DPD will build own substation and switch to electric transport in larger Estonian cities

DPD will finance its own electricity charging infrastructure as part of plans to deliver parcels only by electric vans in the six largest Estonian cities by 2025.

The company will invest €0.2 million for building a substation in an area of constantly growing energy demand – the Jüri sorting centre. The substation will alleviate risks in the case of lack of low-voltage capacity to avoid a steep increase of costs in the future and ensure a smooth transition to electric vans.

Remo Kirss, CEO of DPD Estonia, explained: “We plan to use electric vans in Tallinn, Tartu, Pärnu, Rakvere, Viljandi, and Jõhvi. We have 260 parcel machines in Estonia; therefore, the way in which we organise the logistics of the machines, but also the orders of private and business customers as well as warehouses, has a big role to play in reducing CO2 emissions,”

Substation to reduce supply risks

There are currently 22 electric vans in the fleet of DPD Estonia. However, there are plans to increase the number to 100 to use them in all six cities.

“Increasing the number of electric vans means that there will not be enough amperes in the logistics centre of DPD to charge all vehicles; switching to medium-voltage is also economically more practical than constantly buying new capacity,” said Kirss.

The substation will be built in Rae rural municipality, in the Jüri sorting centre, because 60% of all of the car fleet of DPD services the Tallinn and Harju County region.

“Therefore, the aim of building this substation is to cover the charging demand of additional electric machines of our largest service area. The parcels of Tallinn and Harju country make up more than half, i.e., 54% of all parcels of DPD Estonia,” Kirss explained.

He added that the need for a substation is also illustrated by the fact that the working time of the sorting centre and charging the electric vans happens mainly at night, which is why additional solar panels will not alleviate the growing energy demand at night.

Largest EV fleet in Estonia

DPD Estonia was the first courier company in Estonia to start using all-electric vans for delivering parcels and by now, they have the biggest electrical fleet of machinery of all Estonian logistics companies. The first electric van was purchased in 2019.

Although the switch to electric vans was initially not the most rational decision from a business perspective, that investment has paid off economically.

“Comparing the price of electric and diesel vans, the price of diesel and electricity, maintenance costs, depreciation, and residual value, the total cost is now the same. Yes, it may vary by month, but the residual value of a vehicle is very important to us and now, it is much higher in electric vans,” said the CEO of DPD Estonia.

“Therefore, we are switching to electric vehicles and building the infrastructure necessary for charging now, not in 2035, when the sale of new cars with internal combustion engines will be banned in Europe, after which the steep increase in demand will make it more complicated and costly to buy electric cars,” Kirss explained.