Conceptualized and Designed by Varsha Jeyapandi
With Inputs from Keshav Suryanarayanan, Aishwarya Soni
10 things that made our 2022: ITDP India’s Year-End Roundup
In 2022, we saw our actions over the year have a cascading effect and seen many things fall into place. It’s been a year of scaling up our work at the city, state, and national levels; experimenting with new tools—illustrations, games, and even skits; experimenting with new tools—illustrations, games, and even skits; strengthening relationships with multiple new partners!
Here’s a look at our top 10 wins for 2022:
01 | Launched a Healthy Cities Leaderboard to track the progress of cities through the India Cycles4Change, Streets4People, and Transport4All Challenges!
We launched a Healthy Cities Leaderboard to track the progress of participating cities towards the goals set through the three national Challenges. We hope to see them learn from and be inspired by each other’s progress and speed ahead towards transforming their cities.
Here are some highlights from the leaderboard:
• 32 cities formed the HS Apex Committee
• 14 cities formed the Healthy Streets Cell
• 49 cities hosted open street campaigns
• 51 cities are implementing walking and cycling infrastructure
02 | Trained over 800 officials through 35 workshops, including 2 national workshops
Through the three national Challenges, we trained over 800 officials from over 40 cities to create Healthy Streets and improve their public transport systems. We developed a range of resources for the cities; you can find the entire repository here.
We conducted two national Healthy Streets workshops—in Bengaluru and Chandigarh—to bring together officials from all the cities participating in the India Cycles4Change and Streets4People Challenges, to build their capacity on various topics, and to create a space for active peer-to-peer learning.
03 | Created an illustrated Healthy Streets Vision: Translated into 10+ languages, Adopted by 9 cities
We need to redefine the relationship between our streets and people to ensure that everyone—regardless of age, gender, or physical ability—can move safely and comfortably and breathe clean air. We unveiled the Healthy Streets Vision to inspire cities to transform our streets into healthy and happy spaces for people.
The Vision illustrates 10 things that make Healthy Streets. The vision is now translated into more than ten languages and adopted by 9 Indian cities!
04 | Experimented with new ways of communications: Designed a game and a skit on sustainable mobility!
Over the year, we experimented with new ways of communicating to engage with city officials and get them to interact with each other in new and interesting ways. We thank them for keeping an open mind and supporting these efforts.
We developed a game and a skit for city officials and tested it at a national Healthy Streets workshop attended by over 130 city officials. It was great to see their enthusiastic response and engaged participation!
Many of us in the ITDP India team are huge fans of games. We think they work well to get us to think strategically in creative ways and have fun along the way. So, when we started thinking of interactive ways of training city officials to create action plans for Healthy Streets in their cities, a game seemed obvious! We developed the Healthy Streets Action Plan game as a fun and participative way for city leaders to engage with the process.
We look forward to building on the game in 2023!
To effectively convey the nuances of multi-stakeholder campaigns like the Cycle2Work campaign we tested with cities, our team wrote and performed a skit—the first of its kind in a national workshop—to take the audience through the various steps involved in rolling out such a campaign.
05 | Supported PMPML in adopting an ambitious 5-year vision for buses
On April 18th, PMPML launched Vision 2027 on Pune’s Bus Day 2022.
By 2027, PMPML—the bus operator for Pune and Pimpri-Chinchwad—aims to provide sustainable urban mobility by making buses available near everyone to transform them into congestion and pollution-free cities.
The vision aims for three things:
• More and Greener Buses
• Faster, Reliable, and Affordable Services
• Safe Access to Public Transport
06 | Developed and tested a Street Assessment Framework in Pune to be scaled up to cities across the country
We collaborated with the Pune Municipal Corporation to test the framework to assess their streets and identify areas in need of urgent improvement. The city launched the Walking and Cycle Analysis Report on 11th December, on Pune Pedestrians’ Day!
The framework helps cities measure the impact of street design projects on four principles:
- Ease of movement
- Safety
- Universal Accessibility
- Liveability
07 | Launched 3 reports on the status of e-mobility in India with ASRTU
We partnered with the Association for Road Transport Undertakings (ASRTU) to launch three reports on the status of e-mobility in India. The reports aim to show emerging e-bus technology, electric informal public transport, and electric micro-mobility.
We look forward to working with ASRTU to build the capacity of State Transport Undertakings (STUs) across the country.
08 | Developed state- and city-level recommendations for electric 3-wheelers in Tamil Nadu: Informed by surveys in 6 cities
To understand the gaps and barriers to electrification from the perspective of the 3-wheeler drivers, ITDP India conducted in-depth surveys of autorickshaw drivers in six cities and focus group discussions in three cities across Tamil Nadu. More than 2,600 autorickshaw drivers were interviewed, providing valuable insights into three-wheeler operations and the bottlenecks to transitioning to electric vehicles (EV).
Informed by the findings from the surveys and discussions, ITDP India prepared a report on the electrification of 3-wheelers in Tamil Nadu, which included state-level recommendations to help overcome challenges related to EV adoption. We shared the recommendations with Guidance Tamil Nadu, an investment promotion agency under the State Industries Department, to inform the ongoing revision of the state EV Policy.
We also developed a detailed roadmap for the electrification of three-wheelers for Chennai. The roadmap identifies specific action points for the city to help overcome challenges related to adopting electric three-wheelers. We look forward to working with the city to accelerate the transition to electric mobility.
09 | Signed MoUs with 10 new partners
2022 was a great year for partnerships. We signed memoranda of understanding (MoU) with national-level agencies such as the Association of State Road Transport Undertakings (ASRTU) and Bus & Car Operators Confederation of India (BOCI) to support them on improving public and private bus operations at the national, state, and city levels, and with the National Institute of Urban Affairs (NIUA) to support cities across the country in implementing sustainable, equitable, and inclusive urban mobility.
We also signed MoUs with multiple city agencies, including the Pimpri Chinchwad Municipal Corporation, the Surat Municipal Corporation, the Nagpur Municipal Corporation & Nagpur Smart & Sustainable City Development Corporation Ltd., and the Pune Mahanagar Parivahan Mahamandal Ltd.
