Low-carbon mobility-as-a-service converges with energy prosumption for future cities

January 28, 2025

Aerial view of city Seoul at night, South Korea, — Sony 7 r2 Image: © GoranQ | iStock

Isaac Premsingh, Research Director at Everest Group, discusses how low-carbon mobility-as-a-service converges with energy prosumption for the cities of the future

The race toward net-zero cities is transforming the energy-mobility nexus. At least 240 cities globally aim to become carbon-neutral by 2050 or sooner. This is quite significant and ambitious, considering that 70% of the world’s population is expected to live in metropolitan cities by 2050 compared with 57% today. This means an additional 2.5 billion people will reside in urban areas, with nearly 90% of the new city population coming from Asia and Africa.

Today, as powerhouses of economic development and growth, cities consume 78% of the world’s primary energy and generate over 60% of all carbon emissions. The Asia Pacific region, home to some of the fastest-growing cities in the world, is also the largest emitter, accounting for over 62% of global fossil fuel-based carbon dioxide emissions.

Buildings, energy production, and transport are major contributors to city carbon emissions. Of the three, transportation accounts for 20% of all emissions and is directly influenced by consumers’ mobility preferences.

As pressure mounts on governments and municipal local governing bodies to show tangible outcomes aligned with committed net-zero targets, decarbonising cities and urban living has become a strategic priority, particularly for enterprises and service providers developing city-centric clean energy and low-carbon mobility solutions.

The wheels of mobility turn on energy. Daily mobility energy consumption in cities can be influenced by factors linked to population density, city structures, mobility mode optionality, regional economic development, and urban infrastructure quality.

Communities in urban areas with higher population density and a well-connected public transportation system tend to drive fewer miles. For example, in Korea’s Seoul – a city with one of the highest emissions per capita, initiatives taken by the Seoul Metropolitan Government (SMG) to increase the frequency of intracity and town shuttle buses and extended late-night bus operating hours have increased public transport travel by 14% compared to 2021. During the same period, the average daily car trip has become shorter as more than 170,000 city Seoulites joined the Car Mileage Program designed to encourage city commuters to reduce car usage.

However, even with public transit options, over 50% of city miles driven are in personal vehicles – primarily cars. The number of single-occupancy vehicles continues to increase with cities’ GDP growth. This leads to frequent traffic gridlock and increases fuel consumption by up to 40%, contributing to more carbon emissions.

A complete redesign of city mobility concepts is needed to decouple GDP growth from transportation-related carbon emissions. Future city designs for carbon-neutral societies must incorporate a systems thinking approach focused on leveraging synergies and maximising value creation at the nexus of energy and mobility networks.

The challenge is to build low-carbon mobility systems in which ecosystem partners from energy and mobility value chains seamlessly integrate and orchestrate the flow of on demand energy and mobility services with unified stakeholder aspirations and shared outcomes.

Multi-modal shared mobility and energy presumption are two transformative themes emerging at the convergence of energy and mobility value chains. They are driving changes in consumer behaviour and unlocking new opportunities for energy and mobility stakeholders.

Multi-modal shared mobility

Mobility-as-a-Service (MaaS) platforms offering on-demand multi-modal route-optimised transportation services for city commuters are gaining traction. Users can now log into digital mobile apps, type a destination, and choose from a wide range of travel options with real-time insights on the duration of the trip with price comparisons. They can even get rewarded through integrated payment systems for choosing low-carbon transport modes.

Beijing’s MaaS platform exemplifies China’s “Green and Integrated” approach to decarbonising city transport. Since its launch in 2019, the platform has served 30 million users and 4.5 million daily trips, with green transport options like walking, biking, and public transit accounting for 73.4% of total daily trips. A unique feature of the Beijing MaaS platform is its “MaaS Travel Green Life” campaign, which allows MaaS users to receive carbon reduction credits in return for green travel behaviour. Users shifting from private car travel to a bus, metro, or shared electric vehicle (EV) can automatically exchange credits for public transit discounts and shopping vouchers. As of December 2023, Beijing MaaS has reported that 3.5 million users have participated in this campaign, reducing emissions by 400,000 metric tons of CO2 equivalent.

