Guidance

Apply for zero emission bus funding (ZEBRA 2)

Updated 20 November 2023

Applies to England

Introduction

In March 2021, the government published ’Bus Back Better’, its national bus strategy for England, which set out a vision for the future of buses across the country. The strategy set out a roadmap to transition towards a fully zero emission bus fleet. It committed to consulting on an end date for non-zero emission buses and reaffirmed the government’s commitment first made in February 2020 to support 4,000 zero emission buses.

Since then, an estimated 4,200 zero emission buses (ZEBs) have been funded across the United Kingdom, delivering on this commitment. We have also consulted on setting an end date for the sale of non-zero emission buses. Both these actions will support our long-term goal to decarbonise the whole bus fleet.

The Zero Emission Bus Regional Areas scheme (ZEBRA 1) provided funding for 1,300 ZEBs. This scheme supported the rollout of ZEBs, the development of ZEB technology and provided learning on the challenges of introducing ZEBs and their supporting infrastructure.

The ZEBRA 1 scheme demonstrated the importance of local transport authorities (LTAs) having the right knowledge and experience to deliver large ZEB projects and the importance of partnership working between LTAs and bus operators. It also demonstrated the additional challenges faced by rural LTAs seeking to introduce ZEBs, both technological and financial. If we are to decarbonise the whole bus fleet, we must ensure that all LTAs and all bus operators take the first step towards decarbonising buses.

We are now launching ZEBRA 2, which will provide £129 million to support the introduction of ZEBs in financial years 2023 to 2024 and 2024 to 2025. This will be a single-stage funding competition to award funding over both financial years.

£25 million will be initially reserved for proposals to introduce ZEBs in rural areas, recognising the additional challenges this may bring. All applicants will also be able to seek funding for zero emission minibuses that are used on local bus services.

We want to help LTAs and bus operators that have little to no experience with ZEBs benefit from this funding. Therefore, LTAs that did not receive ZEBRA funding will be prioritised over LTAs that did.

For battery electric buses, reflecting the commercial maturity of the technology and evidence from ZEBRA 1, proposals seeking funding for battery electric buses will be required to demonstrate at least low value for money (VfM), as measured through our greener bus tool. This is a key requirement and battery electric proposals assessed to be poor VfM will not receive funding.

Hydrogen fuel cell buses are at an earlier stage of commercial deployment compared to battery electric buses and we know there is more that we need to understand about the technology. We recognise that hydrogen schemes would struggle to meet a low VfM threshold. Therefore, hydrogen fuel cell bus proposals that are assessed to be poor VfM could be funded, provided they offer a genuine learning and innovation opportunity, such as the vehicles will operate on longer distance bus routes in rural areas.

The funding of ZEBs cannot be considered in isolation. Since March 2020, we have provided over £2 billion funding to support bus industry. We want to ensure that funding for ZEBs is aligned with investment to support bus services. Therefore, in line with the principles set out in the NBS, funding will only be awarded to LTAs that have made an enhanced partnership or have begun following the statutory process to decide whether to implement franchising.

You can read the Bus Back Better, the national bus strategy for England.

How to apply

ZEBRA 2 is a single-stage funding competition open to local transport authorities (LTAs) based in England (outside of London) only.

LTAs need to complete and submit electronically the following documents:

• fully completed application form
• fully completed separate greener bus tool
• fully completed grant funding per bus calculator spreadsheet
• any annex documents requested in the guidance

All applications should be submitted electronically to BUSES@dft.gov.uk no later than 4pm on 15 December 2023.

When applying, LTAs must ensure they:

• put ZEBRA 2 in the subject line of their email
• strictly adhere to the word limit when filling out the application form
• only provide information in annexes when requested

You will receive an acknowledgement within 5 working days. If you do not receive an acknowledgement, then the bid has not been received.

We may wish to discuss the content of bids with LTAs and operators to seek clarity on any aspects following the deadline.

Ahead of this final deadline, LTAs should notify the department of their intention to apply to ZEBRA 2 by emailing BUSES@dft.gov.uk by 4pm on 20 October 2023.

Once applications have been submitted, the Department for Transport (DfT) may contact LTAs to seek clarification on their applications, which may take the form of a clarification interview. These clarifications will be used to inform the assessment of applications.

Final funding decisions will be made by ministers.

Table 1: Funding application timetable

Event	Date
Scheme launch	Week commencing 8 September 2023
Deadline to notify DfT of intention to apply. LTAs may submit questions on their applications to DfT from this date.	4pm, 20 October 2023
Deadline to submit application	4pm, 15 December 2023
Applicants take part in Q&A session on proposals with reviewers	Week commencing 15 January to week commencing 22 January 2024
DfT reviews and makes funding decisions	March 2024
Funding for financial year 23/24 awarded to successful LTAs.	By March 2024
Orders placed for zero emission buses.	31 January 2025
Funding for financial year 24/25 awarded to successful LTAs.	By March 2025

Total funding available

There is up to £89 million available in financial year 23/24 and up to £40 million available in financial year 24/25. Successful bidders will be awarded the majority of their funding in financial year 23/24. The remaining funding will be released in financial year 24/25 when buses have been ordered. DfT may decide not to award all funding through ZEBRA 2.

Nearly all ZEBs that have been funded to date have been introduced in urban areas. Rural areas face additional challenges when seeking to introduce ZEBs compared to urban areas, both in terms of vehicle range and costs. To support the decarbonisation of the bus fleet, lessons will need to be learned on the challenges and solutions to introducing ZEBs in rural areas.

Therefore, £25 million funding will be initially reserved for proposals to introduce ZEBs in rural areas. DfT may decide to award more funding, of up to £50 million, to proposals for ZEBs in rural areas if enough bids of sufficient quality are received. DfT may decide to award less funding to proposals for ZEBs in rural areas and reallocate that funding if not enough bids of sufficient quality are received.

Once approved, the size of the agreed funding will be fixed. Should cost increases occur, DfT will not provide additional funding and this will need to be accounted for within local budgets or from private investment.

The funding that can be provided for this scheme is capital funding only. The funding plans set out in applications must show that funding is capitalised by the LTAs, operators and finance providers, for example.

The funding amount will use the same funding formula as previous schemes.

DfT will contribute up to 75% of the cost difference between a ZEB and a standard conventional diesel bus equivalent of the same total passenger capacity.

For infrastructure, DfT will contribute up to 75% of the total capital expenditure incurred as a result of its purchase and installation.

LTAs can request grant funding to cover up to 50% of total contingency costs, for vehicles and infrastructure. Contingency costs must be based on a quantified risk assessment (QRA) that has been conducted and is appropriately evidenced in the QRA spreadsheet. Refer to the greener bus tool guidance for further details on conducting a QRA.

There is no minimum or maximum size for bids. However, DfT reserves the right to require any LTA to submit a separate, scaled-down or scaled-up proposal.

Applications only for infrastructure will be accepted. LTAs submitting infrastructure-only bids will need to clearly explain how the infrastructure will support the introduction of ZEBs, including by providing evidence from suppliers for the cost of vehicles and explaining how the vehicles will be procured. LTAs should contact DfT by email at BUSES@dft.gov.uk if they have questions about submitting an infrastructure-only bid.

