2017 Fire Awards Winner
Alan Westenskow, Director of Businesses Development, Proterra
Bus fleet operators predominantly use diesel vehicles. Zero-emission vehicles offer a clean, quiet alternative with lower operating costs. However, zero-emissions vehicles currently cost 50% more than conventional counterparts and there are perceived technology risks of batteries and the cost of future battery replacements. These barriers obstruct uptake of a cleaner and more efficient disruptive technology.
Proterra’s electric bus battery service agreements are an initiative led by Proterra to transfer up-front costs and technology risk from the customer. This can remove barriers to uptake and enable wider commercialization.
• High upfront costs of electric buses vs diesel buses
• Perceived technology risks of batteries
• Unknown future costs of replacement batteries
Proterra offers to sell the customer a battery electric bus for the cost of a conventional diesel bus (around $500,000) and to enter into a battery service agreement for 12 years to pay for the use of batteries that Proterra owns and guarantees to provide an agreed upon performance level. This agreement converts a capital cost to an operating cost, which can be paid using operating savings from the cheaper to operate electric bus. Further, the agreement provides a warranty on the batteries and hedges customers against future replacement battery costs. As a result, the customer is expected to have a cost breakeven point on day one compared to conventional diesel buses.
BNEF On-Stage Pitch
Key Impact Metrics
- Vehicle sales to date: 400 sales to 40 customers
- Percent emission reduction compared to diesel bus: 100%
- Number of diesel buses replaced by 2020: 1,500
Most Recent Update
Through the Fire Awards process, as a 2017 Fire Winner, Proterra is receiving support from Climate Policy Initiative and a Working Group of volunteer experts from the Fire network to achieve its near term milestones for growth. In particular, this work is aims to (1) understand the needed features of an effective and scalable battery service agreement structure, and how such features would fit together in a unified structure with the potential to support 100% of Proterra bus sales in the longer term; and (2) determine the appropriate financing partners to help implement such a BSA structure.
To be announced
News & Events
New York – Today at the Bloomberg New Energy Finance (BNEF) Future of Energy Summit, hundreds of leaders in clean energy and finance voted for two Fire Awards winners from amongst four finalists that presented their businesses in an extremely close pitch competition. The two winners are: Electric Bus Battery Service Agreements: A new lease financing model to lower […]
December 6, 2016 London – The Fire Awards have announced the selection of four finalists to pitch their financial innovations for the acceleration of green growth at the annual Bloomberg New Energy Finance Future of Energy Summit in April 2017. The four finalists were selected by the Fire Advisory Panel, consisting of experts in finance, […]