Business Case of

Transjakarta’s First Phase

E-Bus Deployment:
An Executive Summary
May 2023
Institute for Transportation Development Policy (ITDP) is a non-profit
organization that works in cities worldwide in realizing a sustainable urban
transit system as a way to cut greenhouse gas emissions and improve the
quality of urban life. Founded in 1985, the Institute for Transportation and
Development Policy (ITDP) has become a leading organization in the promotion
of environmentally sustainable and equitable transportation policies and
projects worldwide. ITDP Indonesia has been providing technical assistance to
the provincial governments of DKI Jakarta, Medan,Semarang, and other cities
for more than ten years on mass public transportation, parking systems and
improving pedestrian infrastructure.
Business Case of
Transjakarta’s First Phase
E-Bus Deployment:
An Executive Summary
May 2023

Published by:
Institute for Transportation and Development Policy (ITDP)

Written by:
Rifqi Khoirul Anam

Editor:
Gonggomtua Sitanggang
Etsa Amanda

Editorial Design:
Annisa Dyah Lazuardini

Published in:
May 2023

Kontak:
Fani Rachmita - Senior Communications & Partnership Manager
fani.rachmita@itdp.org

Rifqi Khoirul Anam - Transport Associate

rifqi.khoirul@itdp.org

ITDP Indonesia
Jalan Johar No. 20, lantai 5,
Menteng, Jakarta 10340
CONTENT

Context and background of the study 7

Key findings 8

Recommendations 10

A. Transjakarta e-bus implementation phases 10

B. E-bus routes for the first phase of implementation 11

1. BRT routes 12
2. Non-BRT routes 12
3. Microbus routes 12

C. Charging infrastructure locations for the first phase of implementation 13

D. Fleet and charging technology options 14

E-bus types 14
Charging infrastructure types 15

E. Financing Transjakarta’s first phase e-bus implementation 15

Business model recommendations 16
Impact on Public Service Obligation (PSO) 20
Fund channelling schemes to improve financing access 21

Conclusion and The Way Forward 23

 Context and background of
the study

The Government of Jakarta has committed to electrify 100% of Transjakarta fleets by 2030, which amounts
to 10,047 fleets. Prior to this, The Government of Jakarta signed a commitment to launch an electric bus
pilot consisting of 100 e-bus fleets and stop procuring the conventional bus by 2025. Since 2020, ITDP has
conducted several studies and technical assistance to support the electrification target.

Figure 1. The timeline of

Transjakarta electrification
studies by ITDP.

During the second year of the UK PACT EUM124 program (“UK PACT E-Bus Extension”), ITDP Indonesia has
developed recommendations to establish a strong regulatory and financing basis for the electrification,
along with a long-term year-on-year electrification plan that considers factors such as technology
readiness, investment needs, regulatory support, and GESI aspects - including the Gender Impact
Assessment on the regulatory and implementation basis. A business case document, including a detailed
technical plan, is developed to summarise the selected routes, technology, charging locations, and assess
the impacts of partial electrification on Transjakarta’s operations, to inform potential investors on the
feasibility of the project.

Figure 2. The scopes of UK

PACT E-Bus Extension study Regulatory Framework Technical Recommendations Recommendations on Economic
Analysis and Recommendation for 10,047 Transjakarta Electric - Financial Aspects and Funding
Fleets by 2030 Schemes

Creation of Governor Decree No.
1053/2022 on The Guidelines for the
Acceleration Program for the Use
of Battery Electric Vehicle under
Transjakarta Services as well as
the alignment with targets in other
regulations;
Propose new regulations and
amendments to existing regulations
to support the technical and
financial aspects of Transjakarta
electrification.
Technology selection of electric bus,
battery, and charging infrastructure;
Implementation phase for 10,047
electric bus fleets by 2030;
Charging strategy and charging
terminal location recommendation;
E-bus routes recommendation;
Power demand analysis and grid
impact analysis.
Rp/km comparison between diesel
and electric buses for each type;
Funding schemes alternative;
Financial Analysis;
Calculation of the impact on the size
and allocation of subsidies;
Calculation of cost-benefit analysis.

The business case document covers the first phase of Transjakarta electrification plan between 2023-2025
(“the first phase of electrification”). The time frame is defined considering the amount of most viable
funds that can be raised in one issue of Limited Participation Mutual Funds/Reksa Dana Penyertaan
Terbatas (RDPT) and discussions with several investment managers, which will be equal to around 840
e-buses.