Orders for buses must be placed by 31 January 2025. If this key milestone is not met, DfT reserves the right not to provide the remaining funding in financial year 24/25. We expect all buses to come into service within 2 years of initial funding being awarded.

Who can apply for funding?

Given their lead role in developing and delivering transport strategies for their areas, such as through local transport plans and Bus Service Improvement Plans (BSIP), we ask for bids to be written and submitted by English LTAs outside London (counties, unitaries and combined authorities).

In line with the principles set out in the National Bus Strategy, to be eligible for funding from ZEBRA 2, LTAs must have made an enhanced partnership or be following the statutory process to decide whether to implement a franchising scheme.

ZEBRA 2 aims to support more LTAs to introduce ZEBs, particularly those with little to no experience of introducing ZEBs in their areas.

£25 million funding will be initially reserved for proposals to introduce ZEBs in rural areas. This pot can be increased to up to £50 million if enough proposals of sufficient quality are received. To be eligible for this part of the funding for ZEBRA 2, LTAs will:

• have not received funding from the ZEBRA scheme previously
• need to meet the ZEBRA 2 definition of a rural LTA
• need to demonstrate that the bus services where the ZEBs will be introduced serve rural areas

The remaining funding will be allocated first to LTAs that have not received funding through the ZEBRA scheme previously.

Table 2: How we will prioritise funding allocations

Funding amount	Prioritisation for funding
Provisionally £25 million (from £129 million available)	1. Proposal to introduce ZEBs in rural areas, submitted by LTAs that have not previously received funding from ZEBRA scheme.
Remaining budget (up to £129 million)	2. Proposal to introduce ZEBs in any area, submitted by LTAs that have not previously received funding from ZEBRA scheme. 3. Proposal to introduce ZEBs submitted by LTAs that have previously received funding from ZEBRA scheme.

LTAs can submit joint bids, with one LTA identified as the lead bidder. Prioritisation for funding will be based on which LTA is designated as the lead bidder.

LTAs that have received funding from other schemes to decarbonise or improve their transport networks can apply to ZEBRA 2, but they must declare this in their application.

LTAs can submit one bid. LTAs can work with other LTAs to submit bids, but an LTA can only be the lead bidder for one bid. As with ZEBRA 1, bids should be developed in close partnership with bus operators.

LTAs must provide letters of support from the bus operator(s) who will be operating the ZEBs, with signatures from the national CEO and local area MD, committing to investing in the buses and operating them in the area for a minimum of 5 years. LTAs do not need to provide letters of support for all operators in the area, only the operators who will be operating the ZEBs.

If LTAs intend to award a contract to operate the bus service where the ZEBs will be used, then they must provide evidence that bus operators will submit bids to operate the bus service. This should take the form of letters from bus operators expressing their interest in seeking to bid to operate the bus service.

Leasing and financing routes

In line with HM Treasury Green Book guidance, we encourage proposals from LTAs that wish to utilise innovative sourcing of finance and funding streams as part of their solution, for ZEBs, infrastructure or both. We note that these methods can help reduce upfront capital costs and help existing funds go further. This could include financing or leasing companies forming part of a consortium for the area.

Bidders that utilise private finance are required to specify the arrangements for financing the purchase of the buses and infrastructure and how the grant is being deployed within this structure.

For ZEBRA 2, the government will not offer any guarantees, underwriting of local area applications or provide linkages or frameworks to sources of private finance. The funding we will provide for this scheme will be capital funding.

Bidders may wish to consider the following.

UK Infrastructure Bank (UKIB)

UKIB is a government-owned policy bank focused on increasing infrastructure investment across the UK. The Bank can provide financial support to infrastructure projects that align with its 2 strategic objectives: 1) to help tackle climate change, and 2) to support regional and local economic growth. UKIB invests in private sector and local authority infrastructure projects and has identified zero emission buses as a key investment opportunity.

UKIB can offer local authorities flexible loans at a preferential rate of gilts + 60 bps as well as its role in providing financing support to the private sector. UKIB is available to support local authorities’ ZEB programmes and the broader electrification of fleet. UKIB’s local authority advisory function also supports local authorities in delivering their infrastructure priorities.

For further information on UKIB, contact: lalending@ukib.org.uk.

Green Finance Institute (GFI)

Local climate bonds (also known as community municipal investments) are regulated investment products issued by local authorities to diversify their funding sources and access a cheaper form of borrowing for specific decarbonisation projects in an engaging way, offering local people an opportunity to invest in their area in a way similar to crowdfunding and to make a financial return from doing so. They are also designed to price below the prevailing Public Works Loan Board (PWLB) rate at the time of issuance.

Funds raised so far by local authorities have been invested in a variety of projects, including electric vehicle charging points, the replacement of councils’ minibus fleets with greener alternatives and the installation of solar photovoltaic (PV) on public buildings.

For further information, contact: localclimatebond@gfi.green.

Crown Commercial Service (CCS)

CCS has launched an industry-leading twin-agreement solution providing a revolutionary way for public sector customers to source finance for their projects. The solution involves a diverse range of lenders aggressively competing on customer projects through a Dynamic Purchasing System (DPS), ensuring a truly competitive cost of financing. The solution also ensures complete transparency and fairness through bespoke terms designed to protect the customer, developed with specialist external support and input from the department to ensure it is fit for purpose. The DPS offers a range of acquisition options:

• hire purchase
• finance lease
• operating lease
• secured loans
• sale and leaseback

A hire purchase or finance lease is most appropriate for electric or hydrogen buses (and associated infrastructure). The maintenance and operational elements can be handled through a managed service contract with an equipment supplier and operator respectively. CCS works with a diverse range of cutting-edge funders including large investment banks and global high-street names to ensure a robust DPS.

For further information, contact assetfinance@crowncommercial.gov.uk.

Central government and wider public sector can buy standard, converted and specialist vehicles through the CCS Purchase of Standard and Specialist Vehicles Framework, which includes access to vehicles of all sizes, specifications and fuel types.

Vehicles that are eligible for funding

Vehicles eligible for funding are zero emission buses and minibuses used on local bus services. A local bus service is one which is available to members of the general public, has scheduled stopping places and a clear, easily accessible timetable and route map.

A bus is defined as a vehicle used for the carriage of passengers, having a capacity exceeding 22 passengers in addition to the driver, having a maximum mass exceeding 5 tonnes, designed to allow the carriage of standing passengers in the gangway and/or in an that which does not exceed the space provided for 2 double seats.

A minibus is defined as a vehicle used for the carriage of passengers, having a capacity of between 9 and 22 passengers, in addition to the driver’s seat.

To be eligible, vehicle models must be zero emission at the tailpipe. Vehicles must have a zero emission powertrain and have no auxiliary combustion engines such as diesel heaters, producing no regulated emissions. The vehicles most likely to meet these criteria are battery electric buses and hydrogen fuel cell buses.

Vehicles above 5 tonnes must have a Zero Emission certificate supplied. For vehicles under 5 tonnes a V5C document can be used to prove the vehicle is zero emission.

