SMEV suggests that subsidy offered by govt can be utilised most efficiently if two and three-wheelers are promoted initially and gradually bus segment should be shifted to electric once proper infrastructure built
New Delhi: The society of manufacturers of electric vehicles (SMEV) in its meeting with the officials of government think-tank NITI Aayog and ministry of heavy industries in the last week of February has suggested that the union government should focus on promoting electric two-wheelers, three-wheelers and four-wheelers (cabs) initially since that makes more sense economically and are easy to implement, according to a presentation submitted by the lobby group.
SMEV suggested that the subsidy offered by the union government can be utilised most efficiently if the above mentioned segments are promoted initially and gradually the bus segment should also be shifted to electric once proper infrastructure built. According to two people directly aware of the development, the officials of NITI Aayog has asked for some more data from the lobby group, while their counterparts in department of heavy industries has assured of the continuance of the existing FAME scheme in some form after it expires after 31 March.
“Members of the SMEV met the officials of the NITI Aayog in the last week of February and submitted presentation and suggestions based on that. They welcomed our ideas and have asked for more information about emission and efficiency of the electric two and three wheelers which we will provide in the days to come," said an executive of one of the members of SMEV.
According to the presentation of the lobby group, two wheelers report the most reduction in carbon emission and fuel consumption with a subsidy of Rs1,000, followed by electric auto rickshaws and taxis.
The union government gives only Rs15,000 to Rs34,000 subsidy to two-wheelers and it’s easy to introduce electric variants in two wheelers and three wheelers since charging stations are not required and can be done at residence or office premises. Since there is already an existence of a huge scooter market proper implementation would encourage potential customers to move to electric.
While the subsidy in buses are substantially higher compared to scooters or four wheelers.
“What we brought to the notice of the union government is that two-wheelers can easily be shifted since there is an existing scooter market and if 20% of the market can be converted then we can see a lot of electric scooters on the roads. Same is the case for electric auto rickshaws. Once the charging infrastructure is in place the cabs can be shifted to electric and gradually we can move towards buses," said executive mentioned above.
NITI Aayog and Society of Indian Vehicle Manufacturers (SIAM) have already proposed to shift 40% of the total vehicles and 100% of the vehicles used for public transport to electric by 2030.
According to a report prepared by Automotive Component Manufacturers Association (ACMA) 34.5% of the total two wheelers in India will be electric by 2025-2026.
SMEV has also requested the government to put a sunset clause of two years for lead batteries in the next phase of the FAME scheme so that it can be phase out in a systematic manner within a certain period of time. Currently, most of the e-rickshaws run on lead batteries.
According to the Sridhar V, partner, the suggestions of SMEV are pragmatic since most of the two –wheelers in India are scooters unlike China.
“I think it’s better not to paint the whole picture with the same brush. Electric two-wheelers already have seen some success and scooters are used for city commute and are perfectly placed to shift to electric. So are auto rickshaws. For public transport to shift to electric we need a lot of investment in establishment of charging stations at public places which will take some time," explained Sridhar.