An Impact Analysis of Electrifying Florida’s Public Buses Alicia AER Group, Tallahassee FL Buddy Atkins, Vesselka McAlarney, Alicia Queen

Project Scope Proterra Inc. contracted AER Group to perform an impact analysis of converting Florida public buses from diesel to electric Direct cost savings Indirect benefits

Electric Bus Alternative The Proterra EcoRide Equivalent lifespan of a diesel bus (12 years) Improved fuel efficiency Simplified motor FastFill™ Charging Station Discuss the charging system

Methodology Impact Analysis Cost Comparison Additional Benefits Initial Investment Cost Comparison Annual Expenditures Impact Analysis Increased Economic Activity Additional Benefits Reduced Externalities

Methodology Impact Analysis Cost Comparison Additional Benefits Initial Investment Cost Comparison Purchase Price Facility Upgrades Annual Expenditures Impact Analysis Increased Economic Activity Additional Benefits Reduced Externalities

Initial Investment for Electric Higher than Diesel $790,000 $480,000 Alicia Source: Proterra Inc., American Public Transportation Association Factbook, 2012

Initial Investment for Electric Higher than Diesel $310,000 AQ Source: Proterra Inc., American Public Transportation Association Factbook, 2012

Federal Grants Cover at least 80% of Initial Investment for Electric and Diesel AQ Tallahassee’s StarMetro received 100% federal funding for electric buses in 2011 Source: US Department of Transportation Federal Transit Administration, NTD

Initial Investment for Electric Higher than Diesel, but Offset by Federal Grants AQ end $62,000 Source: Proterra Inc., American Public Transportation Association Factbook 2012

Reduced Externalities Methodology Initial Investment Cost Comparison Annual Expenditures Impact Analysis Maintenance Fuel Cost Increased Economic Activity Vesselka Additional Benefits Reduced Externalities

Electric Bus Has a Simpler Mechanical System Engine Engine Oil Engine Components Gearbox Traction Motor Belts Alternator VM Fuel Systems Exhaust Systems Retarder Battery Diesel vs. Electric Proterra Inc., 2013

Lifetime Maintenance Costs for an Electric Bus Are Less than Diesel VC US National Transit Database, 1991 - 2011

Lifetime Maintenance Costs for an Electric Bus Are Less than Diesel $112,000 VC US National Transit Database, 1991 - 2011

Electricity and Diesel Price Projections Needed to Estimate Fuel Costs to 2035 VC In order to estimate the total lifetime costs for a bus, we need price projections to estimate the annual expenditures on fuel. Source: US Energy Information Administration Annual Energy Outlook, 2013

Source: US Energy Information Administration Apply National Diesel Price Projections to Florida without Modification VC Source: US Energy Information Administration

Source: US Energy Information Administration Apply National Diesel Price Projections to Florida without Modification VC Florida Projection Source: US Energy Information Administration

Electricity Prices Vary Due To Numerous Utilities Throughout Florida Source: Florida Public Service Commission, Facts and Figures 2013

Buses Concentrated in Densely Populated Areas VC Source: Florida Department of Transportation

Apply National Electricity Price Projections to Florida, Reduced by 12% VC Source: EIA, FMEA

Apply National Electricity Price Projections to Florida, Reduced by 12% VC Source: EIA, FMEA

Electric Buses Are 5x More Fuel Efficient than Diesel VC – “for our study, we have chosen 21 mpg as this is most relevant for buses in FL…” be sure to be familiar with the Penn state study Source: Penn State Bus Testing and Research Center, NTD

Lifetime Fuel Expenditures for Electric $450K less than Diesel VC $445,000 Source: Penn State, NTD

Total Lifetime Cost for Electric Bus Lower than Diesel BUDDY Source: NTD, APTA, Proterra Inc., Penn State, EIA

Total Lifetime Cost for Electric Bus Lower than Diesel $464,000 BUDDY Source: NTD, APTA, Proterra Inc., Penn State, EIA

Conversion Plan – Purchase 200 Electric Buses Each Year Full Conversion BUDDY To convert 2,400 over 12 years, we need to convert 200 per year

Annual Total Cost of Diesel Fleet and Conversion Initial Investment Total Cost Difference Battery Purchase Increased Fuel Efficiency Initial downward from increased efficiency in system Further downward is due to same NPV and assumption issues as diesel Full Conversion

Despite Initial Loss, Total Cost of Electric Fleet is $120M Less Per Year Full Conversion Recoupment $120 million Initial Deficit

Electric Fleet Continues to Generate Savings with Constant Federal Grants Reference $85 M Constant Grants BUDDY – can you figure out when the break even is for the no grants case?

