Electric vehicle technology dates back to the 19th century, but until the last few years, most iterations of these vehicles have been hamstrung by low power, short drive range, lack of charging infrastructure, and inflated cost—all factors that have hindered adoption for waste industry applications.
And while a handful of waste companies and municipalities have purchased, or announced their intent to purchase, electric waste vehicles in the last couple of years, these have mostly been one-off investments.
This all changed when Republic Services Inc., Phoenix, Arizona, announced a binding agreement with Phoenix-based Nikola Corp. on Aug. 10 to purchase 2,500 electric waste and recycling collection trucks with estimated delivery dates starting in 2023.
According to Republic, this represents “the industry’s first large-scale commitment to fleet electrification.”
During an Aug. 10 conference call, Nikola Corp. founder and executive chairman Trevor Milton and Republic Services President Jon Vander Ark discussed how the deal came to life, the truck specs and what the implications are for Republic and the waste industry at large.
About the trucks
Nikola’s waste trucks will be built on its battery electric Nikola TRE platform, which is a heavy duty chassis that was unveiled last year. The TRE has been undergoing continuous testing in anticipation of delivery to European customers in 2021. Milton says the company will be partnering with waste truck manufacturers, who will be supplying the body directly to Nikola. These truck bodies will be licensed to Nikola, allowing the company to service and warranty the entire truck in-house.
According to Milton, these trucks will have 720 kilowatt hours of energy storage and a range up to 150 miles, allowing operators to collect 1,200 trash cans a day in residential settings or around 140 small containers for commercial customers. The vehicles can be charged overnight for operation the next day.
Dispelling the myth of low power, Milton says, “[This] is the first time an electric trash truck has been able to achieve a full route that you would see with a diesel or natural gas [truck]. The actual powertrain is incredibly powerful. It was made to pull 80,000 pounds. So, we’re going to have to software limit that down. Theoretically, that powertrain is capable of up to almost 2,000 horsepower. … The regular trucks in the industry right now run about 350 to 500 horsepower, and it will supersede those. It will also have a smart algorithm in it that notices when a truck needs more horsepower and it will let it have access to that horsepower instantaneously.”
Milton says beyond added power, these vehicles will have zero emissions and be noticeably more quiet than diesel or natural gas alternatives. These vehicles will also be able to help drivers navigate their assignments through preprogrammed routes accessible from the cab’s infotainment system.
Milton noted that the company will be working directly with Republic to help incorporate some of this fleet management functionality into the trucks during development.
“By partnering with Republic Services, we’re able to develop and design this vehicle specifically for the trash industry to solve as many problems as we possibly can,” Milton says. “That’s going to be an exciting thing. The improvements that we make will be available to the rest of the industry, as well. There will be some specific stuff that Republic will own, like the data to their customers and things like that. But most importantly, they’re going to help us solve problems for the entire industry.”
Republic is also working with Nikola to help improve cab design to ensure these vehicles are as driver-friendly as possible.
The parties didn’t share the total cost of the investment, but Milton noted that the expense per truck would be less than then average cost of today’s electric waste trucks, which normally run upwards of $500,000 a unit. Milton ballparked Republic’s total investment between $1 billion to $2 billion.
Vander Ark notes that the company has “done [its] homework” looking at the end-to-end economics to factor in the cost of the units, the increased maintenance benefits over time, lower energy costs and the potential for the vehicles to help the company win new contracts and give it purchasing power.
Vander Ark issued the caveat that the cost of the trucks wasn’t the bottom line when it came to deciding to invest in the trucks because the company has a longer term vision and isn’t getting “caught up in the details of all the economics [because] that’s how innovation fails.”
What the deal means for Republic
Vander Ark says that Republic has been looking at investing in electric vehicles for several years and had compared all vendors in the space before selecting Nikola roughly a year ago. Since then, Vander Ark says the two companies have been working together to lay the groundwork for the deal.
