Electric Buses Debut in North Carolina

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The days of public buses pulling away from a bus stop with the loud growl of a diesel engine and a cloud of black smoke could become a thing of the past.  The company Proterra makes fully electric buses, and North Carolina will soon see four of these buses hit their streets.  The governing board for Raleigh Durham International Airport has agreed to purchase four of Proterra’s Catalyst E2 fully-electric buses, four charging stations, and the required infrastructure and training at a cost of $3.4 million.  The cost was offset by a $1.6 million grant from the Federal Aviation Administration (FAA).  

Other municipalities in the Triangle are also exploring this option. Chapel Hill has expressed interest in two electric buses, and Go Triangle recently tried to acquire seven buses at a cost of $6.6 million.  Go Triangle applied for the federal Low or No Emission Competitive Grant Program (5339c) to cover half of the cost of these buses, but they were not awarded the grant.  However, this has not stopped them, because this process was a good exercise and opened the door to other viable alternatives for funding.  Proterra has also started offering financing and leasing options for those trying to cover the up-front costs.

Part of the funding challenges come into play because of the higher initial cost of these buses.  While a typical diesel bus costs about $380,000, these all-electric buses cost $722,000.  That large initial price might turn some away from electric buses, but the higher up-front costs appear to be offset by energy savings, reduced maintenance costs, and a longer life span.  Looking at fuel costs, diesel buses typically get 3.86 MPG (miles per gallon).  This equates to a running cost of $0.84/mile driven, compared with $0.74/mile for CNG (compressed natural gas), and $0.63/mile for hybrid diesel buses.  The electric buses use a modest $0.19/mile of electricity, meaning the buses break even in energy savings alone after about 500,000 miles.

Because the drivetrain of these buses is much simpler mechanically, they tend to have fewer moving parts and need less servicing.  For example, the regenerative braking system, which recharges the battery pack when the bus is slowing down, expands the life of the brake pads from a typical 20,000 service interval up to 100,000 miles.  Proterra estimates that the maintenance costs savings could save up to $151,000 over the life of the bus.  Combine this with an estimated life span of 18 years instead of 12 years with a traditional bus, these buses could save up to an estimated $400,000 over their life.  These savings are impressive, but the technology behind them is equally impressive.

Proterra, who is headquartered in Silicon Valley, manufactures these buses in nearby Greenville, South Carolina. There are only two moving parts inside the bus which includes a 220 KW motor and a two-speed automatic transmission.  Most models also include regenerative breaking, which uses the motor as a generator to power the battery packs when the bus is coasting or braking.  Battery packs vary based on usage, but range from 79kWh delivering about 62 miles of range up to a whopping 660 kWh for long-range routes.  While 660 kWh is no small feat, that is 6 times the capacity of the longest-range Tesla.  In fact, Proterra just broke a world record for the longest range of any electric vehicle on a single charge, traveling over 1,100 miles before running out of power.

Electric vehicles are typically hindered by long charging times, but there is a solution for this as well.  Proterra has a high-speed charger that can be mounted overhead at a bus station or bus stop.  When the bus pulls in, it automatically docks to the bus and charges it while waiting at the stop without any kind of driver intervention.  These quick chargers can charge a bus in as little as 5 minutes, however at a cost of $380,000 per charging station, one has to be selective in how many chargers to install.  By utilizing these chargers, the buses can keep the bus charged indefinitely while stopping along routes, and Proterra has approved the buses for continuous, 24-hour-a-day operation.

Robert Smith is a MBA candidate at UNC Chapel Hill’s Kenan-Flagler. He is also a Community Revitalization Fellow with the Development Finance Initiative.

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