Tendering sustainable Public Transport in the region of Utrecht, the Netherlands

By project eBussed

Published on 07 July 2022

Netherlands

Utrecht

About this good practice

In the Netherlands it is common practice to tender the concession for public transport to a private transport company. The tender contains many pre-defined quality agreements. Regarding the ownership of the ebuses; they are bought and owned by the transport operator. The current concession in Utrecht contains flexibility in introducing zero emission buses. This made it possible to gain experiences by all parties with the introduction of ebuses.

The value chain of public transport by ebuses, contains privately owned companies. The transport operator receives the concession for a period of time, mostly ten years, and has the responsibility of tendering the ebuses and e-infrastructure within the quality demands as agreed upon within the concession.

Benefits for whom?

The province of Utrecht gets value for money, at a market rate, the realization of qualitative conditions is linked and secured to the granting of concessions. The province buys timetable hours, as a service, and can rely on a financially sound transport service.
As an entrepreneur, the private transport operator sets its own bandwidths and possibilities to make deals with suppliers and other companies. He makes good use of his entrepreneurship.

Passengers, get a good quality of transport, that meets sustainability goals and is a more quiet form of transport in the streets of Utrecht. They can rely on the service of public transport.

Resources needed

In addition to the regular work for the province to prepare a concession, the extra costs for the changes to a larger number of ebuses amounted to 1.5 FTE for 1.5 years and an extra implementation budget amounted to 9 million euros.

Evidence of success

The operator wants to earn a reasonable profit margin on the public transport, while the authority wants to fulfill certain public policy goals. The tendering process is where these two come together. It is a strong mechanism to get the best value for money out of the market. For example the most public transport, or the highest number of ebuses running in the area, within the available budget of the public transport authority.

Potential for learning or transfer

Challenges encountered:
The challenge is to support the private transport operators to find funding for the purchase of the ebuses in times of less possible public transport because of safety measures for Corona. One of the options is providing a bus loan from the province to the private transport operator.

Potential for learning or transfer:
This way of tendering is a consideration for regions when the plan to tender the concession for public transport by ebuses. They can either choose whether to tender the ebuses and e-infrastructure themselves and thus become the owner of the ebuses and e-infrastructure or to entrust those tasks to a private company. By doing the latter, it allows them to monitor all qualitative requirements themselves and also to achieve a high quality-price ratio through market forces.