The hassle-free way for shippers to leverage subsidies

If businesses, cities and regions are to meet their climate targets, the transition to a low-carbon economy needs to speed up. The collaborative projects of transforming businesses’ road freight operations are a key component of this. Subsidies aid this transition by further nudging the shift from diesel-based to electric freight operations; however, these incentive programs – which vary between cities and regions – come with their fair share of complexity. Read on to discover how your business can leverage subsidies in the most hassle-free way.

‍Subsidies and incentives geared towards electric freight are ramping up across cities and regions around the world, and they can help businesses carve a path to smarter, more sustainable and more resilient movement of goods. These financial incentives can take a range of different forms, including tax benefits, vouchers, and grants. Some are focused on reducing the cost of purchasing electric trucks while others aim to build out the supporting infrastructure, such as charging points and stations. And some are granted on a first-come, first-served basis, while others are awarded based on the strength of an application. 

‍When it comes to awarded subsidies, an application is often judged on how much CO2e reduction will be achieved per invested euro/dollar. Additional merit may be awarded if an applicant has a plan for how charging will be provisioned, with some subsidies specifically rewarding projects that build out charging capacity that will serve other businesses in the region. It can also be favorable for applicants to specify how digital capabilities will aid in operational planning, thus maximizing efficiency.

‍Subsidy programs vary in terms of complexity but are rarely simple for shippers to navigate. That said, it’s worth shippers being aware that such programs exist, as there are ways for them to leverage subsidies without becoming overwhelmed by complexity.

How can shippers unlock the benefit of subsidies?

As the transformation partner for some of the world’s leading shippers, Einride handles all aspects of making the switch from conventional diesel-based freight operations to intelligent, efficient and reliable electric freight operations – including all the necessary physical and digital infrastructure. Einride harnesses the experience of operating some of the world’s largest fleets of heavy-duty EVs. Subsidies are one area that Einride manages so the shipper can instead focus on their core business.

Einride has dedicated subsidies experts across various regions who are highly versed in the available incentives that shippers can leverage. These specialists will review your transportation needs, determine which subsidies are applicable, and prepare and lodge the necessary applications. If the incentive isn’t granted, there is no expense borne by the shipper. 

Einride has a solid track record for winning subsidies across Europe and North America. For shippers wanting to have the best chance at accessing these incentives, a reliable partnership is a way to minimize risk and maximize opportunity.

Transform your operations with or without subsidies

While subsidies provide a welcome boost, shippers don’t require them to move forward with their transformation. The nature of Einride’s offering means that shippers can unlock electric freight operations, today, without complexity or costly overhead investments. That’s because Einride purchases the electric vehicles and takes care of the necessary charging infrastrucuture – absorbing the CAPEX burden – while the shipper simply pays a subscription for freight capacity (as a managed transportation service).  

This one-stop “turnkey” solution enables some of the world’s leading shippers to transform a significant portion of their freight network today. Today, Einride operates some of the largest fleets of electric heavy-duty vehicles in Europe and North America, and it will soon commence operations in the UAE. Subsidies thus provide a supporting role in accelerating the transformation for businesses within the respective region.

In the following sections, we take a closer look at subsidies on either side of the Atlantic.

Subsidies in Europe 

Einride has so far secured public funding for shippers across six European countries: Sweden, Norway, Germany, Austria, the Netherlands, and Belgium. Applications are also being reviewed on behalf of Einride’s customers in the UK. 

Ludvig Hubendick is Einride’s Policy & Public Funding Manager, focused on Region Europe. He says it is common for schemes to cover a portion of the price difference between electric and diesel vehicles: “Depending on the program, the subsidy could range anywhere from 10% to 80%. For schemes with a focus on charging, there are national, statewide and EU-wide programs offering co-funding to support the cost of installing stations or chargers,” he says. “This is a shifting landscape, but at Einride we are always up to date with what’s on offer, and we help our customers and prospects amplify the impact of their electrification journey. We have a strong understanding of the various assessment criteria and ensure that shippers put forward the best case for success.”

