the concern over battery life , as noted above , electric bus manufacturers are beginning to offer up to 12-year warranties on the batteries . This would limit the risk to the Authority that we would have to incur an expensive battery replacement to the final three years of a typical 15-year useful life . Finally , manufacturers are also getting creative with alternative financing options to reduce the impact of the initial cost premium . For example , there are now options in the market to buy the bus ( minus the battery ) at a cost comparable to diesel and then separately , lease the battery . 15 The anticipated fuel and maintenance savings are then expected to offset the cost of the battery lease .
In the initial financial analysis conducted by NREL , we compared the economics of replacing a diesel bus at the end of its useful life with either a new diesel bus or an electric bus ( with a dedicated charger ). 16 Using actual bus fleet information from Dulles International and industry data , we have calculated the time it would take for the Authority to recoup its additional investment in an electric bus over what we would have invested in a new diesel bus .
Replace a Diesel Bus with an Electric Bus
As a baseline for the analysis , in 2019 , a diesel bus in the Dulles International bus fleet traveled on average 54,952 miles , getting 4.9 miles per gallon ( MPG ). In addition , annual maintenance costs were $ 0.75 / mile . Using $ 420,000 as the purchase price of a new diesel bus and $ 890,500 for the cost of a new electric bus ( with appropriate upgrades and a charger ), we set out to determine the cost effectiveness of buying the electric bus based on projected fuel and maintenance savings over the vehicle ’ s useful life . We discounted the cash flows associated with the investments at a rate of 5 % per year which is the rate we use for our capital planning .
Figure 5 : Years to Recover Incremental Investment in an Electric Bus
15 See Proterra , “ Proterra Energy Fleet Solutions .” Accessed June 10 , 2020 .
https :// www . proterra . com / energyservices /.
16 NREL also evaluated replacing a CNG bus with an EV bus but given that the Authority ’ s priority is replacing diesel
buses at Dulles International , those results were not included in this Plan .
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