As awareness of climate change grows, a rising tide of consumers are seeking out more sustainable options in every aspect of their lives – including how they get around. Transportation is one of the largest sources of greenhouse gas emissions globally, accounting for over 24% of CO2 emissions from fuel combustion. And while cycling, walking and public transit are the lowest-carbon ways to travel, many trips still require a car.
Enter Uber Green – the ride-hailing giant‘s answer to environmentally-conscious consumers who want the convenience of an on-demand car without the pollution. Launched in 2019, Uber Green is an option that allows riders to request an electric or hybrid vehicle at only a small premium over a standard Uber ride. By choosing Uber Green, eco-minded consumers can take real action to reduce their carbon footprint while signaling to Uber that demand for greener rides is growing.
The Rise of the Conscious Consumer
Uber Green is part of a larger trend of conscious consumerism, where shoppers are increasingly basing their purchasing decisions on social and environmental values rather than just price and quality. A recent global survey by Unilever found that 33% of consumers are now choosing to buy from brands they believe are doing social or environmental good. And this trend is even more pronounced among younger generations – 62% of 18-34 year olds say they prefer brands that have ethical values and demonstrate authenticity.
In this context, offering sustainable options has become a business imperative for companies hoping to win over eco-conscious consumers. A 2020 report from IBM found that nearly 60% of consumers were willing to change their shopping habits to reduce environmental impact. And 77% indicated that it was at least moderately important that brands were sustainable and environmentally responsible.
Major consumer-facing brands across industries have responded by making high-profile sustainability commitments. Apple has a plan to become 100% carbon neutral for its supply chain and products by 2030. Unilever has pledged to halve its use of virgin plastic and collect and process more plastic packaging than it sells. Fashion retailer H&M aims to use only recycled or sustainably sourced materials by 2030.
The rise of Uber Green and similar electric vehicle initiatives by its competitors represents the sustainable consumption trend catching up to the mobility sector. "Consumers, especially Millennials and Gen Z, are increasingly looking for more environmentally friendly ways to travel," said Tina Moffett, principal analyst at market research firm Forrester. "Ride-hailing companies need to offer green options to cater to this growing segment of eco-conscious consumers."
How Uber Green Works
Here‘s a breakdown of the key features of Uber Green:
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Vehicle requirements: All cars used for Uber Green rides must be either fully electric (BEVs) like Teslas, Chevy Bolts and Nissan Leafs, or hybrids (HEVs) like Toyota Priuses. While they don‘t have to be literally green in color, all Uber Green vehicles must meet stringent emissions standards. Conventional gas-only vehicles are not eligible.
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Pricing: Riders can expect to pay a $1 surcharge on top of the base, time and distance rates for an Uber Green trip compared to a regular UberX. So if an UberX costs $10, the same ride with Uber Green would be $11. Drivers receive an extra $0.50 incentive from the $1 fee for a total of $1.50 extra per Uber Green trip compared to UberX.
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Driver incentives: To encourage drivers to switch to electric vehicles, Uber offers an additional zero-emissions incentive of $1 per trip for fully electric vehicles on top of the $0.50 from the rider surcharge. This means a driver using an EV can earn an extra $1.50 per Uber Green trip, for up to $4,000 per year. Uber has also negotiated discounts with major automakers and charging networks for drivers.
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Availability: As of 2021, Uber Green is available in over 1400 major cities across 60 countries, including most major US and European markets. However, since it requires vehicles with specific emissions standards, it may not be available at all times in all areas compared to standard Uber options. Users can check their Uber app to see if Uber Green is offered in their pickup location.
The Consumer Impact of Uber Green
Since launching, Uber Green has seen promising growth, with over 3.5 million riders taking a Green trip across all markets. In cities like London, which has particularly strong demand for green rides, over 15% of all Uber bookings are now through Uber Green. Of course, this still represents a relatively small portion of Uber‘s overall business – in 2021, Uber recorded over 6.3 billion total trips across all services globally.
But Uber Green‘s impact extends beyond just the individual riders who choose the option. By making low-emission vehicles more visible and accessible, Uber Green helps to normalize and mainstream electric vehicles. It gives curious consumers a low-stakes way to experience an EV firsthand and goes a long way towards challenging outdated stereotypes around electric cars‘ style, performance and range.
Uber Green is also an important part of Uber‘s broader sustainability strategy. The company has committed $800 million in resources to help transition hundreds of thousands of drivers to EVs by 2025. It has also pledged to become a fully zero-emission platform by 2040, with 100% of rides taking place in electric vehicles. While these goals are still distant, each Uber Green ride booked gets Uber a small step closer to achieving them.
"The more consumers choose to ride green, the more they collectively send a powerful signal to companies like Uber about the direction they expect the industry to go," said Don Anair, research director for the Union of Concerned Scientists‘ Clean Transportation Program. "Individual choices can help shape business decisions and government policies that enable cleaner vehicles to become the default."
The Environmental Impact of Uber Green
Transportation is currently the largest contributor to greenhouse gas emissions in the United States, edging out power plants since 2017. Nearly 60% of those emissions come from light-duty vehicles, including cars used for ride-hailing. With electrification, however, emissions from ride-hailing could drop significantly.