The plan primarily addresses the facilities and infrastructure essential for the electrification process,
including e-bus fleets, charging facilities, and charging locations. The project assumes that all electric
buses deployed between 2023 and 2025 will replace existing fleets in select routes, without adding more
buses to the current fleets or introducing new bus routes. The existing service-based payment contractual
schemes between Transjakarta and operators are utilised as mandated on the Governor Decree No. 1053/
2022.

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 9

 Key findings

Electrification of the Transjakarta fleet is both financially and economically viable and
needs to be implemented promptly to maximise the benefits.

Electrifying 10,047 Transjakarta fleets is projected to generate net economic and social benefits of
IDR 4.2 trillion by 2030, or result in 34% economic IRR and Benefit-Cost Ratio of 2.41. Electrifying all
Transjakarta fleet according to the recommended implementation phase will result in 611 ton
cumulative GHG emission mitigation (58% reduction), 45% tailpipe PM2.5, 47% tailpipe NOx, and 47%
tailpipe SOx reduction compared to BaU (still using ICE or CNG fleets). It will also result in savings in
the national government’s petrol fuel subsidy by IDR 2.1 trillion cumulatively by 2030 and foreign
exchange outgo in importing motor fuels by IDR 3 trillion cumulatively by 2030.

Nevertheless, the tailpipe reduction of PM2.5 and SOx are offset by increase in the emissions from
electricity generation. Cleaner electricity generation, such as by power plant decarbonization or
renewable energy sources integration to charging infrastructure, will further increase the benefits of
Transjakarta fleet electrification.

Financial analysis on the first phase of Transjakarta electric bus implementation shows higher net
present value (NPV) compared to the BaU scenario involving ICE fleets. The TCO analysis found that
the total cost of ownership (TCO) of electric microbuses is already 25% lower than comparable petrol
buses. Single electric buses cost 6% less to deploy than diesel buses. The TCO for electric articulated
buses is similar to diesel buses and can be optimised further. However, the TCO for electric medium
buses is still higher than diesel.

Establishing charging facilities at terminals for opportunity charging will significantly make electric
bus TCO competitive. Otherwise, lighter and higher range medium bus models should be explored.
Recent government fuel price increases are expected to further improve the TCO of electric buses
compared to ICE.

To ensure the feasibility of transitioning to electric buses, Transjakarta must explore

new financing solutions such as separating asset ownership and operation, as well as
implementing leasing arrangements with operators to redistribute costs and risks.

A capital investment of around IDR 22 trillion1 is required between 2023 and 2030 to procure e-bus
fleets and establish infrastructure, which is 45% higher than the business-as-usual investment
estimates during the same period. This high upfront costs pose the main barrier to scale-up electric
bus implementation at Transjakarta, as many existing operators lack the necessary financial capacity.

Market consultations reveal significant interest from various financiers to participate in

Transjakarta’s fleet electrification initiatives, particularly to finance the capital expenditures (CAPEX).

A distribution of risks through alternative financing is necessary to support stakeholders that may
have lower financial capacity to electrify their fleets. When exploring new financing solutions, it is
crucial to prioritise and engage operators or cooperatives with lower financial or knowledge capacity
to ensure no one is left behind in the bus electrification initiative.

1
The cost will vary depending on procurement options

10 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

 Involving the Ministry of Finance will result in the lowest cost of funds to deploy electric
buses. RDPT could become an alternative investment instrument to finance the e-bus
program.

Nine e-bus funding schemes are explored and categorised based on the sources of funds, the
government guarantee letter (GGL) requirement, the need to establish a special purpose vehicle, and
the need to issue other investment or financing instruments. Essentially, all schemes show an
attractive cost of funds that are still lower than cost of funds in the market.

The scheme that involves exporting credit agencies or development financing institutions from
foreign nations provides the lowest cost of funds, but it requires GGL from the Ministry of Finance
(MoF). Moreover, to implement the scheme, the Government of Jakarta needs to have a regress
agreement with the MoF.

The issuance of Limited Participation Mutual Fund (Reksa Dana Penyertaan Terbatas, “RDPT”) could
become other financing options where Transjakarta needs to collaborate with an investment manager
to raise capital for the electrification. The scheme is proven doable in other sectors, such as clean
water investment and could be replicated for other sectors.

