Scania: biofuels a stepping stone to EVs

Electric vehicles run on power derived from clean energy will be crucial in propelling road freight towards sustainability, but such transport solutions are still years away – while alternative fuels have the potential to deliver real benefits, both environmental and commercial, today.

That was a sentiment shared by Scania AB President and CEO, Henrik Henriksson (below), on a recent visit to Scania Australia headquarters in Melbourne.

"Electrification will come, of course, eventually – but in a big country with the nature of Australia it will take a little bit longer," Mr Henriksson said to assembled truck media.

"And we cannot just sit and wait for electrification to come as the silver bullet for sustainability. That's why we very much believe in sustainably produced biofuels – coming out of waste water to create biogas; coming out of sugar cane production to create bioethanol; or through growth agriculture product to create biodiesel. Then you can reduce CO2 by up to 90 to 95 per cent."

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Scania has made a concerted effort in recent years to differentiate itself with an aggressive push towards more sustainable road transport.

"We are on a quest, you could say; we have a clear purpose as a company, and that is to drive the shift towards more sustainable transport solutions," he said.

The European Parliament is calling for a 30 per cent reduction in CO2 emissions from heavy vehicles by 2030, while Scania says it's focussing its efforts on achieving fossil-free road transport by 2050, in line with the Paris Agreement.

While electrification will serve as a key tenet in achieving such aims, Mr Henriksson says there are still many hurdles to be overcome, including the inherent difficulties of battery production and its associated cost, and EV infrastructure – not just between cities and states but within cities too.

"Electrification will eventually have TCO [total cost of ownership] parity with diesel and we have a fairly good prediction of that, although it will differ in different parts of the world," Mr Henriksson said.

"But TCO parity is one thing, then you still need a supply chain that is sustainable. We believe it will come eventually but we cannot just sit and wait for that, because [to reach] the target that we agreed upon in Paris, on keeping it [the global rise in average temperature] below two or at least one-and-a-half degrees, we need to work with other things.

"And that is where the alternative fuels come in, the biofuels – that is the solution here and now. That is what we need to do, and then the electrification is coming."

The benefits of biofuels are particularly pertinent to Australia, where we have significant agricultural resources yet still rely heavily on coal-fired power plants for energy production.

Scania's Senior Vice President, Trucks, Sales and Marketing, Alexander Vlaskamp (below), concurs…

"We cannot wait for the silver bullet because we then we might have the silver in the electrical vehicle but we still have not updated the coal [power] plants, so therefore for society we have not done anything," he said.

"So we have to start with the here and now, with the product variations of what we have, and we have to develop them for the different markets."

Mr Henriksson says Australia offers significant scope in terms of biofuel transport solutions.

"I think there is a lot of [potential] here in Australia," he said.

"If you look at the potential of using the natural resources, agricultural resources, waste, we can already today utilise renewables to create biofuels on a much bigger scale than is currently being used.

"What we're trying to do is make sure that everything is sustainable from 'well to wheel', and the lesson learnt is that when you get up and running and you have a [sustainable] supply system, the cost of producing this fuel in many parts of the world is cheaper, and the CO2 reduction is 90 to 95 per cent.

"We have made a conscious decision to make sure that we can offer the broadest range of different alternative fuels, so for us that is an investment in our ambition to drive the ship towards a more sustainable transport solution.

"So of these applications do we get a critical volume? Perhaps not. So we have to spend a lot of money to invest in technology on a broad base. But what we truly believe is that we can de-carbonise the whole global road transport system by 2050."