Part of a series of insights from leading smart-grid, clean-energy, and utility experts speaking at gridCONNEXT. Questions asked by Clean Edge managing director, author, and gridCONNEXT co-chair Ron Pernick.
Ron Pernick: Just five years ago, very few people took electric buses seriously, but now many believe they will revolutionize city transport. In addition to technology advancements and declining costs, what’s driving this shift?
Ryan Popple: One of the big shifts is that cities are taking transit and infrastructure a lot more seriously, with a focus on low-carbon solutions. Similarly, the public increasingly understands that transportation solutions for cities can’t just be car-based. Add in the advent of smart phones, and people are less interested in driving themselves (when there is so much they can be doing between point A and point B).
All of these developments bode well for electrification. And we believe that transit systems are going to grow in both the public and private sector, hence the electric bus trend.
Pernick: The Chinese city of Shenzhen (home to EV manufacturer BYD), recently electrified its entire fleet of 16,359 buses. Bloomberg reports that China is adding 9,500 electric buses (the size of the entire London bus fleet) every five weeks and represented 99% of all battery electric buses (BEBs) deployed globally last year. Do you believe China will continue to dominate the BEB market, and if so, what do you see as your competitive advantages?
Popple: The U.S. and Chinese markets are quite different, with strengths and weaknesses for both. In China, the market is very top down. The centralized nature of the Chinese market has helped on the deployment front (as outlined above). But when a government mandates that an end user must buy your product, you don’t necessarily establish a meaningful feedback loop with customers nor does it encourage innovation on a product-development level.
In the U.S., markets tend to focus more on core engineering, technology innovation, and meeting customer needs. Our products, for example, have climate control (most electric buses coming out of Asia do not), which gives the technology a competitive edge. Our products can deal with climbing steep hills and can travel high-speed routes (highway driving), which isn’t the case for many of the offerings in China. We use an active thermal system to operate in extreme environments and ensure that our buses are heating and cooling passengers appropriately, which requires excellent energy efficiency.
We are creating our buses to operate in diverse and challenging environments from Missoula, Montana to downtown San Francisco. Similarly, our chassis is thousands of pounds lighter (made from composite materials) and our battery pack is far more energy dense.
Pernick: Which American cities are currently leading the charge to electrify their bus fleets, and what actions are they taking? Who are you currently working with?
Popple: In the past week alone, we’ve announced projects in ten more cities and we have orders in 40 of the 50 U.S states. So really, it’s happening across the nation.
It’s hard to pick a few cities or agencies that are leading the charge, but Los Angeles, under the guidance of Mayor Garcetti, is certainly at, or near, the head of the pack. Seattle, WA and King County is another locale that’s aggressively modernizing their mass transit fleets away from fossil fuels and toward low- or zero-emission options. New York City, San Jose, San Francisco, all stand out – some with targets to full electrify their bus fleets by a future date. And it’s not just large cities, but places like Park City, Utah that are getting involved and have proven to be industry pioneers.
What’s driving this? Often, it’s either a mayor or an executive leader at a transit organization that has a vision and picks up the mantle.
Pernick: What can you tell us about recent Proterra advances in BEB charging, costs, power, and range?
Popple: A lot has happened around energy storage in particular. In just the past few years, we’ve seen an increase in onboard energy storage from 80 kWh to 440 kWh systems. Our current 440 kWh (4 battery configuration) systems can go up to 175 miles on a single overnight charge – meeting the needs of most city buses in the U.S. (which travel, on average, 130 miles per day). Add in fast charging along the route, and you can increase that range even further.
Starting next year, we will be shipping a 660 kWh system geared toward customers operating the longest routes. And we are also currently piloting next-gen BEB systems, in which we are expecting both significant power and efficiency gains.
Pernick: BEBs are exhibiting increasingly competitive lifecycle costs (when including conventional offerings’ fuel costs, carbon emissions, etc.) – but higher upfront capital costs can still be a hurdle. What can the BEB industry learn from the solar industry, in which financing breakthroughs (such as solar leases) were nearly important as technological ones?
Popple: Yeah, I think that’s a great point. The way we are selling BEBs today looks a lot like how solar was sold 10 years ago, before the advent of solar leases (which became prevalent and exemplify how financing options can help to move a market).
Currently, electric buses cost anywhere from $150,000 to $250,000 more than the cheapest diesel buses (though BEBs are getting cost competitive with hybrid diesels ). Most of our orders right now are cash sales – meaning our current customers can finance their own buses. But that’s not true for all agencies, especially smaller cities that have less profitable systems or limited access to low-cost capital. I believe we need to transform the clean transportation system by not just selling buses, but also offering lease options and other financing innovations .
Ryan Popple is president and CEO of Proterra , a leading innovator of zero-emission, battery-electric buses. He will be a panelist at gridCONNEXT 2018 in Washington, D.C. in early December. The conference provides an unprecedented opportunity for utilities, policymakers, regulators, investors, businesses, service providers, end-users, and other stakeholders to explore policies and share best practices on building a modern 21st century grid. For more information, visit www.gridconnext.com.