In collaboration with the Council for Energy Environment and Water (CEEW) and Sandeep Gandhi Architects (SGA), we will be working to accelerate the electrification of public and private sector buses.
We look forward to working with our partners to scale up transformation across the country.
10 | Supported the operationalising of CUMTA to transform Chennai’s transport systems
Bringing all key agencies and stakeholders related to mobility under a single roof, the Chennai Unified Metropolitan Transport Authority (CUMTA) will ensure seamless integration and implementation of all transport projects in Chennai. In 2022, CUMTA set up four sub-committees to focus on specific areas: multi-model integration, road safety, digital integration, and mobility resilience.
As a knowledge partner to CUMTA, we are supporting them in the activities of the sub-committees, identifying gaps in the status quo, strategising priority actions for improvement, and building capacity. In the first Authority Meeting chaired by the Chief Minister of Tamil Nadu, two priority areas were identified: Common Ticketing System for Public Transport and Safe Commute for Students.
We look forward to supporting CUMTA towards the vision of a safe, smart and sustainable transportation system in Chennai.
We take this moment to acknowledge the contributions of our many partners, who make our work and wins possible. Our deepest gratitude to our funders for supporting our work. Our heartfelt thanks to the Ministry of Housing & Urban Affairs and Government officials—at the national, state, and city levels—for collaborating with us to create a walking, cycling, and public transport transformation in India. We’d also like to thank the sustainable transport community—NGOs, consultants, mobility experts, academic institutes, CSOs, and individuals—who make things happen on-ground.
In 2022, the ITDP India team also expanded and grew stronger, united in our mission to create Healthy Streets, Healthy Cities and Happy Lives.
We look forward to seeing where 2023 takes us!
Written by Varsha Jeyapandi
Edited by Keshav Suryanarayanan
Transport4All Challenge steps into Stage 2
Shri Hardeep Singh Puri, Minister of Housing and Urban Affairs, in the presence of Shri. Manoj Joshi, Secretary, MoHUA, Shri. Kunal Kumar, Joint Secretary and Mission Director, Smart Cities Mission, MoHUA, and Shri. Rahul Kapoor, Director, Smart Cities Mission, MoHUA; launched the Stage 2 of the Transport4All Challenge, inviting Indian startups to create digital solutions to reform formal and informal public transport in India.
About Stage 1
More than 130 cities signed up for Stage 1 of the Challenge, launched on 15th April 2021. 100 cities formed a Transport4All Task Force (TTF) with key government stakeholders and governments working in the transport sector, along with academic institutes, non-profit organizations, and IPT unions. Check out the highlights from Stage 1.
Stage 1 saw the biggest public transport data exercise in the country with surveys from 46 cities. These cities successfully conducted surveys with more than 2 lakh citizens, 15,000 bus drivers and conductors and 22,000 informal public transport (autos etc) drivers— making it the biggest public transport data exercise in the country.
These cities—who qualify for Stage 2 of the Challenge—used the surveys findings to develop more than 165 problem statements, that is now curated into a final list of 8 problem statements by the Challenge team.
What next?
Stage-2 of the Challenge is open for startups to develop solutions for the issues and problems identified by the cities.
Startups are now invited to develop contextual solutions and scale them up at a national level for the 8 curated statements. Cities and startups will receive guidance to develop and test various solutions, learn from them, and scale them to build people’s trust in public transport and enhance their mobility.
The top 1-2 solutions for each problem statement will not only receive awards of up to ₹ 20 lakhs but will have the opportunity to scale up solutions at a national level.
The startups with working solutions stand to get empanelled with the Ministry of Housing and Urban Affairs and access many opportunities to implement their solutions in several cities in the future.
Are you a startup or do you know startups that would like to get involved in a national-level challenge to make a difference in Public Transport?
Head to the Startup India portal and register, before 30th December 2022.
Startups now can get their DPIIT registration till 15th January 2023.
For more information, visit transport4all.in
Where are we in the Three Stages of the Challenge?
The Transport4All through Digital Innovation Challenge comprises three stages:
● Stage I PROBLEM IDENTIFICATION: Cities, with the support of NGOs, identify key recurring problems that citizens and public transport operators face
● Stage II SOLUTION GENERATION: Startups develop prototypes of solutions to improve public transport with inputs from cities and NGOs
● Stage III PILOT TESTING: Cities engage startups for large-scale pilots and refine the solutions based on citizen feedback
We look forward to the brightest minds in the country developing solutions to the pressing problems identified by the public to improve facilities for a better future in formal and informal public transport.
We’d like to acknowledge the leadership of the Ministry of Housing and Affairs, Smart Cities Mission, Urban Transport and Association for State Road Transport Undertakings—hosts for the Transport4All Digital Innovation Challenge. We thank our knowledge partners, the World Bank, for bringing their global technical expertise in digital innovation and guiding startups and cities. We also thank the technology platform partners, Cix and Startup India, for engaging with startups and for providing a platform for cities and startups to collaborate easily.
As Co-host and Coordinator for the Challenge, ITDP India provides technical and communication expertise to cities, facilitates capacity-building workshops and one-on-one sessions with them, and sets up peer-learning platforms so cities can learn from one another.
ParkItRight
An infographic blog
Conceptualized and Designed by Varsha Jeyapandi
Technical Inputs from Parin Visariya, Bala Nagendran
What’s challenging the private bus sector in its e-bus transition?
This blog is part three of the “Embracing E-buses” series. To read the previous two parts, click here.
India’s great electrification wave is here. It’s everywhere you look, and for all the right reasons. Since PM Narendra Modi’s declaration of a new climate target at COP26—pledging to cut India’s total projected carbon emissions by 1 billion tonnes by 2030, and going net zero by 2070—many Indian cities are prioritising a shift to electric technology. Especially in road transport, which is responsible for 14% of overall carbon emissions in the country.
