Study: Cities Could Save Millions By Switching To Electric Buses

OCT 22 2015 BY MARK KANE 22

Volvo electric bus

Volvo electric bus

Analysis conducted by Volvo and advisory firm KPMG shows large savings from switching from diesel to electric buses.

For example, a city with about half a million inhabitants could see savings reach SEK 100 million (nearly $12 million) annually.

“The analysis has taken into consideration such factors as noise, travel time, emissions, energy use, taxes and the use of natural resources.”

“The analysis was based on a city with about half a million inhabitants and 400 buses. If the buses were run on electricity instead of diesel, the total annualized societal saving would be about SEK 100 million. Among other areas, the savings stem from reduced noise and air pollution, which is estimated to lead to decreased care costs of up to SEK 24 million. The annual reduction in carbon dioxide emissions would total 33,000 tons, corresponding to about 3,000 Swedish households.”

Niklas Gustafsson, Head of Sustainability at the Volvo Group said:

“Standard investment appraisals do not take into account all of the costs that impact society and the environment. Therefore, to quantify all of the aspects, we have now calculated the monetary value of an electric bus line. The results show that irrespective of the number of parameters taken into consideration, electric buses comprise the leading public transport solution.”

Daniel Dellham, KPMG commented:

“Electric buses are an excellent example of an innovation that can create substantial societal values. By supplementing standard financial analysis with socioeconomic and environmental factors, one arrives at a more complete picture of the investment’s impact on companies and society.”

Volvo already launched an  electric route in Gothenburg (see video), and is experiencing high interest, so if the profitability is as good as the report indicates, then we should expect a flood of electric buses soon.

Niklas Gustafsson adds:

“The bus line is one of the most modern in the world and interest is incredibly high, not least due to the buses being completely silent and emission-free, and being run on electricity from wind and hydro power. But the innovation aspect primarily pertains to the complete transportation system. A system that we can now show meets society’s socioeconomic and environmental challenges.”

Categories: Bus, Volvo


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22 Comments on "Study: Cities Could Save Millions By Switching To Electric Buses"

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Not sure about busses there, but some public transporation could save millions by giving out free EV instead. Crenshaw line in LA cost $1.4B to build for 16,000 riders (mostly same riiders each day). That’s $87,500 per person. You can buy over 90,000 SparkEV post subsidy with that much money, or 56,000 SparkEV pre-subsidy and just give them out for free.

If you consider bloated operating budget of some public transporation, it’d be cheaper to give out free EV forever!

The problem with that plan would be congestion. 😉

SparkEV, did you just divide the cost of the transit line by just 1 YEARS ridership numbers?


Assuming you’re not just trolling, ask yourself:
What’s the expected life of Crenshaw line in LA .
is it just 1 year, will it implode all by itself in one year?

Ridership number is 1 day, not 1 year. SparkEV would last about 10 years. At about 5 times ridership, they can give free SparkEV for 50 years. That assumes it’s free to operate the Crenshaw line, which isn’t true; when you factor in bloated operating budget, it’ll be cheaper to give out free SparkEV forever.

Crenshaw line is about 10 miles long. SparkEV, even without DCFC, is 82 miles. It’s far more useful.

Congestion is only a problem, because they’re building 19th century technology (rail). Invest in smart EV roads, and there won’t be congestion. Self driving cars are coming already, even without government investment. Meanwhile, billions and billions (speak with Carl Sagan accent) are wasted on antique rail technology.

Let me clarify ridership. Most people who ride are the same day after day. Therefore, daily ridership is better representation of unique riders. People who ride one way also use it for return trip. Actual unique riders is about half of daily ridership.

But there’s also turnover, quantity harder to find. I use 2X margin to represent turnover by using daily ridership as unique riders instead of 1/2 daily ridership. Obviously, turnover will be more as time goes, but certainly not day to day.

Even without giving out SparkEV, 10 miles of taxi ride will be cheaper than the construction cost for 30 years, never mind the operating cost. Give 16000 SparkEV to Uber and Lyft to service Crenshaw line area at huge discount for the riders? In any case, public transport costs more and less convenient for riders.

How much road space would 40 EVs require if they replace one bus?

EV uses road more efficiently than busses, such as side streets, highways, etc. Busses have to take one path, in most cases far less efficient. In that regard, 40 or 400 EV could take less space than 1 bus.

I doubt your number, I doubt your calculation, therefore, I’m not sure that what you write make sense.
Beside the fact that moving people alone in their car would consume more energy than moving all those people in one single vehicle.
But I don’t see the cost of energy and maintenance, insurance, license plate in your calculation.
Pretty much more work to do AFAIK.