Ludvig says a key factor for businesses with operations in Europe is that emissions will effectively come with an increased cost, due to factors such as the EU’s Fit for 55 legislation package, which is a set of proposals aiming to translate the Green Deal’s climate ambitions into law. As part of this package, road transportation becomes a component of the EU’s Emissions Trading System meaning that freight emissions come with a cost. 

“Subsidies are living up to their intended outcomes in speeding up the transition, so we will continue to see them being rolled out.”

It doesn’t end there. “CO2e levies are to be put on road freight in an increasing number of countries. Member states that fail on their national targets for emissions reductions in the road sector will incur the cost of allowances to cover their emissions or face hefty penalties,” says Ludvig. “At the same time, the emission standards for new heavy-duty vehicles will be strengthened significantly, and there will also be a minimum share of renewable energy to be enforced for road transportation.” 

Another consideration is that from 2025, under the Corporate Sustainability Reporting Directive (CSRD), businesses will be required to report indirect emissions across their value chain; these are known as Scope 3 emissions. 

“For many businesses, the time to act is now – and thanks to the fact that many subsidies are currently available, investing in diesel-free transportation now reduces the risk of transforming later when the cost of emissions comes with a high price tag or other implications,” says Ludvig.

Subsidies in the US 

Shahrukh Ahmed, Einride’s Public Funds Manager for the US, says that when it comes to fleet electrification, one of the key drivers is the prospect of cost parity between electric freight operations and conventional diesel-based operations: “What happens with US federal and state subsidies is you then have more and more scenarios in which this cost gap can be bridged, making freight electrification especially appealing.”

Shahrukh says Einride’s local team of government affairs and public funding experts are uniquely positioned to help shippers navigate these opportunities: “We provide prospective and existing customers with comprehensive services, matching customer cases with a robust database of over 90 heavy-duty vehicle-specific funding programs, totalling more than $100 million in available funding across the US.”

“In the US, subsidies enable us to electrify some of our customers’ freight networks at an even faster pace than initially anticipated.”

Einride doesn’t just stop at matching customers with existing programs. “We actively work with industry coalitions, agency staff, and policymakers to influence and shape new legislation, ensuring that future programs align with the needs of our customers. This proactive approach maximizes the potential for securing funds in a competitive subsidy environment, making it easier for shippers to transition to electric freight”, says Shahrukh.

Einride also manages the entire subsidy application process, from initial relationship-building with agency staff to preparing and submitting applications, and handling compliance. This end-to-end service takes the burden away from shippers, allowing them to focus on their core business while still reaping the benefits of electrification.

Subsidies are living up to their intended effect

“In the US, subsidies enable us to electrify some of our customers’ freight networks at an even faster pace than initially anticipated. For example, one customer aims to electrify lanes in Maryland, so we included these in the second wave of deployment. However, thanks to a subsidy being conditionally approved, it’s likely that the customer will be able to benefit from these lanes being electrified in the first wave – ahead of schedule,” says Shahrukh, adding: “It’s further evidence that subsidies work. They are enabling an accelerated shift away from fossil fuels.” 

His Europe counterpart Ludvig Hubendick agrees, saying he hopes to see many more subsidies being offered in the coming years with regulators and officials seeing them as a good thing: “Subsidies are living up to their intended outcomes in speeding up the transition, so we will continue to see them being rolled out. But even if – for whatever reason – they were to slow down, Einride will still be there to support shippers on their journey to decarbonize their operations,” he says. “As their transformation partner, we make it possible for them to benefit from intelligent and efficient freight operations today. Subsidies are a bonus to help accelerate that shift.”

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Want to find out if there are subsidies or incentives you can leverage in your region? Get in touch and we can connect you with one of our experts. You can also learn more about decarbonizing your freight operations in our article explaining why now is the time to make the switch.