India: E-Vehicles In India

Last Updated: 11 June 2019
Article by Ashima Obhan

According to the World Health Organisation, for the year 2016, more than 25 Indian cities are within the 100 most polluted cities in the World1. The State of Global Air 2017 report quotes that India accounts for the second highest number of premature deaths due to air pollution in the world2. On 2nd May 2018, India Today's headlines read as3, "According to the report of World Health Organisation, about 90 percent of the world's population is exposed to dangerous levels of pollution and 14 of world's 15 most polluted cities are in India." In a view to minimize the ill effects of pollutions, policy makers of India have been strongly promoting the idea of electric vehicles.

Simply put, electric vehicles, unlike a normal car which uses diesel/petrol, uses energy stored in its rechargeable batteries to run. There are mainly three types of electric vehicles; hybrid electric vehicles, which are powered by both petrol and electricity; plug-in hybrid electric vehicles; and battery electric vehicles.

Policies that govern the path of Electric Mobility in India

An abundance of renewable resources of energy, availability of skilled manpower and infrastructure has aided the Government of India ("Government") to formulate various policies in order to pave way for electronic mobility.

In 2011, the then Government had come up with the National Mission on Electric Mobility ("NMEP") and had cleared the proposals for setting up of a National Board for Electric Mobility and National Council for Electric Mobility. Further in August 2012, the National Electric Mobility Mission Plan, 2020 ("NEMMP") was initiated which was launched in the year 2013. NEMMP had set a target of deploying 5 to 7 million electric vehicles in the country by 2020. The Automotive Mission Plan, 2026 ("AMP"), a collaboration of the Government and Department of Heavy Industry ("DHI"), has been initiated with an aim of developing a ten year road map for vehicles, auto components, and tractor industries in terms of size, contribution to India's development, global footprint, technological maturity, competitiveness, institutional structure and capabilities. The AMP wishes to become a significant contributor to the Skill India programe and an igniting engine to the Make in India initiative.

As a part of NMEP, the DHI on 13th March 2015, notified a scheme namely, FAME -India (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India) ("FAME"). As the name suggests, the intention behind FAME has been to support the market development and the manufacturing eco-system of the hybrid/electric vehicles for the purpose of achieving self-sustenance. The major focus areas of FAME have been technology development, demand criterion, pilot project and charging infrastructure. Phase I of FAME commenced in the year 2015 and was extended till the end of the financial year 2018-2019. FAME was drafted in a very descriptive manner providing the process of implementation, the energy utilization criterion, fuel consumption targets, nodal agency operating the scheme among others.

After a successful stint with the phase I of FAME and reviewing the scope of improvement in the same, the DHI, through an office memorandum dated March 8, 2019, notified phase II of the FAME India Scheme ("FAME II"). FAME II came into effect on April 1, 2019 and will be implemented for a period of three years for faster adoption of electricity mobility. Additionally, an inter-ministerial empowered committee, the 'Project Implementation and Sanctioning Committee' headed by the Secretary (Heavy Industries) will be constituted for the overall monitoring, sanctioning and implementation of this scheme. An outlay of ₹10,000 crore for a period of three years, has been welcomed through FAME II. This scheme has been planned to be executed through the following three verticals:

  • Demand Incentives

FAME II is applicable to buses (only electric vehicle technology), four wheelers (electric, plug in hybrid and strong hybrid), three wheelers (electric) including e-rickshaws and electric two wheelers. This incentive is based on the capacity of the battery which is used in these vehicles. The fundamental purpose is the promotion of public transport and vehicles registered for commercial purposes. It is an important component of FAME II which directly aids in the generation of the demand for the electric vehicles by way of reducing the cost of acquisition of such vehicles.

  • Establishment of network of charging stations

FAME II envisages establishment of adequate public charging infrastructure in order to instil a sense of confidence amongst the electric vehicle users. It has been proposed that a slow charging station for each electric bus, and a fast charging station for every ten electric buses shall be provided. A funding for 100% of the costs of establishing charging infrastructure, on a case-to-case basis has also been promised with.

For the betterment of the charging infrastructure policy, there have been amendments made to the Model Building Bye laws 2016 and Urban Regional Development Plans Formulation and Implementation Guidelines 2014, making provisions for establishing electric vehicles' charging infrastructure.  The Government also issued Charging Infrastructure for Electric Vehicles – Guidelines & Standards Regulation on December 14, 2018 ("Guidelines").  According to these Guidelines, there will be at least one electric vehicle charging station in a grid of 3 kms and on the highways, there will be an electric car station every 25 kms. Most importantly, the setting up of these charging stations will be a de-licensed activity. The charging stations will also be free to obtain electricity from any power company through the open access system. The Guidelines also state that the current fuel filling stations will be given priority to set up these electric car charging stations. And above all, company owned, and company operated pumps will get even further priority over privately owned pumps.