The Zemo Partnership (formerly Low Carbon Vehicle Partnership) has developed the Zero Emission Bus definition and test process, and a certification of compliance is provided as each bus type is tested. Bidders will need to approach manufacturers or vehicle suppliers/importers to get the relevant certificates for the buses they are bidding for.

Proposals for hydrogen fuel cell buses will need to demonstrate that buses will use hydrogen that either:

• is approved under the Renewable Transport Fuels Obligation (RTFO) support
• complies with the UK’s draft Low Carbon Hydrogen Standard (LCHS)

All buses must have a 5-year minimum warranty. For battery electric buses, a 5-year minimum warranty will also be required on the battery and electric drive train.

Buses must be operated in the LTA area for a minimum of 5 years.

Vehicles not eligible for funding

Buses and components ineligible for funding:

• zero emission coaches
• buses that are zero emission capable (able to operate in emission-free mode for short periods) but are not zero emission at the tailpipe. Buses powered by biogas or biofuel will also not be accepted

Bids will only be accepted for new buses. Therefore, bids for buses that are retrofitted or repowered with technology to be ZEBs will not be accepted.

DfT will not provide funding for battery replacements or for extended warranties to support battery replacements.

Accessibility requirements

As set out in the NBS, buses funded by the government will need to provide an enhanced level of accessibility. As with ZEBRA, buses funded by this scheme must meet enhanced accessibility standards.

We require vehicles with a capacity exceeding 22 passengers to:

• be compliant with the Public Service Vehicles Accessibility Regulations 2000 (PSVAR)
• be compliant with the Accessible Information Regulations
• provide an induction loop to aid direct communication between drivers and passengers who use a hearing aid
• provide an additional flexible space in addition to the mandatory wheelchair space – this space can either be suitable for a second wheelchair user or at least 2 unfolded pushchairs or prams

We require vehicles with capacity for 17 to 21 passengers to:

• be compliant with the Accessible Information Regulations
• provide an induction loop to aid direct communication between drivers and passengers who use a hearing aid
• provide at least 1 wheelchair space suitable for a passenger in a reference wheelchair, and a ramp or lift to support them to board and alight

We require vehicles with capacity for 16 passengers or fewer to:

• provide at least 1 wheelchair space suitable for a passenger in a reference wheelchair, and a ramp or lift to support them to board and alight

While we do not require that the wheelchair spaces and boarding ramps or lifts installed on vehicles designed to carry 22 or fewer passengers comply in full with the Public Service Vehicles Accessibility Regulations 2000, operators must ensure that they can be used safely and comfortably by passengers using wheelchairs. They might do this by observing those aspects of Schedule I to PSVAR, which can be accommodated on a smaller vehicle. They must also ensure that a wheelchair user can easily move between the boarding ramp or lift and the wheelchair space, and position themselves appropriately according to the restraint system in use.

Vehicles must meet all these requirements upon entering service.

Infrastructure that is eligible for funding

For infrastructure, we will contribute up to 75% of the capital expenditure incurred as a result of its purchase and installation. The eligible expenditure includes (but is not limited to):

• cost of charging unit or refuelling stations
• electrical or other power components
• civil engineering works
• labour costs (for installation)
• hardware costs
• capital costs of rolling out associated software systems
• surveys at the point of procuring the infrastructure, provided they can be capitalised
• electricity grid connection

Examples of the infrastructure most likely to be bid for under this fund are standard, fast, rapid conductive and inductive charging equipment; upgrades necessary to the grid to cater for increased energy demand; and hydrogen refuelling systems.

LTAs should be aware that, since 1 April 2023, demand connection customers are no longer liable for grid reinforcement costs (also known as ‘non-contestable works’) to accommodate their connections. We would, therefore, not expect non-contestable costs to be included in the infrastructure cost.

We recognise, for battery electric buses, that the installation of charging infrastructure may require upgrades to the grid to cope with additional charging requirements. We encourage LTAs to consider innovative solutions that may help to reduce the cost of these upgrades including, but not limited to:

• use of smart charging
• opportunity charging
• energy storage
• community energy generation

For electric vehicles, we encourage bidders to consider the interoperability of their charging infrastructure. All charge points should be compliant with ISO (International Standards Organization) Standard 15118, but bidders may wish to investigate other, specific minimum standards, such as OCPP (Open Charge Point Protocol).

Assessment process

The assessment process for ZEBRA 2 is based on the HMT Five Case Model. The scheme takes a proportionate approach to this model using insights from ZEBRA 1.0 to focus on the key information needed to inform assessment of proposals.

LTAs must remain within the word limits set out in the application form. Additional documents should only be provided where requested in this guidance. DfT reserves the right to reject applications that exceed these word limits or any applications that do not provide documents that have been requested.

Key requirements (not scored)

In section 2 of the application form, LTAs need to confirm that their proposals meet key requirements. Section 2 will not be scored and is pass/fail. DfT reserves the right to reject any application that does not meet any of these key requirements. LTAs need to confirm the following.

They have made an Enhanced Partnership or are following the statutory process to decide whether to implement a franchising scheme.

All vehicles will meet the enhanced accessibility standards set out in this guidance.

LTAs must provide letters of support from the bus operator(s) that will operate the ZEBs, with signatures from the national CEO or equivalent and local area MD, committing to investing in the buses and operating them in the defined area for a minimum of 5 years. The national CEO or equivalent should be empowered to commit the bus operator to operating the buses and providing any required funding for the proposed scheme. LTAs do not need to provide letters of support for all operators in the area, only the operators who will be operating the ZEBs.

Alternatively, if LTAs intend to award a contract to operate the bus service where the ZEBs will be used, they must provide evidence that bus operators will submit bids to operate the bus service. This should take the form of letters from bus operators expressing their interest in seeking to bid to operate the bus service. These letters should be attached as clearly labelled annexes.

All monies administered will take account of subsidy control obligations. This applies to any onward award of monies to third-party organisations. LTAs must confirm they have received legal advice on subsidy control. This legal advice should be attached as a clearly labelled annex.

In the case of battery electric proposals, LTAs must confirm the proposal achieves a minimum of low VfM using DfT’s updated greener bus tool. If this has not been met, DfT reserves the right to not assess the rest of the application.

In the case of hydrogen fuel cell proposals, LTAs must confirm that by March 2025 the buses will use hydrogen sourced with either Renewable Transport Fuels Obligation (RTFO) support or hydrogen that meets the UK’s draft Low Carbon Hydrogen Standard (LCHS). Evidence to support this should take the form of a provisional offtake contract, budget estimate, letter or email from a hydrogen fuel supplier.

Applications will then be assessed against 4 criteria with the following weighting:

• strategic case (including community benefits) – 10%
• grant funding per bus (including infrastructure) – 30%
• value for money – 30%
• deliverability – 30%

Applications will be marked out of 3 on each of these criteria. Each mark out of 3 will then be weighted according to the percentages above.

DfT may contact LTAs to seek clarification on their applications, which may take the form of an interview. These clarifications will be used to inform the assessment of applications.