Indian cities are developing roadmaps to transition to e-buses, but there’s one catch: e-buses don’t come cheap. Priced anywhere between 75 lakhs (USD 93,670) to 1.75 crores (USD 218,500) depending on the bus size and range with a good return of investment over its lifetime, e-buses are desired by all, but affordable only by a few. With e-buses, which are 2.5-3 times the cost of the conventional Internal Combustion Engine (ICE) buses, the upfront purchasing cost poses a major roadblock for operators in owning and operating them. Since 2015, there has been a considerable push from the Government of India to adopt electric vehicles, through the Faster Adoption and Manufacturing of Electric Vehicles (FAME) I and subsequent FAME II scheme by Department of Heavy Industries (DHI).
With a total outlay of Rs 10,000 crores, the FAME II scheme aims to accelerate the transition to vehicles and curb transport emissions, by subsidising 7000 e-buses; 5 lakh e-autorickshaws; 55,000 e-cars (including strong hybrid that consists of both combustion engine and battery powered motored), and 10 lakh e-scooters/motorbikes. So far, 5595 buses have been subsidised. State Transport Undertakings—the public entity that manages the operation of buses at the state level—are currently operating 2100 e-buses across India.
While the scheme to financially support STUs for e-bus transition is commendable, an important player seems to have been left behind: private bus operators. It may seem hard to believe, but private buses comprise more than 90% of all buses in the country. As per the Road Transport Year Book (2018-19) by MoRTH, while there are 1.5 lakh public sector buses, operated by various STUS, and about 20 lakh private sector buses.
The sheer volume of private buses on our roads demands that an electrification plan be developed for them. The government’s electrification efforts HAS to penetrate the entire road transport sector, including the private bus industry. E-buses are more cost-efficient to operate compared to diesel/CNG buses, they have a drastically lower environmental footprint as they require lower energy/km to operate, and they emit zero tailpipe emissions, as the only by-product that comes out of the tailpipe is water vapour. E-buses also require lesser maintenance, reducing the maintenance cost and the overall financial cost of operating them.
To better understand the challenges of the private bus sector, ITDP India spoke with the Bus and Car Operators Confederation of India (BOCI) and other private operators. Here’s what we found:
High upfront capital cost of e-buses, with no subsidy: The high capital cost of e-buses makes it very difficult for private operators to purchase e-buses. Without any subsidy programme from the government, there is no easy leaping for private players into electrifying their fleet.
Low range of electric buses: Currently, e-buses have a range of 250 to 300 km, whereas, for viable intercity bus operation, e-buses need to cover 600 to 700km with opportunity charging in between. The range has a direct impact on the electrification of these routes. If the range is low, the number of charging cycles will increase, lowering the life span of the battery. This means a need for battery replacement fairly soon.
Difficulty in setting up infrastructure: Setting up charging infrastructure is critical for the private sector to transition to e-buses. Issues in sourcing adequate power supply and setting up charging stations with the current land costs are major concerns.
Unviable financing options: The high capital cost of e-buses, clubbed with a short loan repayment period at high-interest rates, makes it hard for operators to manage the initial four to five years.
Battery replacement costs: After seven to eight years of running the e-bus, the operator has to bear an additional battery replacement cost, that requires a huge intermediate investment.
E-buses offer a better journey experience, both for the passengers and the drivers. “E-buses have lesser moving parts than the ICE buses, and hence require less maintenance—which makes the maintenance staff happy. E-buses are much easier to drive than ICE buses—which makes drivers happy. E-buses provide a smoother ride with lesser vibrations and noise inside the bus—making passengers happy. Since everyone is happy, there is no reason that e-buses would not succeed”, says Mr Sanyam Gandhi, director of Chartered Speed Ltd., a private entity operating public buses in many cities.
Here are some of ITDP India’s recommendations to enable a successful transition to e-buses for private sector.
Supporting the set up of charging stations through private and public partnership:
The government can support and incentivise setting up charging stations by engaging electricity distribution companies and private sectors, so long as land can be provided within the terminal facilities. The government should initiate dialogue with the private sector to understand their aspirations and requirements to set up charging stations.
Revising the financing mechanism:
Although the cost of an e-bus is two to three times the cost of an ICE bus, the financing tenure offered to the operators for both ICE and e-bus is the same, which is 5 years, which drives up the initial cost to the operator. Since there is no priority funding for e-buses, the interest rate is high. In order to make the financing favourable for private operators, a mandate from the government or RBI stating that e-buses should be financed for a longer period of time needs to be provided.
Incentivise the private sector to offset the high capital cost of e-bus:
While private operators want to shift to e-buses, current policies do not have any subsidies or incentives for them to do this transition without bearing the high costs of outright purchase. The government can explore the possibility of providing incentives to private operators for electrification, either directly or through development banks. These financial institutions can support the state by providing long-term loans/grants at low-interest.
Revising the permit structure to allow the operation of leased buses:
Currently, the permit requirements do not allow the operation of buses on lease. Government, in consultation with other relevant departments and agencies, can work to amend these stringent clauses to support e-bus operation by the private sector.
Buses, whether operated by government entities or privately, are one of the most affordable and environment-friendly way of moving people from point A to B. E-buses, are even better. As India continues its electrification revolution, voices from all stakeholders need to be captured to create systems and policies that benefit everyone. Going forward, it is critical to understand the perspective of e-bus OEMs, financial institutes, power distribution companies, and most importantly, the government to chart a way holistic vision for e-buses in India, only then can we truly “embrace e-buses”.
Written by: Aishwarya Soni
With inputs from: Faraz Ahmad, Dhruv Soni, and Vaishali Singh
An Analysis of E-bus Procurement in India
This blog is part two of the “Embracing E-buses” series. To read part one titled “Where does India stand in its e-bus transition?”, click here.
India got its first ever e-bus in 2014. As of today, there are just about 2,000 e-buses being operated in Indian cities. The transition to e-buses in India has faced some challenges, including its procurement models, that has limited the pace and expansion of electrification. To ensure India meets the ambitious targets it has set for electric mobility, we need to review the procurement models.
Of these models, the Gross Cost Contracting (GCC) model has many advantages for cities, and some challenges. And we need to understand them if we want to overcome the challenges of operating buses—and specifically e-buses—in India.
What we need today is an improved GCC model (hereon referred to as GCC+), which can address the challenges faced under the GCC model, and help both the operators and the STUs run seamless e-bus operations.
What is the GCC model?