A 2020 study by the Union of Concerned Scientists found that ride-hailing trips in electric vehicles produce 53% fewer carbon emissions compared to those in average gas-powered cars. Even when accounting for emissions from electricity generation, an electric ride-hail trip emits about half the emissions of a private vehicle trip.
If Uber meets its target for 100% of rides to take place in EVs by 2040, it would translate to a reduction of 12 million metric tons of carbon dioxide per year, equivalent to taking 2.5 million cars off the road. Assuming linear growth in EV adoption from now until then, Uber estimates its green initiatives could cumulatively reduce carbon emissions by over 60 million metric tons.
But while EVs are a huge improvement over combustion engines, it‘s important to recognize that they are not a panacea. Battery production and disposal come with their own environmental impacts, from mineral mining to waste management. Experts say we will need to pair vehicle electrification with other systemic changes to create a truly sustainable transportation system.
"EVs are a crucial tool for decarbonizing transportation, but they don‘t address other issues like traffic congestion or unsustainable land use," said Anair. "To maximize the benefits of electrification, companies need to make using shared rides more appealing than riding or driving alone. They should also support policies like street redesigns and downtown zero-emission zones that prioritize walking, bicycling and public transit over cars."
Uber Green from the Driver‘s Seat
Uber‘s ability to deliver on its electric ambitions will hinge largely on drivers, since they own and maintain their own vehicles. And many drivers still face significant barriers to EV adoption. The upfront costs of purchasing an EV remain higher than an equivalent gas car, even though lifetime operating costs are lower. Many drivers also lack access to affordable charging and are unfamiliar with the ins and outs of EV ownership.
To address these obstacles, Uber has taken several steps to make EVs more attractive and accessible for drivers:
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EV rentals: Uber has partnered with rental giant Hertz to make up to 50,000 Teslas and other EVs available for drivers to rent by 2023. The weekly rental rate is currently about $330, including maintenance and insurance, with the aim of lowering it to $299 or less. Drivers must have a rating above 4.85 and at least 150 trips to be eligible.
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Charging discounts: Uber drivers receive discounts and exclusive charging rates with major networks like EVgo, ChargePoint, and BP Pulse. For example, EVgo offers Uber drivers $0.30 off per kWh, about a 30% discount. Uber Green drivers in Europe also enjoy free access to certain public charging stations through Uber‘s partnership with the city councils.
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Driver education: Uber has developed an "EV Hub" in the driver app with tools and resources to help drivers decide if an EV is right for them. The Hub includes a savings calculator to show personalized EV vs. gas costs, a charging map to help locate public stations, and guides on how to maximize range and efficiency.
Uber driver Zack Brown decided to switch from a gas car to an electric Nissan Leaf a year ago for his work on the Uber platform in Denver. "At first I was really hesitant because I didn‘t think I‘d be able to make the same money," Brown told me. "But with all the incentives Uber was offering, I decided to give it a shot. And I honestly haven‘t looked back since."
By Brown‘s calculations, he is saving over $500 per month on fuel by charging his EV compared to filling up at the gas station. And he‘s earning about $1,000 more per month in income thanks to the Uber Green surcharges and bonuses. "Plus," he added, "Riders really seem to enjoy the novelty of riding in an electric car. My tips have never been better."
Of course, no universal driver experience exists. Some drivers have reported challenges with vehicle range and charging times. In certain markets with insufficient charging infrastructure, it can be difficult for full-time drivers to find a convenient place to charge in between rides. There have also been reports of Uber abruptly changing EV incentive structures in some cities, leaving drivers frustrated.
The Road Ahead for Uber Green
As Uber Green matures, the company will need to keep refining its driver-facing programs and working with policymakers to ensure charging access keeps pace with demand. It will also need to keep diversifying its EV fleet beyond just Teslas to serve a variety of price points and preferences.
On the consumer side, Uber‘s next challenge will be increasing awareness of and demand for green rides. A Morning Consult survey found that as of 2021, only about 1 in 5 Uber users in the US were aware that Uber Green was an option. And just 10% of Uber customers said they would be willing to wait longer for an electric or hybrid vehicle because of environmental concerns.
But as EV adoption continues to skyrocket globally, this will likely change. Electric car sales more than doubled in 2021 to reach a record 6.6 million vehicles. And forecasts suggest over 50% of new car sales could be electric by 2030. As more of these EVs end up on Uber and become available at little to no extra charge, opting for an Uber Green will become an increasingly obvious choice.
"Much like organic food or recycled fashion used to be a niche for eco-warriors and are now decidedly mainstream, we expect the notion of ‘green rides‘ to become obsolete in the not-so-distant future," said Adam Gromis, Uber‘s global head of sustainability. "All rides will just be assumed to be green by default."
While the transition to a fully-electrified mobility system won‘t happen overnight, Uber Green represents an important stepping stone. And eco-conscious consumers can feel good knowing that by choosing to go electric for their next ride, they are sending a powerful market signal and doing their small part to accelerate the arrival of that greener future. One trip at a time.
