Delhi government’s electric vehicle policy: Paving the road for EVs

The Delhi government’s electric vehicle (EV) policy is, in many respects, a progressive one. Apart from handsome incentives—a Rs 1.5 lakh incentive for the first 1,000 electric cars, upto Rs 30,000 for two-wheelers and autos, scrapping incentives for old fossil-fuel vehicles (including CNG-powered ones) and waiver of road tax and registration charges on top—the policy puts the onus on the NCT government to drive EV adoption too. The government will have to ensure that at least half of the new buses it purchases between 2020 and 2024 have to be electric. The policy has also included large fleet operators in its vision, such as delivery services; they will have to convert 50% of their two-wheeler fleet to EVs by FY23 and 100% by FY25. This step, along with the incentive plan, are significant given two-wheelers account for nearly two-thirds of new vehicle registrations in the national capital. The NCT government hopes the policy will mean nearly a fourth of the new vehicles registered by 2024 are EVs, with significant reduction of pollution in Delhi apart from significant national savings in terms of decreased fossil fuel imports.

Through the policy, the government is also front-footing efforts to create the support infrastructure—charging points, battery disposal, etc. While the first 30,000 private charging points will receive an incentive of Rs 6,000 each, the policy envisions creation of public charging and battery swapping points every three kilometres throughout the city, with “bare minimum lease rentals” for companies to set these up and full refund of SGST for purchase of swappable batteries by them. It also aims to create a recycling ecosystem, involving battery and EV manufacturers that have the capacity to extract reusable matter from spent batteries.

The Delhi government, however, needs to keep two things in mind. Including mass transit vehicles, such as buses, would have had a large impact on controlling pollution, and faster. So, while the NCT government looks to add a large number of e-buses to its fleet, allowing private operators to ply e-buses in the city, with incentives, could have been considered. Phase II of the Centre’s FAME India scheme offers incentives to public sector transport corporations, like the Delhi Transport Corporation, on an operations-cost basis—that is, on the basis of the cost of running of electric bus in Rs/km “for the minimum assured run per year and for a specified contract period”. The maximum incentive for a standard-sized bus is capped at Rs 55 lakh. The NCT government could have planned a similar incentive for private operators, or at least set a more ambitious e-bus addition goal for itself given some of the e-buses it will add over the next few years could be eligible for the FAME Phase II incentives. The other concern is on an efficient energy mix; given Delhi’s power supply is largely thermal (with most of it coal-based), the impact on pollution may not be all that is imagined.