Institute for Public Policy Research (IPPR)

Report Part Title: CONCLUSION AND RECOMMENDATIONS

Report Title: A SMOOTH RIDE

Report Subtitle: ELECTRIC BUSES AND THE ROUTE TO A FAIRER TRANSPORT SYSTEM
Report Author(s): Stephen Frost, Joshua Emden, Luke Murphy and Lesley Rankin
Published by: Institute for Public Policy Research (IPPR) (2023)
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5.
CONCLUSION AND
RECOMMENDATIONS

England’s bus network remains vital for many but is a shadow of its former self:
its benefits are unfairly shared across the country and existing funding is barely
enough to maintain current levels of service. It doesn’t have to be this way. As the
national bus strategy says: buses are the quickest, easiest, and cheapest way to
make radical improvements to local public transport (DfT 2021a).

Restoring our bus network to its former glory and ‘levelling up’ public transport
would be transformative for people’s lives, communities, and local economies. It is
also fundamental to reaching net zero in a way that is fair and perceived to be so
by the public.

At the heart of this report, and IPPR’s previous research, is the need for the UK
government to publish a new transport decarbonisation plan which recognises
the need for, and opportunities presented by, reducing transport demand and
complies with the advice of the IPCC on achieving rapid and deep emissions
reductions in the 2020s to keep 1.5C of warming in reach. This can only be
delivered fairly alongside a new strategy to deliver far greater mode shift to
public transport and active travel.

A NEW VISION FOR BUSES IN 2030

The UK government, and all parties going into the next
general election, must set out how they intend to deliver
a world-leading local public transport system by 2030
and the role it will play at the heart of a wider transition
in making how we travel fairer, cleaner, and healthier.
The ‘levelled up’ bus network of 2030 must:
• have increased the levels of service in all metropolitan areas to closer
to those seen in London
• be faster and more reliable, with buses given priority through
designated lanes and car-free areas
• have led to far greater bus patronage and mode share, including
having brought the number of per person trips by buses in all major
metropolitan areas much closer to London levels
• have affordable and simpler fares that are well integrated with other
forms of local public transport, community transport and shared
mobility schemes (including ebike sharing and car clubs)
• be connected with high quality walking and cycling infrastructure
• have made significant progress in the shift from diesel and have largely
been electrified within major metropolitan areas.
The key criteria for success will be ensuring more people are able to live a
good life, wherever they live, without needing to own a car.

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Below we outline the policy programme that should underpin the delivery of a
‘levelled up’ and cleaner bus network across the UK’s metropolitan areas.

GOING FURTHER AND FASTER ON OVERARCHING TARGETS

A more ambitious transport decarbonisation plan must provide a clear direction of
travel by setting out more ambitious targets at both a national and local levels.

At a national level, we recommend that the government should set the phase-
out date for the sale of new ICE bus sales as 2030, and keep open the option of
bringing this forward. The CCC has already noted that announcing a phase out
date for non-zero emission buses by or before 2032, could help to stimulate an
acceleration in the delivery of zero emission buses. In practice however, many local
councils, including all the mayoral combined authories we analysed in this report,
are already prioritising the purchase of zero emission buses and almost all have a
target date for the decarbonisation of their fleet. From today, operators should be
purchasing only zero emission buses for routes in urban areas and, if required, the
government should be ready to regulate to enforce this.

For more rural areas, we recognise that electric buses may not yet be proven
to offer the range needed, bus operators are likely to be smaller and less able
to purchase electric buses and councils will have less capacity to apply for
government funding. In the run-up to 2030, operators in rural areas should
purchase zero emission buses wherever possible and buy plug-in hybrids for
the remaining routes.

While existing local decarbonisation targets are welcome, we would also

recommend greater ambition for those LTAs that have the means to do so.
Consequently, in tandem with a ramp up in funding mentioned below, we
recommend that every mayoral combined authority in England should set
targets to have both a larger and a net zero bus fleet by 2030. As part of this
target, we recommend that the default choice of technology for buses should
be electric over hydrogen. While we recognise that a small number of areas
may have easy access to cheap and, in time, low-carbon hydrogen, as we
discuss in chapter 3, electric buses are currently much more widely available,
lower carbon and are likely to have greater prospects for cost reduction.

Finally, there are significant economic and social advantages to delivering bus
decarbonisation through franchising. As such, following Greater Manchester’s
lead, we recommend that every mayoral combined authority should pursue the
development of a franchising model for local bus networks as soon as feasible.
In the longer term, we recommend that the government should work with LTAs
to facilitate discussion over the feasibility of pooling resources and delivering
franchising over broader areas that include smaller or more rural LTAs to ensure
they are not left behind.

MORE FUNDING, MORE FAIRLY ALLOCATED

While positive initial progress has been made on decarbonising buses, as we
discuss in chapter 2, continued funding is essential to the rollout of zero emission
buses while electric buses and hydrogen buses remain more expensive than diesel.
However, as we discuss in chapter 4, there is a significant case for scaling up bus
services even beyond current targets on the grounds of levelling up, improving air
quality and making a more substantial contribution to tackling transport emissions.

With this in mind, we recommend that the government commit to extending the
funding of its existing ZEBRA scheme by £2.5 billion between 2023–30. This would
mean £457 million committed for the remainder of 2023, falling to £209 million
by 2030. At an average across these years of £300 million per year, this funding

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would represent only a small increase from the £270 million the government
committed to bus decarbonisation in 2021 to 2022 (DfT 2022e). Furthermore,
if more mayoral combined authorities followed Greater Manchester’s lead
and pursued a franchising model, this would likely further reduce the cost of
subsidies to government.

