New Flyer Low Emission Buses Too Expensive So Winnipeg Buys Diesel – CleanTechnica

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Into Canada’s ongoing challenges with bus fleet decarbonization comes Winnipeg, which hasn’t featured much so far in the ongoing tale of transit think tank CUTRIC’s incompetence, sole sourcing and hydrogen-centric conflicts of interest. However, it did have a role in a piece assessing Canadian bus manufacture New Flyer’s strategic missteps with hydrogen as the company is headquartered there.

As I lay out in the article on New Flyer, by trying to deliver both battery electric buses and hydrogen buses, New Flyer ends up delivering more expensive battery electric buses that are inferior to others on the market. Further, every hydrogen bus New Flyer manages to deliver at great expense will create unhappy clients. My estimate is that every hydrogen bus the company sells will cost it three sales of battery electric buses as it loses market share. BYD, after all, already has a factory in California and is winning contracts for hundreds of battery electric buses. BYD’s buses are better and a lot cheaper than New Flyers.

The cautionary case study for this is German truck manufacturer Quantron, which followed the same drive train strategy, delivered battery electric delivery vans to Ikea Austria that had 150 kilometers less range and cost €20,000 more than Mercedes equivalent, and then delivered hydrogen vans with the same range as Mercedes battery vans at exorbitant costs. Then Quantron went bankrupt, leaving Ikea Austria with an unsupported fleet. New Flyer’s strategy risks making it the next Quantron and Canadian transit agencies the next Ikea Austria.

Winnipeg is complicit in this, perhaps with no choice. New Flyer being a local company, it has even more of a lock on the transit organization there than it does in Canada in general. And for hydrogen buses it is the only provider in Canada, so when hydrogen buses get selected by a transit organization, typically because conflict-laden CUTRIC, whose Board New Flyer sits on, recommends them, it can’t lose.

Well, New Flyer just lost. Well, not really, that’s not how these things work. It appears to be the only winner out of this mess.

Winnipeg has been trying out various decarbonization options for quite a while. They considered electric tram buses but couldn’t afford the overhead wires. They tried out some earlier electric buses too.

Then in 2021, they made the fatal decision for their transit hopes to buy both battery electric and hydrogen buses from New Flyer. They were going to put the hydrogen buses in the Fort Rouge Garage initially and build an electrolyzer there. They were going to split initial battery electric buses between the Brandon Garage and the Fort Rouge Garage.

This wasn’t enough to replace all of their buses and expand the fleet. The plan was to replace the deteriorating North Transit Garage, built in a couple of stages in the 1930s and 1950s to house streetcars that were powered by overhead electrical wires that Winnipeg ripped out when it got rid of them in 1955, with one suitable for 60 foot buses, electric buses and hydrogen buses.

They set a budget for all of that, including a bunch of buses from New Flyer, electrical connections, a hydrogen electrolyzer at the Fort Rouge Garage, chargers, maintenance bays and the like. But the budget kept going up. And up.

New Flyer was the only respondent to the request for proposal for battery electric and hydrogen buses. No surprise, as no other bus vendor can possibly win in Winnipeg. The lock was in.

Unsurprisingly given New Flyer’s strategic missteps with hydrogen and having a lock, New Flyer’s proposed buses were absurdly expensive. That started to hit the budget in 2023.

“Pricing on both diesel and zero emission buses has increased significantly since this project was developed in 2020. Without additional funding, the number of buses purchased will be reduced to stay within the project budget.”

How much? How about down to 16 total battery electric and fuel cell buses for $33 million. And that’s without any of the infrastructure. Over $2 million per bus. Meanwhile BYD and Yutong buses are a lot cheaper, have more range and are better buses in pretty much every way.

Another $41 million was awarded to New Flyer for up to 43 diesel buses as well, almost a million per bus. Seems a bit rich given that basic 40′ transit buses cost about CA$360,000 in the United States, and basic 60′ buses cost less than a million too.