“We took our time, we didn’t race,” Vander Ark says about the vetting process. “We weren’t trying to meet any other deadline other than to get it right for both sides, which we feel like we’ve done. I spent a lot of my life in the automotive industry, and [I’ve seen] a lot of tension between customer and supplier. And I think we’ve flipped the problem on its head and said, ‘How do we create something truly new and great end to end across the ecosystem?’ All the way from the design of the truck, to the manufacturing, to the servicing, to the grid and putting power back into the grid, all the elements of this thing we’ve worked together on.”
Republic noted that the anticipated benefits of these vehicles are instant torque, no idling, regenerative braking, up to 90 percent lower emissions on a per-mile basis, quieter operation in neighborhoods, as well as significantly lower maintenance costs.
In terms of maintenance and upkeep, Milton says, “Everyone is pointing fingers in the industry right now and no one wants to solve the problems of these trucks breaking down. And it’s a big problem, actually. Probably the most contentious part of owning a big refuse company is getting the service you need and getting the money to fix these parts. The nice thing about having [the whole truck] come from one OEM and one factory is that the entire truck is our responsibility at Nikola, the whole thing. … We have a warranty from [the body suppliers], as well. So, what this allows us to do is provide [service and support] directly to the customer.”
The Nikola powertrains are comprised of a pack of nine batteries. These batteries are estimated to last between five and 10 years, depending on the application and how many cycles a truck is performing in a day. Should damage occur to any one of these individual batteries, only the damaged one needs to be swapped out, the company says. Additionally, Milton says the single-speed eAxles on the truck don’t require the use of gears, which further simplifies maintenance since these can also be swapped out when needed.
Vander Ark says that Republic’s network of technicians should be able to handle the lion’s share of service work when these trucks eventually hit the street, and that the trucks’ design should lend itself to more streamlined repairs. He also acknowledged that the company hasn’t mapped out its expectations in stone for the life cycle of these vehicles.
“About 90 percent of our maintenance today is done in-house. We’re not reliant on a third-party dealer network in this case. Right now, we’ve got some capability builds to do among our more than 1,000 technicians, but we’ve got the ability to control [our service needs] within our system, and working together, we’re going to figure out the life cycle aspects of [these trucks],” he says. “There are just so many fewer moving pieces that we think we can get a maintenance advantage over time.”
Going where the road leads
Although the deal with Nikola is a significant commitment, Vander Ark says the company is still going forward with an electric vehicle pilot program with Mack that was announced last year.
On the company’s agnostic approach to electric fleet technology, he says, “I think if you look at us and you look at any player in the space, they’ll have multiple OEM partners going forward. We are pro electrification and we want everybody to get there, … even providers that we don’t buy from, because I think that creates a cleaner future for everybody.”
As for the company’s potential investments in CNG vehicles down the line, Vander Ark says natural gas has served its purpose as a bridge technology, but the future is in electrification.
Milton says he plans for Nikola to be able to deliver trucks for testing to Republic over the next 12 to 24 months to help work out any bugs in vehicle performance.
According to Vander Ark, the company will initially roll these trucks out into environments that are the most favorable. He singled out California and Arizona as having the right geography, climate, regulatory environment and customer appetite to deploy these trucks upon receipt.
While the initial purchase agreement is for 2,500 vehicles, the deal is expandable to 5,000 vehicles over the life of the agreement. For other waste companies interested in investing in Nikola’s vehicles, Milton says the company should be able to supply trucks to interested parties at the end of 2022 or beginning of 2023.
Summarizing the impact of the deal for Republic, Vander Ark says its investment in Nikola trucks will benefit its customers, employees, neighboring communities and future generations.
“This will be the first zero-emissions vehicle at scale in the industry and our customers in all capacity—small businesses, municipalities, residents—everybody is asking for this, and we’re going to be able to provide it at scale. So, that’s exciting for them,” he says. “It’s exciting for our employees. They get to ride in a state-of-the-art vehicle that is quiet, efficient, clean and gets to serve their customers in their neighborhoods. I’m excited for our shareholders because we’re going to jointly create value in this project together. And probably most importantly, I’m excited for my kids and my grandkids, and hopefully, my great grandkids, because I think we’re going to together deliver a cleaner future.”