Government-owned NBFC, Power Finance Corporation (PFC) has inked an agreement to finance the deployment of 250 buses across nine cities in Uttar Pradesh. The initiative is part of the FAME-II scheme.

PFC on Wednesday signed an agreement to lend ₹275 crore for deployment of 350 electric buses across nine cities of Uttar Pradesh. The agreement was signed with GreenCell Mobility, which is an e-mobility platform supported by the governments of India and the UK to boost adoption of electric vehicles in the country. The buses will be deployed in key cities of UP including Agra, Meerut, Aligarh, Bareilly, Ghaziabad & Mathura.

FAME-II scheme

India has launched FAME-II scheme with an allocation of ₹3,500 crore for promotion of adoption of electric buses. Electric buses offer sustainable mobility solutions by tackling challenges of poor air quality and also reducing carbon footprints of the nation.

The upfront cost of electric vehicles (EVs) is higher than the Internal Combustion Engine (ICE) vehicles. However, the operational cost of electric vehicles is lower than ICE vehicles. Besides, EVs are being supported by way of demand incentives under FAME India scheme to reduce the cost difference between the electric vehicles and ICE vehicles.

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To promote EVs in the country, the government increased the demand incentive under FAME-II scheme to ₹15,000/KWh from ₹10,000/KWh with an increase in cap from 20% to 40% of cost of vehicle, enabling cost of electric two-wheelers to come at par with ICE-two wheeler vehicles.