Gretchen Reese (00:24):

Hey there. Welcome to the Fleet FYIs Podcast, the weekly podcast by Utilimarc that reveals how you can make the most of your data for smarter fleet management. My name is Gretchen, and every week you'll hear from me or some of the industry's finest in candid conversations that will not only shed some light on over two decades worth of fleet data insights, but also some of the industry's hottest talking points and key metric analysis with the aim to help you better understand your fleet from every angle.

(00:52):

But before we begin, if this is the first time you've heard our show, thanks for stopping by. I'm so glad you decided to come along for the ride with us. But I've got a quick favor to ask you. Once you finish today's episode, if you could take a few minutes to leave us a review on your favorite podcasting platform, we would really appreciate it. Give us a rating, five stars I hope, or tell us what you liked, or leave us a comment or a question about what you've heard in today's episode. If we haven't yet covered a topic that you're interested in hearing more about, let us know. We would be happy to go over it in detail in a later show.

(01:34):

Hello everyone, and welcome back to another episode of the Fleet FYIs Podcast. I'm really excited for today's topic. Or this week's topic rather, and I know I say that a lot,, pretty much every single week, but in this case, I wanted to talk about carbon neutrality because I think this is something that we're hearing about a lot, especially as massive companies are committing to carbon neutrality goals. And I want to touch on really what that term means if it's realistic and if it's a realistic goal for fleets especially. So with that being said, whether by external mandate or internal initiative, you have a lot of organizations, especially today that are monitoring their greenhouse gas emissions and their general impact on the environment. This is nothing new. We've talked about it on this show quite a few times in the recent last few episodes, but the point I wanted to make is that as the world increasingly pushes for sustainable change, corporations and governments are setting goals to be carbon neutral. This term that we've heard a lot or potentially have net zero emissions in the future.

(02:46):

So like I said, there's a lot of massive companies that are committing to these carbon neutrality goals, right? And this is where the water gets a little bit muddy because yes, everyone has a plan to at least try and hit carbon neutrality, especially if they're very public facing. General Motors, FedEx, Delta, Shell, to name a few. They've all publicly committed to reaching carbon neutrality as soon as 2030. But here's the thing, alongside this goal, they've also shared plans to invest in green technologies. They're switching to cleaner energy sources, and they're launching carbon offsetting initiatives that regenerate ecosystems around the planet. Now, does this mean that every single fleet needs to do exactly that and have a very intensive plan like some of these companies I just mentioned? No, but we'll get into that in just a second. Let's dig in.

(03:58):

So when we're talking about sustainability commitments and potentially these heavy polluting organizations, and by heavy polluting, I mean folks that are involved in the transport sector or people that deal with fossil fuels, just so that it's not the pointing fingers of your heavy polluting, and I'm not, we're talking about a general sector of the industry here. Greenhouse gas reporting and greenhouse gas reduction may actually have to be done by obligation. So in effort to monitor the footprint of leading emitters in the country, the US Environmental Protection Agency requires carbon reporting from roughly about 8,000 organizations countrywide.

(04:41):

And in either case, close tracking and reporting of emissions is actually necessary to back the integrity and the transparency of these sustainability initiatives. If someone was saying they were doing something without any proof, would you believe them? Potentially, potentially not. But as these regulations get stricter and more common, a major concern that a lot of people have is the validity of companies' carbon reports.

(05:06):

So in order to avoid charges or sanctions, organizations could try minimizing or shifting around their numbers. For example, a fleet reporting on vehicle emissions could go completely electric and claim carbon neutrality. But if this same fleet is relying on what some people call a dirty grid to charge all of these new vehicles, is their fleet really carbon neutral or are they trying to put forth a sustainability commitment and trying to pass these zero emissions vehicles as carbon neutrality?

(05:37):

Well, this is where it gets a little bit sticky. So if you want to talk about emissions in general, let's talk about tailpipe versus facility because this is where, again, the water gets a little bit muddy here because zero emissions, does that mean specifically vehicle based, or does that mean your entire organization as a whole? Well, perhaps the solution to this problem would be for organizations to clarify exactly how they're going to be carbon neutral.

(06:05):

So is it going to be their fleet will be carbon neutral? Will it be the whole thing? In other words, if their carbon profile is neutral or negative across the board, or if neutrality has been achieved at a specific scope. We talked about fleet emission scopes a couple of episodes ago, so make sure you guys take a little peek see into that one. Talking about emissions profiling, why fleets need one, and you know why you should actually be well informed on what fleet emission scopes and profiles actually are. I think it's really helpful when you take a look at emission scopes in this perspective, because if we're just using an organization, for example, whose fleet emits net zero greenhouse gases, it's technically, technically carbon neutral at scope two, but not the entire organization as a whole. So again, that's where that clarity piece really comes into play.

