Assessment process guidance - Scottish Bus Emissions Abatement Retrofit Programme - Phase 5
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Purpose of this document
This document sets out the approach for taking BEAR Phase 5 applications through a process of assessment in order to allocate grant funding to projects that support the strategic aims of BEAR Phase 5.
There are three key stages to the assessment of BEAR Phase 5 applications. The flow chart below summarises these stages:
- Applications received
- Screening and eligibility check
- Applications will be screened to check they are complete, and checked that they are eligible. If an application is not eligible, it will not be scored however we will contact you. Applications will be assessed against fund requirements and state aid guidelines.
- Applications will be assessed and given a score out of 40. A Case Paper will be produced for each scored application.
- Assessment process
- The Assessment Team will review each Case Paper, as well as any conditions associated with the funding. Bidders will be notified of the outcome of their application within 5 working days of receipt by Transport Scotland through phone call or email.
- Final approval by Transport Scotland
- Award letters sent out following result notification
- Feedback to unsuccessful applicants
BEAR Phase 5 Strategic Aims
Transport Scotland will ensure the BEAR Phase 5 assessment process is open, transparent, fair and robust for all applicants.
In order to be considered for funding, applications need to identify projects that deliver benefits directly in line with the core strategic aims of BEAR Phase 5. These strategic aims are to:
- Support licenced bus and coach operators (including community transport operators and local authorities) to reduce nitrogen oxide (NOx) and particulate matter (PM) emissions of existing eligible fleet vehicles operating on routes within, or located primarily within, one of Scotland’s cities identified in the Programme for Government 2017 LEZ commitment (i.e. Aberdeen, Dundee, Edinburgh and Glasgow) and/or one of Scotland’s Air Quality Management Areas (AQMAs) through the installation of Clean Vehicle Retrofit Accreditation Scheme (CVRAS) accredited retrofit technology measures. Significant reduction in emissions >80% are to be achieved whilst the vehicles operate within the LEZ areas.
- To demonstrate and evidence the effectiveness of retrofit technology to Scottish bus operators through an effective monitoring framework collecting, analysing and sharing operational data to demonstrate real world emissions reduction from the use of the retrofit technology and identify and assess any associated impact on fuel consumption and efficiency, and contributing to LEZ monitoring and enforcement.
Specifically, BEAR Phase 5 aims to permit:
- Buses/coaches fitted with CVRAS accredited equipment which reduces emissions to Euro VI levels or better in real world conditions for NOx, NO2 and particulates such as selective catalytic reduction traps (SCRT).
- Buses/coaches fitted with CVRAS accredited low emission drivetrains such as gas power hybrid or electric drive. Bids proposing new repower types will also be considered.
- Monitoring and evaluation identifying evidence of the effectiveness of retrofit technology to Scottish bus operators by sharing operational data to demonstrate real world emissions reduction from the use of the retrofit technology and identifying and assessing any associated impact on fuel consumption and efficiency.
During the pre-assessment process applications will undergo initial screening and an eligibility check. Then those determined to be eligible (or partially eligible) will be assessed further and scored against the assessment framework outlined below.
Each assessment will produce a score out of 40 and a Case Paper will be produced outlining how this score was reached (see Annex 3 for the scoring framework and Annex 4 for an example Case Paper). The Assessment Team will receive a Case Paper for each project as well as a Summary Paper presenting a strategic overview that assesses all the applications received against the available grant funding and the strategic aims of the BEAR Phase 5 programme.
BEAR Phase 5 programme is open immediately and bidders are encouraged to bid as early as possible. The outcome of the funding application will be communicated within 10 working days of the closing date.
Applications received after 5pm on Thursday 28 July 2022 will not be considered.
Applicant organisations are expected to provide full details of their proposed project on the BEAR Phase 5 application form. Please ensure this is filled in completely before submitting.
Please also ensure the Calculator and Fleet Data spreadsheet is submitted at the same time along with any supporting evidence.
Transport Scotland will complete an eligibility check that will assess all applications against BEAR Phase 5 eligibility criteria i.e. the applicant organisation, vehicles and measures.
- Grants are available to licensed bus and coach operators or local authorities (including community transport operators) operating eligible vehicles based on routes within or located primarily within a local authority with one of Scotland’s Air Quality Management Areas (AQMA). Priority will be given to eligible vehicles on routes that pass through one of Scotland’s AQMAs and/or Low Emission Zones set out in the 2017 Programme for Government commitment (i.e. Aberdeen, Dundee, Edinburgh and Glasgow). Details of all of Scotland’s AQMA’s can be found in Annex 6 of this document and on the Scottish Air Quality website.