Indian cities either follow an owner-operator model—where the city bus agency owns and operates the buses—or outsources bus operations. This outsourcing is done primarily through one of four models, including:
In the first three models, the investment to acquire the buses is done by the operator whereas in the management contracting, the buses are provided to the operator. In India, cities have mostly used NCC and GCC contract models besides the owner-operator model.
The GCC model requires the operator to procure the e-buses as well as implement the charging infrastructure, which saves cash-starved state transport undertakings (STUs) from making the initial capital investment. For its troubles, the operator is paid based on the number of kilometres the buses are operated.
Before we go into what a GCC+ model can look like, we need to understand the challenges of the current model, starting from the beginning of e-bus procurement in Indian cities.
The beginning: E-bus procurement under FAME-I Scheme
Battery Electric Bus (e-bus) procurements in India started in earnest with the announcement of the Faster Adoption and Manufacturing of Electric Vehicles in India (FAME-I) Scheme by the Department of Heavy Industries (DHI), Government of India (GoI) and NITI Aayog in 2015. In the FAME-I scheme, cities had the option to either procure the buses outright or or procure the bus operating service via the GCC route.
10 cities applied for subsidy under FAME-I, out of which five preferred outright procurement and the remaining five opted for the GCC model. Most of these tenders were for 15-40 buses per city. All the outright procurement tenders were successfully placed, although there were delays in delivery by manufacturers as well as in arranging necessary depot and power infrastructure. But all the GCC tenders (except one—Hyderabad) were cancelled due to a variety of reasons. But simultaneously, some other cities—such as Ahmedabad and Pune—were also able to successfully procure e-buses based on a GCC tender, though this was outside the FAME scheme.
The next phase under FAME-II
FAME-II—an expanded version of the FAME scheme—was announced in 2019, envisaging procurement of 7,090 e-buses. DHI decided to allow only GCC contracts in FAME II.
Under FAME-II, GoI initially allocated 5,095 buses to 64 cities. Additionally, it also allocated 400 buses for intercity operations, and 100 buses for last-mile connectivity. By December 2021, 18 cities had awarded GCC contracts for 2,965 e-buses. But there was a lot of variation in the bids.
A few cities had to rebid the tenders due to a lack of response or bid prices higher than expected. Only one state—Uttar Pradesh—conducted a joint procurement for multiple cities, while the rest were tendered for individual STUs. A few cities received per km rates of less than ₹50 whereas some received bids more than ₹80.
The following factors can be attributed for this variation:
To bring down the per km price, the Convergence Energy Services Ltd (CESL)—an arm of the state-owned Energy Efficiency Services Ltd.—was tasked to aggregate the demand and float a combined tender on behalf of 9 eligible cities.
Why the tender by CESL was a success in reducing bus procurement cost
The Convergence Energy Services Limited (CESL) tender for 5,450 e-buses that closed in April 2022, is by far the largest tender for e-buses in India. Through a process called Grand Challenge – I (GC-I), CESL was able to homogenise the contract conditions and aggregate the requirements of five out of nine cities eligible to access the government incentives (Table 1).
The GC-1 tender resulted in prices reducing 15% to 48%, compared to prices paid in the past. In fact, the prices through this tender were lower than even those of the diesel/CNG buses.
However, almost every city preferred buses of a different specification, somewhat reducing the benefit of demand aggregation to achieve economies of scale. Reducing the number of bus categories could have increased the benefits even further, although easier said than done.
The key factors that facilitated the reduction in costs were:
One of these factors —economy of scale—is worth exploring in greater detail.
Benefit of economies of scale
Recent e-bus tenders show that bidders favoured larger procurements (seen in Table 2). Even with the same level of subsidy, a larger number of buses allows for lower per km rates.
Despite the maximum subsidy, the bid price for DIMTS tender was the highest whereas the CESL and BEST tenders received the lowest bids even though lower subsidies were offered. Similarly, the subsidy for 9m buses for Nagpur was at least as much as the subsidy available under the CESL tender and yet the bid price was much higher.
Limitations of the current procurement model
The CESL GC-1 tender and the BEST tender are important milestones in India’s electrification of public transport and have raised the expectations of a continued fall in e-bus per km rates similar to the solar energy price trajectory. Based on the initial success, CESL is targeting to procure 50,000 e-buses over the next 5 years. This means that many more cities will go through the next rounds of procurement. CESL must overcome the following challenges in order to aggregate the demand and achieve even lower e-bus prices:
- Many cities manage and operate their own fleet and the current GCC model may not suit them.
- Participating cities may have differing requirements (e.g. requirements of cities vary widely in terms of bus capacity, daily running, air-conditioning, terrain, floor height etc.). This makes it difficult for them to agree on common specifications, which is crucial for achieving economies of scale to reduce the cost of e-bus procurement.
- As per the eligibility criteria stipulated for availing FAME-II subsidy, either an e-bus original equipment manufacturer (OEM) or a consortium led by an OEM should be the bidder; or the bidder must have a prior agreement with an OEM to participate in the tender wherein the OEM is required to co-sign the operating agreement afterwards. OEMs prefer to just sell buses, not operate them, since operating city buses carries substantially higher risks. Involving the OEM in operation of the e-buses in the FAME-I and FAME-II was necessary considering the lack of experience with e-buses, but the OEMs are running out of capacity to take on this additional responsibility in order to sell more buses. It is likely that they would sub-contract the operations resulting in increased contractual risks, and pricing inefficiencies. Besides, this requirement severely limits the number of bidding participants as seen in previous tenders and may prove detrimental for future tender outcomes.
- With respect to GCC, cities have different levels of credibility based on their track record of working with operators on aspects like finances, contract management etc. This affects which cities OEMs want to work with. In bulk procurement, the OEMs cannot pick and choose the cities they work with. When forced to choose between working with all cities or none in a given category, OEMs may choose to work with none by not bidding at all.
- E-bus operations have a very high component of fixed expenses, but the current revenue structure, based on the number of kilometres of running, is entirely variable. This creates a contractual risk for the operators since they do not have full control over actual running of the buses.
As mentioned earlier, CESL has achieved considerable optimisation in the GCC model adapted from the operation of diesel buses. What more can be done to overcome the above challenges?
