CEFC backs Woolworths' 148-truck electric fleet roll-out

The Clean Energy Finance Corporation has committed up to AUD $22 million to support Zenobē Australia's rollout of up to 148 battery electric trucks for Woolworths' last-mile delivery network.

The investment is expected to support Australia's largest electric truck fleet rollout, with Foton T5 trucks leased for grocery deliveries in New South Wales and Victoria, alongside additional vehicles in Queensland, Western Australia and South Australia.

Zenobē will acquire the trucks and retain ownership under a leasing model intended to remove long-term asset risk for Woolworths. The rental package includes maintenance, warranties and upgrades, allowing the supermarket group to add electric vehicles to its delivery fleet without taking on end-of-life exposure.

The rollout comes as battery electric trucks remain a small part of Australia's commercial vehicle market. Of the 12,003 trucks and heavy vans sold in Australia so far this year, only 0.9 per cent were electric.

Transport accounts for up to 23 per cent of Australia's national emissions, and road freight activity is projected to rise by about 35 per cent between 2025 and 2040. Truck emissions are expected to increase by 10 per cent over that period, while road transport is projected to account for 83 per cent of transport emissions by 2035.

The financing targets one of the more difficult parts of transport electrification. While passenger electric vehicle adoption has strengthened, heavy vehicles have lagged because of higher upfront costs, charging infrastructure needs and uncertainty over resale values.

That has left fleet operators weighing the economics of switching technology in a segment where vehicles often remain in service for long periods. Broader use of leasing structures and larger deployments could help establish operating benchmarks and support the development of a secondary market for electric heavy vehicles.

Julia Hinwood, Head of Infrastructure at CEFC, said: "By increasing the uptake of BETs, we're helping develop the market to bring them closer to price parity with their non-electric counterparts. This investment reflects the commercial viability of BETs and enables Zenobē to set competitive rentals to incentivise customers to lease BETs. Backing deployments in hard-to-abate sectors like freight helps normalise new technologies and bring in wider private investment. With fuel price volatility and supply risks increasingly material for freight operators, early large-scale deployments are critical to generating the real-world performance data and operating benchmarks needed to underpin a secondary market for electric heavy vehicles."

Last-mile delivery has emerged as one of the more straightforward entry points for commercial fleet electrification because routes are predictable and vehicles typically return to base depots. High vehicle utilisation can also improve the economics of replacing diesel trucks with battery-powered models.

For Zenobē, the Woolworths deployment expands its transport electrification role in Australia beyond buses and into freight at greater scale. The company has previously worked with the CEFC on battery electric transport projects, and this latest commitment is focused solely on vehicle acquisition and leasing.

Gareth Ridge, Country Director, Australia and New Zealand at Zenobē, said: "This project is evidence that electrification is a commercial opportunity. Woolworths is already rolling out hundreds of electric trucks at scale. That's almost unheard of in Australia's freight sector and proof that, with the right business model and competitive pricing from Zenobē, electrification stacks up right now. Together with Woolworths and the CEFC, we're proving that large-scale zero-emissions logistics is no longer a pilot. It's commercially viable and operationally proven."

The CEFC has made transport decarbonisation a larger investment theme across passenger vehicles, fleet electrification and charging infrastructure. To the end of March, it had directly committed more than AUD $260 million to electric vehicle-related projects since inception.

Its transport portfolio includes support for Team Global Express on fleet electrification, work with Volvo Group Australia on medium- and heavy-duty battery electric trucks, and backing for what it described as Australia's first electrified bus fleet and depot, delivered by Zenobē.

Across its co-finance programmes, the CEFC said it had helped finance more than 20,000 electric vehicles with a combined value exceeding AUD $1.2 billion, including third-party capital.

The full truck rollout for Woolworths is due to be completed during 2027.