Delhi Government’s Draft Policy on E-Vehicles

Why in news?

The Delhi government recently released the draft of Delhi Electric Vehicle Policy 2018.

What is the objective?

About 30% of particulate pollution in winter in Delhi is caused by vehicles.
Rapid adoption of zero-emission electric vehicles is therefore of great importance to Delhi.
The policy thus recognises that a new approach is required to kick-start EV adoption in the national capital.
It seeks to put in place several measures that address the key hurdles to EV adoption.

What are the key features?

The policy sets a target that 25% of all new vehicle registrations to be electric by the year 2023.
Incentives - The Delhi government plans to create a significant corpus of funds to incentivise every vehicle segment.
It proposes to offer a subsidy of Rs 22,000 on the purchase of an e-two-wheeler to ensure that its cost is equal or less than the petrol variants.
All incentives are in addition to the incentive offered by the Government of India under the FAME scheme.
Additional fees on non-electric vehicles will fund the bulk of corpus created to incentivise the adoption of electric vehicles.
FAME is the Scheme for Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles, notified in 2015.
The FAME programme incentivises manufacturers, whereas the Delhi government’s scheme incentivises consumers.
Infrastructure - The policy has also committed to strengthen the infrastructure for battery charging and swapping.
This is to ensure provision of access within 3 km range from anywhere in Delhi.
The policy will also seek to promote large-scale job creation in driving, selling, financing, servicing and charging of e-vehicles.
Public transport - The policy focuses on enhancing the quality of public transport rather than on private vehicle ownership.
E.g. e-two-wheelers will also be permitted to provide last-mile connectivity
They will additionally be offered a “scrapping incentive” of up to Rs 15,000 on older two-wheelers.

For e-auto owners, the state proposes a payment subsidy of Rs 20,000 plus an interest subvention of 5%.

For e-cabs, it plans to offer a full waiver on registration fees, road tax and the one-time parking fees.
Passengers who use e-cabs will enjoy a cash-back of up to Rs 10 per trip.
Delhi government also plans to ensure that e-buses will comprise half the fleet of new buses (1,000 of these to be inducted in 2019).
E-carriers, too, will be offered subsidies as well as exemption on restrictions on plying times and parking for light goods e-vehicles.

What is the challenge ahead?

Financing the subsidies would be a major challenge for the government.
The underwhelming experience with CNG (Compressed Natural Gas) vehicles is principally because of the relative dearth of refilling points.
So for e-vehicles, the success depends on the efficiency of the infrastructure i.e. the existence of charging stations.
Power distribution companies have welcomed the plan, on the assumption that they will be able to charge full rates at charging stations.
But the real challenge here is to ensure that Delhi’s discoms have the wherewithal to lay parallel lines for charging stations.
This requires a significant upgrade of capabilities and network management and maintenance.
The discoms say they cannot do so, and demand at least a one-time grant to bolster their networks.
Without this, they will be forced to pass on the costs to consumers, which will disincentivise the use of e-vehicles.
So the state government will have to work closely with the discoms first.
It should ensure that the buyers’ incentive it is building into its e-vehicles has a solid supporting foundation.

Source: Business Standard