GCC+ — An alternate compensation/contracting structure to further optimise the GCC Model
Revenue risks often contribute significantly to the overall risk of any business. Aligning the compensation structure to the cost drivers can overcome some of the challenges mentioned above in addition to reducing contractual risks.
This can be achieved by splitting the compensation into following components:
The Bus Availability Fee would primarily depend on the bus specifications and can be homogenised across cities. The Bus Operating Fee can be customised for each city based on local parameters, scale of operations etc.
This structure can help make the contracting process more flexible for both the STU and the operator. The bus operating component can be made optional so that the STUs who prefer to run the operations may choose only the Bus Availability component (effectively a wet-lease contract). Further, the duration of the two components can even be separate with the Bus Availability contract being of a longer duration while the Bus Operation contract is of shorter duration.
For example, a similar arrangement is seen in case of Transmilenio (Bogota) where the procurement of E-bus is split into three parts –
This structure would have many advantages, including:
- Significantly lower operating risks for the bus provider – The fixed payment eliminates the operating risks to the bus provider other than equipment related risks which can be managed through a contract with the OEM. The operator may even be able to procure the bus on lease.
- Maximising clean transportation – The apparent variable cost for the STUs under the proposed structure will be much lower than that of the diesel bus since the energy cost of e-bus is much lower than its diesel counterparts. This will incentivise the STUs to maximise e-bus operations.
- Potential to lower the cost of funds – With a stronger payment security structure, the fixed monthly e-bus availability payments can be securitised and financed at a lower rate. For example, Solar Energy Corporation of India (SECI) in conjunction with RBI and Ministry of Power, GoI and the respective state governments has set up a facility for tapping the central devolution of funds to the states to make payment to the power producers in the event of a default by the state-owned utilities. CESL could consider the same to strengthen the payment security mechanism for the e-bus operators. Such an arrangement could actually reduce the subsidy payments from the state governments to the STUs. Another avenue for reducing risk will be to insure/guarantee termination payments.
- Simplified contract administration – The bid document need not specify any minimum assured kilometres and compensation in the event of over/under achievement, thus simplifying contract administration as well as risk of STUs to pay for under-utilisation.
- Simpler computation of termination payments – In case of early termination, the operator mainly loses out on the investment component for the remaining period. With the split compensation structure, a net present value of the future availability fees together with a demobilisation fee could be sufficient compensation.
- Potential to lower the capacity costs – With reduced operating risks, the bus provider would be willing to enter into a longer contract period, thus reducing the annual costs further.
Risk: The above split contractual structure, the onus will be on the STUs to ensure optimum utilisation of the e-bus failing which the effective cost could be even more than the current structure. Also, there may be implications on the Goods and Services Tax (GST) payable by the operators/STUs in case bus provision and operations are contracted separately.
Summing up: Why GCC+
The GCC model of procuring and operating e-buses has some advantages and a few challenges for the cities. We can start addressing some of the challenges by creating a GCC+ model— a split compensation structure that would bring several advantages for the STUs and operators, including lower risks and costs. This will go a long way towards enabling STUs and operators to move faster towards the adoption and operation of e-buses. India is well on its way on the path to electrification of buses, and the GCC+ model can help smoothen the way.
References
- https://www.uitp.org/news/aggregation-delivers-more-savings-than-subsidy-in-recent-indian-electric-bus-tenders/ accessed June 18, 2022
- https://timesofindia.indiatimes.com/india/lowest-ever-prices-in-e-buses-tender-cesl/articleshow/91112542.cms accessed June 18, 2022
- WRI Blog
- https://auto.economictimes.indiatimes.com/news/commercial-vehicle/mhcv/another-round-of-price-discovery-for-10000-e-buses-coming-soon-adviser-niti-aayog/91172608, accessed June 18, 2022
- https://economictimes.indiatimes.com/industry/renewables/cesl-plans-mega-tender-of-50000-e-buses-over-5-years/articleshow/91948742.cms?from=mdr accessed June 18, 2022
- Fiscal Incentives to scale up adoption of electric buses in Indian cities; UITP and Shakti Foundation, March 2019
Written by: Sutanu Pati
Edited by: Keshav Suryanarayanan
The opinions presented in the blog are of the author.
Sutanu Pati has over 25 years experience in the fields of transportation, e-mobility, and energy. His areas of expertise include financing, procurement, and public-private partnerships. He is currently engaged as an independent consultant with national and international organisations such as ITDP, WRI, GIZ, RITES, UMTC etc.
The #HealthyStreets Movement in India
Across India, a paradigm shift is happening. Cities are reimagining their streets, as places for people and not just for cars; redefining streets as destinations, and not just a by-pass; redesigning streets to create a thriving environment where everyone can experience their streets in a fun and safe way, at all times, day or night. The result? People love it, and many more are embracing walking and cycling, enjoying their time on the streets!
This is the start of the #HealthyStreets movement—that aims to reduce congestion, air & noise pollution, and carbon emissions across Indian cities. Healthy Streets ensures that everyone—be it an 8-year-old or an 80-year-old—can move safely and comfortably, and breathe clean air. Here’s an illustrated guide of 10 things that make a Healthy Street!
The transformation is happening, slowly but surely. Here are a few cities that have embarked on the #HealthyStreets movement, and are now an inspiration for many other cities to follow too.
ensuring a fair share of the space for all users.
Road space is limited, and presently, most of it is occupied by personal motor vehicles—such as cars and two-wheelers. We must ensure that all kinds of users—whether they are on foot, cycling, or using public transport—get an equitable allocation of the road space.
In 2015, road transport emissions contributed to 74,000 premature deaths in India. Unfortunately, people who face the grave consequences of polluted air are not even the ones who cause or contribute to it. With zero emission modes like walking and cycling, and low emission shared modes such as e-buses and e-rickshaws that use clean vehicle technology, cities can move closer to breathing air that’s healthy.
According to a World Bank report published in 2021, India has the highest number of casualties in road crashes—there are 53 road accidents in the country every hour and one death every four minutes. Road crashes claim the lives of about 1,50,000 people and disable at least an additional 7,50,000 each year, a large share of which are pedestrians and cyclists, mainly representing working-age adults from the poorer strata of society.
