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Border Wide, Mexico

Border-Wide Low-Emission Vehicle Purchase Program in Mexico

Status: Completed Construction

Background

Based on data from the Mexican national statistics institute, INEGI, more than 37% of households in the major urban areas of the border region depend on public transport to support their daily activities. In addition, many companies offer private bus service to transport their personnel to and from manufacturing and other facilities. The operating technology commonly used in public transportation vehicles in the border area is EPA 1998 with outdated emission control systems.

Mexico's National Climate Change Strategy indicates that greenhouse gas (GHG) emissions in Mexico increased 16.9% between 2000 and 2010. One of the largest increases in emissions came from the transportation sector, which registered an average annual increase of 4.1% in GHG emissions between 1990 and 2010. The transportation sector has been associated with nearly 30% of total CO2 equivalent emissions in Mexico. According to the U.S. Department of Transportation, new buses (especially newer diesel vehicles) produce less pollution than cars per passenger mile, 0.16 pounds of CO2 and 0.96 pounds of CO2, respectively, by utilizing advanced technologies and higher standards.

Description

Mercader has financing programs designed to extend purchasing credit to reputable public transportation service providers. The purpose of the project is to establish a financing program for purchasing or leasing lowemission vehicles in the Mexican border region with longer terms than its current funding options. The initial scope of the Project is expected to
support purchasing or leasing an estimated 100 buses. To participate in the program, potential borrowers (including private transportation services to manufacturing companies) must have an existing license for 2 the operation a public transportation vehicle, will need to complete available training from the manufacturer, and comply with warranty requirements.

The vehicles available through the program will be manufactured by DINA Camiones, one of the largest bus and truck manufacturers in Mexico. Only the most-state-of-the-art vehicles will be available, including ultra-low sulfur diesel (ULSD) and compressed natural gas (CNG) vehicle options. At a minimum, the vehicles will comply with EPA 2004 emission standards. Selection of the specific vehicle is expected to be influenced by available fuel sources in the area of the service provider or based on local transportation system policies.

Benefits

The project is expected to improve public transportation systems by promoting access to low-emission buses that offer a comfortable, safe, rapid, and accessible transportation option for the existing market, while at the same time improving environmental and human health conditions by achieving lower emissions related to vehicle operation and reduced urban congestion. The use of new diesel vehicles that comply with EPA 2004 standards will lower nitrogen oxides (NOx) and hydrocarbons (HC) emissions by approximately 50% and will achieve nearly 24% lower carbon dioxide (CO2) emissions. In the case of natural gas-fueled vehicles, the reduction in criteria pollutant emissions is significantly higher. Specifically, the replacement of 100 existing vehicles using EPA 1998 technology with 100 vehicles using EPA 2004 diesel technology is expected to generate environmental and human health benefits related to the displacement of an estimated 192 metric tons/year of CO2, 30 metric tons/year of NOx and 1.2 metric tons/year of HC.

Project Financing

Total Project Cost US 44.61M
NADB Funding US 35.03M - NADB Loan
US M - NADB Grant: BEIF
US M - NADB Grant: CAP
US M - NADB Grant: SWEP
US M - NADB Grant: WCIF
Other Funding Partners Market Rate Loan
Clients that participate in the program

Project Photos