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Electric scooters have become a fixture in Melbourne’s CBD over the past few years, with the rent-and-ride model offering many Victorians a convenient, affordable and environmentally friendly alternative to cars and other transport options.
However, their growing popularity has also raised concerns about safety and misuse, leading Melbourne City Council to recently decide to ban shared e-scooters entirely in the city.
Melbourne’s ban is an important reminder that for emerging circular business models to be successful and sustainable, they must prioritise the basic needs of their customers and communities – in this case, safety.
So what does this ban say about the viability of circular business models in Australia – and could it ultimately hinder Australia’s transition to a circular economy?
The current state of circular economy in Victoria
In 2020, the Victorian Government launched its Circular Economy Plan to transform our waste and recycling system, improving how we use and reuse resources, and manage waste that cannot be recycled.
The plan also strengthens the central role of Victorian businesses in this transition, encouraging business owners to adopt a PSS model, where consumers pay a usage fee for products and businesses take responsibility for maintenance and end-of-life management.
The City of Melbourne has been pioneering in this area, launching the Kensington Circular Economy District earlier this year to provide incentives to businesses keen to adopt circular economy solutions.
Despite these developments, Melbourne’s ban on e-scooter rentals could set a precedent beyond the transport sector, with wider implications for the adoption of circular business models.
A popular part of Victoria’s transport network
E-scooter rentals were first introduced in 2022 when Victoria partnered with Lime and Neuron Mobility. After a two-year trial, the Victorian government permanently legalized shared e-scooter rentals across the state.
Neuron Mobility has become the leading provider of rental e-scooters in Australia and has since announced a series of new safety features to give councils control over where their e-scooters can be ridden, including helmet locks, data sharing and geofencing technology (creating virtual geographic boundaries).
Lime’s electric scooters have been introduced in major cities in Australia and New Zealand, with more than 15 million trips made in both countries to date.
Interestingly, Lime’s electric scooters and e-bikes have travelled more than 25 million kilometres across both countries, the equivalent of driving the distance from Melbourne to London almost 1,500 times.
The Victorian government initially extended the trial of shared e-scooters by six months, but the City of Melbourne decided to end its contract with a shared e-scooter provider early, citing ongoing safety concerns.
There are similar examples in Queensland, where the Sunshine Coast Council recently halted its experiment, following the example of Melbourne, Paris and many other cities around the world.
However, despite Melbourne’s ban, several councils in northern Victoria are forging ahead with their own rental schemes.
Moving away from the “take, make, throw away” approach
Shared e-scooters encourage more efficient use of resources by reducing the amount of time the products sit idle, a common issue with private ownership.
It would also significantly reduce the demand for individual e-scooters, thereby reducing the consumption and extraction of virgin (unprocessed) materials and moving away from the traditional “take-make-dispose” production cycle.
Product pooling, where multiple users share a product, can reduce environmental impact by up to 50%.
However, despite its ambitions and benefits, the PSS model does not always achieve the desired environmental benefits.
Research has shown that the lack of ownership in the PSS model means users may treat the product less carefully and increase the likelihood of vandalism, which in turn shortens the product’s lifespan and places higher demands on materials and manufacturing.
Future circular business models need “fine-tuning”
The success of circular business models, including shared e-scooters, depends on understanding the value proposition they offer to the general public and how the model works in practice.
For the shared electric scooter business, the value proposition is that it offers a low-cost, low-emission, and innovative transportation option that is accessible to people living in urban areas.
The decision to ban them stems from a significant mismatch between their value proposition and an essential customer need, in this case the safety of their users and the general public.
In large cities like Melbourne, shared electric scooter services have great potential to encourage resource sharing and improve urban mobility.
However, successful implementation requires careful consideration of, and collaboration between, the interests and needs of both clients and councils.
Instead of a ban, city councils could take practical steps to regulate the use of e-scooters, such as creating designated parking zones and putting strict geo-fencing restrictions in high-traffic areas.
Cities can also improve micromobility infrastructure by creating dedicated lanes for e-scooters, allowing users to ride safely without disrupting pedestrian or vehicular traffic.
Only with continued “fine-tuning” and support from the city council can circular business models like shared e-scooters have the potential to operate safely and sustainably.
Courtesy of the University of Melbourne
Source: What the electric scooter ban implies for Australia’s circular economy (September 24, 2024) Retrieved September 24, 2024 from https://techxplore.com/news/2024-09-scooter-australia-circular-economy.html
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