June 2024 Newsletter

Dear HVTT Forum subscriber,

This month’s newsletter focuses on the status and challenges regarding the uptake of electric cars and heavy vehicles in South Africa. I would like to acknowledge two HVTT Forum Board members, Michael Atkins (Senior Lecturer, Wits University, Johannesburg) and Abdool (AK) Kamdar (Manager: Decarbonisation and Drive to Zero, KDG Logistics, Durban) as well as one of Michael’s MSc students, Arnold Matiane, for providing the bulk of the material for this newsletter.

There has been a surge in sales of EVs in South Africa, driven by government incentives such as the 150% investment allowance for new EV investments starting in 2026 and the strategic release of the Electric Vehicle White Paper, which outlines a comprehensive roadmap for the transition to new energy vehicles by 2035 (NAAMSA). Additionally, rising fuel costs and environmental concerns are pushing consumers toward EVs as a more sustainable option. NAAMSA reported that new energy vehicle (NEV) sales increased by nearly 83% in Q1 2024 compared with the same period in 2023, with 3 042 NEVs sold between January and March 2024 (NAAMSA)​​ (TechCabal). However, this rise has occurred amidst a persistent power crisis, with Eskom’s (national electricity supplier) unreliable supply resulting in frequent loadshedding, which disrupts the charging infrastructure. As of 2023, South Africa had over 350 public charging stations, but this number is growing more slowly than the number of EVs, potentially leading to future shortages​ (Bolt Earth)​. This situation poses significant challenges for heavy goods vehicles, as the current infrastructure is insufficient to support widespread EV adoption for long-haul transport. Sales of electric trucks have been gaining momentum globally, but in South Africa, the high upfront costs and inadequate charging infrastructure remain major barriers​ (IEA)​.

The past year has seen the arrival in South Africa of the Volvo heavy electric truck tractor and the Scania electric rigid truck, followed more recently by electric freight vehicles from Daimler Trucks. Whilst the number of offerings has been growing, sales remain in the single digits. The shift to battery electric heavy vehicles (BEHVs) in South Africa’s road freight sector promises environmental benefits but several barriers impede progress. These include:

• Import Duty. The 20% import duty on electric vehicles increases the initial cost, making BEHVs prohibitively costly on a Total Cost of Ownership (TCO) basis.
• Truck Charging Infrastructure. Key to BEHV success is suitable charging infrastructure:
  • Strategic Location: Adequately spaced along major freight corridors.
  • Accessibility: Designed for large trucks.
  • High Charge Rate: To minimize charging downtime.
  • Low Cost: Affordable electricity rates to offset high capex.
• Currently, South Africa lacks sufficient infrastructure, particularly on major national highways such as the busiest in the country between Durban and Johannesburg (N3), as well as in the major cities, which is a significant barrier to BEHV adoption.
• Grid Capacity and Load Shedding. Frequent load shedding disrupts charging schedules, affecting the reliability and operational risk of BEHVs. A stable power supply is crucial for the feasibility of electric trucks. The alternative is to introduce battery buffered charging stations.
• Weight and Dimension Allowances. BEHVs are heavier due to the batteries, and current regulations do not accommodate this, limiting payload capacity. Regulatory improvements are needed to support BEHV efficiency similar to the EU 2015/719 and EU 219/1242.
• Lack of Financial Incentives. Unlike other countries, South Africa offers no subsidies or tax breaks. On the contrary, there is a punitive 20% import penalty.
• Green Procurement. Global brands and cargo owners have signalled demand for green freight options, but green procurement policies do not reflect the intent of the demand signal.

Case Study: Volvo Electric Truck Tractor by KDG Logistics

KDG Logistics purchased South Africa’s first Volvo electric truck tractor for use as a car carrier. No local auto manufacturer has thus far procured eFreight services on local routes for which charging infrastructure can be developed, and no long-haul charging infrastructure exists to allow a case study to develop. It remains a stranded asset.

Recent initiatives:

The World Economic Forum (WEF) First Movers Coalition convened an In-Country Workshop in Cape Town in March 2024, with good attendance from a wide range of stakeholders. Unfortunately, by co-hosting the Hydrogen and battery electric interest groups, much of the conversation centred around a freight future as an “AND” scenario, where HFCEV and BEV trucks worked together in fleets with different freight tasks in a complementary manner. It is the writer’s personal opinion that such muddying of the waters detracts from future freight certainty and promotes a “wait-and-see” approach, whereas a large proportion of the urban freight task could rapidly transition to electric.

Recently, a funding application was made to the Climate and Clean Air Coalition to pivot the N3 highway to a Green Freight Corridor. The application was unsuccessful.

Eliminating import duties, developing truck-specific charging infrastructure, ensuring electricity grid stability, revising weight and dimension regulations, offering financial incentives, improving the knowledge base regarding competing technology solutions without creating uncertainty/confusion and promoting green procurement are essential steps to facilitate BEHV adoption in South Africa. Overcoming these barriers will enable a greener and more sustainable logistics industry.

Weatherwise, we are well into winter in South Africa. There have been significant snowfalls (by SA standards) in isolated parts of the country, with temperatures dropping to -10°C for short periods. However, in the main, we are having a typical winter, with minimum temperatures seldom dropping to below freezing and reaching the low 20’s during the day in most parts of the country. Colder weather can be expected in July and early August. On 3 June a severe tornado (with an EF3 rating and wind speeds up to 265km/hr), which caused major damage in Tongaat just north of Durban, and severe flooding in the Eastern Cape province in early June have been two recent significant weather events.

All the best and drive safe.

Paul Nordengen

HVTT Vice-President: Africa