Electricity and Diesel Prices Stay Constant Until 2035 VC In order to estimate the total lifetime costs for a bus, we need price projections to estimate the annual expenditures on fuel. Source: US Energy Information Administration

Electricity and Diesel Prices Stay Constant Until 2035 VC In order to estimate the total lifetime costs for a bus, we need price projections to estimate the annual expenditures on fuel. Source: US Energy Information Administration

Electric Fleet Continues to Generate Savings with Constant Fuel Prices Reference Constant Fuel Prices $80 M BUDDY – circle the date of the break for constant fuel prices

Reduced Externalities Methodology Initial Investment Cost Comparison Annual Expenditures Impact Analysis Increased Economic Activity Buddy Additional Benefits Reduced Externalities

Reduced Externalities Methodology Initial Investment Cost Comparison Annual Expenditures Impact Analysis Increased Economic Activity Buddy Additional Benefits Reduced Externalities

Electrifying Public Bus System May Create New Jobs Converting to electric bus system New power plant to meet demand by electric buses Government diverts cost savings to other sectors Stimulate local economy Jobs Personal income growth AQ

Additional Electricity Demand May Require a New Power Plant in Florida Current supply and demand of electricity is in equilibrium Charging electric buses at peak times will create unplanned demand for electricity A new electricity plant of 85 MW may be needed New plant may be needed because the demand for electricity by 2400 buses will push utilities over their current capacity. Large utilities, such as those in urbanized areas where buses tend to be concentrated, are required to keep a reserve ratio of 20% (vesselka how can I explain this better? we need to tie this to show how if the utililities do not expand enough by 2025 to meet the electricity demand from 2400 buses they will eat into their reserves so even at 1% of total demand, that may be enough to necessitate a new plant of 85 MW) Source: Florida Public Service Commission

Estimates produced using a regional economic model by REMI, Inc. If a New 85 MW Electric Plant Is Built, It Will Stimulate the Florida Economy Category Estimate Construction Spending $110 million Operating Cost $2.5 million/year Annual Sales $50 million/year New Jobs (direct & indirect) 100 permanent jobs Personal Income Increase $20 million AQ If a new power plant is built, this will stimulate the Florida economy by creating jobs and increasing personal income. To model these economic effects, we used a regional economic model by REMI and we found that… Estimates produced using a regional economic model by REMI, Inc. Source: U.S. Energy Information Administration, Florida Public Service Commission

Estimates produced using a regional economic model by REMI, Inc. Local Governments Can Divert Transit Cost Savings of $120M to Other Services If cost savings are spent on education: Category Estimate Annual Cost Savings $120 million New Jobs (direct & indirect) 500 permanent jobs Personal Income Increase $40 million AQ In addition to stimulating the economy through electric plant expansion, converting the buses to electric could stimulate the economy if the government diverts the transit cost savings to ther government services. We modeled the effect of this increase in government spending if it were on education using the regional model and found that… Estimates produced using a regional economic model by REMI, Inc. Source: U.S. Energy Information Administration, FMEA, FDOT, Proterra Inc.

Electrifying Public Bus System Could Reduce Negative Externalities Since 2001, “clean diesel” has helped reduce air pollutants CO2 emissions have not been reduced Will conversion aid in the reduction of CO2? AQ Source: USF Center for Urban Transportation Research (2009), US EPA

40 metric tons of CO2 per bus annually CO2 from Electric Buses Comes from Production of Electricity at Power Plants AQ 1.23 lbs of CO2 per kWh 40 metric tons of CO2 per bus annually Source: Public Utilities Commission; EIA

CO2 Emissions Are Significantly Lower for Electric Buses CO2 emissions are 75% lower for an electric bus! AQ Total CO2 emissions from power plants in FL (2011): 115 m metric tons Source: CUTR, NTD, EIA, Florida Public Services Commission

Electrifying Transit Will Continually Reduce CO2 Emissions At full conversion, 300k tons of CO2 can be saved Update the numbers Source: CUTR, NTD, EIA, Florida Public Services Commission

Electrifying Could Reduce Externality Cost by as Much as $7M Annually Use price to quantify the negative externality cost from CO2 emissions American Power Act (2010) would have established a cap-and-trade program for GHG emissions EIA estimates that externality price could range from $10 to $25/metric ton of CO2 Source: CUTR, NTD, EIA, Florida Public Services Commission

Conclusion VC Impact of Electrifying Florida’s Public Buses

Reduced Externalities Methodology Initial Investment Cost Comparison Annual Expenditures Impact Analysis Increased Economic Activity AQ Additional Benefits Reduced Externalities

Florida Would Benefit from Electrifying the Public Bus System At full conversion: Annual cost savings of $120M Creation of up to 600 jobs Reduced externality effect by $7M It makes economic sense for Florida to adopt an electric bus system VC

Vesselka drops the mic and kisses baby in audience (Dougie)