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June 03, 2003
FedEx and UPS Green Up Their Fleets With Hybrid Electric and Fuel Cell Vehicles
    by William Baue

FedEx introduces hybrid electric delivery vehicles, while UPS is investing in fuel cell technology.

Late last month, the package delivery companies FedEx (ticker: FDX) and UPS (UPS) announced steps they are taking to reduce their energy consumption and carbon emissions. FedEx collaborated with Environmental Defense, a nonprofit organization, to introduce a low-emission hybrid electric powered delivery vehicle that could become the standard medium duty delivery truck in FedEx's fleet. Meanwhile, UPS announced a joint project with the U.S. Environmental Protection Agency (EPA) and DaimlerChrysler (DCX) to develop and later deploy zero-emission, fuel cell-powered vehicles.

Later this year and into early 2004, FedEx will introduce 20 OptiFleet E700 hybrid electric vehicles in four yet-to-be-named U.S. cities. Except for a small OptiFleet logo, the E700 vehicles will look the same as their standard W700 counterparts. However, the vehicles will function quite differently.

While the W700 uses gasoline to power a six-cylinder engine, the E700 combines a four-cylinder diesel engine with an electric motor, with a computer determining the most efficient combination. FedEx and Environmental Defense, which began their collaboration in 2000, chose the Eaton Corporation (ETN) from among more 20 competitors to manufacture the hybrid electric powertrain.

"Working together with Environmental Defense, FedEx has developed a truck that will deliver cleaner and healthier air, reduce oil dependency, and reduce climate change impacts," said Fred Krupp, president of Environmental Defense.

Compared to a 1999 W700, the representative model of the FedEx fleet, the E700 will decrease particulate emissions by 90 percent, reduce smog-causing emissions by 75 percent and increase fuel efficiency by 50 percent. It does this in part by employing a particulate trap to capture the increased amount of particulates emitted by diesel engines. It also uses "regenerative braking," a process that recycles the energy that is usually wasted in braking by capturing and storing this energy in lithium-iron batteries for future use by the electric motor.

"While diesel does have higher particulate matter content, it's an excellent alternative to gasoline-powered engines, and when you incorporate hybrid technologies such as regenerative braking, you're using more of the energy generated by the engine for propelling the vehicle itself," said Brian Adams, public information associate with Rocky Mountain Institute (RMI). RMI is a nonprofit energy resources think tank that consults with businesses on progressive transportation options such as hybrid electric and fuel cells.

"Most of the energy that goes into a vehicle is wasted," Mr. Adams told "Only about one percent [of the energy generated by the engine] actually moves the driver down the road, so using the energy given off from braking into a hybrid electric motor is an excellent way to transition to a zero-emission alternative."

Mr. Krupp trumpeted: "Environmental Defense now challenges other companies to step up to the plate and meet the green standard set by FedEx."

UPS is working toward setting its own green standard, and it may be positioning itself to surpass FedEx. UPS introduced its first and only hybrid electric vehicle into its fleet in Huntville, Alabama in October 2001, and it has introduced 13 Chrylser Electric Powered Interurban Commuter (EPIC) minivans into its Los Angeles fleet. Now, UPS is making the transition from low-emission to no-emission technology with the introduction of fuel-cell powered vehicles.

Fuel cells convert the energy generated in the chemical reaction between hydrogen and oxygen into electricity without combustion, and hence without creating exhaust emissions. By late 2003, UPS will introduce one DaimlerChrysler "F-Cell" vehicle for use in early-morning deliveries in the Ann Arbor, Michigan area, where EPA is providing access to its hydrogen refueling station. UPS plans add more fuel cell vehicles to its fleet in 2004.

"Environmental improvements like this and the needs of business are not incompatible," said Tom Weidemeyer, chief operating officer of UPS and president of UPS Airlines. "It's time to deploy this technology in a commercial fleet and learn exactly what's needed to make it broadly available."

Mr. Adams confirmed the value of test deploying fuel cell vehicles in a commercial fleet. The Rocky Mountain Institute considers fuel cells to be a preferable solution to the dilemma of fossil-fuel based transportation systems.

"The best way to start the transition in transportation solutions is through fleet vehicle services, such as package delivery businesses that are fueled in a central depot and maintained under the same umbrella organization so that their data can be monitored and analyzed to update and advance fuel cell technology," said Mr. Adams

"We're ultimately in favor of the fuel cell vehicles over the transitional diesel hybrid technology," Mr. Adams told


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