Navigant Research Blog

Purchase Incentives More Cost-Effective for E-Bikes Than EVs

— March 24, 2017

Electric bicycles (e-bikes) continue to be the highest selling EV on the planet, with nearly 35 million unit sales forecast for 2017. Increasing urbanization and a desire from consumers and city officials to move away from cars for motorized transportation are opening opportunities for alternative mobility devices. E-bikes are uniquely positioned to be a primary benefactor of this trend since they are low in cost relative to cars, do not require licensing, have no emissions, and can take advantage of existing bicycling infrastructure. The European Cyclists’ Federation (ECF) published a report that shows e-bikes are a particularly cost-effective way to decarbonize the transport system through incentives. However, e-bikes have received little in the way of purchase incentives within most countries’ electric mobility strategies.

Germany has spent an enormous sum of money on electric cars, with unimpressive results. The country spent €1.4 billion ($1.5 billion) through 2014 on R&D and added an additional nearly €1 billion ($1.07 billion) subsidy scheme in 2016. Yet, there are just 25,500 pure EVs on the road in Germany. Meanwhile, e-bike sales exploded in the country during the same period with virtually no subsidies, aside from a few small pilot projects. Over 2.5 million e-bikes are in use in Germany, and Navigant Research expects nearly 650,000 unit sales for 2017. One wonders how much higher this figure could be if e-bikes had the same public financial support as EVs in Germany.

Differences in E-Bike and EV Policy, Germany: 2016

(Source: European Cyclists’ Federation)

New E-Bike Purchase Incentives in Europe

Several new e-bike purchase incentives have popped up across Europe, providing a boost to the industry and demonstrating new confidence in e-bikes as a cost-effective way to reduce traffic congestion and greenhouse gas (GHG) emissions. France announced a $200 subsidy for e-bike purchases in February 2017, and earlier in the year, Oslo, Norway began a $1,200 incentive program for electric cargo (e-cargo) bikes. Austria has offered an e-bike incentive program for numerous years. The ECF estimates roughly 25% of early e-bike purchases in the country’s crucial market uptake phase, around 2010-2011, were supported by financial incentives. Austria has one of the highest sales rates of e-bikes per capita in Europe, third behind the Netherlands and Belgium.

The increasing number of e-bike incentives in Europe demonstrates the growing recognition by European policymakers that e-bikes can be a more cost-effective technology to incentivize over EVs within an electric mobility strategy. On average, e-bikes cost less than 8% of the price of an electric car, according to the ECF. This, coupled with the lack of licensing requirements, make adoption much easier for consumers.

Studies Show

As noted in a previous blog, a consumer survey conducted by the Oregon Transportation Research and Education Consortium (OTREC) showed that the primary reason respondents bought e-bikes was to replace car trips—not bicycle trips. E-bikes offer enormous potential to replace cars. One study by the German Federal Environmental Agency shows that e-bikes are faster than cars for distances of up to 10 km (6.2 miles) in an urban environment. The trends in Europe in conjunction with conclusions from these studies suggest that more countries should incentivize and promote e-bikes if the goal is to reduce GHG emissions and traffic congestion in a cost-effective way.

 

Smart Parking Market: Higher Quantity of Projects, but Smaller Project Sizes

— March 15, 2017

The smart parking industry continues to grow as an increasing number of cities struggle with traffic congestion and inadequate parking availability. However, there has been a notable shift in the market over the past few years. The early stages of smart parking projects were marked by several citywide, high profile deployments—such as those in Moscow (over 11,000 sensors deployed), San Francisco (over 11,000 sensors deployed), and Los Angeles (over 8,000 sensors deployed). Although these projects have demonstrated success in reducing congestion and parking search times, obtaining the necessary funding for similarly sized projects has proved challenging in some jurisdictions without government subsidies. The result has been a move toward a higher quantity of projects being developed (particularly in smaller cities), while the average project size has decreased.

A Prime Example

Cardiff, the capital and largest city in Wales (about 350,000 inhabitants), is one of the latest examples of a smaller city deploying a modest-sized smart parking project. Working with Australia-based Smart Parking Ltd., Cardiff is deploying around 3,000 sensors (in on-street and off-street locations) for its smart parking solution, which is building off a successful pilot program in 2015 that covered 275 parking bays across the city. The solution includes variable message signage directing drivers to open parking spots throughout Cardiff and a smartphone app that provides real-time parking availability and guidance. Additionally, Smart Parking’s software program, SmartRep, collects data from the sensors to analyze how parking spaces are being used. This provides the Cardiff City Council with tools to develop improved day-to-day parking management and future parking policy and planning.

New Developments Spurring Growth

While a higher number of smaller projects has characterized the smart parking market over the last few years, new product and technology developments offer the potential to accelerate adoption in the industry. The trend toward more hybrid and integrated business models is increasing, with a focus on reducing expensive hardware and instead utilizing more software and data applications. Increasingly, smart parking systems are also expected to be integrated with broader smart city deployments such as smart street lighting and automated vehicle infrastructure. Additionally, improving sensor technology is resulting in sensors with extended battery life and increased accuracy. These trends point toward a growing market in the coming years, with the potential for an eventual resurgence in larger smart parking projects. Time will tell if the resurgence in larger citywide deployments will develop incrementally (through separate projects in multiple city neighborhoods) or through a return to large single deployments. Currently, Navigant Research assesses the former scenario (incremental approach) to be more likely in the near term as cities target specific areas with particularly bad congestion.