This is easily preventable—by designing safe streets and strictly enforcing road rules. Cities should design streets that reduce conflicts between motor vehicles and vulnerable users such as pedestrians and cyclists and encourage safe driving.
The two simplest, most affordable modes of transport deserve to be a comfortable experience for everyone. When walking and cycling is made safe and attractive—with wide, continuous footpaths, segregated cycle tracks, regulated on-street parking, managed vending, shaded seaters, and play zones—everyone would choose to walk and cycle instead!
Public transport is the pulse of every city that has the power to connect people to opportunities. 70% of Delhiites use public transport to commute to work, as per the 2019 Socio-Economic Survey report. Public transport, especially buses, is often the most affordable means of transport for the majority, especially for women. Most of these public transport trips typically start or end with a walk, or on a cycle.
By ensuring that public transport services are within easy reach and interconnected by walking and cycling facilities, and that stops provide safe shelter for everyone at all times, would enable more people to use the services conveniently.
Our streets need to cater to people of all demographics, age groups, and abilities. A large group of our population: caregivers with infants and toddlers; the elderly; and people with disabilities—are often left out in urban design and transport planning, severely impacting their independent mobility.
Cities must ensure that transport infrastructure meets the needs of these vulnerable groups, by ensuring streets and public transport are universally accessible.
An article by Safetipin notes that street harassment disproportionately affects women throughout their lives. It is part of a larger epidemic of violence posing a significant threat to women’s autonomy, and ultimately, it becomes a violation of consent in public, driving women to retreat to private spaces and curtailing their freedom.
Vulnerable groups such as women, children and the elderly need to feel safe on our streets and in public spaces. Cities must eliminate opportunities for crime on their streets through programming, better design, ample lighting, and activity management.
Streets are important social spaces that enable us to interact with other people and the environment.
Cities must think of streets as vibrant public spaces that invite everyone—including women, children and the elderly—to spend more time outdoors and socialise, thus improving the mental and physical well-being of citizens. When streets are designed for walking and cycling, they become platforms for unplanned interactions and help foster a sense of community.
There is a strong correlation between well-designed streets and its impact on local businesses. When streets allow people to move comfortably without any conflicts with traffic, are well shaded, and have amenities for them to sit and rest, they tend to spend much more time on the street, which results in a sales boost for local vendors and shops. Cities can enhance livelihoods by integrating street vending and local retail businesses in street design.
It isn’t uncommon to see streets inundated with water, following a spell of heavy rains. Footpaths get slippery, posing a risk for the ones who are running for shelter. Our streets need to be resilient to such weather changes and be usable by people all year round.
Cities need to use materials and designs that enhance the life of infrastructure, ease maintenance, and are responsive to the environment. Underneath the footpath, utility lines such as water supply, electricity, street lighting and other fixtures, stormwater, sewage, and telecommunications must be routed via ducts or trenches, accessed through conveniently placed manholes. Gratings that lead to catchment pits should be provided. Cities must also choose the right kind of surface treatment to ensure footpaths are durable and long-lasting.
Through the India Cycles4Change and Streets4People Challenge—an initiative of the Smart Cities Mission of the Ministry of Housing and Urban Affairs and ITDP India—39 cities are accelerating their transformation towards creating #HealthyStreets. With the test-learn-scale mantra, cities are working with residents and experts to implement permanent walking and cycling-friendly infrastructure, create institutional reforms, and build momentum for more walking and cycling-centric cities.
With such widespread enthusiasm for creating people-friendly cities in India, we hope to see many more paragons of #HealthyStreets in the future! Stay tuned.
10 things that make a Healthy Street!
An illustrated tour
We all need #HealthyStreets to ensure that everyone—regardless of age, gender, race, or physical ability—can move #safely, #comfortably, and #breathe clean air. 🚸What makes a #HealthyStreet? This illustrated poster shows exactly that!
Get your hi-res copy here, now available in these languages!
English | Hindi | Tamil | Marathi | Odia(Oriya) | Punjabi | Malayalam
Designed by Suvetta Lakshminarayanan
With inputs from Aswathy Dilip, Sivasubramaniam Jayaraman, Kashmira Dubash, Pranjal Kulkarni, Parin Visariya, Venugopal AV, Aangi Shah, Smritika Srinivasan, Santhosh Loganaathan, Bala Nagendran M, Naveenaa Munuswamy, Aishwarya Soni, Aditi Subramanian
Where does India stand in its public e-bus transition?
In India, the transport sector is responsible for 14% of overall greenhouse gas emissions. In light of the nation’s recent commitment to net-zero emissions by 2070, Indian cities have a unique opportunity to skip the usual stages of gradual and marginal improvements to public transport and fuel efficiency. What India needs is an urgent and ambitious vision to overhaul its public transport system. And e-buses may be the answer.
Cities need to improve and strengthen their transport systems and augment the number of buses on the streets. Buses can move people across cities more efficiently—in lesser space and at lower cost—and more affordably than any other transport mode. As of 2019, India had only ~30,000 buses to meet the needs of over 471 million people living in urban areas. As per the benchmarks laid out by the Ministry of Housing and Urban Affairs, cities require 60 buses per lakh population, and thus India needs an additional 1,45,000 buses to adequately serve the travel needs of citizens. India is operating at less than one-fifth of the buses that it needs.
Given the number of people who travel in every bus, the amount of tailpipe emission per passenger per trip is already low in even diesel and CNG buses. This can further be brought down to ZERO if we can accelerate the transition to electric buses. Here’s why e-buses are better.
Why e-buses are better
Studies show that e-buses are more cost-efficient to operate compared to diesel/CNG buses, especially with rising fuel prices. In the case of Pune’s PMPML, the fuel cost/ km for 9m and 12m e-buses is ₹5.8 and ₹6.6 respectively, which is about one-third of Internal Combustion Engine (ICE) buses.
E-buses have a drastically lower environmental footprint as they require lower energy/km to operate. Compared to diesel buses, e-buses have zero tailpipe emissions. They also provide a much better service to passengers—smoke-free rides, smooth rides. As per an April ’22 survey conducted by PMPML in association with ITDP India among e-bus commuters, 78% of respondents prefer to travel by e-bus because of less noise and vibrations.
