Citybus is using secret public funds to buy technology from a company in which its parent owns a significant stake, Transit Jam has learned, with millions of dollars of taxpayers’ money so far channelled into a Fujian-based mainland joint venture providing a double-decker electric bus and a roving “publicity stunt” showcase dubbed as a “hydrogen bus”.
Sources say the latest electric double-decker demonstrated by Citybus was funded by the government’s New Energy Transport Fund (NETF), a slush fund formerly known as the Pilot Green Transport Fund and rebranded in 2020 after reporting irregularities revealed by Transit Jam in 2020 forced an auditor to be fired.
Citybus this summer purchased the high-profile electric double-decker bus from its financial cousin Wisdom Fujian without any competitive tender or public accounting, according to government sources.
While the ownership of companies involved is shrouded in secrecy and offshore structures, public records available show Citybus parent Bravo’s parent company Templewater also owns 51% of Wisdom Fujian. The remaining 49% of Wisdom is owned by Ballard, which has a strategic partnership with Templewater; and which also owns 49% of Weichai-Ballard, the exclusive fuel-cell supplier to Wisdom Fujian.
Templewater is owned by Investec and former Chow Tai Fook executive Cliff Zhang.
While the government admits CityBus has approved funding from NETF for two electric double-deckers in a deal stamped in November 2020, officials from Environmental Protection Department (EPD) refused to disclose the amount or extent of government support for the project.
Nor will the government confirm how CityBus successfully applied for NETF funding for the deal despite its ownership links to the technology seller.
According to the rules of the NETF, “the recipient shall ensure that the subsidised product shall only be purchased from suppliers who are not associates, associated persons of the recipient or from their related companies,” says an EPD spokeswoman.
Transport Department (TD) have stated that the electric double-decker bus “did not involve any cost in the franchise account”, revealing the bus was effectively free for the bus company.
But it is not clear if this is because the government fully funded the bus or if the parent company paid its joint venture outside the franchise account.
For the “hydrogen” bus, the government says no tender was required and there’s no evidence the bus was publicly funded. “Citybus took the initiative to acquire one hydrogen fuel cell bus for test and trial in Hong Kong. Since it involves one bus only for test and trial purpose, it is not material to the bus service and hence tendering is not required,” said a TD spokesman.
Wisdom Fujian has quickly emerged as the only and preferred cleantech supplier to Citybus, and stands to gain a significant order book for Hong Kong’s public transport as Bravo, operating around a third of Hong Kong’s 6,000 franchised buses, pledges to purchase only cleantech buses from 2027.
The technology of the firm has been questioned: one expert called Wisdom’s hydrogen bus “a publicity stunt” as it was towed around various events in Hong Kong last month. And others pointed out design problems with the electric double-decker which reduce bus capacity.
Bravo said its hydrogen bus was the “world’s first tri-axle hydrogen fuel cell bus”. But Transit Jam was refused entry to all events showing the bus to officials and lawmakers and could not independently verify company and media claims that the bus could move under hydrogen power.
That bus was later towed back to the mainland before heading off to an exhibition in Australia.
“This prototype bus is now being returned to the mainland, to conduct further tests and obtain relevant certifications alongside the construction of a full production model,” said Bravo in response to questions on the bus.
Citybus today said it aims to build a hydrogen fuelling station at its West Kowloon Depot, to be operational by the first quarter of 2023.
Under Hong Kong law, hydrogen is classed under the Dangerous Goods Ordinance, and buses fuelled with hydrogen would not be allowed to use highway tunnels or cross-harbour tunnels without first being drained of fuel, observers say.