For more information on the smart parking industry, check out Navigant Research’s report, Smart Parking Systems.

 

US Smart Cities Market Continues Momentum through Readiness Challenge Grants

— February 22, 2017

SmartCityThis month, the Smart Cities Council announced the five winning US cities of the Smart Cities Council Readiness Challenge Grant program. These cities—Austin, Texas; Indianapolis, Indiana; Miami, Florida; Orlando, Florida; and Philadelphia, Pennsylvania—will receive a package of benefits from the Smart Cities Council, the world’s largest smart cities network. These benefits include city-specific readiness workshops, as well as an array of products and services from Council member companies. The workshops are expected to help the chosen cities develop a strategic approach toward utilizing smart technologies in a way that increases infrastructure innovation and investment. Some examples of the smart city products and services that Council member companies will be providing to the winning cities include:

  • Ameresco: Consulting services to optimize smart street lighting
  • AT&T: 25 AT&T Internet of Things (IoT) Starter Kits
  • Sensus: Free citywide hosted communications network for 1 year
  • Telit: Free access to the Telit IoT platform
  • Transdev: Up to 3 days of technical assistance in developing more efficient urban mobility options

Each city is focused on its own unique challenges as part of the Readiness Challenge Grants:

  • Austin is focusing on affordable housing, mobility, and economic development
  • Indianapolis has placed an emphasis on smart utilities and transportation
  • Miami is targeting urban resilience and climate adaptation
  • Orlando is centering on a comprehensive smart city plan with multiple department integration and regional stakeholders (with a particular focus on smart transportation and security)
  • Philadelphia is building a regional smart cities ecosystem through a coalition of city, community, business, and educational institutions

Evolving Initiatives

The Smart Cities Council Readiness Challenge Grant program is expected to help the selected cities reach their goals for improved public services and build on the momentum generated by several important initiatives in the United States over the last few years. The White House Smart Cities Initiative was originally launched in September 2015 and included an initial investment of over $160 million for federal research and technology collaboration efforts to help municipalities address key challenges such as reducing traffic congestion, fighting crime, fostering economic growth, managing the effects of climate change, and improving the delivery of city services. In mid-2016, Columbus, Ohio was officially announced as the winner of the US Department of Transportation’s (DOT) Smart City Challenge. The city is set to receive a total of $140 million, with combined contributions from the DOT ($40 million), Seattle-based company Vulcan ($10 million), and a group of local businesses called the Columbus Partnership ($90 million).

These initiatives demonstrate how the smart city concept is being embraced and implemented in the United States. With over 130 cities applying for the Readiness Challenge Grants, US cities are increasingly looking to achieve greater efficiency in the delivery of important public services such as transportation, water delivery, and public safety. Initiatives such as these from the Smart Cities Council, in addition to several national programs, are helping US cities develop long-term digital infrastructure strategies and implement high-impact smart city projects.

 

The Future of Smart Parking Is Integration with Automated Technology

— January 26, 2017

Electric Vehicle 2The smart parking industry continues to evolve as an increasing number of cities struggle with traffic congestion and inadequate parking availability. While the deployment of sensor technologies continues to be core to the development of smart parking, a wide variety of other technology innovations are also enabling more adaptable systems—including cameras, wireless communications, data analytics, induction loops, smart parking meters, and advanced algorithms.

Moving Toward Automation

The future of the smart parking market is expected to be significantly influenced by the arrival of automated vehicles (AVs). Several cities around the world are already beginning to trial self-parking vehicles, specialized AV parking lots, and robotic parking valets.

For example, in Boulder, Colorado, ParkPlus is working on deploying the first fully automated parking garage in the Western United States through Boulder’s PearlWest mixed-use development. The company’s automated parking system uses lasers to scan cars and a robotic valet to park the vehicles. Vehicles are transported by a robotic dolly that lifts and transfers them to storage racks. Using this system, up to 4 times as many cars can be parked in the same amount of space as a traditional garage (since there is no need for extra space in between cars). The automated system is expected to deliver vehicles within 2 minutes of a retrieval request.

Development and Deployment

Somerville, Massachusetts has partnered with global automaker Audi to develop self-driving and self-parking cars. In 2018, a small fleet of cars with piloted parking technology will be deployed to test self-parking capabilities with a specialized nearby parking garage. The idea is that having cars that self-park will help improve traffic congestion considerably as riders could be dropped off in front of their destination and the car would park itself and minimize the time spent taking up space on the road (as opposed to drivers circling several blocks continuously looking for a space). In 2020, phase two of the project is expected to commence with the deployment of a full fleet of self-parking Audi cars. By 2030, the self-parking garage is targeting availability to the broader AV market. It is estimated that parking garages specifically designed for self-parking cars can take up 60% less space than traditional lots (as cars can park much closer together and elevators and stairs are no longer required).

Leading smart cities are recognizing that smart parking infrastructure (i.e., sensors and communications networks) can be leveraged to help enable cars of the future to park themselves. AV fleets are also expected to fundamentally change the way cars are used, affecting how often and where future vehicles will be parked. For more information on the smart parking industry, check out Navigant Research’s recently released report, Smart Parking Systems.

 

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