Rising Fuel Costs = Alternative Energy

A Los Angeles electric school bus being charged. Interest in electric is expanding across the U.S.
A Los Angeles electric school bus being charged. Interest in electric is expanding across the U.S.

I am seriously feeling the pain at the gas pump. Are you feeling the same? If you are like me, you drive a fair amount, and that takes gas and money. As of May 13, before we went to press, the national average for a gallon of regular gasoline is $2.954, according to the U.S. Energy Information Administration. Gasoline prices have shot higher over the last several months. With summer approaching, will there be any reprieve?

According to Reuters, there is a growing gap between diesel and gasoline prices, which will accelerate the shift away from diesel toward gasoline for private passenger and fleet vehicles. Government regulations and taxation policies are already favoring the sale of gasoline and electric vehicles, rather than diesel cars and trucks. Will the fuel price differential speed-up the shift for school buses? Or will higher gasoline prices slow the process?

I’m sure your school district or company will be taking a hard look at increasing fuel costs as new fiscal year budgets get approved. Did you budget enough for escalating fuel prices? This major line item could hurt if you didn’t. Are you looking to purchase newer, more fuel-efficient school buses this coming year? If not, you should be.

In the recent Q2 earnings report for Blue Bird Corporation, Phil Horlock, president and chief executive officer, stated that alternative fuel-powered school buses represented an impressive 46-percent mix of the total backlog volume. That compares with a 34-percent mix for the same period last year. Further, the total number of alternative-fuel buses sold is up 24 percent from one year ago. Horlock said it is building momentum in the fastest-growing segment in the school bus market.

“We’re seeing very strong interest in our latest product, our all-new, zero-emission, electric-powered school bus, which is powered by a Cummins electric drivetrain,” Horlock said.

During a recent keynote address at the Advanced Clean Transportation Expo in Long Beach, California, Roger Nielsen, president and CEO of Daimler Trucks North America, said his company is going “all in” on battery-electric trucks, by renovating a plant in Oregon to produce Freightliner electric vehicles. “The road to emissions-free transportation is going to be driven with battery-electric vehicles,” Nielsen said. “I believe the future is electric.” One can surmise that Thomas Built Buses and new electric powertrain partner Proterra, will be laser-focused on the school bus electrification movement in school transportation.

One school bus dealer I spoke with said many school districts and contractors are considering adding more propane-powered school buses this year, but there is definitely interest in learning more about electric school buses.

The alternative energy push is driven by more government grants, bond measures, and funding programs, in addition to the Volkswagen Mitigation Trust Fund. Strong property taxes revenues help, too. Voters recently passed a $1.76 billion bond for Cypress-Fairbanks ISD in Houston. From those funds, $88 million will be allocated for transportation enhancements, such as bus replacement, GPS and a new transportation center.

A director of transportation I spoke with discussed how the school district is targeting the available VW grants, along with a few other government grants, to buy new alternative energy school buses in the coming school year and beyond.

Amid this trend of higher oil prices, be sure to plan accordingly. To remain efficient and fully operational into the new budgetary cycle this summer, consider the many fuel choices that are available to you. It’s a smart decision to consider a long-term investment strategy in a sustainable technology that creates fuel savings for the future.

At the upcoming STN EXPO Indianapolis and STN EXPO Reno, be sure to visit the exhibit halls to connect with OEMs, dealers and other suppliers. Talk to them about this trend of rising fuel costs and ask for help in how to mitigate the impact on your organization. Industry partners are there to help educate you on the different products, programs, and grants that are available to help achieve your goals.

Editor’s Note: As reprinted from the June 2019 Issue, Publisher’s Corner of School Transportation News.