Purpose

To seek a decision on payment of Clean Air Plan (CAP) grant funds to South Yorkshire Mayoral Combined Authority (SYMCA) for the delivery of a local Zero Emission Bus (ZEB) project:

The project will utilise the CAP funds awarded to SCC and RMBC by HM Government, the funds are ring fenced specifically for ZEB upgrade and cannot be used for other purposes without Department
for Environment, Food & Rural Affairs (DEFRA) change approval.

The local ZEB project is to reduce NO2 from bus emissions to bring concentrations to within legal limits within the shortest possible time in line with our Ministerial Directive.

The project to bring forward the electrification of Holbrook depot from 2029 to 2026/27 and the purchase of 66 electric vehicle (EV) buses to operate on key routes in Sheffield from mid-2027.

The project will be delivered by SYMCA as part of their Tranche 1 bus franchising programme

Decision

a)

Approve the payment of £8,074,337 Clean Air Plan grant funds awarded to Sheffield City Council by HM Government and approved for the purpose of implementing ZEB upgrade to accelerate NO2 reduction as quickly as possible, to South Yorkshire Mayoral Combined Authority (SYMCA) to deliver the ZEB project as agreed with Department for Environment, Food & Rural Affairs (DEFRA) as outlined in this report.

b)

Approve upfront payment of the CAP grant funds noting that SYMCA intend to use the funds to secure purchase of 66 electric buses to be ordered in May 2026 for deliver in / by May 2027. Advance payment will:

-       Secure delivery of the buses in the shortest possible time to realise a reduction in roadside NO2 form bus emissions in Sheffield as quickly as possible.

-       Secure a purchase price in a volatile market.

Reasons for the decision

Timely transfer of the funds to SYMCA will enable the delivery of the local CAP ZEB scheme to bring forward a reduction in NO2 from bus emissions to bring concentrations to within legal limits within the shortest possible time in line with our Ministerial Directive.

Alternative options considered

Sheffield City Council (SCC) and Rotherham Metropolitan Borough Council (RMBC) remain under a joint Ministerial Direction to achieve legal annual average Nitrogen Dioxide (NO2) limits at all CAP valid air quality monitoring locations within in the ‘shortest possible time’.  There are remaining exceedances in Sheffield where further NO2 reduction is required and where bus emissions are a contributing source.

Bus emission issues are delaying achieving compliance and a solution to bring forward NO2 reduction as quickly as possible at locations significantly impacted by buses needed to be found. As such, do nothing was not an option and available options were limited.

Alternative Option 1:

The option to seek bids from operators early in 2025 utilising the £8.8m available at that point was tested:

·       The available funding was insufficient to deliver the scale of change needed to have a material impact on NO2 reduction.

·       The approach proved un-deliverable as the uncertainty associated with bus franchising limited the scope of future commercial investment commitments that operators could offer.