ERA launches the Energy Transition Project

The European Rental Association (ERA) has kicked off a project on Energy Transition in the Rental Industry.

The project marks a significant step toward advancing decarbonisation of the rental industry and related value chain. This initiative comes at a critical time when transitioning to low-carbon solutions is essential for long-term growth and environmental stewardship.

By bringing together various stakeholders, ERA aims to develop a cohesive handbook offering numerous strategies to face existing challenges with the process of the energy transition towards electrification and alternative fuels solutions.

The Importance and Challenges of Energy Transition

The process of the energy transition in the rental and by extension the construction industry has been ongoing gradually for several years. The process is fuelled by the need for decarbonisation of the industry, increasing pressure from regulations and from customers on sustainability and the overall shift to modern equipment that is required to have many digital capabilities.

However, the rental industry faces significant structural challenges as it moves towards low and zero emissions equipment.

These challenges include limited availability of alternative fuels and fuelling and charging infrastructure, fragmented landscape of charging solutions, limited availability and a price of low emissions equipment, cultural and technical reticence of rental customers to embrace low emission equipment, as well as the complex considerations of total cost of ownership of equipment.

To address these issues, ERA contracted EY, the renowed consultancy, to engage all stakeholders—OEMs, rental companies, customers, users, and public authorities in a truly collaborative study.

Deliverables of the project

The Energy Transition Project is built around four essential objectives, offering a comprehensive roadmap:

1. On standardisation, the study will summarize current trends in batteries and infrastructure to articulate the rental industry standards needs and identity training needs of rental companies in this area. This part will also deliver recommendation to equipment manufacturers and to public authorities on standardisation actions.
2. Guidance on energies will summarize the range of alternative energy options and will identify the most appropriate type of energy in a piece of equipment and the barriers to the alternative types of energy adoption. A separate note on the taxation of fuels, incentives and subsidies will be developed in this part of the project.
3. A report on customer requirements and customer value proposition will detail the challenges and opportunities of the energy transition from the customers’ point of view. It will give recommendations to improve the accessibility and attractiveness of low carbon solutions for the customers. It will also identify new business opportunities for rental companies related to electrification of equipment and alternative energies.
4. Revision of the rental total cost of ownership model will update the existing TCO model with energy related considerations, based on the conclusions of the first three phases.

Looking Ahead

While the journey of the energy transition towards decarbonisation is a one that the industry inevitably needs to take, with the initiation of the ERA project, it is becoming apparent that there are many ways different and nuanced ways to get there. For example, electronification of equipment is one of them, but using alternative low emission fuels such as HVO in improved internal combustion engines will continue to be a solution where electrification is not a feasible option.

The ERA project on Energy Transition will guide all stakeholders in the rental value chain through this process. ERA expects to the all deliverables of the project will be available by mid 2025.