(06:54):

And this is the important difference between tailpipe and facility emissions. All internal combustion engine vehicles produce some level of exhaust at the tailpipe, discharging carbon dioxide, carbon monoxide, nitrogen oxides, and many other pollutants. This we're all very well aware of by now. Organizations looking to cut down at scope two may transition to cleaner vehicles like CNG engine vehicles. We talked about that in a previous episode as well, plugin hybrids, or even all electric vehicles, which ultimately reduces their full tail pipe emissions. Now, these vehicles are a viable option for companies facing regulations around fleet greenhouse gases and who are looking to cut down as quickly as possible if their budget allows. Now, what that doesn't mean is that they're completely off the hook because a fleet of 200 internal combustion engine vehicles going all electric can definitely reduce their carbon footprint. But the question then presents itself as to whether they're charging these 200 new electric vehicles on a fossil fuel powered grid, or is it alternative energy?

(07:57):

Where's the balance? Where's the carbon neutrality here? For a fleet that's only required to report on scope two emissions, this is great because then it doesn't matter. I mean, it matters, but not in the sense of reporting of how you're charging your vehicles and if you're moving emissions rather than eliminating them. That topic is really interesting to delve into, I think, as well, because are we trying to remove them or are we trying to move them? It's a little complicated, but the reality is that greenhouse gases are simply being shifted to another source instead of completely eliminated. Therefore, the carbon neutrality statement is pretty much null because it's not carbon-neutral, it's just being moved.

(09:04):

But then the question is, is there a clean energy solution? Because I'm very aware that this could sound very doom and gloom if you're trying to go carbon-neutral and you don't really have a place to start. It's really tricky and the water's still pretty muddy. I mean, that's going to be true industry-wide, right? We're all still trying to figure this out, and the whole purpose of episodes like these is really just to get you all thinking about what carbon neutrality or what this sustainability movement, what it really means to you, and what it really means to your organization. Because to me, it could mean that I want to be better with my internal combustion engine data and to try and make my existing vehicle fleet more sustainable. It could mean that I want to be profitable for the longevity of my organization, or it could mean that I want to switch to alternative energy and completely go electric or CNG or hydrogen based. It's different for everybody, right?

(09:58):

There's no one size fits all approach. We've talked about that quite a lot on this show, but at the end of the day, the concept of carbon neutrality is evidently ambiguous. And as more organizations commit to this goal, specifications are probably going to be necessary to clarify what the objective really entails. So for fleets that are looking to go carbon-neutral at all levels, the root of the problem is most likely their energy source. And as long as fleets rely on dirty grids, "dirty grids" to power electric vehicles or plug-in hybrids, they will only ever be able to reduce emissions to a certain extent, and a true solution would be clean energy for powering cleaner vehicles.

(10:36):

The last little nugget that I'd love to leave you with today is a real life example of a case study that we wrote not too long ago on Jersey City and Jersey City's microgrid because it presents an attractive opportunity for other fleets that are looking to do the same or to potentially use as inspiration in the future.

(10:55):

Now, this city is set to build the first self-sustainable municipal microgrid in the country, which creates power through solar panels. And the cleaner energy produced will then be used to charge the city's fleet of electric garbage trucks in the future to be able to keep the city cleaner and evidently running on cleaner energy too. The key here is the combination of independent renewable energy and a plan for fleet sustainability and the transition to cleaner technology, and that could be a variety of different technology options like we've mentioned a few times on this show already.

(11:29):

And whilst I'm aware these efforts do take a great deal of investment, it also takes a great deal of planning and support from stakeholders. It actually seems to be one of the most feasible paths to carbon neutrality today. And the last little piece, I know I said the case study was the last piece I was leaving you with for today, but just one statement that really has stuck with me since one of our last events that we attended in June of this year was that if you're looking at carbon neutrality, it has to start with the smallest pieces of your organization.

(11:59):

So we're not just talking about fleets and vehicles here. It's also taking into account the uniforms that your technicians wear, where your power is coming from, what materials are used to build your facility, and really understanding the carbon footprint of all of these pieces combined truly to get to the bottom of how long it will take your organization to become carbon neutral, if that is in fact a goal of yours. Anyways, that's all from me this week. I would love to hear if you have any questions about carbon neutrality, what it means for fleets, what it means for the fleet industry. Let me know. Toss all your questions my way. You can send me an email, tag me on LinkedIn, use the hashtag Utilimarc Fleet FYIs, or you can send me a carrier pigeon if you fancy it, because why not? Anyways, until next week, I will chat to you later. Ciao.

(13:08):

Hey there. I think this is the time that I should cue the virtual high five because you've just finished listening to another episode of the Fleet FYIs Podcast. If you're already wanting more content, head over to utilimarc.com, which is Utilimarc with a C, utilimarc.com for this episode, show notes, and extra insights coming straight from our analyst to you. That's all from me this week, so until next time, I'll catch you later.