Operating Costs
As ethanol has a lower energy density than diesel, comparatively more fuel is used. This is currently
1.17 kms per litre compared with 2.22 kms per litre for diesel.
The latest batch of ethanol (at time of writing) cost £1.21 per litre, compared to £0.98 per litre for
diesel.
Current taxation regulations give a rebate on ethanol of £0.5719 per litre and a rebate on diesel of
£0.4321 per litre.
The annual additional fuel cost of an ethanol bus compared to a diesel equivalent is around £25,000.
There have been no additional operating costs, other than for ethanol-specific engine oil which is
some £1000 per year per bus extra.
In addition, the capital costs of such buses are around £40k per bus, adding some £4k per bus per
annum to depreciation costs.
The fuel cost of E95 per km has been consistently higher than the cost of diesel throughout the
project. This is partly due to the small batch size of each order and it is felt that a reduction of some
15-20 per cent might be achieved for larger orders. In addition, diesel prices have seen a steady
upward trend in the past few years. This means the difference in price between ethanol and diesel is
likely to fall in the future.
However, it is felt that even with such trends, the additional cost is unlikely to fall below £20k per
bus per annum. For a fleet the size of NCT’s, this would amount to additional costs of over £6m per
annum if rolled-out fleetwide.
Clearly, a significant change in government taxation policy towards ethanol is required in order to
expand its use. Such a policy has been adopted in Sweden, resulting in a countrywide roll-out of its
use across many bus fleets.
Ethanol Supply
For the duration of this trial the ethanol used was derived
from wood waste imported from Sweden.
British Sugar currently produces 55,000 tonnes of
bioethanol per year at their Wissington factory in Norfolk.
The product is made from 100 per cent UK sourced
Sugar Beet. Currently the entire product is sold as 100
per cent ethanol (E100) to UK oil companies who are
blending it with petrol at a rate of around 3.5 per cent.
UK HMRC Excise regulations state that all UK produced
ethanol must be denatured to ensure that it cannot
be sold into the potable alcohol market. In the UK the
only approved denaturants are Methanol, or Gasoline.
The chemical package that Sekab sell to ensure that
E95 works in bus engines is not compatible with either
Methanol or Gasoline. Because the E95 that Sekab produce complies with Swedish regulations it is
therefore accepted as an import into the UK, while the British Sugar product that is manufactured in
the UK is unable to be denatured in line with Sekab’s requirements.