As per reports4, Indian Oil Corporation has partnered with Fortum India for founding these charging stations. The corporation has signed agreements with NTPC, Power grid and Rajasthan Electric as well. Hindustan Petroleum also states that it will be setting up charging stations across its networks, tying up with Tata Power to create the infrastructure.

  • Administration of FAME II

For a thorough implementation of FAME II, knowledge partners, technical expertise and other logistic support shall be put in place. Consumer awareness will be created, and activities related to information, education and communication shall be undertaken.

States that are treading towards Electric Vehicles

  • Karnataka

Karnataka was the first state5 to introduce a policy solely dedicated to electric vehicles – the Karnataka Electric & Energy Storage Policy, 2017 ("Karnataka Policy"). The Karnataka Policy aims to create a conducive environment for transition to electric vehicle environment from internal combustion engines. The key objective of the Karnataka Policy is to maintain the lead share of Karnataka as a preferred destination for attracting investments in manufacture of electric  vehicle.

  • Delhi

The capital of India has in place the Delhi Electric Vehicle Policy 2018 ("Delhi Policy") which has waived off road tax, registration fees and MCD one-time parking fee for all electric two-wheelers with an advance battery, e-autos. The Delhi Policy further commits to  pure electric buses being at least 50% of all new state-carriage buses procured for the city fleet including for last mile connectivity, starting with the induction of 1000 pure electric buses in 2019. This will help achieve a target of making 50% of the public transport bus fleet zero emission by 2023.

  • Maharashtra

Maharashtra's Electric Vehicle Policy 2018 ("Maharashtra Policy") aims at creating an amicable environment for the manufacture of 5,00,000 electric vehicles in Maharashtra within the next five years. Additionally, the Maharashtra Policy proposes exempting e-vehicles from road tax and registration charges. A 15% subsidy will also be provided to the first 1,00,000 owners of the electric vehicles registered in the state.

Uttar Pradesh, Kerala, Telangana, Andhra Pradesh, Uttarakhand are some other states which have recently come up with policies and regulations for the upliftment of the electric vehicles.

Car Manufacturers that are en-route the road to Electric Mobility

Several public sector undertakings, the railways and various ministries are in the process of creating robust infrastructure and manufacturing components for electric vehicles. Plans are underway to fuel electric vehicles with clean power. Industries are also exploring solar-plus technology. Indian Railways with the assistance of the private sector, has decided to allocate space for electric charging places at the station parking lots6.

NITI Aayog, the policy think tank that has been actively working on laying a permanent foundation for electric vehicles, has issued a draft concession agreement for Public Private Partnership in operation and maintenance of electric buses in cities.

Several big automobile manufacturers are now aiming at an all-electric future and have thus started swinging in electric and hybrid vehicles in the country. As revealed by the ETAuto.com7, home-grown carmakers like Tata Motors and Mahindra & Mahindra are planning on bringing the compact versions of electric car in the coming two years. Maruti Suzuki is planning on launching the electric version of its compact hatchback Wagon R in the year 2020. Hyundai Motor India is also keen on coming up with an electric SUV Kona in the second half of 2019. Similarly, Audi and Jaguar are also scheduling the launches of their respective vehicles.

Footnotes

1 WHO Global Urban Ambient Air Pollution Database (Update 2016), http://www.who.int/phe/health_topics/outdoorair/databases/cities/en.

2 State of Global Air, HEI and IHME, Accessed on 8 March 2018

3 https://www.indiatoday.in/education-today/gk-current-affairs/story/14-worlds-most-polluted-15-cities-india-kanpur-tops-who-list-1224730-2018-05-02

4 https://www.business-standard.com/article/companies/ministries-psus-power-firms-gear-up-to-charge-india-s-electric-vehicles-119042100203_1.html

5 http://www.indiaenvironmentportal.org.in/content/450017/karnataka-electric-vehicle-energy-storage-policy-2017/

6 https://www.business-standard.com/article/companies/ministries-psus-power-firms-gear-up-to-charge-india-s-electric-vehicles-119042100203_1.html

7 https://auto.economictimes.indiatimes.com/news/passenger-vehicle/cars/here-are-11-electric-cars-that-will-be-launched-in-the-next-two-years/68705794

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