Figure 3. Estimated Total Cost

of Investment (Present Cost)

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 11

 Recommendations

A. TRANSJAKARTA E-BUS IMPLEMENTATION

PHASES
Several factors below are considered in developing recommendations for Transjakarta e-bus
implementation phases, including the number and type of buses deployed annually:
• Fleet and charging technology readiness
• Charging infrastructure provision feasibility
• Transjakarta electrification target
• Fleets quota in 2030 set by The Jakarta Transport Agency
• Expected completion dates of current contracts
• Projected number of fleets up to 2030
This study’s main recommendation for Transjakarta to achieve 100% electrification target in 2030 is to
deploy electric buses based on the Year-on-Year (YoY) target as follows:

Table 1. YoY e-bus deployment

target recommendation for
Type of bus Number of deployed e-bus per year (unit)
Transjakarta (“Base Case”)
2022 2023 2024 2025 2026 2027 2028 2029 2030

Articulated bus 0 0 0 111 165 19 22 23 24

Low Entry bus 74 26 0 0 0 0 190 98 21

Single bus (high 0 100 150 31 224 264 113 110 375
deck)

Medium bus 0 100 0 50 204 250 253 260 401

Microbus 0 0 100 200 400 600 1,129 1,800 2,160

Annual e-bus 74 226 250 392 993 1,133 1,707 2,291 2,981
deployment

Cumulative number 74 300 550 942 1,935 3,068 4,775 7,066 10,047
of e-buses

Percentage 2% 7% 14% 24% 38% 51% 69% 85% 100%

of e-buses in
Transjakarta fleet

First phase of implementation

Upon further investigation, the study discovered that the total cost of operation (TCO) for electric
microbuses is significantly lower than that of their ICE counterparts. Additionally, the cost of investment
required for electrifying this segment is the lowest. As a result of these findings, an alternate scenario was
developed that suggests accelerating the electrification of microbuses, as shown in the table below. By
deploying e-microbuses more quickly, Transjakarta can increase its electric fleet penetration rates and
optimise the expected financial and environmental benefits.

Nevertheless, albeit financially the “Alternate Scenario” could be attractive, the acceleration of e-microbus
deployment is still hampered by several challenges that should be addressed, such as fleet technology,
financial capacity, and the technical readiness of the existing microbus operators - including the
availability of depots or charging locations. Therefore, the “Base Case” YoY implementation target was
still used as the basis for further analysis in this study.

12 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

Table 2. Alternative YoY e-bus
deployment target with Type of bus Number of deployed e-bus per year (unit)
accelerated e-microbus
deployment (“Alternate 2022 2023 2024 2025 2026 2027 2028 2029 2030
Scenario”)
Articulated bus 0 0 0 91 185 19 22 23 24

Low Entry bus 74 26 0 0 0 154 0 19 20

Single bus (high deck) 0 100 0 0 305 261 128 93 480

Medium bus 0 100 75 97 204 178 203 260 401

Microbus 0 50 450 585 793 977 1,129 1,186 1,219

Annual e-bus 74 276 600 777 1,386 1,510 1,707 1,677 2,040
deployment

Cumulative number 74 350 950 1,727 3,113 4,623 6,330 8,007 10,047
of e-buses

Percentage 2% 9% 20% 33% 48% 60.6% 75% 86% 100%

of e-buses in
Transjakarta fleet
First phase of implementation

Figure 4. Comparison between

the Base Case and the
Alternate Scenario with
accelerated e-microbus
deployment

B. E-BUS ROUTES FOR THE FIRST PHASE OF

IMPLEMENTATION
In developing recommendations for the routes to be included in Transjakarta’s first phase implementation,
the following factors were taken into consideration:Route-level TCO per km
• Number of buses on the route
• Fleet visibility and usability (based on potential emission-based traffic restriction areas)
• Charging strategy and shared use of infrastructure
• Connection with terminal stations

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 13

 1. BRT ROUTES
Table 3. BRT routes for the
first phase of e-bus Year Route Code Route Name Number of deployed e-buses Fleet
implementation electrification
Single buses* Articulated buses percentage