If you don’t like my numbers, you can do the math yourself. 10 miles per day, how much energy, insurace (metro mile), etc. etc. and see what you come up with for EV. All the info are in public, Wikipedia has basics and links to other places.

Oh, and moving all those people in one bus. If you’ve seen busses during the day in that area, there’s maybe 4 or 5 people in it. Meanwhile, it’s burning energy to move 30,000lb of bus with plenty of stop and go. On aggregate, you can do the math yourself; it’s actually worse than EV, but you wouldn’t believe me until you do the math yourself.

*Somebody* doesn’t like public transportation.

Tell me, how much did you pay for the road between your house and your work again? That must have been provided free to city hall too. And the operating costs must be nothing at all either, judging by your budgetary estimation.

I don’t know why you’re talking about road that’s used by private vehicles AND public transit. Stick to the topic, which is vastly wasteful public transit, especially in CA. I mean, why spend more money AND inconvenience the riders AND slower AND … AND … AND!

Why are you screaming into the internet over this, exactly? Your post about your local public transit system has about as much relevance here as the price of tea in China, and you seem unduly upset about it on top of that. As if your family will starve to death because you paid an extra $58 in tax last month (which, you probably didn’t, and it’s pretty clear you haven’t done the math on how much exactly that one project cost you, personally). I could easily do a tiny bit of googling and do a nice cost comparison between say, my city’s recent freeway upgrades and its recent subway upgrades, comment on the value of each in terms of the amount of time I spend sitting in traffic every day (the freeway upgrades appear to have done nothing in that respect, FWIW) and any difference said infrastructure changes have made, and fill a post with numbers and facts that, while kind of interesting to me in particular, would clearly be lost on you. So that would be a bit of a waste of time where it comes to what I’m writing here. So instead, I’m just going to ask: Why… Read more »

See the subject of this article. My point is giving out free EV could save millions, too, while bringing far more benefits. I’m correcting all the fallacies that people have about EV vs public transit.

Let me ask you, why did you post complete non sequitur about roads, and continue to do so? Why do you feel a need to chime in on discussion with completely unrelated topic? That seem to suggest there may be something wrong with you trying hard to fit in, and that’s not even coming close to hyperbole.

The complete non-sequitur about roads was a followup to your complete non-sequitur about $1.6 billion spent on a railroad. You screamed about how this epic boatload of money was being spent on infrastructure when it *could* be spent on building something that goes *on* infrastructure. Recently my city (and province, and country) spent $3.3 billion on a new, wider bridge, plus an extra lane each way on the freeway that goes across it. It made little to no impact on the length of my commute over this route. And every time there’s a collision on this route (about three to five days a week), traffic is just as affected. You should take *this* cost into consideration when you say that your government should *not* spend $1.6 billion on public transit infrastructure, and should instead spend it on giving more people cars so they can use the freeway instead. So to me, it seems that you think your government should spend money on putting more cars on the road, so they’re forced to spend even more money on making the road bigger. Instead of spending that money getting people *off* the road and into a far more efficient and cheaper method… Read more »

Take a ride on the twin cities green line:

This is rather like quitting smoking. Gov’ts want you to do it but then moan about the loss of taxes.

And taxes are high in most European countries for petrol.

I’ve never heard my government complain about how much less tax they’re collecting from tobacco, but then, they’re footing the bill for chemo in the end anyway. Plus, they consider the egregious (truly!) taxes they collect on tobacco to intentionally be a disincentive. They’re not looking to make a profit on taxing them.

I’ve heard it mentioned, and read stories about loss of sin tax income. Diesel engine pollution tax and congestion restrictions should tend to assuage Europe’s taste for diesel.
Still, and I hate to use this analogy,
they have not only drunk the diesel koolaid but recommended it too all their friends.

No matter how you look at it, this is an apples-to-oranges comparison. The article suggests we should take the entire cost to society as a whole, including indirect costs such as health care costs attributable to diesel pollution, and compare that to only the direct cost to the municipal government for running a fleet of electric buses.

I’m all in favor of replacing every single fossil-fuel powered bus in the entire country with an EV bus, and ASAP. But the monetary justification for that, as presented in this article, appears to be more opinion than fact. More specifically, it appears to be a case of cherry-picking which factors to include and which to ignore.

That’s pretty much exactly what I was thinking when I read about how it’s supposed to be cheaper if and only if you consider the costs of externalities.

Of course, the government in many cases is also picking up the tab for those externalities, like health care. I know that’s a foreign concept to Americans, but for the rest of the developed world, it’s totally not.

Imagine a bus manufacturer doing a study that results in strong results for their product. Talk about sheer coincedence!