- Grants will only be open to vehicles that meet the following criteria:
- Buses and coaches operated under a Public Service Vehicle operator licence or used for voluntary, community or other non-profit making purposes. Owned by applicant for a minimum of 12 months.
- Less than 13 years old at time of application unless of a historic nature.
Remaining service life
- A remaining service life of at least five years in Scotland.
- Engine out emissions needs to be consistent with OEM standards unless replacing with new drivetrain.
- To provide quarterly telematics data demonstrating both daily and instantaneous NOx and PM abatement per bus through a data portal, maintenance of equipment, daily AdBlue consumption, daily mileage, mpg, GPS location of bus; all for a minimum 5-year period. In addition, where possible, at least 12 consecutive months of historical fuel consumption data for each specific vehicle prior to retrofitting in order to effectively monitor and evaluate any associated impact on fuel consumption and efficiency resulting from retrofitting.
- Operator to confirm in application form how services will be delivered in an LEZ and/or AQMA.
- If a vehicle is poorly maintained following retro-fitment, then it is possible that retrofit technology will not operate effectively and applicants will therefore be required to demonstrate a history of effective maintenance and commit to an agreed maintenance cycle. Bus retrofit technology manufacturers currently support some, but not all, bus models operating in Scotland that meet these eligibility criteria.
- The list of approved manufacturers and devices currently Clean Vehicle Retrofit Accreditation Scheme (CVRAS) accredited are available on the EST website.
- More vehicle/engine configurations are being tested and will be added as test data is provided. There is also the possibility for CVRAS to assess approval extensions on a case by case basis dependent on bus fleet composition and applications required. The retrofit supply industry is currently assessing the market needs of the Scottish bus fleet to understand the vehicle/engine combination requirements for retrofit emissions reduction solutions.
- Grant funding will only fund retrofit technology measures accredited by the CVRAS. EST and the Low Carbon Vehicle Partnership (LowCVP) now ZEMO, jointly launched CVRAS in mid-2017. CVRAS provides a detailed list of accredited retrofit technology providers to the bus sector. A number of bus models operating in Scotland may not have an accredited retrofit technology because the technology has yet to be tested on these specific bus models. BEAR Phase 5 grant funding will be available for the following CVRAS accredited technologies:
- Selective Catalytic Reduction (SCR) units that reduce NOx emissions by reacting with ammonia over a catalyst resulting in emitting harmless emissions of nitrogen and water; these must include Diesel Particulate Filters (DPF) to reduce the particulate matter emissions from the exhaust.
- Engine repowers such as gas conversion, hybrid and electric drive conversions.
- Additional fuel costs are not eligible for grant funding.
As retrofit technology has not been deployed in Scottish bus fleets before on any scale a key objective of BEAR Phase 5 will be to establish an effective monitoring framework to:
- Demonstrate and evidence the effectiveness of retrofit technology to Scottish bus operators
- Obtain feedback from Scottish bus operators on the use of bus retrofit technology
- Understand the logistics of installing bus retrofit technology, to create early findings that will inform subsequent BEAR phases
- Collect, analyse and share operational data from emissions monitoring equipment including vehicle telematics to demonstrate real world emission reduction from the use of the retrofit technology and support CVRAS (or ZEVRAS) accreditation and in-service standards.
- Identify and assess any associated impact on fuel consumption and efficiency resulting from retrofit installation
- Support LEZ monitoring and enforcement.
Because monitoring and evaluation is a key objective of BEAR Phase 5, the provision of data by BEAR Phase 5 grant recipients will be an absolute requirement. As a minimum BEAR Phase 5 grant recipients will be required to provide a record of specific fuel consumption, daily distances driven, hours operated, daily average NOx and PM emissions reductions, GPS location of bus, daily AdBlue use and maintenance carried out for each vehicle funded. This information can be sent directly to Transport Scotland from equipment supplier if preferred via a data portal. Data to be sent at a minimum quarterly interval for a minimum period of 5 years.
The current standards for CVRAS retrofitted equipment require in-service performance of >80% daily NOx reduction. Applicants are advised to ensure that both the equipment fitted and the condition of the existing vehicle is sufficient for this to be achieved in-service. This will require regular AdBlue filling and maintenance. In some cases, applicants may need to adapt their operational practices to ensure that the retrofit equipment is maintaining sufficient temperature for NOx abatement to take place.