Between them that’s $74 million dollars awarded to New Flyer for up to 57 buses. Nice work if you can get it, and clearly New Flyer can.

But that wasn’t the only problem. Costs kept going up elsewhere as well, and unsurprisingly the hydrogen buses were central to part of it. They received one bid on the electrolyzer for the Fort Rouge garage, gasped in shock, and pivoted to extracting the hydrogen from methanol, claiming that this would still be lower emissions than the diesel buses. Yeah, not so fast.

A couple of years ago I dug through the number for methanol’s manufacturing emissions, because well to wheel is the actually useful measure. And methanol is very high emissions to manufacture. It’s typically made from natural gas or coal gas with lots of carbon dioxide boiling off. When it burns it’s cleaner because it has a higher ratio of carbon to hydrogen than diesel, but it still has carbon dioxide emissions. However, the lack of carbon atoms means it also has a lot less energy than diesel so more of it has to be burned, 2.2 times as much.

The combination means that just burning basic methanol with its global average carbon intensity results in 2.9 times as much carbon dioxide as burning diesel.

But wait, you say, they are going to strip the hydrogen out of the methanol with their gizmo, so that’s alright, isn’t it? No, it actually makes it worse in two ways.

What a methanol steam reformer does is put methanol in a bath of hot steam, just like doing the same to natural gas to make hydrogen. And just like doing it to natural gas, the carbon bonds with oxygen to make carbon dioxide, the greenhouse gas, and the carbon dioxide is vented to the atmosphere.

The embodied carbon from manufacturing the methanol is still there and the carbon dioxide created if it were burned as a fuel is still created.

However, the energy content of the carbon is lost, and it’s 55% of the energy of methanol, with the hydrogen providing the other 45%, just like methane. That means that the embodied carbon debt of the methanol more than doubles, with the total comparative carbon dioxide or equivalent for the same energy being about 6.4 times as bad as burning diesel in an internal combustion engine. Thankfully, I guess, fuel cells are more efficient than diesel engines, so it actually balances out fairly closely.

However, what’s left after steam reformation is hydrogen, and as noted in this series, hydrogen both leaks and has a high global warming potential, 37 times that of carbon dioxide over 20 years and 13 times over 100 years. Assuming a realistic 2% to 3% total leakage of hydrogen between reformer, storage tanks, compressors, pumps and bus, that makes the greenhouse gas emissions even worse.

Hydrogen is about 12.5% of the mass of methanol. That 2.2 tons of methanol that replaces a ton of diesel will have about 0.28 tons of hydrogen. If 3% of that leaks, that’s equal to about a third of a ton more carbon dioxide from the hydrogen in greenhouse gas emissions, making the total about 3.2 times worse than diesel.

This is the great bait and switch the methanol industry keeps trying to pull over the transportation industry’s eyes.

So much for the hydrogen buses being zero emissions. If they had built an electrolyzer at the Fort Rouge garage, that would have been about as good as hydrogen gets. Manitoba has the lowest carbon electricity in Canada and among the lowest in the world, 1.3 grams of CO₂ equivalent per kilowatt-hour. By comparison, I’m a few provinces west in British Columbia which has stunningly low carbon electricity and it’s ten times higher carbon. Germany, after decades of work to reduce carbon emissions, is still around 300 grams per kWh. Ontario, with its hydroelectric and nuclear fleet is at 35 grams, still good but still 27 times higher (and rising as Ontario’s energy policy under the current administration involves burning a lot more natural gas).

That means hydrogen electrolyzed at Winnipeg’s transit bus garages would have very low carbon debt for manufacturing, compressing and storing hydrogen, even with the low efficiencies of small electrolyzers at refueling stations, of about 0.1 tons of CO2 per ton of hydrogen. Adding the 0.3 tons of leaking hydrogen arrives at 0.4 tons of emissions for the system, which is much better than the 3.1 tons of emissions from diesel. An 87% improvement is actually an improvement, as long as they can keep leaking under control. Too bad it was too expensive to build and operate.