With fewer moving parts, e-buses require lesser maintenance, reducing the maintenance cost and the overall financial cost of operating them. They are also more reliable and have a lower trip cancellation rate, improving the quality of service. The benefits are umpteen, so it is advisable for urban bus operators to transition to e-buses.
Since 2015, India has seen multiple schemes to promote the transition to e-buses, by subsidising the cost of their purchase for cities. However, the road to transition is replete with its own set of challenges. Most city & state transport undertakings (STUs)—the agencies responsible for public bus operations in India lack the technical knowledge to procure, deploy, and manage e-bus fleets optimally. Several STUs also face funding gaps and do not have budgets to make direct purchases, leading to slow uptake of these schemes.
In this blog, we investigate the current status of e-buses in India, and how close (or far?) we are to a 100% transition.
How cities are procuring more e-buses
FAME-I
To accelerate the transition to electric and hybrid vehicles—such as 2-wheelers, cars, 3-wheelers, and buses—the Department of Heavy Industries (DHI) launched the Faster Adoption and Manufacturing of Electric Vehicles (FAME) Scheme in 2015 under the National Electric Mobility Mission. FAME was a subsidy programme for electric vehicle manufacturers as well as providers. Under the scheme, the State Transport Undertakings (STUs) were given subsidies to procure public electric buses and install the required charging infrastructure.
FAME-I offered two options for STUs—Outright purchase and Gross Cost Contract, with subsidies from the Government of India. For the purchase of e-buses, which typically cost between 75 lakhs (USD 93670) to 1.75 crores (USD 218500) depending on the battery size, DHI offered two kinds of demand incentives:
Five cities (Bangalore, Mumbai, Hyderabad, Ahmedabad, and Jaipur) invited bids under GCC, and the rest (Indore, Lucknow, Kolkata, Jammu and Guwahati) went ahead with the outright purchase of buses. However, the rollout of buses has been slow in many states due to a variety of reasons. Tenders have been cancelled in Bangalore, Mumbai, Ahmedabad, and Jaipur—all cities that chose to go ahead with GCC except Hyderabad—while buses have been pressed into service in the rest.
Under the GCC model, the tender conditions, bus requirements, and range requirements were vastly different across cities, leading to a considerable variation in prices. Cities requested for 9m/12m buses, AC and non-AC variants. Another notable difference was in terms of the city’s range requirements (assured km per day). Kolkata, for example, had one of the lowest requirements at 150km/day while Hyderabad asked for 225 km/day. The tender documents also revealed that some cities pushed the cost of electricity onto the GCC operators, while others chose to pay for it themselves. This also led to a lot of tenders getting cancelled.
By the end of the FAME-I scheme, 10 cities received the subsidy, and a total of 425 e-buses were deployed:
The steep costs of electric buses were worrying—compared to diesel buses, electric buses were 2-3 times more expensive, and hence many transport undertakings were not in favour of deploying the new technology, especially through direct purchase.
FAME-II
In 2019, the Government of India approved Phase II of the FAME Scheme, with total budgetary support of INR 10,000 Crore (USD 1.3 billion). FAME-II focussed on the electrification of public & shared transport. Through this scheme, DHI intended to support the procurement of 7090 e-buses, with a total outlay of about INR 3500 Crores (USD 450 million).
For a city to be selected, it needed to meet two criteria—one was that the state had an Electric Vehicle policy; and two, it had a provision to waive the registration charges and road taxes for electric vehicles. FAME-II also mandated procuring buses through a ‘Gross Cost Contract’ (GCC). Under FAME-II, DHI offers a maximum demand incentive of INR 55 lakhs (USD 71k) per bus for 10-12m buses, INR 45 Lakhs (USD 58k) for 8-10m buses, and INR 35 Lakhs (USD 45k) for 6-8m buses.
FAME-II received a tremendous response—86 proposals from 26 States and Union Territories for the deployment of 14,988 e-buses. After a thorough evaluation, the Government of India sanctioned 64 City & State Transport Undertakings to procure 5095 e-buses for intra-city operations; 400 e-buses for inter-city operations; and 100 e-buses for last-mile connectivity to Delhi Metro Rail Corporation (DMRC).
DHI approved the highest number of e-buses for the state of Maharashtra (725 e-buses), followed by Uttar Pradesh (600 e-buses), Gujarat (550 e-buses) and Tamil Nadu (525 e-buses), while other states received a sanction of less than 500 e-buses.
As of Dec’ 2021, 2965 buses have either been deployed/received a supply order or received extension to issue a supply order, as part of the FAME-II scheme.
Grand Challenge
A lot of cities were not able to utilise FAME-II assistance, as many e-bus suppliers quoted significantly higher prices during the FAME-I scheme, owing to higher liabilities such as setting up of charging infrastructure. The COVID-19 pandemic also impacted many cities’ plans to procure e-buses under the scheme. Tenders were cancelled in several cities.
To bring down the per km price, Convergence Energy Services Ltd (CESL)—an arm of the state-owned Energy Efficiency Services Ltd.—was tasked to aggregate the demand and float a combined tender on behalf of all 9 remaining cities with more than 4 million population, on the GCC model. The STUs were invited to express their interest to aggregate the demand. As a result, CESL rolled out a tender for 5,450 buses worth INR 5,500 crores (USD 706 million), seeking bids for e-bus operations in five cities: Kolkata, Delhi, Bangalore, Hyderabad, and Surat. Tata Motors has emerged as the lowest bidder across all five operational categories. Because of the mass tender, the bid received were less than ₹50/km for 12m buses.
Other Schemes
Outside FAME-I and II, many state and city governments have shown interest in procuring electric buses, with a majority opting to procure e-buses under the GCC model.
Pune’s public bus operator, Pune Mahanagar Parivahan Mahamandal Ltd., procured 25 9m variant e-buses and 125 12m variant e-buses, with funding from the Smart Cities Mission of the Ministry of Housing and Urban Affairs. As this procurement was done outside the FAME schemes, the Municipal Corporations of Pune and Pimpri Chinchwad decided to provide an upfront subsidy of INR 50 lakhs/bus (USD 65,000) through the Smart City Funds.
