Electric Buses in America
Lessons from Cities Pioneering Clean Transportation

Executive Summary

America’s bus network plays a crucial role in the lives of millions of people, providing transportation for those who cannot or do not wish to drive, and carrying up to half of all American children to and from school every day. The majority of America’s buses, however, are still powered by polluting fossil fuels such as diesel that pose a serious risk to public health and contribute to global warming.

Battery-powered electric buses can reduce the environmental and health threats posed by diesel buses while also providing a reliable and cost-effective option for cities and school districts. Advances in electric bus technology and a rapid decline in battery costs over recent years have made electric buses an increasingly viable option for many transit agencies and school districts.

However, electric buses are still an emerging technology. Transit agencies and school districts considering electric buses need to know what to expect – and, more importantly, how to get the greatest benefit from their investment.

The experience of six early adopters of electric buses illustrates the challenges that agencies have faced, as well as the benefits many have received from their electric bus pilots. To speed up the rollout of electric buses and ensure that cities see the benefits of these vehicles, state and city officials should commit to a transition to electric buses on a specific timeline and create favorable utility rate structures for transit agencies that include reduced off-peak energy rates and limited demand charges.

Electric buses deliver numerous benefits to the communities they serve.

  • By eliminating diesel exhaust emissions, particulate pollution and pollutants that contribute to the formation of ground-level ozone, they improve the air quality in our communities.
  • They produce significantly lower greenhouse gas emissions than diesel, diesel hybrid and natural gas-powered buses. Replacing all of the country’s diesel-powered transit buses with electric buses could eliminate more than 2 million tons of greenhouse gas emissions each year.
  • Electric buses can deliver financial benefits, including substantially reduced maintenance costs and, in places where utility rate policies are favorable, reduced fuel costs.
  • By reducing air pollution, electric buses can also deliver significant societal benefits, including avoided healthcare expenses resulting from cleaner air.

Electric buses have often performed well in early pilots, and have often been cheaper to fuel and maintain than their diesel counterparts. But early adopters have experienced a set of technological and economic hurdles that future electric bus programs will need to overcome.

  • Seneca, SC. In 2014, Seneca became the first city in the world to launch an all-electric bus fleet. The buses have outperformed their diesel equivalents in fuel and maintenance costs and exceeded expectations regarding charging time, range and battery life. Seneca views its electric buses as a successful, scalable model of full-fleet electrification.
  • Chicago, IL. The Chicago Transit Authority’s (CTA) rollout of two electric buses in 2014 was one of the first major tests of electric bus technology in a cold winter climate. The vehicles have performed well, have had no difficulty with extreme temperatures, and have saved the CTA more than $24,000 each year in fuel costs and $30,000 each year in maintenance costs. The agency is currently moving forward with its commitment to full-fleet electrification by 2040.
  • King County, WA. King County Metro Transit has been testing electric buses since 2016. The buses have performed well in a range of weather conditions, but with occasional problems, including issues with battery life and range. Per-mile fuel costs have been higher than for diesel due in part to high electricity demand charges. Taking into account other factors, such as environmental benefits, the agency nonetheless regards its electric buses as providing a good return on investment and plans a large-scale rollout in the coming years.
  • Albuquerque, NM. Safety and durability issues with its electric buses, as well as subpar battery life, inadequate range and sensitivity to extreme heat, contributed to Albuquerque’s electric bus tests in 2018 ending in disappointment. Having incorporated safeguards into its contract with the manufacturers to ensure it would lose no money in the event of failure, the city cancelled the contract and returned its buses. In August 2019, however, the city announced its intention to buy five new 40-foot electric buses.
  • Twin Rivers, CA. In 2017, the Twin Rivers Unified School District Transportation Department in California became one of the first school districts in the country to deploy electric school buses. The vehicles have experienced few problems and produced a 75-80 percent savings on fuel costs (largely due to very favorable utility rates), exceeding the district’s most optimistic expectations. The district reports a total savings of $15,000 per year on energy and maintenance costs, and believes its experience proves that electric school buses can be a reliable and cost-effective alternative to diesel buses.
  • Massachusetts school bus pilot. In 2015, the Massachusetts Department of Energy Resources tested electric school buses in three school districts across the state. The vehicles produced significantly fewer harmful emissions than diesel school buses, had no difficulties with range, and cold weather did not affect their performance. Fuel cost savings were smaller than expected, however, mainly due to unmanaged charging of batteries and high electricity demand charges. All three school districts chose to keep their buses after the pilot.

Policy Recommendations

  • States, cities, towns and school districts should commit to a full transition to electric buses on a specific timeline. These commitments will help grow the market, drive technological innovation, and enable transit agencies and school districts to gain the benefits of economies of scale in maintenance facilities, operational experience, and electricity pricing.
  • States should provide grant programs and subsidies for agencies to go electric. This will ensure agencies and the communities they serve will experience the benefits of electric buses without additional financial burdens being placed on the agencies themselves.
  • Public officials and utilities should implement financing programs in which they front the initial investment for electric buses and allow cities and school districts to pay back on utility bills as they save on fuel and maintenance costs. These “pay as you save” financing programs can help agencies overcome the higher upfront costs of electric buses and deliver monetary savings immediately.
  • Public officials and utilities should provide discounted off-peak charging rates, limit excessive demand charges, and experiment with policies and practices that allow battery-electric buses to be used for storage/use vehicle to grid technology.

Transit agencies and school districts considering electric bus deployments should:

  • Establish solid collaborative partnerships with utilities from an early stage, and open a dialogue about goals and interests from the outset. Agencies should work with public officials and local utilities to enact a transportation rate for electricity and use rate modeling in the planning process for launching electric bus service.
  • Ensure contracts with the bus manufacturers include provisions to guarantee protection in the event that the vehicles delivered do not perform as promised.
  • Be realistic about the capabilities of electric buses for particular routes and conditions, and study route modeling data to determine the appropriate type of bus for the route.
  • Before going to bid, have electric vehicles from different vendors shadow existing diesel buses and ensure that the bid includes the needs identified in the route study.
  • Invest in as large a fleet as possible as soon as proof of concept can be established. Ensure the availability of additional electrical capacity and build the infrastructure to be able to add more chargers, including on-route charging infrastructure where necessary. The larger the fleet, the greater the potential economies of scale, and the greater the opportunity to demonstrate the vehicles’ functionality and desirability.
  • Acquire as much data as possible from agencies already using the technology. Ask agencies where they’ve been successful, where they’ve failed, and where they’ve worked with manufacturers and utilities to find solutions to issues that have arisen.
  • Include environmental and health benefits (for example, the “social cost of carbon”) in any evaluation of the costs and benefits of electric buses. Calculations of return on investment should include the total societal cost for the life cycle of an electric bus versus a diesel bus.