The Government of Delhi had released the draft of Delhi Electric Vehicle Policy on November 27, 2018. Against the backdrop of the worsening air quality in the Capital, it's time to revisit this draft policy and explore measures that need to be addressed for the growth of electric transport infrastructure in the Capital.
The Capital has become a gas chamber, and there seems no end to bad air days for its hapless residents. Among the many factors contributing to the poor air quality, vehicular emission occupies a sizeable chunk, adding to air pollution. The purchase of conventional internal combustion engine vehicles and their use to commute have led to a significant increase in air pollution. The number of registered vehicles crossed the mark of 1 crore in May 2017 in the Capital alone. The city is accumulating 1,400 vehicles daily in the above-mentioned tally, and apart from this, there are numerous vehicles not registered with Delhi's regional traffic office and running on road fearlessly. According to cross border traffic survey, 5.7 lakh passenger and personal vehicles enter the capital daily. All these vehicles emit pollutants which only worsen the air quality. These alarming situations go on to highlight the importance of electric vehicles in addressing air pollution and other climate concerns because they have zero emissions.
The Central government had launched the 'National Electric Mobility Mission' in 2013. Though this mission was designed to aim fuel security and was supported by FAME1 India Scheme for manufacturing of hybrid and electric vehicles in India, and enabling citizens to realize EVs' importance.
Amidst the talks of Central Government for launching a fresh focused policy on electric vehicles at the national level, the Government of Delhi notified a draft of 'Delhi Electric Vehicle Policy 2018' on November 27, 2018, for public comments and feedback. The policy aims to bring down vehicular emissions in order to improve Delhi's air quality. For the same, the strategy seeks to drive quick adoption of electric vehicles in such a manner that the share of registration of electric vehicles will be 25% in the total registration of new vehicles by 2023.
Delhi Electric Vehicle Policy 2018
Keeping in mind the popular transportation segments in New Delhi, it is evident that two-wheelers comprise the two-thirds share in new vehicle registration. In addition, public and private shared transportation modes, namely, buses, cabs, autos, rickshaws, have a large fleet on Delhi roads. A push for electrifying these segments will have positive consequences on the environment. Hence, to coerce the adoption of electric vehicles on a large scale, the policy provides incentives for purchasing and using electric two-wheelers and also supports the electrification of public and shared modes of transportation through its different provisions.
Electric Two-Wheelers
The existing conventional internal combustion engine two-wheeler does not fulfil the BS (IV) Standard; on scrapping and deregistering it, the owner will be incentivized with Rs 15,000. The incentive will be applicable for 2 years from the date of notification of the policy. This incentive will be issued in the form of a certificate that can be redeemed on the purchase of an electric vehicle in the same financial year, provided that the electric vehicle is listed under the FAME India scheme. A customer can avail 'Purchase Incentive' equivalent to 50% of the demand incentive which is being offered under the FAME India scheme.
Additionally, 'Top-up Incentive' of up to 50% of the FAME India incentive will be sanctioned to two-wheelers having swappable battery specification for three years from the date of notification of this scheme.
The Government of Delhi will notify the list of two-wheelers to grant Top-up Incentive. Such electric vehicles will be exempted from registration fee, road tax, and parking fee. Also, these electric two-wheelers can be used for commercial purposes (taxi/rental services) after obtaining necessary approvals. Incentives, as mentioned above, will be functional as per the FAME India policy guidelines. In case incentive provisions under FAME India are being altered, the Government of Delhi will review the additional incentives mentioned under this policy and ensure price competitiveness of the electric two-wheelers with conventional vehicles.
Electric Three-Seater Auto-Rickshaws
The existing three-seater auto-rickshaws (TSRs) that are more than seven years old will be granted Rs 15,000 as incentive upon scrapping, deregistering the vehicle, and surrendering the permits. This incentive will be issued in the form of a certificate which can be redeemed on the purchase of an electric auto in the same financial year provided that the vehicle is listed under the FAME India scheme. The issued incentive certificates are transferrable. Moreover, the permit for older conventional vehicle can be exchanged with the electric auto permit at no additional cost. An open permit can be taken up for electric autos, which means there will be no limit on the number of permits for a particular body or a person.
