City moves forward on plan to spend $100M on e-bus transition

Calgary is moving forward in negotiating a nearly $500-million arrangement with the federal government that would help the city replace some of its diesel bus fleet with up to 259 zero-emission electric transit buses.

The council’s executive committee voted 7-1 on Wednesday to support a proposed finance arrangement in which the city would put up $100 million to secure as much as $391 million in federal financing. 

Mayor Jyoti Gondek said the $491-million arrangement would allow Calgary Transit to replace some of its diesel buses as they reach the end of their usefulness.

Along with lowering greenhouse gas emissions, the electric buses are expected to help the city save on operating costs in the long run. 

“What we’ve got in this situation is a $100-million investment by the city, which will result in about $224 million in a grant from the federal government as well as the ability to tap into $168 million in a low-interest loan from the Canada Infrastructure Bank,” Gondek said. 

Repayment of the low-interest loan would be covered through the savings of not operating a diesel fleet, the mayor said.

Of the $100 million put up by the city, $80 million would come from previously approved capital funding and $20 million would come from the city’s Centralized Climate Fund. 

The zero-emission electric buses are estimated to cost $310 million. Charging infrastructure and other costs would amount to roughly $181 million, according to Calgary Transit. 

The Canada Infrastructure Bank is only offering the low-interest loans for the project until the end of this month.

During Wednesday’s meeting, Calgary Transit officials said that if steps weren’t taken before that deadline, the bank could adjust the rates in the new year, making the bus electrification process significantly more costly.

Coun. Dan McLean was the only committee member to vote against the financing plan, explaining that he would have liked to have seen more data on how other cities implemented electric buses and what problems they faced. 

“I’d rather wait until the second model and the imperfections are worked out,” he said. “That’s the only reason I voted against it. I’d rather see a pilot and more information first before we spend a whole bunch of taxpayers’ money.” 

Next week, council will discuss the proposed deal. If approved, the plan would move forward and construction on the electric buses would be slated for October 2023. 

Under the city’s plan, the first electric bus would roll out in December 2025, and rest of the fleet would hit the streets the following year. 

When all of the 259 electric buses are in service, greenhouse gas emissions in the city could be reduced by 13,000 tonnes per year, city administrators said. 

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