Applicants will therefore be required to agree to the installation of additional emissions and air quality monitoring equipment on vehicles sufficient to allow each vehicles emissions to be monitored, the performance of retrofit technology to be monitored and accredited where necessary, and to enable mobile air quality monitoring. Applicants will also be required to agree to participate in a monitoring process that will involve the collection, analysis and dissemination of associated data to help inform Transport Scotland, Scottish Ministers, Scottish bus operators and other key stakeholders on the impact of the programme for a minimum 5-year period.
Applicants will be required to identify and provide evidence of costs in their application and these will be assessed and reported to the Assessment Team. If an application receives a ‘no’ for any of these questions and is ultimately successful, it is likely that a condition of funding will be providing additional evidence.
BEAR Phase 5 grant funding constitutes State Aid and is aligned with the context of the European Union rules. Applicants therefore have the option of applying for BEAR Phase 5 grant funding either under the European Commission’s ‘de minimis’ Regulations, or under the revised European Commission State aid decision on 14 May 2020.
De minimis grant funding allows organisations to receive up to 100% grant towards eligible capital costs, limited at total of €200,000 of ‘de minimis’ State aid over any three-year fiscal period. Alternatively, operators can receive up to 95% grant towards eligible capital costs under the revised State aid terms of 14 May 2020. The Phase 5 grant calculator permits operators to toggle between these State aid thresholds for the appropriate level for the application.
The definition of SMEs used in the State aid area is as follows:
- A medium-sized enterprise is an enterprise satisfying all of the following criteria:
- has fewer than 250 employees and
- has either an annual turnover not exceeding €50 million, and/or a balance-sheet total not exceeding €43 million.
- A small enterprise is an enterprise that satisfies all of the following criteria:
- has fewer than 50 employees and
- has either an annual turnover and/or a balance-sheet total not exceeding €10 million.
- A micro- enterprise is an enterprise that satisfies all of the following criteria:
- has fewer than 10 employees and
- has either an annual turnover and/or a balance-sheet total not exceeding €2 million.
- The criteria must be applied to the company as a whole (including subsidiaries located in other Member States and outside the EU). The Regulation provides definitions of an autonomous enterprise, partner enterprise and linked enterprise in order to assess the real economic position of the SME in question.
Illustrative examples of the BEAR Phase 5 funding options
Bus Company A is a small enterprise and has a fleet of eight vehicles it wishes to have retrofitted and has not received any De-Minimis funding in the last three financial years. Bus Company A has a choice of two funding options:
Option 1 - De-Minimis funding
Bus Company A can apply for De-Minimis funding of up to €200,000 and can apply for funding to retrofit nine of its twelve vehicles
(9 x £18,000 = £162,000 or €182,000).
Option 2 - 95% State aid threshold
Bus Company A can apply for 95% State aid threshold funding to retrofit all twelve of its vehicles. This will allow Bus Company A to fund up to 95% of the cost of retrofitting its vehicles
(12 x £18,000 = £216,000 x 95% = £205,200).
Bus Company B is a large enterprise and has a fleet of 20 vehicles it wishes to retrofit and has received €142,000 in De-Minimis funding in the last three fiscal years. Bus Company B has a choice of two funding options:
Option 1 De-Minimis funding
Bus Company B can apply for De-Minimis funding of up to €58,000 and can apply for funding to retrofit three of its 20 vehicles
(3 x £15,000 = £45,000 or €50,500).
Option 2 - 95% State aid threshold
Bus Company B can apply for 95% State aid threshold funding to retrofit twenty vehicles. This allows Bus Company B to fund up to 95% of the cost of retrofitting its twenty vehicles
(20 x £15,000 = £300,000 x 95% = £285,000).
There are four project impact criteria that will be assessed and scored for each project. Scores will be determined based on the information provided in the application form and calculator spreadsheet. Any supplementary documents provided to support the application will not impact the score of an application. Transport Scotland may contact applicants throughout the assessment process to seek clarification on specific elements of the application; however, any information provided to Transport Scotland subsequent to the submission of the application form will provide context only and will not impact scoring. Applicants should ensure that all project impact criteria have been addressed in the application form.
Each criterion will be weighted equally and given a score out of ten – meaning that total quality scores will be out of 30. Furthermore, up to 10 marks will be awarded in a financial assessment of value for money relative to the degree of air quality improvement. Transport Scotland assessors will provide a short comment with a justification for the score. The four criteria that will be assessed and scored are:
- Project rationale and strategic fit
- Emissions reductions
For an explanation of each of these criteria and how they will be assessed see Annex 3.
In addition to an overall score, each project will also be assigned a red, amber or green (RAG) rating. The purpose of the RAG rating is to highlight any risks or issues identified during the assessment to the Assessment Team.