2023 1 Blok M – Kota 100 0 71%

1 Blok M – Kota 70 0 100%

2024
9 Pinang Ranti – Pluit 80 0 65%

1 Blok M – Kota 0 41 100%

3 Kalideres – Pasar Baru 33** 24 71%

2025 9 Pinang Ranti – Pluit 5** 39 100%

9C Pinang Ranti – Bundaran Senayan 0 9 45%

8 Lebak Bulus – Harmoni 63** 0 78%

* Includes maxi buses (1 maxi bus = 1.3 single bus)

** reallocated from Corridor 1 to Corridor 8. The remaining could be reallocated to Corridor 3 or 9

2. NON-BRT ROUTES
Table 4. Non-BRT routes for Year Route Route Name Number of deployed Nearest Terminal Station
the first phase of e-bus Code e-buses (medium bus)
implementation
6C Stasiun Tebet - Karet 7 Kampung Melayu

1E Pondok Labu - Blok M 10 Blok M

5N Kampung Melayu - Ragunan 9 Kampung Melayu

6N Ragunan - Blok M 10 Blok M

1C Pesanggrahan - Blok M 8 Blok M

2023 8D Joglo - Blok M 8 Blok M

3E Puri Kembangan - Sentraland Cengkareng 17 Kalideres

8E Bintaro - Blok M 7 Blok M

1Q Rempoa - Blok M 7 Blok M

11D Pulogebang - Pulogadung 2 14 Pulogebang, Pulogadung

7P Pondok Kelapa - BKN 9 Kampung Melayu

11Q Kampung Melayu - Pulogebang 7 Kampung Melayu, Pulogebang

9H Cipedak - Blok M 15 Blok M

2025
8K Batusari - Tanah Abang 13 Grogol

1M Meruya - Blok M 13 Blok M

3. MICROBUS ROUTES
Table 5. Microbus routes for
the first phase of e-bus Year Route Code Number of deployed e-buses (microbus) Terminal Station
implementation
JAK.53 43 Grogol
2024
JAK.56 30 Grogol

JAK.30 30 Grogol

JAK.31 30 Blok M

JAK.46 41 Pasar Minggu

JAK.54 27 Grogol
2025
JAK.15 48 Tanjung Priok

JAK.19 42 Pinang Ranti

JAK.84 31 Kampung Melayu

14 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

 C. CHARGING INFRASTRUCTURE
LOCATIONS FOR THE FIRST PHASE OF
IMPLEMENTATION
For electric fleets that cannot solely rely on overnight charging at depots, opportunity charging infrastructure
should be installed at several terminals. The terminals below are recommended as opportunity charging
infrastructure locations with the aim of minimising dead kilometres for the fleets and hence improving
cost-effectiveness of the e-bus operations.

Table 6. Opportunity charging

infrastructure locations for
Year Charging infrastructure locations
the first phase of e-bus Kalideres terminal
implementation
Blok M terminal
2023
Kampung Melayu terminal

Pulo Gebang terminal

2024 Pinang Ranti terminal

Grogol terminal
2025
Lebak Bulus terminal

Figure 5. BRT routes for the

first phase of e-bus
implementation

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 15

 D. FLEET AND CHARGING TECHNOLOGY
OPTIONS
E-BUS TYPES
The aspects below were considered in deriving recommendations on the appropriate e-bus types for
Transjakarta:
• Technology readiness, which can be inferred from wide availability of models in the market
• Current ICE fleet types’s capacity and specifications
• Regulatory framework, in particular regarding gross vehicle weight limits
• Cost and procurement time efficiency, e.g. avoiding battery size customization to reduce additional
cost and speed up procurement process

The recommended e-bus types for Transjakarta fleets are summarised below. All the types of electric buses
will be gradually introduced prior to 2025. The battery sizes were selected based on standard available
models, to avoid customization and longer procurement lead times. The electrification plan excludes
double-decker buses, Royaltrans buses, and 13.5-m maxi buses as they are not part of Transjakarta’s
electrification plan

12-m single 7-m medium

bus (high bus
deck) 135 kWh**
324 kWh

12-m low 4-m

entry bus microbus
324 kWh 42 kWh

*In the worldwide market, there are no high-deck

18-m articulated electric bus models that have been
articulated deployed.
bus **higher-capacity batteries to extend the range of
450 kWh* medium buses complying with current GVW
regulations are being explored in the market.

CHARGING INFRASTRUCTURE TYPES

It is recommended to use plug-in chargers in the initial phase before 2025, followed by the introduction
of pantograph chargers in 2025 to align with the planned introduction of electric articulated buses and
the technology readiness.

