Electric Transport in South Africa with Pay-As-You-Save
Pay-As-You-Save (PAYS) is an innovative finance approach that holds the key to unlocking a lower carbon, electric transport future as seen in a recent industry brief and short video released by GreenCape and the Friedrich Naumann Foundation.
Like many developing nations, South Africa is confronted with the seemingly contradictory objectives of reducing carbon emissions whilst simultaneously needing to improve the public transport system – a system that primarily serves the poor and disenfranchised.
In South Africa, these people typically live the furthest from places of employment and, in Cape Town specifically, they spend approximately 43% of their monthly household income on transport costs.
Public Mobility: Electric Buses
Electric buses (e-buses) present the best business case for transitioning to electric public mobility. They are space-, emissions- and energy efficient.
The Cape Town mayoral committee member for public transport and urban development, Felicity Purchase, says that the lifetime carbon emissions from electric buses would be significantly lower than diesel buses if charged using renewable energy.
However, according to GreenCape’s sustainable transport analyst, Khanyiselo Kumalo, the upfront capital costs of e-buses are currently acting as a barrier to the rapid roll out of this public transport alternative. This is despite the significantly reduced operational costs associated with e-buses when compared with the equivalent costs of conventional combustion engine buses.
Pay-As-You-Save (PAYS): Pay for Charging instead of Diesel
Minister of Transport and Public Works, Donald Grant, says that the PAYS buses approach is a business no-brainer. “Companies operating buses can invest in electric buses, still pay the same capital cost as a diesel bus and then instead of buying diesel, pay a fixed charge for electricity to charge the bus battery. This fixed charge is less than they would have paid for diesel and other operating costs.”
Businesses, municipalities and climate conscious citizens are being encouraged to explore the PAYS approach which has been made freely available on the GreenCape website.
- With the PAYS system, the bus operator would pay for its electricity consumption to charge the battery according to the amount used, which is variable; and the cost recovery for the PAYS investment is a separate fixed charge on the same monthly bill.