Ineligible projects (i.e. those that do not undergo full assessment) will not be scored and therefore will not be included in this RAG rating process. A red RAG rating, therefore, does not mean that the project is ineligible; it means that the project is eligible, but high risk.
- RED - Projects that receive a red RAG rating are considered high risk, or where a significant issue has been identified.
- AMBER - Projects that receive an amber RAG rating are considered medium risk, or where an issue has been identified and remains unresolved.
- GREEN - Projects that receive a green RAG rating are considered low risk, and will have no unresolved issues.
Role of the Assessment Team
The Assessment Team will be responsible for testing and ratifying the assessments presented to them in the project Case Papers.
The Assessment Team will discuss the relative scores of the applications as well as issues and risks associated with the projects, and, importantly, how various combinations of applications will achieve the strategic aims of BEAR Phase 5 (see section 2.1).
The Assessment Team will have discretion to recommend awarding funding to applications that may not necessarily represent the highest ranked, but will deliver on strategic aims – such as geographic spread across Scotland’s AQMAs, number of operators introducing retrofit technology, etc.
The Assessment Team will receive a copy of each eligible application form and a Case Paper for each eligible application. See Annex 4 for an example Case Paper.
At end of year, a Summary Paper will be produced that provides a strategic view, an explanation of scoring process, and a summary of applications funded.
The outline of the Summary Paper is as follows:
- An overview of the strategic aims of BEAR Phase 5.
- An explanation of the scoring process and project impact criteria.
- A complete list of all projects and their respective scores and RAG ratings.
- A list of applications funded.
- An explanation of the rationale behind the funding awards, i.e. an assessment of overall alignment to strategic aims of BEAR Phase 5, value for money etc.
- Proposed key areas of discussion for future schemes.
Awards and due diligence
Following the Assessment, and once Transport Scotland has given final approval, letters providing conditional offers of funding will be issued to successful applicants. Letters will include any conditions set out by the Assessment Team and requests for any outstanding information to support any final due diligence necessary.
Due diligence will ensure the information provided by the applicant organisation is accurate and complete, for example financial information, legal status, vehicle eligibility. It will also ensure that any concerns raised by the Assessment Team have been addressed.
Unsuccessful applicants will be informed of the outcome and offered feedback on their application. Final announcements of awards will be embargoed until all further due diligence has been satisfactorily completed.
Applicants should be aware that the Scottish Bus Emissions Abatement Retrofit Programme Phase 5 (BEAR Phase 5) guidance will be reviewed as the programme evolves and therefore may be subject to change. Transport Scotland reserves the right to amend the published guidance during the period of the programme.
Transport Scotland reserves the right to reject an application where:
- an application is submitted late, is completed incorrectly, is materially incomplete or fails to meet any submission requirements which have been notified to the applicants; and/or
- the applicant (including any partners) are guilty of a material misrepresentation or false statement in relation to its application and/or the application process.
Transport Scotland reserves the right at any time:
- not to consider applications other than those submitted in accordance with the requirements of the application process;
- to issue amendments or modifications to the application documents during the application process;
- to require an applicant (including any partners) to clarify their application in writing and/or provide additional information (failure to respond adequately may result in an application being rejected);
- alter the timetable of any aspect of the application process;
- to not award any grant funding under the BEAR Phase 5; and/or
- to cancel the application process at any time.
Any costs or expenses incurred by an applicant (including any partners) or any other person in participating in the application process will not be reimbursed by Transport Scotland. Transport Scotland and/or any of their representatives or advisors will not be liable in any way to any applicant (including any partners) or any other person for any costs, expenses or losses incurred by any applicant (including any partners) or any other person in connection with this application process.
Change of plans
Should any operator wish to sell, dispose, or repurpose the BEAR retrofitted vehicles within the term of the 5 year commitment following fitment of equipment, operators may write in advance to Scottish Ministers at firstname.lastname@example.org to request a variation in terms:
Alternatively, operators may wish to sell or repurpose a BEAR vehicle within the 5 year commitment term to facilitate the earlier adoption of zero emission buses. As a zero emission bus would also deliver the environmental and air quality objectives of BEAR, operators would therefore not be precluded from applying to replace the bus with a zero-emission alternative, or repowering the bus to be zero-emission, or from applying for subsidy to do so. In such cases operators should write to Scottish Ministers at the above address to gain consent in advance of any change taking place.
In the case of applying for subsidy to replace or repower a bus that has previously been retrofitted with BEAR funding, that should be made clear in the application for subsidy. The ScotZEB Challenge Fund bid form includes a section for information about any buses previously retrofitted with BEAR funding and successful bids will require the consent of Scottish Ministers with respect to replacing those buses within the 5 year commitment term.