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£50m scheme launched to create England's "first all-electric bus town(s)"

07 February 2020
As part of its £220m funding package to improve bus services in England, the Government has this week pledged £50m to support the creation of England's first all-electric bus town (or towns).  

1. What is the scheme?

As part of its £220m funding package to improve bus services in England, the Government has this week pledged £50m to support the creation of England's first all-electric bus town or towns.  

Transport authorities can apply for the funding to help them make the switch to a fully electric service which it is claimed will "reduce emissions and clean up the air in their community".   

The Department of Transport has said the winning town (or towns, should the money be able to support more than one successful bidder) will be used as a pilot (or pilots) as it aims to ensure all UK buses are fully electric by 2025.

Transport Secretary Grant Shapps said buses had "a crucial role to play in bringing down emissions".  

The All-Electric Bus Town proposal has the following key aims:

  • to act as a pilot to understand what can be achieved when there is a real commitment to move all buses in a place to electric zero-emission; 
  • to understand the impact this can have on improving air quality and greenhouse gases in a place; 
  • to understand better the challenges of running a wholly electric bus fleet; 
  • to understand the impact that an electric fleet can have on running costs for bus operators (given that electric buses should be cheaper to run in terms of fuel costs); and
  • to support bus manufacturers in the development of zero emission bus technology

2. How does the application process work?

The Fund will take the form of a two-stage competition, with Phase 1 being a light-touch expression of interest proposal, leading to a short list of places selected for Phase 2, where a full business case must be submitted. 

3. How will the fund be invested?

£50m is available in total to support this project (thus far), which could go towards one or more all-electric bus towns/cities. 

The amount of support for a place will be based on the funding formula used in the earlier Ultra-Low Emission Bus funding round. That is as follows: 

  • the Department of Transport will contribute up to 75% of the cost difference between a zero-emission bus and a standard conventional diesel bus equivalent of the same total passenger capacity; or
  • in terms of infrastructure, the Department of Transport will contribute up to 75% of the capital expenditure incurred as a result of its purchase and installation. 

4. Who can apply?

Local transport authorities (including local authorities, combined authorities and other responsible bodies) across England (outside London) can bid for the money to help pay for a new fleet of electric buses however the Government expects bids to be developed in close partnership with all local bus operators in any given area.

5. What are the key dates for application?

6th February 2020

Phase 1 opens and expressions of interest invited

5pm 30th April 2020

Deadline for expressions of interest

End May 2020

Announcement on shortlisted places moving to phase 2

Summer/Autumn 2020

Business cases of shortlisted place(s) to be submitted

6. What are the environmental benefits?

It is claimed a town with 200 electric buses could save around 7,400 tonnes of CO2 each year, the equivalent to taking 3,700 diesel cars off the road.  Obviously if the pilots are successful the exercise may be rolled out on a much larger scale.  

7. What other types of funding are available for green bus schemes?

Transport is generally agreed to account for the greatest share of UK domestic greenhouse gas emission[1].

The All-Electric Bus Town scheme is part of the Government's "better deal for bus users" which sits against a back drop of the Government's ambition for all UK buses to be fully electric by 2025, as part of its Road to Zero Strategy (whereby the UK will transition to zero emission transport by 2050 and become the world leader in the development and manufacture of zero emission vehicles).

£20m has recently been ear marked for a trial of an "Uber-style" on-demand bus service for rural areas which will allow users to access bus travel closer to where they live, at a time convenient to them, via the use of an App. Applications can be made to the rural mobility fund here.

The Government has also released the list of successful bidders (details can be found here) to its 2018 £48m Ultra-Low Emission Bus Funding scheme, which will support 7 towns and cities across England to bolster the low-carbon public transport offering with plans to purchase 263 new ultra-low emission (mainly electric) buses – doubling the UK's existing low emission bus stock and providing funding for the related new infrastructure costs.  

The department for transport has also launched a new £6m scheme to provide charging points for electric taxis across the UK, with around 300 rapid charging points and 46 fast chargers for ultra-low emission taxis in 17 local authorities including Greater Manchester, Brighton, Leicester and across the North East. 

How can we help?

Our public sector and transport teams advise on multiple low carbon transport initiatives across the UK and offer expertise on issues relevant to State aid and public procurement.  We would be happy to assist you with your bid.  Please feel free to get in touch.  


[1] https://www.gov.uk/government/collections/uk-greenhouse-gas-emissions-statistics