In January 2018, the city of São Paulo, Brazil, adopted Law 16.802, an amendment to its Climate Change Law that sets 10-year and 20-year targets for fleetwide reductions in tailpipe emissions of fossil carbon dioxide (CO2) and the air pollutants particulate matter (PM) and nitrogen oxides (NOx). The aim of the amendment is to eliminate emissions of fossil fuel derived CO2 and reduce emissions of PM and NOx by 95% from 2016 levels by January 2038.
We estimate that all new buses purchased beginning in 2019 and continuing thereafter will need to meet Euro VI or better emissions performance in order to achieve sufficient PM and NOx emissions reductions to comply with intermediate, 10-year targets. A substantial fraction of these buses also will have to be fossil-fuel free in order to meet the 10-year fossil CO2 emissions reduction requirement. This fraction is estimated to be 60% of all bus purchases if the transition starts in 2019 and increases to 70% and 80% if the transition is delayed until 2020 or 2021, respectively. If the transition to zero fossil fuel buses is delayed to 2023, it is unlikely that intermediate targets can be met without early retirement and replacement of buses that have not reached the end of their 10-year service life. Our procurement model indicates all new buses entering the fleet should be fossil-fuel free by the beginning of 2028 in order to meet the 20-year fossil CO2 emissions target.
We found that a fleetwide transition to zero emission electric drive bus technologies would provide the greatest climate benefits of the zero fossil fuel technologies considered in this analysis. Transitions to biomethane- and ethanol-fueled bus technologies also are estimated to reduce the climate impact of the São Paulo fleet, although not to the same extent as electric buses. Transitions to Euro VI buses fueled with soy-based biofuels, although providing some near-term climate benefits through the control of BC emissions, may not meaningfully reduce CO2 emissions and associated warming relative to current procurement practices.
With the exception of the ethanol bus, the total lifetime costs of owning and operating alternative technology bus options were found to be within 10% of the lifetime costs of the baseline P-7 diesel bus. Euro VI diesel, diesel-electric hybrid, and battery electric buses are estimated to offer cost savings relative to P-7 diesel buses when all costs incurred over the service life are considered. Especially in the case of battery electric buses, traditional procurement practices that favor bus technology options with the lowest purchase price may bias against technologies that have a higher purchase price but lead to substantially reduced operating costs over the lifetime of the bus. Changes to existing procurement practices and implementation of innovative financing models that take into account lifetime operational savings of alternative bus technologies may be needed to accelerate the uptake of these technology options.