The rapid deployment of zero-emission buses in Europe

The deployment of fully electric buses has increased rapidly, rising from a 5% sales share in 2016 to 10% in 2021. This trend looks likely to accelerate, driven largely by demand-side policy from cities and national governments. This briefing summarizes the current market for zero-emission buses, shows how manufacturers have responded to the rapid growth in demand, and identifies policy levers that will accelerate the deployment of these vehicles in Europe.

On the demand-side, several Member States have pledged to convert their entire bus fleet to zero-emission by as early as 2030, as is the case in the Netherlands. More ambitious targets are evident at the local level, with Amsterdam and Copenhagen planning for a fully zero-emission bus fleet by as early as 2025, and over half of all European capital cities planning for a fully-zero emission fleet by 2040. However, most of the ambition is driven by high-income Western Europe countries, with less of a transition evident from lower-income Eastern European countries.

Legacy manufacturers have been slow to meet this growing demand of zero-emission buses, resulting in an emergence of several smaller manufacturers. While most major manufacturer have plans to increase their sales share of zero-emission buses in the next decade, some have been focusing significant resources on natural gas technologies. There is still a clear demand for natural gas buses, despite the insignificant climate or health benefits over a modern-day diesel bus, but cities see the technology as a short-term investment and plan to eventually shift to fully zero-emission vehicles.

The acceleration of zero-emission bus deployment may be solidified through upcoming directives and regulations. The Clean Vehicles Directive, which sets minimum sales shares of publicly procured zero-emission buses, will be reviewed in 2027 to set new post-2030 targets, and will play a significant role in further driving the increase in zero-emission buses. In addition, the CO2 standards for heavy-duty vehicles, which don’t currently apply to buses, will be reviewed by the end of 2022 bringing the possibility to establish Europe’s first CO2 standards for buses. Finally, some financial support is available for lower income regions which may lack the capital to overcome the financial hurdles associated with investing in zero-emission vehicles. Introducing further such initiatives may play a critical role in unlocking the zero-emission transition of public fleets in lower income countries.