16 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

 E. FINANCING TRANSJAKARTA’S FIRST PHASE
E-BUS IMPLEMENTATION
The current Transjakarta business model makes it difficult for new players to participate due to a lack of
flexibility for new entities to participate as operators and high upfront costs.

The study recommends:

a. Implement different business models for large/medium buses and microbuses, as the operations of
the two bus types are significantly different. For instance, microbuses do not have a depot to locate
the charging infrastructure and they are also operated by individuals under cooperatives.

Table 7. Business model

recommendations for each Bus type Business model recommendation Financing model recommendation
type of electric bus
Articulated bus Concessional model Self-financing through government
funding/loans) or leasing

Low Entry bus Buy the service (BaU model) Bus operator’s own equity
+ bank loans or leasing

Single bus (high deck) Buy the service (BaU model) Bus operator’s own equity
+ bank loans or leasing

Medium bus Buy the service (BaU model) Bus operator’s own equity
+ bank loans or leasing

Microbus Leasing model Leasing (facilitated by Transjakarta) or

own funds

b. Use fund channelling schemes to improve financing access and address financing challenges.

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 17

 BUSINESS MODEL RECOMMENDATIONS
The study assessed four options below to investigate the most financially attractive business and
financing model for Transjakarta’s first phase of bus electrification. For more information regarding the
business models, please refer to Table 9 and Figure 6.

Regardless of the business model, the assessment revealed that all the evaluated models had a higher
net present value (NPV) compared to the BaU scenario involving ICE fleets. This finding demonstrates that
implementing electric fleets will lead to long-term cost savings for Transjakarta.

The Concessional model (“Option 2”) is still the most favourable financially, followed by a combination
of business models based on bus types (“Option 4”). To optimise the financial and implementation
feasibility, combinations of business models and sources of financing as presented in Option 4 is
recommended.

Table 8. Assessment of
business and financial model Option 1 Option 2 Option 3 Option 4
options
Buy the service (BaU Concessional model Fleet leasing 2 Combination of
model) scenarios

Business Fleet Bus operator Transjakarta Bus lessor Single bus, low entry
model ownership bus, medium bus:
Buy-the-service
Fleet Bus operator Bus operator Bus operator model
operations
Articulated bus:
Fleet Bus operator OEM/APM Bus lessor
Concessional model
maintenance

Source of financing Equity from investors Equity from DKI Equity from investors Microbus:
and debt from local Jakarta and debt and debt from Fleet leasing
commercial banks from PT SMI, financial instruments
commercial banks,
financial instruments

WACC 3 10% p.a. 7.15% p.a. 10.54% p.a. Varies

ΔNPV with BaU (ICE fleet) 9.2% 17.9% 12.5% 16.9%

scenario, as % of BaU (ICE
fleet) NPV

Remarks Regulatory and Most financially Most implementable Optimises financial

institutional attractive from NPV (least capital cost and implementation
mechanisms already standpoint from operators and feasibility
exist Transjakarta)

Sensitivity analysis on various factors was conducted to assess financial robustness. All options, except
for the scenario with a 67% increase in electric bus costs using fleets from western countries, showed
positive net present values (NPVs). It was found that financial feasibility is highly sensitive to e-bus capital
expenditure (CAPEX) and moderately sensitive to changes in electricity prices, maintenance costs, and
cost of funds. Additionally, the accelerated electric microbus deployment roadmap (“Alternate Scenario”)
has a higher NPV compared to the “Base Case” scenario.

2
In the case of microbus, depot and overnight charger provision will be arranged by the fleet leasing company (“Fleet and depot
leasing model”)
3
For more details on WACC estimation, please refer to Table 10

18 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

Table 9. Business model
options
Buy the service (BaU Concessional model Fleet leasing Fleet and depot
model) leasing

Business model Transjakarta contracts Transjakarta as Transjakarta leases Transjakarta contracts

description bus operators who an electric fleet electric fleets from bus bus operators to
own electric fleets to owner contracts bus lessors and contracts operate buses. Bus
operate and maintain operators to operate bus operators to operators lease
buses buses and OEMs to operate the buses. electric fleets from
maintain buses The bus lessor is bus lessors who also
responsible for fleet provide depot charging
maintenance facilities and fleet
maintenance

Applicable for Large bus, medium bus, Large bus, medium bus Large bus, medium bus Microbus
microbus