Electric autos, for the purpose of this scheme, should be configured with advanced swappable batteries, while other specifications will be the same as defined in the FAME India scheme. However, a list of eligible electric autos under this scheme will be prepared and notified by the Government of Delhi. These electric autos will be exempted from registration fee, road tax, parking charges, and auto-rickshaw permit charges. An individual with LMV license and a PSV badge can apply for permits although these permits are non-transferrable.
The Government of Delhi also seeks to drive wide ownership to improve the income of electric auto owners. Hence, it will provide financial support. The provisions of policy provide that 5% of the purchasing price can be taken up as a down payment subsidy. Also, 5% interest subvention will be supported by the government with the capping of Rs 12,500.
Electric Rickshaws
The policy proposes the replacement of lead-acid battery-driven electric rickshaws with new generation swappable battery-driven electric rickshaws. The Government of Delhi will provide a 'Hire Purchase Scheme' under which an individual with a valid license and PSV badge can have an electric rickshaw by paying 5% of the purchase amount. The remaining amount can be paid in the next 36 months with 5% interest rate. However, the list of approved electric rickshaws will be notified by the Government of Delhi for this purpose. The Government of Delhi will also provide financial support through DFC empanelled banks for NBFC. Under the scheme, 10% of the purchase price can be taken up as a down payment subsidy with the ceiling of Rs 20,000. Also, 5% interest subvention will be supported by the government with the loan amount capping of Rs 180,000 and will be granted for three years.
e-Cabs/Autos
App-based service and mobility solution providers will be invited to join the scheme christened as 'App-based e-cab/e-auto user incentive scheme'. These app-based aggregators need to have a fleet of electric cabs or electric autos to offer green rides. The Government of Delhi will offer cashback on such green rides which will be up to 20% of the trip cost with the capping of Rs 10 per ride.
e-Buses
The Government of Delhi looks forward to procuring at least 50% electricity buses out of the total number of buses to be procured in the region from 2019 to 2023. The government is going to purchase the first consignment of 1000 pure electric buses in 2019, which will be a significant addition towards achieving the target of having zero-emission by 50% public transport by 2023. The government will also offer considerable incentives to private bus operators in Delhi for electrifying their fleet.
Charging Infrastructure
Charging infrastructure is a key driver to accelerate the growth of electric vehicle emission. In line with the same, the policy provides significant enabling provision for the public as well as private charging infrastructure. In the case of private charging infrastructure, as most of the end-users park their vehicles at their homes and offices, it is expected that these electric vehicles will be battery charged there. Keeping in mind the same, all renovated and new non-residential, commercial buildings, having parking space for more than ten equitant car spaces should be 'EV ready' by converting 20% of the available parking space into the e-parking zone, with installed e-charging points/stations to charge electric vehicles. Moreover, all renovated and new residential buildings, group housing societies, co-operation, and colonies administered by residents welfare association, having parking space for more than 10 equitant car spaces, should be 'EV ready' by converting 100% of the available parking space into e-parking zone, with installed e-charging points/stations to charge electric vehicles. The existing residential societies and building owners will be encouraged to install one charging point/station for every three equivalent car spaces.
Public Charging Infrastructure
The Government of Delhi aims to provide public charging facility available within 3 km from any spot in Delhi. This needs robust efforts. The entire Union Territory will be unbundled into 11 'travel districts'. These travel districts will be mapped with the existing 'revenue districts'. The Government of Delhi will invite bids from 'Energy Operators' to set up charging stations in the specified travel districts. Successful bidders will be given the right to operate public charging infrastructure in the respective travel district for 10 years.
The Government of Delhi will provide capital subsidy to qualified bidder towards the charger cost and installation expenses. However, no operational subsidy will be provided to the bidder. The qualified bidder will have the liberty to price the service on their own. Technical specifications of charging infrastructure will be defined by the transport department of the Government of Delhi.
The department will lay down these specifications in line with the BEVC-AC001 and DC001 norms. Any alternation on these norms by the Central Government will lead to subsequent changes.
The Government of Delhi shall provide concessional locations in every district for setting up charging infrastructure. These concessional locations will be identified at existing metro stations, bus depots, terminals, public parking zones, and other recognized places to ease out the entry and exit of vehicles. Apart from these concessional locations, the energy operators will also be free to put their charging infrastructure to other sites.
