Transport Notes

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The goal of Transport Notes series is dissemination of recent experiences and innovations in the World Bank Group’s transport sector operations.

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  • Publication
    Electric Buses: Why Now?
    (International Finance Corporation, Washington, DC, 2020-01) Graham, John
    There is a quiet revolution underway in a previously sleepy segment of the transport sector: the electrification of municipal buses and other intra-city vehicles. As McKinsey reported last October, the compound annual growth rate of battery-electric buses has exceeded 100 percent since 2013- surpassing that of every other electric vehicle segment. Investing in battery-electric buses - as well as other high-use vehicles, such as e-delivery trucks - is an effective way for International Finance Corporation (IFC) to move the needle on air quality and greenhouse emissions from urban transportation. The opportunity is massive, and IFC has the capacity to fast-track implementation. It’s time to hit the accelerator. A cocktail of technology, investment, and scale in electric buses (and other high-use intra-city electric vehicles) will soon reach a point where reliability and cost advantages create the death spiral for internal combustion engines. Superior technology and declining costs will eventually overwhelm the old, static, diesel driven transportation paradigm.
  • Publication
    E-Bus Economics: Fuzzy Math?
    (International Finance Corporation, Washington, DC, 2020-01) Graham, John
    Electrifying the global urban vehicle fleet depends on the convergence of several economic, technological, and political factors. However, the big shift to electric vehicles will likely take place only when the economics of owning and operating electric becomes a no-brainer. Using the example of electric buses, two factors must fall into place before the electric option can take off: first, the upfront cost needs to come down and second, there needs to be a change in procurement culture towards lifecycle cost or total cost of ownership (TCO). If utilities can structure out fluctuations in power costs (through PPAs) and the marketplace moves to leasing and other fixed-price operations and maintenance arrangements, these calculations can standardize across the board quickly. This is when the math starts to get a lot less fuzzy.