Bus Services Bill: Next steps to Zero Emission Buses

Status

The Bus Services (No. 2) Bill (the Bill) continues to progress through Parliamentary approvals, having recently completed its Committee Stage in the House of Commons. Amongst other, wider reforms, the Bill includes a proposed mechanism for ending the UK sales of non-zero emission buses (non-ZEBs).

The government has published the responses to a consultation on this topic, which asked for stakeholder views on five key components of ending non-ZEB sales:

• Whether the zero emission vehicle mandate should be applied to buses
• Whether the sale of non-ZEBs should end on a specific date
• When a preferred specific end date should be between 2025 - 2032
• Whether the type of vehicle subject to this end date should be defined by existing type approval categories or some other mechanism
• The nature of the challenge created by charging and refuelling infrastructure and how this could be addressed. 

Responses show that there is general support for mandating the end of sales of non-ZEBs across the industry, and that there is a strong preference for a specific date on which this should come into force – respondents generally seem to believe that this would catalyse the development of new bus technology and give certainty to the sector. 

It should be noted that this consultation was initially run in 2022. Since then both the Conservative and Labour governments have continued to invest in zero emission buses, grid reforms are in progress and Clean Air Zones have been introduced or planned across the UK's cities that capture buses which places the sector in a different position to when the consultation was run.

Challenges

The consultation responses consistently drew out three key challenges: 

1. The availability of charging and refuelling infrastructure: There were concerns that increased demand for technology could not be met by current zero emission infrastructure providers, particularly on a short time frame, and that there was insufficient space in existing bus depots for the necessary charging infrastructure and batteries, and that hydrogen bus fleets in particular faced challenging in sourcing fuel. 
2. Increased pressures on the national grid: Fuelling the one billion bus service miles (in England alone) with electricity would place significant additional pressure on an already stretched National Grid capacity. Respondents were concerned both about significant upgrades that would be needed to the grid to fully electrify the bus fleet and whether DNOs currently had the ability to plan for this transition. It is hoped that ongoing grid reforms may address some of these concerns. 
3. Additional challenges for rural fleets and small operators: Rural routes require either buses with longer ranges or charging infrastructure outside of depots, both of which are more of a challenge, and more costly, for operators. This would add to the already increased cost of running rural services. 

SMEs with fewer resources would also need longer to retrain staff and change their manufacturing processes and technology, with concerns that small businesses may lose out to overseas competitors if they are unable to meet the required deadlines. 

Solutions 

All of these challenges, respondents believed, could generally be solved with: 

• Sufficient time to prepare for the transition – respondents were keen for a specific date to be mandated, with enough time to allow for necessary action to be taken by the sector. Responses showed a strong preference for 2030 implementation (however as noted the consultation initially opened in 2022 so industry may now expect a later deadline). 
• Government funding to support the industry, especially rural fleets and SMEs. Some respondents highlighted the importance of the Zero Emission Bus Regional Areas Scheme. Since the consultation, this DfT scheme has seen an additional £168.1 million of funding provided to local transport authorities to fund the purchase of ZEBs and investment in required infrastructure. However, there have not been any recent announcements about further funding.

Although the transition to ZEBs is not yet mandatory, the sector continues to pursue decarbonisation strategies. We have supported a number of bus sector operators and financiers, including FirstGroup and Rock Road, in relation to private funding arrangements to successfully deploy ZEB fleets.

For further information or advice related to decarbonisation of fleets and the potential impact of the Bill, please contact Chris Simms, Chris Lewis, Charlotte Robinson or your usual Burges Salmon contact.

To accelerate bus decarbonisation, government is taking forward a measure in the Bus Services (No. 2) Bill that, from 2030 at the earliest, will prevent the use of new non-zero emission buses (ZEBs) on local bus services in England.

https://www.gov.uk/government/consultations/ending-the-sale-of-new-non-zero-emission-buses-coaches-and-minibuses/public-feedback/ending-the-sale-of-new-non-zero-emission-buses-consultation-and-coach-and-minibus-decarbonisation-summary-of-responses