Both automotive OEMs and energy companies are catching up with the MaaS wave through acquisitions or by establishing sub-brands and entering strategic partnerships with other OEMs, public transit operators, and service providers. Traditional energy retailers and fueling station operators are disrupting themselves and futureproofing their businesses by expanding into the shared electromobility space.

Even as MaaS apps experience exponential growth in users, their impact on reducing city carbon emissions is not a direct correlation. Multiple scenarios can be visualised based on differences in city policy framework, vehicle utilisation, degree of electrification, and carbon intensity of the electricity grid. For example, best-case scenarios for deep decarbonisation in China’s cities indicate that shared mobility combined with a vehicle purchase restriction policy could reduce emissions by up to 83% by 2060, which aligns with their net-zero goal.

Energy prosumption

The shift toward shared electromobility in cities collides with energy transition in a big way. While energy efficiency continues to be a focus, future cities will be run by energy prosumers living in integrated energy districts, collectively contributing to grid decarbonisation.

Energy consumers function as individuals or a community by generating energy needs and selling locally stored excess electricity for others’ use.

Possibilities in energy prosumption are expanding as power-to-mobility sector coupling gains momentum. Integration of variable renewable energy (VRE), distributed energy resources (DER), vehicle-to-grid (V2G), and peer-to-peer (P2P) energy trading is enabling the creation of new business models.

Energy utilities are increasing engagement with energy prosumers and shared electromobility service operators to balance the grid and deliver energy on demand. However, establishing an energy infrastructure for prosumption in cities is challenging. New business models are being explored to improve energy generation potential and ensure secure access. These include:

Omni-sharing energy:
- The transition to shared electromobility introduces fundamental changes to vehicles’ where and how energy is produced, stored, and utilised. As cities undergo grid decentralisation, DER with bi-directional energy flows is evolving as the new backbone for future cities. By localising energy generation, storage, and use, cities become less dependent on long-distance transmission grids and more resilient to blackouts. However, dependence on P2P energy sharing using batteries as a resource for backup power is expensive.
- To address this, Tsinghua University in China has proposed a novel omni-sharing business model by which prosumers belonging to DER communities can crowdsource electricity from shared EVs with V2G capabilities through MaaS digital apps. Potential implications of this model on peak-load reduction and self-sufficiency are being evaluated even as new partnerships such as Uber-Wallbox are in play to establish digital communication between vehicles, grids, buildings, and charging networks for ride-sharing drivers.
Telematics-based managed charging:
- The growth in shared electromobility in dense cities aggravates grid instability and burdens the grid as more city EV users charge their vehicles during peak hours (typically late evening), forcing utilities to add more base load capacity to match demand, which is often generated by fossil fuel sources. A study by researchers at Nanjing University in China estimates that the electricity demand of an average household with residential EV charging increases by 7% to 14% during peak hours. This has created a need for intelligent EV charging solutions that avoid peak hours and lower electricity rates for shared EV fleets. Managed charging is a solution that helps optimise EV charging to benefit both the EV driver and the grid.

Traditionally, utilities-controlled EV charging sessions through charging equipment (EVSE). However, the inability to access the vehicle’s state of charge and other critical time-of-use data has made EV behavioural telematics data the preferred source for managed charging programs. With the introduction of Distributed Energy Resource Management Systems (DERMS) and virtual power plant (VPP) software, utilities can now offer managed charging programs that enable city commuters to benefit from dynamically scheduled charging sessions optimised for the least time-of-use rates and grid carbon intensity. China, Japan, India, and South Korea are leading the efforts in V2G integration supported by policies and technical standards to manage rising power demand from residential charging customers.

As cities evolve into net-zero societies, there is an urgent need to transform mobility and decarbonise the grid. The future of urban mobility lies in multi-modal, shared, and electric trips enabled by MaaS platforms, which are already reducing emissions in cities like Beijing. To maximise the impact of multi-modal shared electromobility on emissions, cities should introduce policies that incentivise EV public transport and shared EV users even as automakers prioritise bidirectional charging in EV models and utilities invest in interoperable charging infrastructure to accelerate EV integration with the electric grid.

As technology evolves, the future of low-carbon mobility and energy management in cities raises questions about the role of EVs in shaping a greener, more flexible city grid. As we navigate uncharted waters, it is clear that innovation, collaboration, and a willingness to embrace new paradigms will be essential for building truly sustainable cities.