Rural eligibility

In section 3 of the application form, LTAs that are seeking the funding earmarked for rural areas will need to demonstrate they meet the rural definition used for ZEBRA 2. Section 3 will not be scored and is pass/fail.

Rural areas will be defined using the government Rural Urban Classification. This classification is used to distinguish rural and urban areas and defines areas as rural if they have a population of fewer than 10,000 residents.

For ZEBRA 2, LTAs should refer to the Rural Urban Classification and Rural Urban Classification 2011 lookup tables for local authorities areas, which classifies local authority districts on a 6-point scale based on the share of the resident population that resides in rural areas.

To be eligible to apply for funding for ZEBs in rural areas:

• LTAs must not have received funding from the ZEBRA scheme already
• if a unitary authority, the LTA must be classified as ‘Mainly Rural’, ‘Largely Rural’ or ‘Urban with Significant Rural’
• if an upper tier authority or a combined authority, at least one of the local authority districts or combined authority members must be classified as ‘Mainly Rural’, ‘Largely Rural’ or ‘Urban with Significant Rural’

For LTAs submitting a joint application for funding earmarked for rural areas, all LTAs included in the proposal must meet the above rural criteria to be eligible to receive funding.

In section 3 of the application form, LTAs seeking to introduce ZEBs in rural areas will need to demonstrate the bus service predominantly serves communities in areas classified as a rural area in England under the government Rural Urban Classification.

Bus services that enable residents of rural areas to access amenities in an urban area are included in the scope for eligibility.

If DfT determines that the proposal does not meet the definition of a rural area, then the proposal will be considered alongside proposals to introduce ZEBs in other areas.

Bid description

In section 4 of the application form, LTAs will need to provide information on the project. Section 4 is to provide context and will not be assessed.

LTAs should provide a description of the areas where the buses will operate. LTAs should provide a list of the bus routes where the ZEBs will operate.

LTAs should also set out the location of the bus depot and/or other locations where supporting infrastructure will be located. LTAs should set out who is the landowner for the depot and/or other locations where supporting infrastructure will be located.

Assessment criterion 1: the strategic case

In section 5 of the application form, LTAs should set out the strategic case of the proposal.

Case for change

In section 5.1 of the application form, LTAs need to explain the process by which the scheme came to be identified as the preferred option. LTAs need to explain why the bus routes where the ZEBs will be introduced were chosen.

LTAs that can evidence that they have conducted a thorough assessment of all bus routes in their area, engaging with all bus operators, will score higher. LTAs that can explain and evidence that these bus routes will benefit from other bus service improvements will score higher.

LTAs also need to explain why they have chosen the particular ZEB technology. This should include why battery electric or hydrogen fuel cell technology has been chosen.

For proposals for battery electric buses, LTAs should set out why the vehicle specification has been chosen, in particular why the size of the battery is appropriate for the bus routes and bus services the buses will be used on. Proposals for battery electric buses should also explain why a particular charging technology has been chosen, such as plug-in charging in a bus depot or en-route opportunity charging. LTAs that can explain they have considered alternative technology options, and evidence this, will score higher.

LTAs should explain how their proposals align with wider plans to improve bus services. LTAs that can provide evidence to support this, such as reference to Bus Service Improvement Plans, Enhanced Partnership or plans to implement bus franchising or local transport plans, will score higher.

Community benefits

In section 5.2 of the application form, LTAs should explain the community benefits of the proposals with regard to employment and training. LTAs should set out how their proposal will support the creation of employment opportunities, such as apprenticeships and training opportunities both in use of the new ZEBs and in their manufacture and maintenance.

LTAs that can demonstrate their proposals will create new jobs and support apprenticeship and training opportunities for those from under-represented groups, and those who face barriers to employment, such as prison leavers, people with disabilities or those living in deprived areas will score higher. LTAs that set out and evidence the number of full-time equivalent (FTE) employment opportunities retained or created will score higher. LTAs that set out and evidence the number of apprenticeships and training retained or created will score higher.

In section 5.3 of the application form, LTAs should explain the community benefits with regard to the supply chain. LTAs should set out how their proposal will support medium and small organisations in the supply chain for ZEBs and supporting infrastructure.

LTAs that are able to quantify the benefits for small and medium sized organisations in the supply chain will score higher. LTAs that can demonstrate how they will engage with small and medium sized organisations in the supply chain will score higher. LTAs should be aware of current and upcoming legislation, such as the Procurement Bill, which could impact the procurement process.

LTAs that can demonstrate how community benefits will be considered as part of the procurement process for vehicles and infrastructure will score higher.

Wider decarbonisation benefits

In section 5.4 of the application form, LTAs should set out the wider decarbonisation benefits of their proposal. LTAs should set out how their proposals will support the wider decarbonisation of the bus fleet in their area and other modes of transport. If infrastructure in a bus depot has been provided ahead of need, LTAs should explain how this will support the introduction of ZEBs in future.

LTAs that can quantify and evidence how many ZEBs could be supported in future will score higher. If infrastructure could be used by other transport modes, LTAs should explain how other transport modes could benefit from this infrastructure. LTAs that provide evidence, such as agreements in principle or memoranda of understanding, will score higher.

Equality impact assessment

LTAs are expected to conduct a thorough equality impact assessment that will highlight how they have paid due regard to the Public Sector Equality Duty (s149 Public Sector Equality Duty – Equality Act 2010) and how people with protected characteristics will benefit from the scheme, ensuring that any possible negative impacts are mitigated early on. We expect LTAs to consult with relevant stakeholders that represent people from protected characteristic groups.

In section 5.5 of the application form, LTAs should set out an equality impact assessment that includes:

• which stakeholders were consulted
• relevant research/data
• potential positive equality impacts
• potential negative equality impacts
• mitigations to negative impacts
• how the impact on equality will be monitored throughout the lifetime of the proposal

Innovation

The innovation criterion will only apply to applications seeking funding for hydrogen fuel cell buses that are poor VfM. Applications that are seeking funding for hydrogen fuel cell buses that are at a minimum low VfM do not need to complete this criterion. Applications for hydrogen fuel cell buses that are poor VfM will need to demonstrate they are innovative to receive funding. This criterion will not be scored and will be pass/fail.

Hydrogen fuel cell buses are at an earlier stage of commercial deployment than battery electric buses. We are aware of the importance of continuing to build a substantial evidence base around deployment of hydrogen buses and refuelling infrastructure. ZEBRA 1 provided funding for the largest hydrogen bus project in the UK. Government continues to work to support the decarbonisation of bus fleets and there are more lessons to be learned about hydrogen fuel cell buses that DfT is keen to explore through real-world trials.

To date, hydrogen fuel cell buses in England have been or will be introduced on routes mainly in urban areas with hydrogen refuelling infrastructure located in bus depots. To be innovative, a proposal for hydrogen fuel cell buses will need to demonstrate in section 5.6 of the application form that it will provide learning to DfT and wider government that will not be obtained from existing hydrogen fuel cell bus projects.

Proposals seeking to introduce on routes in urban areas, that are not long distance or high intensity, are unlikely to be considered innovative.