Battery Swapping Operators
The Government of Delhi also looks forward to set up business for battery swapping. Bids will be invited from battery manufacturers and other interested parties to identify three qualified 'Battery Swapping Operators' to operate across the Union Territory. The bidding will be based on two factors: the number of swapping stations a bidder commits to place within 2 years and the price they will charge for per unit kWh power from users, including all fixed and variable costs. The qualified battery service operators will be able to install and operate the battery swapping stations within existing metro stations, bus depots, terminals, public parking zones, and other recognized locations. The space at these recognized locations will be allocated by the government on minimum lease rental. The battery swapping operators can also operate these stations in collaborations with energy operators. They will also be free to run the swapping kiosks through franchisees or business associates.
Battery Recycling Ecosystem
An electric vehicle requires two batteries in 10 years of its lifespan. Electric vehicle batteries need replacement once they get degraded 70-80% to their capacity. To prevent high environmental cost, the policy will drive reuse and recycling of these batteries. The policy also gives responsibility to 'Energy Operators' and 'Battery Swapping Operators' to act as 'end of life battery recycling agencies'. Any electric vehicle user may deposit the degraded batteries to any charging station or battery swapping station. In lieu of that, the user will be reimbursed at a considerable price. A nodal agency appointed by the government shall purchase and aggregate such batteries that have degraded to 70% of their capacity. These batteries will be sold out to renewable power generators for using them as power banks for storing renewable energy.
On the other hand, batteries that cannot be used further and have reached their end of life will be sent for recycling. During the recycling process, high-value battery material (cobalt and nickel) will be fetched out and then these batteries will be sold out to battery manufacturer for re-use. In this regard, the government shall also invite bids for establishing battery recycle business in the city.
Special Support from Power Sector
The Delhi Electricity Regulatory Commission in Tariff Schedule 2018–19 identifies the tariff applicable for energy operators and battery swapping operators to run their respective stations. It is mentioned that power be provided on Rs 5.50/kWh, whereas the time of day rebates will also be applicable. The Government of Delhi will endeavour to maintain this special tariff identical for the entire duration of the policy. The Delhi Government also seeks to provide the facility of open access without conditioning the provision of a minimum 1 MW contract demand. The government will also facilitate the Energy Operators and Battery Swapping Operators with 'Power Banking' by means of which the operators can establish the captive renewable power generating plants and can exchange power from the second person as and when needed.
Concept of 'Feebate'
The Transport Department, Government of Delhi will disseminate real-time information about the public charging infrastructure. The government will use 'feebate' concept to provide an additional support arm to this policy by which vehicles with conventional fuels will be charged 'fee' while electric vehicles will receive 'rebates'. A pollution cess will be applicable from April 2019 on all petrol and diesel engine vehicles. As diesel is pollutes more than petrol, the pollution cess on diesel engine vehicles will be on the higher side.
On the other hand, all internal combustion engine vehicles will have to pay additional air quality parking surcharge on existing parking fare. These vehicles will also need to pay extra road tax. However, all these surcharges and fees will be reviewed and revised once every year. The revenue collected from these taxes and surcharges will be credited into the State Electric Vehicle Fund.
Even though the Delhi Electric Vehicle Policy 2018 does not support hybrid vehicles, but it significantly focuses on the transportation segments which are being used by the citizens for the last mile connectivity. The policy tries to address various key hurdles for the adoption of electric vehicles by incentivizing the purchase and use of electric vehicles and by providing adequate e-infrastructure. The policy also foresees the creation of significant job and training opportunities. And against the backdrop of poor air quality, it becomes pertinent to revisit the draft policy and give it a leg up.
(The author is a Research Officer in the Economics Division of Central Electricity Regulatory Commission. His areas of interest are Energy Management, Regulatory Framework of Energy Sector, Sustainable Development, Qualitative Research Design and Methodology. He can be reached at atulagrawal@cercind.gov.in; The article was first carried in the Jan-June issue of Energy Future)
1 FAME (Faster Adoption and Manufacture of (Hybrid and) Electric Vehicles) Scheme was launched by the Ministry of Heavy Industries and Public Enterprises in 2015.