Clean Tech

EV Adoption: With a li’l help from friends

Preeti Mehra | Updated on July 11, 2021

Sops: for e-mobility adoption under the two FAME schemes have not made a significant difference yet   -  V RAJU

Companies spell out their policy wish-list — from subsidies for private e-bus fleets to legalising e-bike taxis — for green mobility to kick in

If the government wants to keep its 2030 deadline for 100 per cent electric mobility in the country, it must listen to the 30-odd corporations that have spelt out the policy tweaks they require to lend a helping hand. Key policy intervention, they say, will enable them to participate in the EV adoption mandate and help the government lower carbon emissions to meet its obligation under the Paris climate accord.

Some may call it a gentle nudge, but this time round, instead of beating around the bush, corporations have laid down the specifics. The paper, ‘Policies for India’s global leadership on EV adoption’, brought out recently by the World Business Council for Sustainable Development (wbcsd), makes clear what businesses see as the way forward and how, if given the opportunity, they can support both emissions reduction and energy security.

At the outset, industry would like to see the country set a national electric vehicle (EV) target — an EV sales target or a target to phase out internal combustion engines. “…a clear timeline and roadmap for implementation can provide certainty and galvanize action across policy and market,” the paper says.

All eyes are also on the government schemes that are intended to accelerate an EV ecosystem. FAME I (Faster Adoption and Manufacturing of Hybrid and EV) was introduced in 2015 with an outlay of ₹895 crore, and the ongoing FAME II in 2019 with a ₹10,000-crore fund. The two schemes largely offered subsidies for two- and three-wheelers, hybrids, e-cars, e-buses, and for setting up charging infrastructure. Though the schemes made a little headway, they have not made a significant difference yet.

Powering private e-buses

In the FAME II scheme, a budget of ₹3,550 crore has been allocated for e-buses, but only for public transport. The corporations feel they could participate actively in the electrification process if private e-buses, too, were included in the subsidy scheme. They argue that this would be a win-win for the government and private players, as state transport undertakings own only 10 per cent of the 1.7 million buses in India. With subsidies, private fleet operators could add to the e-bus numbers.

“Providing subsidies to only State Transport Undertaking-run buses limits the early transition opportunity for private players running buses with higher utilization (180–200+ km/day) for use cases such as employee transport, school buses and airport transfers. Many companies, such as Shuttl40 and Lithium41, have already expressed interest and are adopting EV buses for the employee transport segment. Similarly, there is latent demand from forward-looking corporate customers who are encouraging their fleet partners to consider e-buses,” says the report.

Retrofit advantage

While industry must be happy that FAME II was recently extended by two years, up to mid-2024, it would like it expanded to cover fuelling technologies such as battery swapping and business models that retrofit fossil fuel vehicles into EVs.

The argument is that encouraging retrofitting of internal combustion vehicles can help in several ways. One, it will increase the lifecycle of the vehicle while also reducing the manufacturing environmental footprint. Second, as retrofitting is cheaper than buying a new EV, more owners will go for it, thus also increasing the demand for charging stations. In the short term, it would also roll out EV options for small and medium commercial vehicles.

The report further recommends waiving toll fees and airport charges for those who invest in EVs. Currently, only six states including Karnataka, Maharashtra and Tamil Nadu have waived road tax on EVs. Pointing out that the draft toll policy prepared by the National Highways Authority of India (NHAI) proposes a 50 per cent concession in toll fees for EVs, the report calls for its implementation.

The non-fiscal incentives suggested include instituting low-emission zones in cities, relaxing the daytime entry of EV urban freight, legalising e-bike taxis and streamlining the licensing of e-bike rentals across states.

Enabling access to clean energy is envisaged as an important requirement. “EV charging demand is currently scattered and disaggregated. Liberal regulations to aggregate demand for charging stations to allow usage of renewable energy through open access or lowering the open access threshold for charging operations would allow India to power its energy transition for mobility,” the report advises.

Besides this, as always, best practices are proposed. These reiterate the importance of establishing market rule, harmonising policy across government ministries as the electrification process involves the coming together of several crucial departments, and, lastly, providing a level playing field while formulating policies.

Preeti Mehra

Published on July 11, 2021

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