While the ZEBRA scheme is an important initiative that should drive bus
decarbonisation, the way this funding is distributed must be changed. As the
Campaign for Better Transport has previously argued (CBT 2022b), funding for
local transport authorities must move away from a competition-based model,
towards long-term allocation of funding through a single pot of funding that
is granted when specific milestones and objectives are reached. Alongside
this model, government should internally seek to accelerate the process for
approving and providing funding as well as ensuring that every local authority
has funding to hire in-house expertise to deliver on bus service improvement
plans and their integration within wider transport planning more generally.

In addition to an uplifted ZEBRA funding scheme, government should allocate

funding for SME bus and coach operators, particularly in rural areas. This pot of
funding would require LTAs convening smaller bus operators in their area and
putting forward proposals for bus decarbonisation jointly. This would ensure
smaller operators do not get left behind or get unduly penalised by parallel
plans by local authorities to stimulate modal shift, accelerate decarbonisation
and tackle air pollution through measures such as congestion zones.

While this paper does not explore broader economic benefits to scaling up
bus services, it will nevertheless be essential to ensure that greater electric
bus investment sees corresponding benefits to the UK supply chain. We
recommend that government should follow their own example from the
Clean Heat Market Mechanism (that will require boiler manufacturers to
make a proportion of sales from heat pumps) and set bus manufacturers
a minimum percentage requirement for manufacturing electric buses as
a proportion of their total business. Correspondingly, government should
require recipients of ZEBRA funding to source a minimum percentage of
their electric buses from UK manufacturers. This would also require ZEBRA
funding to follow Scotland’s example and have a cost cap (where subsidies
would be offered up to 75 per cent of the cost difference between zero
emission buses and diesel, or up to the cost cap, whichever was cheaper).
This would help to prevent the temptation for manufacturers to charge
a premium in the knowledge that operators were required to source a
percentage of their fleet domestically.

Finally, a rapid scale up in bus services in mayoral combined authorities will also
require a corresponding scale up in both local capacity and broader route planning
to facilitate service improvement, such as the creation of bus corridors. While this
report does not estimate these broader costs, at the very least we recommend that
government should scale up its investment in BSIPs from £1 billion to the £3 billion
it originally committed to as part of its national bus strategy (DfT 2021a). The next
UK government should commit a tranformative level of funding to LTAs to deliver
the full scope of their BSIPs, this should be in the region of £10 billion.

The new investment detailed above could be funded through fairer and more
responsible allocation of existing transport funding. Capital funding for an
improved bus network (roughly 60 per cent based on previous studies (KPMG
2020)), should be reallocated from the £27 billion committed to the roads
investment strategy – a strategy that is incompatible with both climate and
nature goals. Fuel duty cuts disproportionately benefit the wealthiest and it is
estimated they will cost £27 billion in lost revenue over five years (Salutin 2023).

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These cuts should be reviewed with the resulting increase in revenues from fuel
duty ringfenced to fund improvements to public transport, alongside improved
walking and cycling infrastructure.

PROVIDING THE CONDITIONS TO ENABLE SUCCESS

Beyond increasing funding, there are a range of enabling measures that are needed
to move further and faster on bus decarbonisation. This will require action taken
both at a national and local level and careful coordination between the two.

At a local level, a significant scale up in bus numbers will also require careful road
planning to accommodate for increased service provision alongside improving
speed and reliability. Consequently, we recommend that all local authorities within
mayoral combined authorities set out plans to reallocate road space to buses:
aiming to creating a cohesive network of bus-priority routes that support the shift
to car-free high streets and city centres. Reallocation of road space to buses should
be integrated with action to provide more space for walking, wheeling, cycling and
nature in-line with a coordinate response to climate adaptation and in support of a
nature recovery.
To accompany these plans, we recommend that local authorities should explore
introducing zero emission zones that include all private vehicles into major
city centres, town centres and high streets and in areas of high air pollution.
As suggested by TfL (2019), zero emissions zones will be most effective and fair
if implemented alongside physical transformations to an area that prioritise
walking, cycling and public transport over motorised vehicle. In air pollution
hotspots they may work best if tightly-defined, for example covering school
streets, and limited to certain times of day (ibid). Such zones should never be
introduced without an accompanying scale up in bus services and would require
a corresponding increase in national government support for scrappage schemes
that support people to move to cleaner modes of transport.13 This would help to
ensure that a shift to zero emission public transport would lead to an increase in
accessibility and avoiding both the perception and actual risk of limiting people’s
ability to travel into city centres or within their local area.

In addition to accommodating vehicles on the road, it will also be crucial to

create enough space for both buses and coaches to charge, while fitting in
within other community transport needs. To this end, we recommend that local
authorities set out plans to incorporate shared charging infrastructure that
would include use cases for bus depots allowing public charging as well as new
public charging infrastructure allocating space and charging points for coaches.
This planning could also extend to promoting community ownership of assets, as
is currently being crowdfunded in Merton and Malvern Hills (Crowdfunder 2023;
Teme Wheels 2023).

At a national level, we welcome plans from National Grid ESO to reform grid
connections from a first come first served to a first ready first served model which
should enable those with planning consent already in place to be prioritised. This
should result in bus depots getting grid connections significantly more quickly
and we recommend that bus infrastructure should also be considered a strategic
infrastructure priority when receiving these connections.

Finally, although there is uncertainty around how batteries will be used at the
end of their life, there is also significant potential for a range of applications.
Consequently, we recommend that government should consider requiring
battery manufacturers to take an equity stake in bus recycling plants to
encourage battery designs to be more easily recyclable.

13 Scrappage schemes should be designed to promote the shift to cycling, shared mobility and public
transport, but still support those who need access to a private car to purchase EVs.

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