Satisfaction, Willingness to Pay, and Ridership When Buses Are Electrified

Do citizens value the electrification of public transport? Cleaner and quieter services should increase consumer welfare. Yet this response has not been tested, despite the vast investment planned by governments worldwide. We provide a three-pronged empirical analysis of the demand response to bus electrification. First, commuters alighting from electric buses report higher satisfaction regarding noise, fumes, and smell compared with a diesel bus control. Second, residents of a neighborhood exposed to electric buses for over one year are willing to pay US$0.085 for an electric relative to a diesel bus ride, which amounts to US$20 per resident per year. Consumer welfare gains are US$250,000 per electric bus procured—a neglected demand-side cobenefit in public transit’s energy transition that is similar in size to the carbon savings. Third, ridership is higher on electrified bus lines. This effect increases with the timing, duration, and intensity of a bus line’s electrification.