A “first of its kind” $12 million electric ferry plying the waters of Wellington Harbour is being hailed as the future of water transport.
Jeremy Ward, CEO of the East by West (EBW) ferry service, says the 19m catamaran - which carries up to 132 passengers between the Wellington CBD and Eastbourne and has been launched with funding from Kiwibank - has saved 220,000kg of carbon emissions in the year it has been operating.
Ward says the ferry is quiet, efficient and sustainable. “It’s the future of water transport, particularly public (water) transport and a first of its kind.”
Ward knew EBW was ahead of the times when, 10 years ago, he started thinking about how to provide a more sustainable ferry service. He explored options in Australia and Europe, but could not find what he wanted.
So, in partnership with Kiwibank, he decided EBW would build its own. He assembled a team of electric transport and boat building experts and work began on what became the protoype for the new business.
Now, EBW has not only built New Zealand’s first electric ferry, but has also assembled the expertise to start a fledgling electric boat business with global ambitions.
“It’s New Zealand, so we just went ahead and did it. It’s cost us a fortune - our annual turnover is around $2 million and we’ve just put a $10m - $12m asset in the water.
“But look at what we have got out of it. While others are still talking about it, we now have New Zealand’s first electric ferry service and, using the boat as a proof of concept, we have a new company building world-leading electric passenger boats.”
EBW General Manager Mat Jonsson says the new ferry’s performance has resulted in the company reducing fuel consumption by about 40 per cent. “It costs about $130 for each of our two diesel ferries to do one return trip. For our electric ferry, it costs $28.”
Made from durable carbon fibre and able to be charged at the wharf between sailings, it has outperformed all its design criteria. It is faster and quieter than expected, has reduced the company’s energy spend by 55 per cent while its carbon emissions saving is far more than expected.
Jonsson believes there is probably another 25 per cent more emissions savings possible on top of the 220,000kg already achieved that “we can get out of it from year two onwards.”
And, Ward says, regular maintenance and replacement savings are significant. “On an ordinary diesel ferry you’d be servicing each engine between shifts and replacing or rebuilding each engine every 15-20,000 hours, (but) with the electric drive trains, there’s no regular servicing and you won’t need to touch them until around 50,000 hours - and then only to possibly check an injector.”
But the project has not been all plain sailing. During the build, EBW dealt with Covid lockdowns, supply chain delays, huge variability in patronage and a much more complicated period of sea trials and commissioning.
As a result, Jonsson says, they needed an understanding, knowledgeable and supportive backer - “which we had in Kiwibank.”
Kiwibank’s Head of Asset Finance, Matt Miller, says the bank tailored its offering to a unique proposition during an equally unprecedented global pandemic . “We did that because we knew what we were going into, which was a startup venture that had a significant amount of the unknown, and so we had to be able to pivot throughout the process.”
Just as the electric ferry is a trailblazer in New Zealand, Kiwibank’s funding is also a trailblazer. Miller says the bank stepped outside its normal asset finance lending focus on the likes of transport, earthmoving, forestry and plant and machinery.
The proposition’s sustainability credentials more than balanced the risk that this had never been done in New Zealand. “We backed it for the right reasons, rather than just saying no it’s too hard.”
He says funding the ferry epitomises the perception shift he is encouraging within his team, and Kiwibank as a whole organisation, by supporting ground-breaking, sustainable projects by Kiwis.
“The way we were able to get this across the line was by asking the right questions up front, and throughout the project, to have a full understanding of the asset and the business. If it wasn’t for extensive research and risk assessment resulting in curated expertise, we wouldn’t have got there.”
Kiwibank was also flexible about the metrics that underpinned its lending. “Normally we would put in place a five-year term for assets like trucks, but the benefits of this ferry will be delivered over a much longer term. The hull will last for 25 years. We’ve structured the loan for the longer term accordingly.”
Above all, Miller says Kiwibank liked the fact that East By West wasn’t just building an electric ferry to impact their bottom line. They were doing it because it was the right thing to do.
“They’ve done it with Kiwi designers, builders, suppliers and expertise, and they now have the intellectual property to replicate it. That’s the real success of this project.”
He says the ferry is a project that has enabled Kiwibank to live its purpose - Kiwi helping Kiwi -and proving the bank’s sustainable values by doing what is right.
Watch the fourth episode in Kiwbank’s series, Business for Better, and learn more about how East by West is leading the way in how they do business for the better www.kiwibank.co.nz/businessforbetter
This article was proudly bought to you by Kiwibank, who believe sustainability and profitability go hand-in-hand when creating a future-proof business. That’s why Kiwibank support Kiwi businesses making a positive impact on the environment, their customers, and their employees. This is business banking for better #ThisisKiwi