An innovative hydrogen fuel cell bus proposal could include:

• introducing hydrogen fuel cell buses on long-distance bus routes, such as in rural areas
• introducing hydrogen fuel cell buses on high-intensity bus routes, such as 24-hour bus routes
• demonstrating how the proposal will support plans for the introduction of other hydrogen vehicles into the local area, and how sharing learnings will help to grow and develop the local/regional/national hydrogen transport economy

Assessment criterion 2: value for money

All LTAs will be required to conduct value-for-money analysis (VfM) and determine a suitable VfM category. This will help show the extent to which the requested public resources would create additional public value. The value for money assessment seeks to account for all significant costs and benefits from across the economy, including those incurred by bus operators, bus passengers, local transport authorities, government departments and wider society.

Value for money is based on a comparison of the scenario where the scheme is delivered against the counterfactual, which is the scenario that would be expected to occur without ZEBRA 2 funding.

For all proposed ZEBRA 2 schemes, the counterfactual scenario should assume a new euro VI diesel bus will be purchased and operated. The higher purchase costs of zero emission buses mean there will continue to be a financial incentive to purchase diesel buses, in the absence of grant funding. This can currently be seen as operators are not routinely purchasing zero emission buses without government funding.

In 2022, DfT consulted on ending the sale of all new non-zero emission buses, with options considered ranging between 2025 and 2032. We hope to announce the end sale date shortly. Before an end of sales date intervention, bus operators will continue to have the option to purchase new non zero emission buses. Afterwards, the counterfactual of a funding proposal would be different to reflect the restriction.

Section 6 of the application form and the greener bus tool will be used to assess value for money. This represents the ‘economic case’ of the Five Case Model. LTAs need to detail the expected VfM of the proposed scheme using outputs from DfT’s greener bus tool.

Refer to the greener bus tool guidance for more specific advice on completing the tool. This tool provides a proportionate, consistent and robust approach for LTAs to estimate an expected benefit cost ratio (BCR) of a proposal.

In line with DfT’s value for money framework, the LTA should form a judgement on the VfM category, taking into account the central BCR, uncertainties, risks and non-monetised benefits.

The greener bus tool and justification for the proposed VfM category will be reviewed and where appropriate amended by the department to form the final VfM category. The final VfM category will be the basis for the proposed VfM score.

The greener bus tool has been updated since the first round of ZEBRA and will not be revised during this process. This updated version of the tool must be used.

At a minimum, the value for money section of the application form should include the following.

A proposed VfM category for the investment proposal reflecting the central BCR, non-monetised impacts and risks and uncertainties. All completed versions of the greener bus tool should be provided, showing the central BCR output and the BCR outputs of sensitivity analysis. If completing the minibus version of the tool, a minimum of 2 versions should be provided, one using the default life expectancy assumption of 10 years and another version with a 15-year life expectancy sensitivity test.

Evidence and analysis informing key inputs/assumptions, including:

• the estimated annual vehicle distance per bus
• battery replacement costs (if the suggested values in the greener bus tool are not used)
• annual infrastructure maintenance costs (if an annual maintenance cost is stated in the tool)
• the fuel/electricity consumption scenario chosen

If a quantified risk assessment has been conducted, then evidence of how this has been conducted should be provided, such as listing all identified risks with associated cost outcomes and likelihoods in the QRA template spreadsheet provided. Refer to the relevant sections in the greener bus tool guidance for further detail on the level of evidence required for assumptions.

Explanation of any significant impacts of the scheme that have not been estimated by the tool.

If any significant non-monetised benefits are identified, the scale of change needed to reach a higher VfM category should be determined, by calculating the required percentage increase and absolute increase in present value benefits (PVB). Justification of whether non-monetised benefits would of sufficient scale change the value for money category should be provided.

Explanation of any significant risks and uncertainties that might influence a scheme’s VfM, with results of appropriate sensitivity tests to show the impact these risks and uncertainties would have on the scheme BCR. This might include risks that total bus distance or private-sector contributions could be lower than assumed to estimate the BCR.

Sensitivity testing should be used to provide an understanding of the impact of the risks and uncertainties.

Given proposals for electric buses must achieve at least low VfM, we strongly recommend the greener bus tool should be used to inform optioneering to ensure that a scheme that can achieve this threshold is selected, and to influence continued scheme development.

Tips on improving VfM

There are several scheme design factors that will improve VfM. The most significant factors are the capital costs, the average annual distance the buses and fuel/electricity consumption of the proposed route(s) buses will be used on.

These factors should be considered when optioneering and designing schemes. For illustrative purposes, table 3 below outlines the average vehicle distance per bus that would be needed for an electric bus proposal to reach a BCR of 1 (implying low VfM), assuming all other factors, such as bus and infrastructure costs, are equal to the average seen in ZEBRA 1. Costs also include a mid-life battery replacement cost for a 352kWh battery, which is the average battery size of electric buses from existing Zemo test certificates. The actual vehicle distance needed for a specific scheme will depend on local scheme details, such as the cost of vehicles.

Table 3: Average vehicle distance per bus to achieve a BCR of 1

Scenario	Scenario description	Annual average km per bus needed for the BCR to equal 1*	Equivalent daily km per bus**
High fuel/energy consumption.	Based on an inner urban route	Between 67,000km – 77,000km	258km – 296km
Medium fuel/energy consumption	Based on an outer urban route	Between 88,000km – 101,000km	338km – 388km
Low fuel/energy consumption	Based on a rural route	Between 95,000km – 109,000km	365km – 419km

*Range represents uncertainty in outcome of individual scheme quantified risk assessment (QRA), influencing total scheme cost.

**Assuming services are run Monday to Friday for 52 weeks.

Where possible a QRA should be conducted for the capital costs related to the purchase of zero emission buses. In the absence of a robust QRA, a 20% level of optimism bias will be applied to all capital costs. Conducting a QRA may improve the VfM if the estimated adjustment to costs is less than the 20% level of optimism bias.

Similar to zero emission buses, proposals to invest in zero emission minibuses should also consider the key factors that would influence the carbon savings generated, such as the current diesel consumption and the annual vehicle distance of services where zero emission minibuses could be implemented. Proposing to implement zero emission minibuses where diesel fuel consumption and vehicle distance are highest will result in higher carbon benefits and increase the BCR.

Table 4 below outlines what the average annual vehicle distance per minibus would need to be for an electric minibus proposal to achieve a BCR of 1 (implying ‘low’ VfM) for a number of illustrative scenarios. The scenarios differ based on the capital costs of minibuses (vehicles and infrastructure) and the energy intensity of the route they will be introduced on. The fuel/energy consumption, particulate matter and nitrogen oxide emission figures informing the scenarios are based on existing Zemo test certificates for a diesel minibus model and an electric minibus model. Estimates assume a 10-year life expectancy for minibuses, with no mid-life battery replacement. Stakeholder evidence suggests that the operating life of a minibus could range from 10- to 15-years, with a longer life expectancy reducing the annual vehicle distance needed to reach a BCR of 1.

