Sourcing Finances

 

Getting the money for any innovative initiative can frequently be complex and difficult. Especially when the initiative is being developed and implemented within a commercial, public transport bus operating environment. While money to buy (capital expenditure; CAPEX) and operate (operating expenditure; OPEX) conventional buses is clearly available, additional CAPEX and OPEX associated with the project (for purchase, training, maintenance and other operating costs) will need to be met to fully cover the increased Total Cost of Ownership (TCO).

The major source of this additional money in JIVE and JIVE 2 has been the FCH JU. Funds from the CEF through the MEHRLIN Project have also supported the HRS implementation in many JIVE sites. Various levels of the local, regional and national government have also contributed. In some cases, such as in the UK, funding from low emission vehicle and government innovation initiatives has been provided. Some funding, such as for the Groningen project in the Netherlands, has also come as one element of a much broader, energy system or economy-wide vision for hydrogen (H2) and fuel cells.

Overall, additional sourcing funds has not been easy. No site has found this trouble-free, including those with experience from previous projects. However, there were no patterns that could be identified that could lead to success or problems. Much seemed to depend on specific knowledge of local, regional and national funding programmes, and local circumstances at the time, particularly political circumstances. Possibly the only common driver for funding is the existence of supranational (EU) and national targets for emission reduction. These have clearly acted to galvanise action from those involved in the provision of public transport. The pressure in this respect is going to increase via the revised Clean Vehicles Directive (CVD) that sets out mandatory minimum procurement targets for clean light-duty vehicles, trucks and buses for 2025 and 2030, including zero-emission buses.

Beyond TCO, it can be beneficial to undertake Life-Cycle Costing (LCC). This takes into account, in addition to TCO, costs resulting from the consequences of emitting greenhouse gases (GHG) and other pollutants. These result in costs associated with health treatment and climate change impacts as well as mitigation and adaptation policies. The savings achieved by replacing conventional buses with zero-emission alternatives can be a useful argument when negotiating for additional funds or, in the future, cheaper loans from the government for whom these costs are a large budget item.

Challenges and Solutions for Sourcing Finance

Determining Costs

Covering Costs

Resources for Sourcing Finances