Financing the Electrification of Heavy-duty Vehicles
Heavy-duty vehicles (HDVs), including trucks and buses, account for 40% of global road transport carbon emissions. Electrification is one of the most promising routes to decarbonisation. Although the total cost of ownership of an electric truck is similar to their fossil counterparts, in an increasing number of use cases, electric vehicles today have a significantly higher upfront cost compared to conventional diesel vehicles. Additional finance solutions are therefore needed to bridge the cost gap and accelerate the transition to sustainable transport. This project aims to understand the finance needs for truck and bus electrification.
This study quantifies the financial requirements for public transport bus operators and logistics companies transitioning to electric vehicles in different contexts. Learning from past successes in urban public bus electrification and exploring future challenges to private buses and freight trucks, the project explores different financing solutions to bridge the gap in ownership costs, including subsidies, loans, de-risking, guarantees and public-private partnerships.
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