Of course, making hydrogen and using it is three to four times less efficient than just using the electricity in battery electric buses and battery electric buses don’t leak any greenhouse gases. As a result, a battery electric bus in Winnipeg would be seeing a lot less dam to wheel emissions, around 16 times less. Once again, if the goal is actually decarbonization, there is no other answer than battery electric that’s remotely credible, or for that matter less expensive or more reliable.

Originally the budget for the new building was $200 million. The budget ballooned to $305 million, which they blamed on the electrical infrastructure costs. They tried to add $80 million to it in September to cover the increases.

And now, they’ve doubled down on diesel buses, eliminating the Transition to Zero Emission Buses program and rolling it into the Transit Buses program. The funding approved for everything for 2025 is now going to be used solely to buy more diesel buses.

However, there is a disclaimer in there that leaves the door open for lower emissions buses, which is the assertion that it doesn’t impact Investing in Canada Infrastructure Program (ICIP) funding. Per the Government of Canada, that would be up to $111 million. That would be enough for a decent fleet of battery electric buses from a decent vendor as well as upgrades to the Fort Rouge and Brandon garages to charge them, but they’ll undoubtedly try to keep the hydrogen buses as well.

Transit planners are supposed to come back and tell council what they can achieve with whatever the real amount of money is, but New Flyer comes out of it golden. Basically they get even more bus orders from the city, and for ones they are competent to build, diesel ones. They don’t have to send nearly as much time and money on especially very expensive hydrogen buses.

And they received CA$38 million more governmental money recently to move bus final assembly to a new plant in Winnipeg, as until now they were shipping partially assembled buses south to a plant of theirs in the USA for that purpose. That’s on top of the fiscal assistance they received from the Manitoba Development Bank and Export Development Canada in their $400 million plus refinancing in 2023.

The council’s logic isn’t faulty as much as depressing. They can get a lot more buses on the roads for the same money, and expanding transit and ridership will get more cars off the road. That’s not a terrible trade off. Ridership in Winnipeg is still off millions every year after the COVID impacts. The new buses will cover new routes and more frequent service. Unfortunately, they’ll still be stinking, noisy, polluting, high-emitting diesel buses, which do provide some inhibition on ridership as well as impacts on the communities they service.

Arguably, this is a significant slowing of transit decarbonization in the city but might be an overall passenger travel decarbonization win. However, Winnipeg are complicit in the challenges. They didn’t use their power with New Flyer to influence it to stick to getting battery electric right, with buses as good as BYD’s or Yutongs and more reasonable prices. They went along with the bad idea of a mixed fleet of hydrogen and battery electric buses despite there being more transit fleets globally who have trialed hydrogen and abandoned it, and a lot more transit fleets that did realistic cost comparisons and never started with hydrogen. The exact same pattern exists in hydrogen passenger rail and hydrogen passenger ferries, by the way.

This is all easily discoverable information, and if CUTRIC were actually doing what it were supposed to be doing, it would have assembled it on behalf of transit agencies and be waving them off of hydrogen buses frantically, instead of having Enbridge, Ballard and New Flyer pushing hydrogen from Board positions.

If Winnipeg and other transit agencies really wanted to accelerate fleet decarbonization, they’d band together, tell New Flyer to stick to electric and ditch hydrogen, they’d ask the Ford government in Ontario to please invite BYD and Yutong to set up a factory in Oshawa to compete with New Flyer, they’d ask NRCan to stop wasting money on hydrogen buses as they aren’t zero-emission, are more expensive and less reliable, and they’d ignore everything CUTRIC says until it has had a top to bottom governance refresh and was operating under new leadership. They’d also be instructing their transit people to build lots of rooftop solar and put big buffering batteries into their depot plans.