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An Exemplary Approach in The Framework of The Public Procurement
Law No. 4734 for Electric Bus Purchases by Local Governments

The model proposed in this study bases on the procurement and operation
of electric buses together with renewable energy-based charging stations,
instead of the internal combustion engine (diesel and CNG) buses currently
used for public transportation systems. An approach that may compensate the
investment financing to be used for the first investment, is projected by means
of acquisitions over the years including the fuel and maintenance & repair costs
as well as the operational warranty. Accordingly, the most suitable business
model specific to local governments in Türkiye for electric bus purchases within
the framework of the public procurement law, is the “Public Transportation
Operational Performance” contracts specific to the public transportation
sector that are be signed in the scope of ICP, based on Energy Efficiency in
Transportation. In this regard, a significant added-value will be provided for
efficiency in transportation, which is included in the III. basic category of energy
efficiency concept. It is considered that the tenders for the procurement of
electric buses to be made through performance contracts in the scope of
ICP will provide a significant advantage in reaching the total time required
for the sustainable financing of the total budgets of the projects as well as
obtaining the required technologies for the domestic electric vehicle industry.
In addition, drawing up the contracts with the unit prices in foreign currency
(Dollars or Euro) instead of Turkish Lira in the scope of the ICP contracts, offers
an advantage in the volatile market conditions for the parties in the purchasing
tenders when considered the possible long term contract periods.
The projected model relies on an approach based on paying as much as it
saves. Currently, an innovative financing solution specific to electric buses is
provided by configuring the industrial and building energy efficiency project
concepts (efficiency-enhancing projects) specified for the public transport
systems. In the proposed business model, the resources (incentive, support
funds or debt financing) to be offered to enterprises / operators providing
public transportation services under the local governments is based on the
use of electric buses and renewable energy-supported charging infrastructure.
“Public Transportation Operational Performance” contract to be introduced
will compensate the difference of initial investment cost of the electric buses
to be used by the relevant enterprise/operator through operational gains over
the years, compared to the internal combustion engine (diesel/CNG) buses
in the similar nature. With the proposed model, a concept was configured on
the basis of separating the cost of propulsion batteries from purchase cost of
the electric buses, and enabling a long-term rental of propulsion battery in
a commercial sense through a payment model divided into years. Thus, the
cost of propulsion battery which is the most significant expenditure item in
the electric buses will compensate itself during the specified warranty period
by using the operational gains obtained from operating the buses (according

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