Table 4: Average annual vehicle distance per electric minibus to achieve a BCR of 1

Scenario	Scenario description	Annual average km per minibus needed for the BCR to equal 1*	Equivalent daily km per minibus**
Small minibus with AC charging, high fuel/energy consumption	£80,000 electric minibus capital cost £2,000 infrastructure cost Based on an inner urban route	23,000km – 28,000km	88km – 108km
Small minibus with AC charging, low fuel/energy consumption	£80,000 electric minibus capital cost £2,000 infrastructure cost Based on a rural route	27,000km – 33,000km	104km – 127km
Small minibus with DC charging, high fuel/energy consumption	£80,000 electric minibus capital cost £50,000 infrastructure cost Based on an inner urban route	53,000km – 63,000km	204km – 242km
Small minibus with DC charging, low fuel/energy consumption	£80,000 electric minibus capital cost £50,000 infrastructure cost Based on a rural urban route	63,000km – 74,000km	242km – 285km
Large minibus with AC charging, high fuel/energy consumption	£180,000 electric minibus capital cost £2,000 infrastructure cost Based on an inner urban route	55,000km – 66,000km	212km – 254km
Large minibus with AC charging, low fuel/energy consumption	£180,000 electric minibus capital cost £2,000 infrastructure cost Based on a rural route	66,000km – 80,000km	254km – 308km
Large minibus with DC charging, high fuel/energy consumption	£220,000 electric minibus capital cost £50,000 infrastructure cost Based on an inner urban route	95,000km – 113,000km	365km – 435km
Large minibus with DC charging, low fuel/energy consumption	£220,000 electric minibus capital cost £50,000 infrastructure cost Based on a rural route	114,000km – 136,000km	438km – 523km

*Range represents uncertainty in outcome of individual scheme quantified risk assessment (QRA), influencing total scheme cost.

**Assuming services are run Monday to Friday for 52 weeks.

Assessment criterion 3: grant funding per bus

The grant funding per bus criterion will form part of the financial case of the Five Case Model.

Proposals will be assessed on the amount of grant funding per bus, with less grant funding per bus receiving a higher score. LTAs must complete the grant funding per bus calculator spreadsheet. This tool will calculate a score for grant funding per bus based on grant funding amounts requested for both ZEBs and infrastructure will be assessed.

Bids will be scored out of 3 against a funding range based on the grant funding amount per bus requested through ZEBRA.

Table 5: Scoring criteria for grant funding per bus assessment

Grant funding per bus score	3	2	1	0
Zero emission bus with 9-15 passenger seats	£10,000	£30,000	£50,000	£70,000
Zero emission bus with 16-21 passenger seats	£100,000	£120,000	£140,000	£160,000
Zero emission bus with 22-29 passenger seats	£165,000	£185,000	£205,000	£225,000
Battery Electric bus with a total capacity for 30-49 passenger seats	£180,000	£200,000	£220,000	£240,000
Battery electric bus with a total capacity for 50 passenger seats	£190,000	£210,000	£230,000	£250,000
Hydrogen fuel cell bus with a total capacity for 30-49 passenger seats	£240,000	£260,000	£280,000	£300,000
Hydrogen fuel cell bus with a total capacity for 50 passenger seats	£250,000	£270,000	£290,000	£310,000

Evidence from ZEBRA 1 demonstrated that hydrogen fuel cell buses generally require more grant funding per bus than battery electric buses. Therefore, hydrogen bus proposals will be scored against a different funding range.

Evidence from ZEBRA 1 also demonstrated that the grant funding per bus required varies depending on the size of the vehicle. Therefore, grant funding per bus will be scored based on number of passenger seats the bus has.

Assessment criterion 4: Deliverability

The deliverability criterion draws together relevant aspects of the Finance, Commercial and Management Cases in the Five Case Model. This is in section 8 of the application form.

LTAs need to set out how they will deliver the buses and supporting infrastructure and provide evidence that they have arrangements in place for the delivery such as timelines, risk management, monitoring and evaluation of their proposal.

Finance case

Together with grant funding per bus Section 8.1 of the deliverability criterion will form the finance case of the Five Case Model.

Funding sources

In section 8.11 of the application form, LTAs should set out clearly all the sources of funding for their proposal, which should match the information included in the greener bus tool. This should include:

• how much funding they are requesting
• how much funding is being provided by the LTA and where this is sourced from
• how much funding is being provided from other public sector sources
• how much funding is being provided by bus operators
• how much funding is being provided by other private sector sources

In section 8.12 of the application form, for all funding sources, except grant funding from the government, LTAs should set out a short summary detailing the source of the funding and what approvals (such as investment or credit committees) are required to access the funding.

In section 8.12 of the application form, for LTAs seeking to use external finance other than from a bus operator(s) (such as private, UKIB, other) they will need to explain the details of the finance, what further steps would be needed to secure that finance on confirmation of any grant award from the scheme and what other alternative sources would it seek to utilise if the external finance was subsequently not available.

Subsidy control

In section 8.13 of the application form, LTAs must outline their plans for complying with subsidy control rules. It is important that LTAs thoroughly consider legal requirements, including in relation to procurement, subsidy control and, where applicable, state aid before applying.

The UK subsidy control regime began on 4 January 2023 and enables public authorities to give subsidies that are tailored to their local needs and that drive economic growth while minimising distortion to UK competition and protecting our international obligations.

Guidance for public authorities on complying with the UK’s international obligations on subsidy control is available at:

• Subsidy control rules: quick guide to key requirements for public authorities
• UK subsidy control regime

LTAs must seek legal advice from their own legal team on the UK’s international obligations on subsidy control. This legal advice should be informed by a principles assessment that LTAs conduct.

LTAs should take into consideration the 7 principles as detailed in the guidance and ensure that sufficient detail is provided in all areas. LTAs must also ensure they conduct an Energy and Environment assessment against Principle A and Principle B of the Energy and Environment principles as part of this.

This principles assessment is not required to be included in the application. However, a summary of the obtained legal advice must be provided in the application form, along with a copy of the full legal advice attached as an annex.

Where LTAs are successful in securing funding that involves the development of a subsidy or a scheme, LTAs should consider if their subsidy or scheme meets, or has the potential to meet, the definition of a subsidy or scheme of particular interest (SSoPI) or a subsidy or scheme of interest (SsoI). SSoPIs and Ssols involve larger subsidies or schemes where there is greater potential for undue distortion and negative effects on competition and investment in the UK, or on international trade or investment in the UK, or on international trade or investment.

A SsoPI will involve a mandatory referral to the Subsidy Advice Unit (SAU) for independent evaluation before the subsidy is given, however, where a subsidy or scheme meets the definition of a SsoI, LTAs may make a voluntary referral to the SAU for a report, but it is not mandatory. Further information, explaining how a subsidy or scheme can meet the definition of a SsoPI or or SsoI can be found in the UK subsidy control statutory guidance at page 110 (see chapters 10 and 11).

On acceptance of a referral from an LTA, the SAU will produce a non-binding independent report within 30 working days of receipt for LTAs to take into consideration before implementing the subsidy or scheme. The SAU strongly encourages early re-referral engagement with transport authorities that may be thinking of making a referral to the SAU. Referral must be completed prior to the LTA issuing the subsidy to any third-party recipients.