Asset ownership

E-bus fleet Bus operator Transjakarta Bus lessor Bus lessor

Overnight/ Bus operator Bus operator Bus operator Bus lessor

depot charging
infrastructure

Terminal charging Charging service Charging service Charging service Charging service
infrastructure4 provider provider provider provider

Operational responsibility

Fleet operations Bus operator Bus operator Bus operator Bus operator

Fleet Bus operator OEM/APM Bus lessor Bus lessor

maintenance

Pros and cons

Pros • Regulatory and • Lower capital cost • Asset-lite model: • Asset-lite model:
institutional for bus operators Lower capital cost Lower capital cost
mechanisms already • Lower cost of funds for Transjakarta and for Transjakarta and
exist compared to fleet bus operator bus operator
• Simple and familiar procurement by bus • Lower cost of funds • Addresses the
business model operators compared to fleet problem of depot
• Transjakarta has full procurement by bus and overnight
control over the operators charging facility
assets • Has been availability for
implemented for microbus operators
intermediate
(informal) public
transport

Cons • High capital cost • Asset-heavy model • Government of • Government of

from bus operators for Transjakart Jakarta indicates Jakarta indicates
for fleet • Government of hesitancy to hesitancy to
procurement and Jakarta indicates arrange/guarantee arrange/guarantee
depot charging hesitancy to debt financing for debt financing for
infrastructure arrange/guarantee Transjakarta Transjakarta
• Not all bus operators debt financing for • Operators tend to do • Operators tend to do
have the financial Transjakarta not take care of the not take care of the
capacity to provide • Operators tend to do assets when these assets when these
down payment for not take care of the are not owned by are not owned by
e-bus financing assets when these them them
• Banks are hesitant are not owned by
to extend finance them
towards new
technology

4
Terminal charging infrastructure is arranged through Public Private Partnership (PPP) with Charging Service Provider (CSP) where
they would get paid by Transjakarta for the initial investment and by operators for the energy used

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 19

 Figure 6. Business model
alternatives to support
electric bus implementation
in Transjakarta

“Business As Usual” or “Buy the Service” Model

Buses Acquired by Transjakarta using Concessional Finance

20 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

 Buses Acquired through Leasing Mechanism

Business Models for Electric Microbuses

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 21

 IMPACT ON PUBLIC SERVICE OBLIGATION (PSO)
The estimated total cost of ownership (TCO) for electric buses is lower compared to that of internal
combustion engine (ICE) buses. As a result, the projected Public Service Obligation (PSO) required to
support Transjakarta with electric buses is expected to be lower than the PSO estimate for operating ICE
fleets. However, it is worth noting that the overall amount of PSO will still rise each year due to
Transjakarta’s planned expansion, which includes a 2.5 times increase in fleet numbers and increased
operating costs due to inflation.

After evaluating the four business and financing models discussed earlier, it was found that Concessional
model (“Option 2”) shows the greatest reduction in subsidies compared to the estimated PSO for the
BaU scenario5 involving only internal combustion engine (ICE) fleets.

Figure 7. Estimates of relative

reduction in operating
subsidy compared to BaU (ICE
fleet) PSO projection

If the Government of Jakarta or Transjakarta chooses to pursue Option 2, the total capital investment
cost required from Transjakarta until 2030 is IDR 15,899 trillion.

Figure 8. Net Funding

Required from Transjakarta in
Option 2 to Procure Electric
Buses

5
ITDP estimates, assuming all 10,047 fleets in 2030 are all ICE buses. Annual inflation in various aspects are considered, such as:
• 4.11% in general cost components
• 3% on electricity prices
• 4.5% on fuel prices
• 8% in minimum regional income
• 3.5% in ICE buses
• 5% USD - IDR appreciation exchange rate

22 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

FUND CHANNELLING SCHEMES TO IMPROVE FINANCING
ACCESS
Based on discussions with Transjakarta, The Government of Jakarta, electric bus industry players, and
various financial institutions, several alternative funding and financing schemes for Transjakarta electric
buses have been developed and presented in Table 10.

All fund channelling schemes result in an attractive cost of capital, which is still lower than the interest
rate in the market. The study suggests using fund channelling schemes to improve financing access and
address financing challenges. These schemes are designed to be replicable, scalable, flexible, and attract
various private investors. The goal of the schemes is to provide proof of concept where the costs of funds
of each scheme are evaluated to provide confidence in the schemes.

