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CSE welcomes notification of Electric Vehicle Policy by Delhi government

Aim is to achieve 25 per cent electrification of new vehicle fleet by 2024 

  • Notification gets legal backing for time-bound implementation
  • Can have a national spin-off as Delhi is a major vehicle market
  • Transformation of Delhi market can create upward pressure for zero emissions mandate for the automobile industry
  • Requires disciplined milestones for time-bound implementation to achieve stated targets and raise the level of ambition
  • Commendable that the COVID-19 related economic crisis has not come in the way of this decision, says CSE 

New Delhi August 7, 2020: Centre for Science and Environment (CSE) has welcomed the notification of Electric Vehicle Policy by the Delhi government to achieve the target of 25 per cent electrification of new vehicle fleet by 2024. Within three years, 25 per cent of all new vehicle registrations will be battery-operated electric vehicles. This is expected to transform the market from the current level of electrification. According to the VAHAN database of the Ministry of Road Transport and Highways, electric vehicles were only 3.2 per cent of the new vehicles registered in Delhi in 2019-20.  

Says Anumita Roychowdhury, executive director-research and advocacy, CSE and head of the Centre’s air pollution and sustainable mobility programmes: “It is commendable that this much-awaited notification has happened despite the ongoing COVID-19 crisis and economic slowdown. In fact, this policy is being seen as a stimulus strategy to boost jobs and economy.” 

“This step in Delhi can not only accelerate zero emissions trajectory to reduce air pollution and toxic emissions from internal combustion engines, it can also have a national spin-off. According to the last available Road Transport Year Book of the Ministry of Road Transport and Highways in 2016-17, Delhi is ninth among all states and top among all cities in terms of cumulative vehicle registrations,” adds Roychowdhury. 

The proposed 25 per cent transformation of Delhi’s new vehicle market can catalyse electric vehicle production and bring more product diversity, say CSE experts. State-level action is critical to achieve nation-wide scale. The incentive programme designed by the Delhi government is additional to the Central government’s already existing incentive scheme called FAME II. This combination is expected to make the incentives package more attractive in Delhi. 

This intervention is critical at this moment given the devastating impact of the lockdown and pandemic on the overall vehicle market, especially the electric vehicle market. CSE’s analysis of the VAHAN database shows that while overall vehicle sales have nosedived during the lockdown period, electric vehicles had plummeted even lower, especially when the country went into a lockdown. Nationally, the registration of electric vehicles dropped by a whopping 93.4 per cent between March and April 2020. 

But, the sector recovered to some extent, registering a seven-fold increase between April and July, although the numbers were still less than about 50 per cent of the March 2020 registration level. In Delhi, the impact of COVID-19 lockdown on electric vehicle registration was just as bad, reducing it by 89 per cent between March and April 2020, while recovering in June and July. The challenge, therefore, is to recover from this abysmally low level to meet the 25 per cent target by 2024.

 This notification sets the stage for greening of the economic recovery, says Roychowdhury. 

Aligns with global trend
It is encouraging that Delhi’s move aligns with the global trend in which several major vehicle markets have stayed on course to continue to support the electric vehicle programme despite the economic slowdown. Most notable is the European market where, because of the incentive programme and strong requirement of low carbon emissions from vehicle fleet, electric vehicle sales have remained robust. While the overall sales of IC engine-powered vehicles have reduced across Europe by 52 per cent in March 2020 compared to March 2019, the electric vehicle market share has increased overall to reach an all-time high market share of 10 per cent (average for all manufacturers) by March 2020. This has been further spurred by the increased purchase incentives in several countries including Germany, France and Spain favouring electric vehicles. 

Meet the milestones
It is now important that the Delhi government refines the strategy for implementation to meet the milestones for incentives, charging network and requisite infrastructure to achieve this target by 2024. 

It is hoped that the economic recovery nation-wide will include fiscal stimulus to accelerate the electric vehicle programme. 

Here are the key highlights of Delhi’s newly notified electric vehicle policy that requires time-bound implementation. 

Two-wheelers:

  • A purchase incentive of Rs 5,000 per kWh of battery capacity (advanced battery), maximum incentive of Rs 30,000 per vehicle.
  • Owner to get Rs 5,000 per vehicle for scrapping old ICE two-wheelers.
  • Conversion of 50 per cent and 100 per cent of all fleet used by delivery services 

E-autos:

  • A purchase incentive of Rs 30,000 per vehicle (advanced battery)
  • Interest subsidy of 5 per cent on loans and/or hire purchase scheme for e-auto
  • Registered e-auto owner to get Rs 7,500 per vehicle for scrapping old vehicle. 

E-rickshaws and e-carts

  • A purchase incentive of Rs 30,000 per vehicle for purchase of one e-rickshaw and e-cart. Additionally, interest subsidy of 5 per cent on loans on vehicles with advanced battery. 

Buses:

  • Conversion of 50 per cent of all new stage carriage buses (all public transport vehicles with 15 seats or more) by 2022. 

Goods carriers:

  • A purchase incentive of Rs 30,000 per vehicle for the first 10,000 e-carriers (applicable on advanced battery vehicles). Interest subsidy of 5 per cent on loans etc. Registered e-carrier owner to get Rs 7,500 for scrapping old IC vehicles. 

Four-wheelers:

  • A purchase incentive of Rs 10,000 per kWh of battery capacity (advanced battery), and maximum incentive of Rs 1,50,000 per vehicle shall be provided to the first 1,000 e-four wheelers. 

Applicable to all vehicle segments:

  • Complete removal of road tax and registration fee for all battery electric vehicles.
  • For swappable technology – if battery is not sold along with vehicle, then 50 per cent purchase incentive shall be provided to vehicle owner and the remaining 50 per cent shall be provided to the energy operator.
     

To know more about our work on clean air and electric vehicles and talk to one of our experts, contact Sukanya Nair of The CSE Media Resource Centre, 8816818864, sukanya.nair@cseindia.org

 

 

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