As the Chancellor unveiled his Budget, it became clear that the environment has moved front and centre in the discussion about the future of the UK and our economy.

Published 18 May 2021

Last updated 9 December 2021

This article was originally published in Public Sector Executive.

The Government’s plan for growth recognises the role that our fleet and transport infrastructure will play as we seek to build back better. 

Transitioning to net zero will present opportunities for economic development and job creation across the country, encouraging new business growth, and helping us to leave our environment in a better condition than we found it.

And the interweaving focus on net zero, infrastructure investment, and the environment demonstrates the potential benefits for the whole UK presented by the technology that has emerged over the last two decades – technology which the Government is backing to power our recovery after the pandemic.

It also puts new demands on the public sector’s approach to fleet management, and makes the case for change even stronger. 

Public bodies need to consider now how they can adapt to a net zero, electric future, and what co-benefits can be achieved by making the switch. 

The switch

With the sale of new petrol and diesel cars and vans set to be banned by 2030, the public sector is approaching a very real turning point in how it manages its fleets.

The Government is investing £1.3 billion in the rollout of charge points for electric vehicles in homes, streets and on motorways across England. At the same time, investment is promised in the UK’s car manufacturing bases to accelerate the transition to alternatively fueled vehicles – whether electric or hydrogen-powered.

Public sector fleets are already starting the process of transitioning to fully electric or hybrid vehicles while also boosting their regional charging infrastructure. 

I recently worked with East Devon District Council – a large, rural local authority in the south of England – who decided to act on climate change by converting its streetscene fleet to lower carbon alternatives; in this case, electric Light Commercial Vehicles. The eventual solution is clean, low-carbon, and able to traverse the full range of the largely dispersed local authority area. 

Their new fleet can return to one of two charging stations for overnight charging, with real-time charging data so the fleet manager can be sure charging time is being maximised. There are now plans to install more charging infrastructure for staff, supporting electric vehicle usage beyond a single council service.

The solution is designed to be easily scalable, and while its benefits won’t automatically transfer to every local authority, the key elements of how we reached it will. More on that later.

The risks of grey fleet

Aside from vehicles owned by your organisation, it’s important to factor employee-owned vehicles into your net zero calculations.

Vehicles that your employees own and use for business purposes are commonly referred to as ‘grey fleet’. It’s reckoned that over a billion miles are incurred each year in employee-owned vehicles.

As we emerge from the pandemic and the UK inevitably gets back on the road, we’re likely to see a rise in employees making use of their own vehicles for business purposes. Any increase in grey fleet usage has health and safety risks. It also poses a greater risk from higher CO2 levels, with the average age of grey fleet vehicles estimated to be 8 years old.

If your employees are using vehicles that pollute more than your own fleet would, it’s worth considering a ‘green’ salary sacrifice scheme. 

Like any salary sacrifice scheme, the employer takes control of its design. Schemes are designed as cost-neutral for the employer, meaning no investment is required. 

The employer can specify the type of vehicles available, including Ultra Low Emissions vehicles (ULEV), and schemes can include fully comprehensive insurance, servicing and maintenance, road fund licence and breakdown cover. 

For electric or plug-in hybrid vehicles, salary sacrifice scheme providers can source home-charging equipment and build the right solutions into the lease package for the individual.

Like the traditional fleet example, there are commonalities in the approach that can be taken by local authorities that will deliver benefits suited to the reality of your local area. 

Three steps to sustainability

At CCS, we know that many organisations expect to begin the shift to sustainable solutions in 2021. This is a challenging process for any organisation, so to help, we have identified the 3 steps organisations looking to transition to sustainability must consider.

  • Step 1 – know your data

First, you need to develop a clear understanding of how your fleet is currently being used. 

You should seek information on journey types, frequency and mileage, as well as the service, maintenance and repair impact on vehicles. You also need to understand driver behaviour which impacts fuel consumption and emissions. 

Factor in hired vehicles and grey fleet. Don’t overlook the cost to your business of all those mileage and subsistence claims.

  • Step 2 – understand demand and scope solutions

Next, you need to understand the optimum composition of your fleet.  

It sounds obvious, but your first consideration should always be how to reduce the need to travel altogether. For those essential journeys, you will likely end up with a blend of fleet and pool vehicles, hired in vehicles and, yes, grey fleet.

Consider whether salary sacrifice schemes will work for you, and start early and meaningful stakeholder engagement. Talk to your employees at large, and your sustainability, finance, estates and HR teams too. 

Plan your vehicle charging infrastructure before placing any orders for your new electric vehicles. Home-based charging can be relatively easy to implement and can even form part of the vehicle lease contracts. Work-based charging can be more challenging and costly. Explore options such as using public charging infrastructure or implementing revenue generating charge infrastructure. 

  • Step 3 – achieve great things 

Set your strategy and begin to make changes. New vehicle models and technologies are coming along all the time, so revisit your strategy periodically. CCS’s Fleet Portal is a great tool that can help you identify all the latest vehicles available in the market. 

It provides access to all vehicles available in the UK and, by using the filtering systems, you can easily identify vehicles that meet your criteria. The competitive quoting functionality ensures value for money and visibility of whole life costs when comparing different vehicles.

Let us power your fleet

Our suite of Total Fleet Solutions provide you with everything you need to power your fleet through uncertain times. Whether you’re looking to procure, adapt and maintain vehicles, or run your fleet efficiently and sustainably, we’re here to help.

To learn more, visit our Total Fleet Solutions web page which is packed with framework news, case studies and insight. 

If you have any questions, our fleet category experts are here to help – contact the team.

Kim Harrison, Crown Commercial Service’s Senior Category Lead for Fleet