Other key takeaways from the fund channelling scheme assessment are as follows:

1. Loan funding alone, either through market or concessional loans, has limited to no success regarding
the purchase of electric buses. This is due to many factors already mentioned, such as predominance
of CAPEX over operating and maintenance costs in investment decisions, limited knowledge of
technology, poor financial conditions of operators, among others.

2. A 2-step loan scheme where Development Financial Institutions (DFIs) or Export Credit Agencies
(ECAs) provide loans to the government (Scheme A-3) will result in the lowest cost of capital.
However, the scheme needs a Government Guarantee Letter from the Ministry of Finance. Transjakarta
needs to own or establish an SPV as an asset owner or asset aggregator, as well as the e-bus
programme implementer.

3. Regional loans from PT SMI (Scheme A-1) will result in the lowest cost per kilometre borne by
Transjakarta to meet the WACC in Table 10. This is because tax shield analysis was not taken into
account in the calculation.

4. The highest fee per kilometre on the other hand is resulted from Scheme B-1A (loan from commercial
foreign banks to private sectors), due to the two-step channelling for fleet acquisition i.e., loan from
foreign bank to importer/buyer/capital provider and financial lease to bus operators.

5. Reksa Dana Pendapatan Tetap (RDPT) is an attractive investment option for bus electrification due
to its basic asset in infrastructure which is a priority for the government, and its varied yield based
on project type and location. RDPT also offers an easy process and the option to buy back shares
when there is better liquidity. Various financing institutions, market players, including the government,
could become sponsors of donors on the issuance of the RDPT.

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 23

 Source Scheme Description Govern- Special Other WACC Pros Cons
of fund / ment Purpose invest- Simu-
financing Guarantee Vehicle ment/ lation
Letter financing Result6
instru-
ments

Transjakarta must request

PT SMI provides
regional loans to
A-1
The Government of
Jakarta
Public
sector
The combination of
regional loans and
A-2
financing products
issued by PT SMI
PT SMI has managed the
GoJ’s loan portfolio, so that
the government has gone
through the Know-Your-
Customer (KYC) process
X V X 7.21%
by PT SMI. The tenure of
municipality loans can
be longer (up to 20 years)
compared to market loans
from the private sector.
PT SMI has collaborated
with several Development
Financial Institutions (DFIs),
X V V 7.39%
such as Asian Development
Bank (ADB) and World Bank
(WB).
the GoJ to issue the
Regional Loan. GoJ must
also have commitment
for this scheme to work,
e.g. issuing a regional
regulation (Peraturan
Daerah or “Perda”) which
needs to be issued
and approval from
the Regional People’s
Representative Council
(DPRD).
Compared to Scheme A-1,
the structured financing
is more complex because
of the need for issuance
of other financing
instruments..

Development
Financial Institutions
(DFIs) or Export Credit
A-3
Agencies (ECAs) Loan
to Government (2-
step Loan)
Tenure of sovereign loan
ECA-UKEF requires a
can be longer than 10
GGL from the Ministry of
V V X 6.86% years. An ECA has sent an
Finance. Full financial risk
Expression of Interest (EoI)
to the public sector.
Letter to Transjakarta.

Loans from local and

foreign commercial
banks, including
Exporting Credit
B-1
Agencies (ECAs)/
Development
Financing Institutions
(DFIs)
Might need higher
Government financial
The risk will be fully borne support or subsidies
X X X 10.08%
by private sectors. to increase the level of
confidence of the private
sector.

Loan from commercial The role of the main actors

Zero mitigation on current
foreign banks to will be optimised without
financial barrier, high
B-1A Private Sectors - x x x 10.18% changing the roles that
upfront cost, relatively
Business as usual have been carried out so
has lower flexibility
(BaU) far.

Provide an alternative to
Rating a company
Bond as investment involve private sectors to
(potentially the SPV)
B-2 instrument to raise x v v 11.32% raise capital without using
is needed. Will be time
capital commercial loans from
consuming.
banks.

