USPS OIG Concludes Electrification of Post Office Delivery Fleet Operationally Feasible, But Costly; Federal Funds and V2G Revenue Required
|More than 96% of the USPS delivery fleet drives less than 40 miles per day. Data: USPS OIG report. Click to enlarge.|
Broad use of electric vehicles (EVs) in the US Postal Service (USPS) delivery fleet would be operationally feasible, according to a study assessing the operational and economic feasibility of moving the fleet to EVs conducted by the USPS Office of the Inspector General (OIG). Electrification of the USPS fleet could also provide a valuable opportunity for the nation to test EV technology.
However, the report finds, due to the Postal Service’s current financial distress, government funds and vehicle to grid (V2G) revenue would likely be needed to make this transition economically feasible.
Operational feasibility. The OIG evaluation determined that even current EV technology would work well with the average mail delivery driving distance of approximately 18 miles per day.
More than 96% of USPS delivery vehicles drive less than 40 miles per day.
Previous delivery operations tests under favorable environmental conditions within California showed that the EV performance levels were adequate for mail delivery ranges of up to 40 miles a day and battery technology has advanced considerably since then resulting in significantly increased driving distance ranges. Less than 4% of the delivery fleet has driving distances that exceed that amount.
To capture the benefits of the current Federal investments in battery technology, however, the report recommends a phased approach to electrification to be able to capture the benefits of future technologies before widespread adoption of earlier technologies in the fleet.
Economic feasibility. In its current financial condition, the Postal Service expects investments of its available capital to generate a high return and have a short payback period—at least 30% in fewer than three years.
The report authors evaluated four economic scenarios for acquiring 3,000 electric vehicles for use in delivery operations:
Postal Service purchases and maintains vehicles without government funds or grid revenue. This resulted in a payback time of greater than 10 years and an IRR = -1%.
Purchasing and maintaining vehicles without government funds, but generating grid revenue with V2G. This resulted in a payback time of 5.6 years and an IRR of 15.3%.
Purchasing and maintaining vehicles with available DOE program grants. This resulted in a payback time of 5.5 years and an IRR of 19.9%.
Purchasing and maintaining vehicles with grid revenue and DOE program grants. This resulted in a payback period of less than 2 years and an IRR of 63.2%.
V2G and the Postal Service. The Postal Service has a total fleet of some 146,000 delivery vehicles which are parked from approximately 5:00 pm to 8 am. Currently about 20% of the delivery fleet is in an area which offers V2G. Based on the planned expansion of V2G opportunities over the next 2-5 years, the report recommends testing and deploying Postal Service EVs in geographical areas that offer V2G.
US Postal Service Electrification of Delivery Vehicles (28 August 2009)