For support and guidance on subsidy control, contact the BEIS subsidy control team: subsidycontrol@beis.gov.uk.

Commercial case

Section 8.2 of the application form of the deliverability criterion will form the Commercial Case of the Five Case Model.

Procurement

In section 8.21 of the application form, LTAs should set out the procurement strategy including, but not limited to:

• who will own the assets, including ZEBs and supporting infrastructure
• how the ZEBs and supporting infrastructure will be procured
• details on any leasing arrangements for ZEBs and/or supporting infrastructure
• how the grid connection(s) will be secured and who will be responsible for securing the connection
• for proposals for hydrogen fuel cell buses, how hydrogen fuel will be supplied and who will be responsible for securing the supply of hydrogen fuel

LTAs should explain the rationale for the chosen procurement approach.

Evidence of costs

In Section 8.22 of the application form, LTAs should provide evidence that they, or one of their partners, has engaged with the supply chain to demonstrate reliability of costs. DfT reserves the right to reject any application that has not provided all the required quotes.

In section 8.221 of the application form, LTAs must provide quotes from 2 manufacturers for the cost of ZEBs. Quotes from bus manufacturers should clearly set out the cost of additional features that are not provided as standard with a particular model. These quotes should provide evidence that the vehicles will meet the enhanced accessibility standards set out in this scheme.

LTAs must also provide quotes from the manufacturers for the cost of an equivalent diesel bus from the same manufacturer. If the manufacturer does not produce a diesel equivalent then the LTA should obtain a quote from a suitable alternative manufacturer, which should be a vehicle of similar size and passenger capacity. The cost of an equivalent diesel bus must include the cost of the enhanced accessibility standards set out in the ZEBRA scheme and any additional features, such as higher specification seats and USB charging points, that the proposed ZEB would include. DfT reserves the right to select an equivalent diesel bus if an appropriate equivalent has not been provided.

If the proposal is to introduce multiple ZEBs of more than one vehicle size, quotes must be provided from 2 manufacturers for each vehicle size.

Please attach quotes in the form of a letter or email from suppliers as a separate annex(es). The annex(es) should be clearly labelled. Key information on the ZEBs should be inputted into the table in section 8.221 of the application form.

In section 8.222 of the application form, for proposals for battery electric buses, LTAs must provide quotes from 2 suppliers of charging infrastructure. Evidence from suppliers should take the form of a letter or email from an infrastructure supplier. The LTA should complete the table with the specification for the charging from the proposed supplier. If the LTA is seeking to introduce more than one charging model, they should include a separate table for each charging model from the proposed supplier.

In section 8.223 of the application form, for proposals for hydrogen fuel cell buses, LTAs must provide quotes from 2 suppliers of refuelling infrastructure. Evidence from suppliers should take the form of a letter or email from an infrastructure supplier. The LTA should complete the table with the specification for the refuelling infrastructure.

LTAs need to reassure DfT that the vehicle and infrastructure specification and quotes they have obtained are reflective of the vehicles and infrastructure that they, or their partners, intend to procure. This will provide reassurance that costs will not increase due to changes to vehicle or infrastructure specifications. In section 8.224 of the application form, LTAs should explain how the quotes they have obtained have been informed by the vehicle and infrastructure specifications they intend to introduce.

In section 8.225 of the application form, LTAs should provide evidence of the cost of a grid connection. This should take the form of a connection offer, budget estimate, letter or email from the distribution network operator or independent connection provider.

LTAs should be aware that for applications submitted from 1 April 2023, demand connection customers are no longer liable for grid reinforcement costs (also known as “non-contestable works”) to accommodate their connections. We would, therefore, not expect non-contestable costs to be included in infrastructure costs. LTAs should consider this when seeking quotes for the cost of a grid connection.

Details on the grid connection should include:

• name of distribution network operator
• existing grid capacity
• proposed grid capacity
• cost
• timescales

Please attach quotes in the form of a letter or email from suppliers as a separate annex(es). This annex(es) should be clearly labelled. If a grid connection is not included as part of the proposal, please explain why.

For section 8.226 of the application form, LTAs submitting proposals for battery electric buses that are not using the default electricity prices in the greener bus tool, which are values published in the Transport Analysis Guidance (TAG), should provide strong evidence to suggest alternative electricity prices, such as a signed power purchase agreement with an energy provider covering the full operational lifetime of the buses. If proposals for battery electric buses propose using a renewable energy tariff, they should provide evidence. This should take the form of a letter of email from an electricity supplier.

For section 8.227 of the application form, LTAs submitting proposals for hydrogen fuel cell buses should provide evidence of costs of hydrogen fuel. In line with other funding for hydrogen transport, proposals for hydrogen fuel cell buses will need to demonstrate that, by March 2025, the buses will use hydrogen sourced with either Renewable Transport Fuels Obligation (RTFO) support or hydrogen that meets the UK’s draft Low Carbon Hydrogen Standard (LCHS). This evidence should take the form of a provisional offtake contract, budget estimate, letter or email from a hydrogen fuel supplier. Please attach this as a separate annex(es). This annex(es) should be clearly labelled.

For section 8.228 of the application form, if any external finance other than from bus operators (such as private, UKIB, other) utilised alongside the grant by the LTA, it should provide a letter of support from the external financier. Please attach quotes in the form of a letter or email from suppliers as a separate annex(es). This annex(es) should be clearly labelled.

The LTA will also need to explain the details of the funding, what further steps would be needed to secure that finance on confirmation of any grant award from the scheme, and what other alternative sources would it seek to utilise if the external finance was subsequently not available.

Management case

Section 8.3 of the application form will form the management case of the Five Case Model.

Governance

In section 8.31 of the application form, LTAs should provide reassurance that they, their bus operator partner(s) and other partner(s) have the capacity to deliver the project. LTAs should set out:

• a description of the role of each partner organisation in delivering the project – previous experience of introducing ZEBs should be referred to where relevant
• if the LTA owns the bus operator, they should provide more detail on this relationship
• which partner will operate the zero emission buses
• which partner will own the zero emission buses – if this is not the bus operator, explain the relationship and obligations with the owner of the buses and the bus operator
• which partner will own the batteries on the zero emission buses – if this is not the bus operator, explain the relationship and obligations with the owner of the buses and the bus operator
• which partner will own the charging or refuelling infrastructure – if this is not the bus operator, explain the relationship and obligations with the owner of the buses and the bus operator
• which partner will own the bus depot – if this is not the bus operator, explain the relationship and obligations with the owner of the buses and the bus operator

Allocating grant funding

In section 8.32 of the application form, LTAs must demonstrate they can allocate grant funding to bus operator(s) within the timeline set out in their proposal. LTAs that can provide a draft funding agreement with bus operators will score higher. For more information about what could be included in a grant funding agreement, see tips from ZEBRA 1. If the LTA intends to procure vehicles and infrastructure themselves, they do not need to complete section 8.32.

Project plan

In section 8.33 of the application form, LTAs should provide a project plan that should include the following as a minimum.

The date the LTA will provide grant funding to the bus operator.

If the ZEBs will be used on a tendered bus service, the dates for when the tender will be launched to operate the bus service and when a bus operator will be selected.

