TCO in Electric Buses: Exploring the Integration of Operational with Social and Environmental Costs

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Résumé:

TCO in Electric Buses: Exploring the Integration of Operational with Social and Environmental Costs

Purpose
Municipalities are increasingly investing in electric bus fleets to reduce local air pollution, improve public health, combat climate change, and achieve greater efficiency in the future. However, despite their numerous advantages, electric buses face significant challenges due to their relatively new status in transportation systems. Two critical concerns include the high initial investment and uncertainty about battery longevity. Financial assessments often focus on ROI based primarily on purchase price, but only consider part of the operational costs, which account for approximately 80% of total expenditures.
To address these challenges, this paper aims to clarify ambiguities in the Total Cost of Ownership (TCO) and Life Cycle Costing (LCC) methodologies, which dominate cost analysis for electric buses. While TCO focuses on the cumulative costs incurred over the operational life of a vehicle, LCC includes a broader scope, encompassing costs from production to disposal. Existing studies can employ inconsistent variables and data sources, complicating cross-study comparisons and diminishing practical applicability. By conducting a systematic review using the PRISMA methodology, this paper synthesizes existing research to provide a comprehensive approach for future TCO assessments. Though limited in scope, relevant LCC calculations are considered to support and complement TCO analysis.
This analysis is expected to inform policymakers and public transportation stakeholders by identifying robust frameworks for cost evaluation and providing actionable insights into integrating external costs.
Design
It was chosen the PRISMA approach, a methodology for systematic literature reviews, focusing on the following aspects: variables selected, assessment of results and future trends. The initial search for relevant studies was conducted using the Scopus database, which yielded over 1,700 papers in the first round of the review. To analyze in a clear and direct way, this review is guided by four created questions:
Q1: How is the TCO of electric buses assessed?
What are the key components?
What are the sources of input data?
How is the TCO calculated?
Q2: How do papers compare the TCO results?
What are the KPIs used?
What are the correlations made?
Q3: How does the paper quantify external costs/social values and compare them with other values?
What are the key components?
What are the sources of input data?
How is it integrated with the operational costs of the TCO?
Q4: What are the future analysis and recommendations made by these studies?
After selecting the final set of studies, a meta-analysis was conducted to synthesize the findings, focusing on three core areas:
Variables and data sources used in TCO calculations.
Approaches for integrating external costs with operational costs.
Recommendations for future analyses and methodological improvements.
Main Results
From the meta-analysis, three main findings emerged:
The lack of standardization in methodologies and variables used.
The difficulty of integrating external costs, such as environmental and social costs, with operational costs.
Significant discrepancies in the final conclusions of TCO calculations as a result of these issues.
The first finding highlights the variability in the selection and calculation of variables across studies, as well as inconsistencies in data sources. For example, when estimating the number of electric buses required, some studies assume the same number as diesel buses, while others introduce a secondary variable that accounts for the downtime needed for charging.
The second finding underlines one of the most critical challenges: electric buses are not implemented solely for cost considerations but also due to their social and environmental benefits. However, during TCO analysis, very few studies successfully integrate these two types of outputs to provide cohesive conclusions. Most studies tend to focus on either operational costs or external costs, rarely addressing both comprehensively. Naturally, those that focus on operational costs are clearer, as cost valuation in this area is more straightforward. In contrast, studies incorporating external costs often exhibit more inconsistencies, such as methodological discrepancies mentioned in the first finding, and face difficulties due to limited and less reliable data.
Finally, as a consequence of the first two findings, the papers analyzed utilize different methodologies and sometimes yield contradictory results, making comparisons difficult and hindering the extraction of broader insights. Additionally, sensitivity analyses are often superficial, with limited examples of variables being compared against each other or explored for deeper insights. For instance, few studies analyze the combined effects of policies, such as incentives for electric buses and increased taxation on diesel, focusing instead on their impacts in isolation.
Significance
This research contributes both theoretically and practically by addressing key criticalities in the Total Cost of Ownership assessments for electric buses. By identifying the main challenges in the current literature, such as the lack of standardization, the limited integration of external costs, and the variability in data sources, this study provides a structured overview for future analysis.
The review includes papers with diverse approaches, ranging from operational cost evaluations to broader analyses that attempt to include social and environmental costs. Comparing these different types of studies highlights gaps in the methodologies and suggests improvements for ensuring consistency and reliability in future research.
Additionally, this study proposes a set of main variables and reliable data sources that should be prioritized in TCO assessments. For instance, operational factors such as acquisition cost, infrastructure investment, energy consumption, maintenance costs, and battery lifespan should be standardized. On the external costs side, environmental impacts like emissions reductions and social values such as public health improvements need better integration into the overall evaluation.
Finally, the paper offers suggestions on how to approach the integration of external costs with operational costs. A more holistic methodology, combining these elements, can lead to conclusions that better reflect the true value and feasibility of adopting electric buses in public transportation systems. These contributions aim to assist policymakers and researchers by improving the clarity and relevance of TCO evaluations, ensuring more informed decisions and sustainable outcomes.