Sempra’s ( SRE Quick Quote SRE - Free Report) business subsidiary, Southern California Gas Co (SoCalGas), recently joined forces with Ford Motor Company (F) on a demonstration project that involves the development of a F-550 Super Duty Hydrogen Fuel Cell Electric Truck to combat emissions from the commercial fleet as part of its ASPIRE 2045 sustainability goals.
The move also comes in sync with the U.S. Department of Energy's intent to scale down emissions from medium and heavy-duty trucks under its SuperTruck 3 program.
Details of the Demonstration Project
Per the agreement, Ford will provide the F-550 Super Duty Truck for SoCalGas, while the latter will assess the performance and durability of the truck in demanding and hard-working conditions of a utility. SoCalGas will also have a temporary hydrogen refueling station at its Bakersfield facility as part of the project.
This project is an important step toward gaining carbon neutrality in the heavy-duty transportation of the utility fleet and will act as a great respite for utilities amid rising energy prices.
SoCalGas’ASPIRE 2045 Sustainability Goals
SoCalGas’ ASPIRE 2045 Sustainability Goals highlight its commitment to achieving net-zero greenhouse gas emissions in its operations and delivery of energy by 2045. This step toward carbon neutrality also entails its pledge to replace 50% of its over-the-road fleet with clean fuel vehicles by 2025 and operate a 100% zero-emission fleet by 2035.
With this aim, SRE has been consistently working to electrify transportation and progress in CO2 reductions from the fleet. Before this collaboration, in April 2022, the company announced to convert 200 new Ford F-250 service pickup trucks to run on renewable natural gas to reduce greenhouse gas emissions.
Moreover, SoCalGas boasts a fleet family of 50 hydrogen fuel cell electric vehicles (EVs) and plans to install 1,500 EV chargers at 67 company facilities by the end of 2024. Additionally, it has 10 active hydrogen pilot projects in its discretion, thus exemplifying its massive efforts in the clean energy space.
Such decarbonizing initiatives by the company, including the latest partnership with Ford, takes Sempra one step ahead in its goal to attain its carbon neutral target and further solidify its presence in the clean energy market for vehicles that represent abounding growth prospects. Hence, it is imperative to mention that the immense focus of the company on electrifying the transportation sector has made a third of SoCalGas' over-the-road fleet to operate on clean fuels.
The expanding EV market amid the increased focus on transitioning to the low-carbon forms of energy has led many utility companies to expand their position in the lucrative EV market. In this context, utilities that have invested in the EV segment of the market are
Duke Energy ( DUK Quick Quote DUK - Free Report) , Edison International ( EIX Quick Quote EIX - Free Report) and WEC Energy Group ( WEC Quick Quote WEC - Free Report) .
In July 2022, Duke Energy Sustainable Solutions announced a first-of-its-kind 10-year agreement with Pinellas Suncoast Transit Authority (PSTA) officials to install, maintain and operate electric bus charging infrastructure, the latest step in PSTA’s ongoing mission to transform the fleet to clean and green by 2050.
The long-term earnings growth rate of DUK is pegged at 6.1%. Duke Energy’s shares have rallied 2.8% in the past year.
Edison International’s Southern California Edison through its Charge Ready program aims to install, maintain and cover installation costs for charging infrastructure, while participants own, operate and maintain charging stations. The program also provides rebates on the purchase of charging stations.
The long-term earnings growth rate of Edison International is pegged at 2.9%. EIX shares have returned 24.6% in the past year.
WEC Energy Group joined utility companies across the Midwest to expand EV charging options for drivers. The company has signed a multi-state effort to build and grow EV infrastructure. As part of the collaboration, WEC Energy Group pledges to expand the EV charging network within the service territories of its electric utilities – We Energies, Wisconsin Public Service and Upper Michigan Energy Resources.
WEC’s long-term earnings growth rate is pegged at 6.1%. WEC Energy’s shares have rallied 9.4% in the past year.
In the past year, shares of Sempra have rallied 25.4% compared with the
industry’s growth of 16.5%. Image Source: Zacks Investment Research Zacks Rank
Sempra currently carries a Zacks Rank #3 (Hold). You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here