In public debates about reducing transportation-related carbon, transit agencies typically sit on the side of the angels, and many have pressed their advantage with pledges to replace their diesel bus fleets with zero-emission vehicles (ZEV). Yet progress has been halting because of cost, technical issues around charging and the pervasive caution of transit managers.
Case in point: electric bus adoption. The Toronto Transit Commission has 400 in operation – a fifth of its fleet – and claims to be North America’s leader. New York’s Metropolitan Transportation Authority, has about 500 – less than a 10th of its fleet – and aims to complete the transition by 2040. Metrolinx, which operates hundreds of GO buses in the Greater Toronto region, is still plodding through a six-stage procurement initiative.
But the pace of conversion isn’t slow everywhere. Transport for London (TfL), for instance, now has 1,900 e-buses, while Santiago, Chile, has 1,800, up from just two in 2017. The agency, known formally as Red Metropolitana de Movilidad (RMM), says it will have 4,400 e-buses by next year – 68% of its total fleet – and asserts that it has become the second-largest e-bus operator in the world, outside China. (RMM runs 391 bus lines that carry 3.3 million passengers per day across Greater Santiago, which has a population of almost seven million people.)
China, in fact, is the telling detail in this decarbonization narrative. TfL’s new e-buses, including new double-deckers, are made by Shenzhen-based BYD, the world’s largest manufacturer of electric vehicles. Santiago’s are also sourced from Chinese manufacturers. The unit prices have fallen from about US$400,000, when the agency secured its first pilot vehicles, to about US$260,000 today, according to Alejandro Schmidt, chief technology officer.
“The buses we have in operation are from China,” he adds. “They have been very aggressive in terms of the pricing of the product, but now we are seeing also competition from European OEMs like Volvo, Scania and Daimler, with their bodies built in Brazil.” Even more relevant: the Chinese bus makers can deliver vehicles in six to nine months, which is considerably faster than what’s on offer among other manufacturers.
As Chile’s transportation minister, Juan Carlos Muñoz, an academic specializing in transit and logistics, put it at an international forum in Leipzig on May 21, “We do not close the door to technologies coming from any country, and that has been very good in terms of finding competition. It has been key for us to allow every charging system in the world to be open for operators to provide.” A former board member of Santiago’s Metro system, Muñoz has been one of the driving forces behind the electrification of the city’s far-flung transit agency.
Santiago’s transformation isn’t only about going after low-cost suppliers, and as such serves as an interesting model for transit operators looking to, well, accelerate.
The national government in Chile provides transit subsidies and has also agreed to backstop private-sector investment in the new fleets. (The Canadian government in 2023 kicked in $700 million for the TTC’s e-bus fleet.) Early on, Schmidt explains, the first external investors were actually Chilean electrical utilities, which had a commercial interest in fleet electrification. But the financing now also comes from private equity firms, which ink leasing deals with the local operators (several municipal bus companies operate within Metro Santiago).
Hastening the changeover is a law banning the purchase of diesel buses and an open procurement approach that sets out the performance specifications. However, the agency’s e-bus procurement policy doesn’t include pre-conditions stipulating locally manufactured content – a reflection of Chile’s long-standing and at times controversial neo-liberal political outlook in the post-Pinochet era. “We are a very open economy,” Schmidt says, adding that there’s no vehicle production in Chile, and thus no incumbent that needs to be protected, as is the case in Brazil as well as North America (New Flyer Industries is the dominant supplier).
Energy, of course, is the final piece of this puzzle. According to Schmidt, Chile’s electricity mix includes hydro, fossil fuels and a rapidly expanding portfolio of solar, in the country’s north, and offshore wind, in the south. “We’re reaching 75% green energy,” he says. For the e-bus fleet operators, the trick has been to ensure that they’re not overly exposed to high spot market rates for green energy. The agency is also looking at using hydrogen to round out the supply of low-carbon electricity. “We’re trying to figure out the best way to solve these challenges,” Schmidt says.
Public response has been, unsurprisingly, positive. Electric buses are quieter and provide a smoother ride, and there are predictable air-quality improvements.
With RMM’s e-bus transition now irreversible, Schmidt explains that Santiago’s remarkable pivot was the result, initially, of some political risk-taking at the national level, plus a totally open approach to technology procurement, the involvement of private capital and the willingness of the local bus operators to make the shift. “We weren’t able to do it by ourselves.”
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