australian Electric Vehicle Association and EV Council maintain what's on listings - and talk to other business owners.

Download some EV spec sheets (www.aeva.asn.au/info) and use those stats and your existing company mileage data to run a cost comparison. It's okay to change one vehicle at a time and change tack. The electric vehicle market is dynamic.

Charging is also a big part of the equation, so don't forget to assess your capacity. Will your facilities need an electrical upgrade? Plan to position chargers as close to supply as possible to minimise installation costs. Mr Gaton recommends businesses look to install mostly cheaper AC chargers as they will usually be sufficient. DC fast chargers, while capable of fully recharging some vehicles in less than a lunch hour, won't often be needed. For example, he says Ford estimates average Australian daily van use is around 115km and the current Ford E-Transit has a range of more than 200km, with the Custom E-Transit, due out later this year, having a claimed range of 380km.

 2. Try before you buy

Mr Gaton advises business owners to use their purchasing power to negotiate longer-term road tests or a discounted first purchase. Companies are interested in examining Australian usage and your business may help. He also recommends spreading initial purchases across brands, rather than putting all your eggs in one basket. 

3. Take your staff with you

"People hate uncommunicated change," Mr Gaton says. If staff aren't on board, or are fearful rather than excited by the transition, they can make it a bumpy journey as employers rely on them to stick to efficient charging schedules. Involve your staff in test driving and seek advice on vehicle selection. Many manufacturers offer driver training, particularly for heavy vehicles such as Scania electric trucks.

4. Prepare for technology and tariff change

As more consumers go electric, tariffs for charging at peak periods will rise dramatically. For example, under the WA tariff system, charging from 9am to 3pm costs 8.2cents/kWh, while that jumps dramatically to 51.2cents/kWh for charging 3pm-9pm. Smart-charging technology can help, but businesses should plan to maximise daytime opportunity charging. "If you've got solar it's a no-brainer to use that wherever possible. If you choose the wrong tariff it can cost you a bucket," Mr Gaton says.

Another big advance due to roll out in the next 12-18 months is the ability for electric cars to actually feed power back into a home or building (V2B) via a switchboard (to reduce peak hour costs or run appliances during an outage), and to feed back into the grid (V2G) to earn money.

At present many cars already have the power to feed out to a powerboard (V2L), with a Queensland mother recently using the family's BYD Atto 3 to power her son's dialysis machine after a Christmas Day storm outage.

The message, Mr Gaton says, isn't so much that change is coming, rather, that it's here, and businesses should be examining their options. 

Resources:

• Bryce Gaton maintains free, downloadable EV Fact Sheets (with on-road price and stats updated monthly) available via the Australian Electric Vehicle Association's website: www.aeva.asn.au/info

• The Driven EV news site.

• Carloop website has comprehensive data on EVs, charging sites and trends. Watch Carloop's summit on electric fleet transitions for a deep dive into fleet transition.

To discuss new how lower-rate green loans could help drive energy-efficient upgrades in your business, speak to your broker now. 

Electric all stars

Electric vehicles are expanding into everything from mining and farming to air travel. In the next 12-18 months it will also become more common for electric cars in Australia to be able to supply electricity back to homes and even sell it back into the grid at peak times. Here's what's coming or already here, according to EV expert Mr Bryce Gaton.

• Light commercial vehicles: The range is set to expand from 14 to 30 by the end of this year, with prices from under $60,000.
• Utes: LDV's eT60 was the first to market in 2022 and received a lukewarm reception, but Gaton says we're still one to two years away from a decent range. By the end of 2025 he expects around six utes on the market. Most recently Isuzu announced it will bring an electric D-Max to Australia around 2026.
• Medium trucks: E-trucks are available in the 4.5-16 tonne range, with more coming in the next 3-5 years.
• Heavy trucks: Scania has a 16-tonne truck and provides driver training for fleet drivers.
• Mining and construction: Plant and equipment such as 20-tonne wheel loaders are here. As the market develops it has huge potential for construction and mining with reductions in noise, vibration, heat, emissions and costs.
• Tractors: Fully electric tractors will hit the market in 2026. "They're also saying that by the same time to be fully autonomous so you can set them going in a paddock and they'll just do the job," Mr Gaton says.
• Ferries: The world's first electric battery car ferry, the MV Ampere, began operating in Norway in 2015.
• Aircraft: South Australian company Bader Aero has produced anall-electric two-seater aircraft aimed at reducing the footprint of flight training in the country.

Article from: SMART: your Procure news bulletin