Private Utilises Limited Opportunity of

sector Participation collaboration between
Mutual Funds (Reksa Fund Managers and
The scheme is quite
B-2, Dana Penyertaan Transjakarta (SOE – ROE
x v v 9.89% complex and involves a lot
Alt 1 Terbatas, “RDPT”) synergy) that may increase
of players.
as the investment the level of confidence as
instrument, SPV as well as simplicity of the
the asset owner process

SPV as the asset owner

has a strategic alliance
agreement with leasing
B-2, Utilises RDPT, finance
x v v 10.03% companies (2-step) who
Alt 2 lease to operators
have financial lease The 2-step process that
agreements with bus must comply with strict
operators. OJK Regulation adds to
Bus operators have additional process and
Utilises RDPT, time to implement.
financial lease agreement
leverage lease
B-2, (lease to own) to own
agreement between x v v 10.54%
Alt 3 the assets, which will
SPV and leasing
be maintained/ utilised
company
properly.
Table 10. Fund channelling
schemes assessment
6
WACC (Weighted Average Cost of Capital) simulation assumption:
• Fleet cost: USD33,600 or IDR524,328,000 per unit • Contract period: 10 years
• Daily kilometres: 208 km • Loan/lease period: 7 years
• Number of days: 365 days per year • Residual value: None
• O&M margin: 10%

24 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary

 Conclusion and
The Way Forward

1 A comprehensive regulatory framework assessment on the existing regulations and

bills should be conducted in tandem with the development of the business case. This
is to ensure the alignment of the electrification target stated on Governor Decree 1053/ 2022 and
accelerate the electrification progress. The action plans on this areas need to be taken by The
Government of Jakarta and Transjakarta are:
a. Amend the Regional Regulation No. 5/2014 on Transportation to increase the maximum service
life of zero-emission public transportation fleet to more than 10 years.

b. Align the electrification target of Transjakarta to achieve 10,047 electric buses (3,658 non-
microbuses) by 2030 in the Draft Governor Regulation on Air Pollution Control Strategy.

c. Set the targets for implementing electric vehicles (particularly Transjakarta electric bus),
estimate electricity consumption, and estimate greenhouse gas emissions reduction in the
draft Regional Regulation on the Regional Energy Plan.

d. Include the use of electric buses as one of the KPIs in the Jakarta transportation system;
implement electric buses for road-based public transportation; provide supporting facilities for
the implementation of electric buses - including charging facilities, in the draft Regional
Regulation on the Jakarta Transportation Master Plan.

e. Integrate the development of charging terminals and other charging locations for Transjakarta
electric buses into the Spatial Planning Master Plan for 2022-2042.

f. Expand the scope of work for Transjakarta in the areas of funding, asset leasing, and
establishment of subsidiaries as per the Amendment to Regional Regulation No. 4/2014 on PT
Transportasi Jakarta.

2 Accelerate the establishment of terminal charging infrastructure for opportunity

charging. The study suggests that opportunity charging at terminals will significantly lower the
TCO/km, especially for medium electric buses. The Transport Agency should select and prioritise
terminals for establishing charging stations. Additionally, Transjakarta could explore a synergy with
state owned enterprises (Badan Usaha Milik Negara, ‘BUMN’) between region owned enterprises
(Badan Usaha Milik Daerah, ‘BUMD’), or with private charging infrastructure providers. The change
on contractual framework should be taken into account where the operators could utilise the
charging facilities at terminals.

3 Rank and select eligible routes and operators based on financial and commercial
perspectives. While this study focuses on the technical aspects of planning, categorising routes
and fleets according to attractive and unattractive IRRs to determine private investor involvement
or structured support needed from the government under PSO assignment will also be needed.
Operator’s scoring combined with the feasibility result of each route could deliver an attractive
IRR(s) that can be the interest of prospective private capitals or investors. Furthermore, analysis on
operators that need ‘financial kick support’ will be offered for the Transjakarta Support Assistance
(TSA) program.

4 Collaborate with fund management and multi-finance institutions to cover the end-to-
end investment of moderate-sized capital market projects and conduct thorough feasibility
analyses to mitigate risks.

5 Collaborate with BUMNs to provide charging infrastructure and resources to retrofit

depots and offer opportunities for operators to gain experience through technical assistance
programs.

6 Lower implementation risks of e-bus projects by:

a. Conducting feasibility studies (end-to-end) for each type of bus.

b. Using private-funding with blended financing for procurement to verify the commercial,
operational & financial arrangement of commercial e-bus routes projects.

Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 25

26 Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary
Business Case of Transjakarta’s First Phase E-Bus Deployment: An Executive Summary 27