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By 2040, 80% of city buses worldwide will be electric, according to a just-released report by the consultancy Bloomberg New Energy Finance.
The big picture: China dominates the market right now and accounting for 99% of the market last year, according to BNEF. But EV bus adoption is expected to accelerate significantly in Europe and elsewhere by 2040.
- It's BNEF's first long-term forecast of electrification of city bus fleets.
- It's a deployment surge enabled by total ownership costs that will be generally more attractive than conventional diesel starting next year, and economics that will continue getting better.
One level deeper: The new bus projection is part of their annual long-term forecast on electric vehicles. The new report's top line is similar to last year's — BNEF forecasts that 55% of new passenger vehicle sales will be EVs in 2040, similar to last year's 54% figure.
- That equates to light-duty vehicle sales worldwide going from one million in 2017 to 60 million in 2040.
- Supply chain risk: Tight supplies of cobalt, a key battery material, is a risk to EV sales over the next five to seven years.
- But longer term, "we expect high prices to bring on new supply and accelerate the adoption of new battery chemistries," BNEF said.
The big picture: BNEF expects that the transition to electric cars and buses will add 6% to global electricity demand in 2040. However, electrification is projected to displace 7.3 million barrels a day of transport fuel that year.