London Gains Momentum in Electrifying Its 9,000-Strong Bus Fleet

The sun was peaking through the clouds at Lea Interchange bus depot, near London’s Olympic Park, as I listened to Stagecoach Engineering Director Mark Wallis during a recent site tour. It quickly became clear that the sun is also shining on Transport for London’s plans to convert its fleet of around 9,000 buses to zero-emissions models over the next decade.

London’s bus fleet includes 1,600 electric buses, up from 485 in March 2021, and TfL says it’s on track to have 2,500 by next year. Wallis explained that Stagecoach — one of several operators in the city — will have about 350 electric buses in London by the end of the financial year, up from just 78 at the end of 2023. Preparing for these vehicles is no small feat, but the industry is learning fast.

The Lea depot supports around 50 electric buses with 28 150-kilowatt chargers that are capable of fully charging a bus in two to three hours. There are plans to support 263 buses, expanding the site’s whopping 6-megawatt grid connection to 9 megawatts. That’s the equivalent of around six thousand houses.

The competition for land and grid connections in the capital is intense. The first indication of this was learning that the Waltham Forest borough’s council plans to co-locate residential apartments and a new railway station on the site. The second was seeing around 15 new electric double-decker Volvo buses parked at the back of the depot. They’re meant for another depot, but the grid connection has been delayed. Permitting to run cables to new loads can be a major blocker for companies in the sector.

Stagecoach has 13 depots in the capital, and Wallis explained how competition for power is going to be worse in some areas, due to other loads coming online. One of those will be data centers.

Data centers are a big part of the Labour Party’s plans to boost the UK economy, with Chancellor Rachel Reeves welcoming the decision to review two previously denied planning applications and jetting off to the US and Canada to meet data center companies such as CoreWeave and CyrusOne. Dutch operator Yondr has had planning approved for the third stage of its 100-megawatt data center in West London on Aug. 15.

BloombergNEF’s 2024 Power Grid Investment Outlook forecasts that grid investment in the UK will rise to $13.2 billion by 2026. While transmission spending is double to quadruple what it’s been over the last decade in real terms, distribution is only set to rise between 12% and 33%. This is in part because Britain is proactively investing in transmission for wind farms. Distribution-network investment, on the other hand, has been more reactive. This increases the risk of grid upgrade delays for projects like bus depots.

For operators coming to grips with buying more expensive electric buses and upgrading sites, TfL is taking some risk away by providing fixed seven-year contracts that deliver a cost per mile. UK Transport Secretary Louise Haigh this week put legislation before parliament that would allow more UK regions to follow TFL’s franchise model. Vehicles’ residual values, reliability and range, however, remain unknowns.

TfL’s Bus Action Plan states that for roughly 15% of routes, overnight bus charging alone won’t be suitable. The government body is reviewing daytime top-up charging and trialing 20 hydrogen buses.

Still, it appears batteries are likely to dominate the market over time. Chargers at the Lea bus site sit on top of where London’s hydrogen bus-maintenance facility — unveiled by Boris Johnson in 2010 — was later ripped out.

Bus operators are contracting with companies like Zenobe, which has raised more than £1 billion in debt since 2019, to electrify sites. They installed the chargers at the Lea depot and support over 75 such sites globally. Zenobe also manages power connections, installs battery storage, finances chargers and vehicles and even purchases the electricity.

Stagecoach London used over 60 gigawatts of electricity last year and will need to be as proficient at purchasing electricity as it has in buying the 90,000 liters (23,775 gallons) of diesel it goes through daily. It’s a task charging operators are prioritizing, as they sign power purchase agreements to hedge costs. BNEF tracked 11 agreements signed by Fastned, Allego and Electrify America already in its latest quarterly EV charging market outlook.

Cheap electricity, lower maintenance costs and plunging battery prices all may add momentum to electrifying fleets. Bus operators could also recoup investment by opening their chargers that sit idle for most of the day. The hope for TfL, which said it needs £500 million more government funding to have a fully zero-emission bus fleet by 2030, instead of 2034, is that these benefits materialize sooner rather than later.

For more on this topic, check out BNEF’s Commercial Vehicles Decarbonization Monthly reports to keep up to date on the sector.