The Delhi government’s draft policy on e-vehicles (EVs) deserves credit for displaying a serious intent to combat vehicular pollution, one critical component in the smog that envelops the city for most part of the year.

Details of the policy –

  • The broad thrust of the policy is to target that 25 per cent of all new vehicle registrations be electric by 2023.
  • To make it a reality, the Delhi Government is offering subsidies for auto, two-wheelers and e-buses that would be over and above the central government’s Faster Adoption for Manufacture of (Hybrid and) Electrical Vehicles, better known as FAME.
  • The FAME programme incentivises manufacturers. The Delhi government’s scheme incentivises consumers.
  • It also 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.

Salient features the scheme –

  • The scheme focuses on enhancing the quality of public transport rather than on private vehicle ownership.
  • For instance, e-two-wheelers will also be permitted to provide last-mile connectivity, and they will be additionally 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 per cent.
  • For e-cabs, the government 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.
  • The state government also plans to ensure that e-buses will comprise half the fleet of new buses (1,000 of these are to be inducted in 2019).
  • E-carriers will be offered subsidies as well as exemption on restrictions on plying times and parking for light goods e-vehicles.

Critical issues –

  • However, it is unclear how much this would cost the state or how the state government plans to finance these subsidies.
  • There is no clarity over the issue of access to charging stations i.e. critical e-infrastructure.
  • Power distribution companies may have welcomed the initiative but the real challenge here lies in the fact that if Delhi’s discoms have the wherewithal to lay parallel lines for charging stations.
  • As per the argument of Discoms, they will need at least a one-time grant to bolster their networks, otherwise, they will be forced to pass on the costs to consumers, which will disincentivise the use of e-vehicles.

Conclusion –

The state government will have to work closely with the discoms first, so that the buyers’ incentive it is building into its e-vehicles has a solid supporting foundation.

SourceBusiness Standard

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