Other states have also issued Request for Proposals (RFPs) for e-buses, with fleet sizes ranging from 10 to 500. Delhi is the largest of them all. DIMTS, the Special Purpose Vehicle that manages the city’s cluster bus operations, has already initiated the process to procure 375 12m variant AC e-buses.
In 2019, the Government of Tamil Nadu received a loan of INR 1,600 crore (USD 200 million) from KfW, the German state-owned development bank, to procure 2,000 e-buses, of which 500 would be procured under outright purchase by 2022 in Phase-I.
How cities can procure more e-buses
To meet its current public transport needs, Indian cities need 1,75,000 buses, while presently they have only 35,000 buses operated by STUs. Of these, around 2000 are electric. The gap is wide, but not insurmountable.
Funding under the FAME schemes and from other sources have accelerated the procurement of e-buses and the adoption of the Gross Cost Contract model in Indian cities. Going forward, cities require similar sustained financial support to enable a 100% transition to e-buses.
The procurement of e-buses is only the beginning, and states need to identify sustainable funding sources to keep e-bus operations up and running. States and cities should consider setting up Urban Transport Funds (UTF), which will not only help sustain the operations of e-buses but also help cities maintain high-quality service. Tamil Nadu, for example, has used loans from development banks to improve and expand their bus operations, and other STUs must also consider such methods of financing.
Most STUs currently lack the knowledge to plan and operate e-buses. As cities procure more and more e-buses, it’s essential that public transport operators now equip themselves technically to deploy and utilise upcoming e-bus fleets efficiently and effectively. As Indian cities embark on this transition, a capacity development programme and peer-to-peer learning for city officials across the country would go a long way towards ensuring cities have all the support they need to make our transition to 100% e-buses in Indian cities.
Stay tuned to the next part of the series where we see how cities can choose among the different types of procurement models in India, for a faster and smoother transition to e-buses.
Written by: Aishwarya Soni
Edited by: Keshav Suryanarayanan
With inputs from: Vaishali Singh and Dhruv Soni
Silvassa embraces healthy commutes with Cycle2Work campaign
To encourage more people to cycle and build a strong cycling culture in the city, Silvassa Smart City Ltd., in partnership with ITDP India and UrbanMorph, rolled out a pan-city Cycle2Work campaign for industries and organisations at a launch event on Thursday, 21st July’22. The campaign calls for employees to reconsider their every mobility choice—to shift from cars and motorbikes, and cycle to their workplace instead, building health while saving the planet. Silvassa’s efforts have inspired many other officials from India to launch Cycle2Work in their cities.
Through repeated positive experience, Cycle2Work has the potential to nudge behaviour change, and ingrain a cycling habit among people.
Opening the event, Ms Charmie Parekh, CEO, Silvassa Smart City Ltd., said:
“Cycle2work is a great initiative for companies to encourage their employees to stay healthy and reduce carbon emissions. Parallelly, we will also improve cycle infrastructure to make Silvassa a cycling city.”
One and half months of testing and learning
Silvassa launched the test phase of Silvassa Cycle2Work on World Cycling Day on 3rd June 2022. Post a successful 45 days of testing and learning with six industries, the test phase concluded, and all industries and organisations in Silvassa are now invited to join the campaign and promote cycling to work amongst their employees.
Silvassa followed a four pronged approach for the test of the campaign: Onboard, Engage, Incentivise, and Monitor
Onboard
To effectively measure the shift in user behaviour and uptake of cycling in the city, there was a need to have a single platform where the cycle2work rides would be tracked. Cycleto.work, an innovative open-source platform created by UrbanMorph, gamifies cycling for commute through a leaderboard. Here, individuals can check how they stack up against others within their company as well as in the city, country, and even around the globe! Currently, more than 450 organisations are registered on the platform.
Cycleto.work shows you:
- How many cyclists from a company have enrolled
- The leaderboard position of the company in comparison to other cycleto.work companies
- Fuel savings
- Carbon offset
- Routes that are used by the cyclists
and several other features!
Engage
Each of the industries appointed “Cycling Ambassadors”—an inidividual who can champion the cause of cycling and can dedicate time towards this initiative. The Ambassadors encouraged their respective teams to sign up on the cycleto.work platform and track their rides. They motivated them through active outreach through posters, emails, and meetings. They also spotlighted stories of the individuals who cycled to work—including those from senior leadership—on social media and on the company websites.
Incentivise
Industries also provided facilities and incentives to keep up the cycling momentum.
Most industries installed cycle parking stands at their premises. Some installed locker facilities to safely store the employee smartphones, as some industries prohibited their usage inside the premises. Other facilities such as showers, changing rooms were also being considered.
Incentives were broadly of three kinds:
1. Milestone-based gifts: Some industries gifted every new registration with a helmet, water bottle, and head light. They also rewarded the cyclists for each milestone they achieved: a t-shirt for completing 200km, a thermos water bottle for completing 400km, and a bag for completing 600km.
2. Money rewards: Some Ambassadors were offered token money to motivate others in the organisation to join as well. One industry also considered an allowance of Rs 500 for those who cycled to work.
3. Certificates and recognition: Industries acknowledged the employees who cycled to work with certificates of appreciation.
Monitor
Progress was regularly monitored on a Whatsapp group with the Industry ambassadors, and through weekly leaderboard updates.
During the test phase, the six industries steadily jumped the ranks of the leaderboard as several employees embraced cycling as their everyday mode of commute. As of July, four out of the six industries were listed in the top 25 rankings.
The impact
Together, the six industries have completed 377 rides, saved 305 litres of fuel, and offset 706kgs of carbon emissions!
We’re excited to see the impact scale up with all organisations and industries in Silvassa joining the campaign.
Way forward for cycling in Silvassa
As the number of cyclists in the city grows, Silvassa must create the right systems to promote and sustain cycling. ITDP India will work with Silvassa on a charting a holistic plan—getting support from all concerned stakeholders (such as the traffic police), creating a cycling network, and ensuring high-quality designs for cycling infrastructure.
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