Vehicle delivery

The date when the order for ZEBs will be placed – orders for buses must be placed by 31 January 2025. If ZEBs will be ordered in batches, set out dates for each batch.

Infrastructure delivery

Time for planning permission to be secured.

Date when an order will be placed for charging infrastructure or refuelling infrastructure.

Date when charging infrastructure or refuelling infrastructure will be installed and operational.

Where relevant, date when an order for a grid connection will be placed and date when work on grid connection will be complete.

For hydrogen proposals, date when a hydrogen fuel supplier will be selected.

Buses entering service

Date for when ZEBs will enter service.

If ZEBs will enter service in batches set out separate dates for each batch.

In assessing proposals, we will consider how far the proposed project plan is realistic.

A Gantt chart, or similar project management tool/format setting out key milestones, can be attached as an annex(s). These must be provided in an excel format.

Risk management

In section 8.34 of the application form, LTAs should set out their top 5 risks, providing scores to indicate the significance of the risks to their project and the actions they will take to mitigate these risks. The main risks associated with ZEB projects are generally:

• cost increases for ZEBs
• cost increases for charging/refuelling infrastructure
• delays introducing ZEBs
• delays introducing charging/refuelling infrastructure
• delays securing a grid connection
• energy price increases

LTAs that explain how local circumstances affect each of these risks and mitigations will be scored higher.

In assessing proposals, we will consider how appropriate the risks identified are.

Monitoring and evaluation

LTAs will be required to take part in programme-level monitoring and evaluation (M&E). Exact monitoring data requirements will be confirmed nearer to the time but could include for example the following.

ZEBs and charging infrastructure outputs:

• number of ZEBs purchased
• number of ZEBs in operation
• number and type of internal combustion engine (ICE) buses replaced.
• number (and capacity) of charging facilities introduced
• charging methodology, such as depot overnight, en-route charging
• for hydrogen fuelled buses, fuel production and refuelling method
• AC or DC charging

Scheme costs:

• purchase cost per ZEB
• purchase cost per equivalent ICE bus
• average operational cost (including maintenance and infrastructure) per ZEB (£ per month).
• average operational cost (including maintenance and infrastructure) per ICE (£ per month) (if ICE buses operational in fleet
• cost of electric or hydrogen fuelling infrastructure (upfront cost) (£)

Data to inform analysis of carbon impacts:

• average daily ZEB mileage
• average daily ZEB energy consumption
• average daily diesel mileage and fuel consumption for each route (baseline/comparator data)
• average ZEB well-to-wheel greenhouse gas emissions
• average battery state of charge before/after charging
• time of day ZEB charged and electricity tariff (including electricity generation source)

In section 8.35 of the application form, LTAs should confirm that they will conduct the following as part of the programme-level M&E:

• participate in programme-level M&E activities as required, for example, taking part in interviews or group discussion sessions
• share relevant monitoring data in an electronic format (such as Microsoft Excel)
• share relevant monitoring data on a quarterly basis
• ensure relevant monitoring data is collected automatically via telematics

In section 8.36 of the application form, LTAs should set out their plans for scheme-level M&E, including the following.

A logic map setting out the inputs, outputs, outcomes and impacts of the scheme, and expected causal links between these (for guidance please see the Magenta Book).

The evaluation questions they plan to answer through scheme-level M&E. Examples may include:

• what worked well and less during scheme implementation
• what impact does the scheme have on passengers/bus operators/air quality
• was the scheme implemented cost-efficiently?

Tips from ZEBRA 1

Some suggestions from LTAs that took part in ZEBRA are as follows.

Plan ahead to have a scheme in mind if/when funding is available.

Think about how the scheme fits with wider plans to decarbonise the bus fleet and demonstrate that it is part of a plan for the overall fleet.

Develop a roadmap to achieving a ZEB fleet.

Engage with operators and energy suppliers early.

Engage with the right teams within the bus operator company. For the larger operators, sign-off for financial contributions is likely to be required at both local and group level.

Make sure the right skills and resources are in place, including technical, legal, financial and procurement.

Use the Greener Bus Model to inform the optioneering process and understand what drives the BCR.

Simpler schemes (involving one area, one operator, a simple commercial model, and established technology) are easier to justify and require less work than more complex schemes.

In addition to the above, we note that the process of pulling together a Grant Funding Agreement with all parties had high levels of complexity for multiple schemes. Given this, we have developed a set of steers of things to consider for this process.

Start working up the grant funding agreement details as early as possible once your partners for delivering the project are identified.

Consider a range of topics that your project may need to consider as part of this. This may include:

• conditions of grant award (including funding claim eligibility and payment)
• obligations and warranties of all parties – ensure this considers any parent companies that are involved
• dispute resolution
• how monitoring and evaluation will be conducted (including for data collection and audit purposes)
• conditions for withholding or clawback of funding, such as in the event of sale of assets
• impacts of ‘significant change’ or ‘events of default’
• how Freedom of Information requests will be dealt with
• intellectual property

As with ZEBRA 1, applicants may want to consider the methods by which they obtain goods and services and access additional financial support. Applicants can use the newly updated Crown Commercial Service Framework to procure vehicles and utilise the additional finance support offered by UKIB (as detailed in the Leasing and financing routes section above).

Branding

For any LTAs that are successful in obtaining funding, DfT will communicate the latest expectations in terms of branding both on the vehicles funded and on communications materials issued related to the scheme.

LTAs in receipt of a DfT local transport grant that is at least 10% of the total costs of the project or programme are required to signal the government’s funding contribution by displaying the ‘Funded by UK Government’ logo when publicising it.

Transparency and privacy

LTAs will be expected to spend funds in an open and transparent way. We would expect plans relating to the project to be publicly available. In addition, we will expect details of the project and progress to be made available to other LTAs (except where this is commercially confidential) and DfT over the duration of the project including cooperating with any central monitoring and evaluation activity that the department undertakes to ensure learning is drawn from projects to inform future policy development and scheme design.

When LTAs submit an application, as part of the government’s commitment to greater openness in the public sector under the Freedom of Information Act 2000 and the Environmental Information Regulations 2004, we encourage them to also publish a version or summary, excluding any commercially sensitive information, on their own website after submitting the final bid to DfT.

Any personal data provided through the application will be processed in line with data protection legislation and DfT is the data controller. The lawful basis that applies to this processing personal data is 6(1)(e) of the GDPR: the processing of personal data is necessary for the performance of a task carried out in the public interest or in the exercise of official authority.

Your personal data is being collected to identify solutions to receive support from the ZEBRA 2 scheme. We are processing your data as part of phase one of the application process. We may also use it to contact you about further opportunities to apply for this project if we expand the scheme in future.

We may share information, including your personal data, with external assessors as we assess the applications. Your personal data will only be shared with the assessor for that purpose and will only be retained by them for the duration of the assessment process. Your personal data will be held for the duration of the fund, including the duration of any monitoring and evaluation activity – which may be 2 years after the conclusion of a trial.

DfT’s privacy policy has more information about your rights in relation to your personal data, how to complain and how to contact the Data Protection Officer.