Electrifying public transit benefits public finances in small island developing states

Abstract

Deep decarbonization of the transport sector in small island developing states (SIDS) can simultaneously address issues of energy security, high fuel import prices, and climate change mitigation measures while ensuring a reduction in air pollution and higher levels of wellbeing for citizens. Electrification plays a vital role in the decarbonization process. Here, we investigate potential transition pathways towards electrification, taking the public transportation system in Mauritius as an example, where there is vast potential in electrifying the old and overburdened bus system. We simulate a variety of public bus turnover scenarios, considering initial costs of investments, energy and fuel requirements, and reductions in greenhouse gas emissions. We demonstrate that optimized investment into electrifying public transit pays off, with annualized investments of about $5 million superseded by annual savings on fossil fuel imports of about $15 million. We suggest that international donors can accelerate this transition by providing loan guarantees and, by this, reducing the cost of capital.