Truck electrification asset management under deep uncertainty

Abstract

Truck operators replacing diesel fleets with electric alternatives face a sequential, irreversible investment problem whose structure makes a single optimal rollout plan inadequate for strategy. This paper develops a framework that distinguishes two sources of decision variance: within-scenario flexibility, the room to resequence or defer commitments inside a given future, and cross-scenario sensitivity, the degree to which the preferred strategy changes across futures. We show theoretically, using real options and mean-preserving spread arguments, that flexible operators with independent adoption choices should exhibit more within-scenario latitude, while inflexible operators constrained by bundled commitments should face more cross-scenario exposure. A Probabilistic Mixed-Integer Programming (PMIP) formulation makes the decomposition observable. Stylized experiments confirm the prediction: the inflexible operator’s cross-scenario variance is twelve times larger than the flexible operator’s, with virtually no within-scenario latitude, while the flexible operator retains meaningful room for manoeuvre within each future.