Home >Industry >Energy >CESL to supply 25,000 two-wheeler EVs for Andhra Pradesh government employees

NEW DELHI: State-run Convergence Energy Services Ltd (CESL) will supply 25,000 electric two-wheelers to New and Renewable Energy Development Corporation of Andhra Pradesh (NREDCAP) for the state government employees.

“The Electric 2-Wheelers will be provided on a monthly lease inclusive of a comprehensive insurance that will be deducted as EMI from the volunteering government employee’s account," the two firms said in a joint statement on Tuesday.

CESL, a unit of Energy Efficiency Services Ltd (EESL), plans to supply electric two-wheelers to states such as Andhra Pradesh, Kerala and Goa, in a boost to India’s ambitious plans for green mobility as reported by Mint earlier. EESL is a joint venture of NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd and Power Grid Corp. of India Ltd.

“Under the agreement CESL and NREDCAP will work to aggregate demand, deploy electric vehicles, and build charging infrastructure. CESL will devise a suitable payment security mechanism, which will be facilitated by NREDCAP," the statement said.

Under the new scheme, CESL aims to have 200,000 two-wheeled EVs and 300,000 three-wheeled EVs across India. It plans to halve the cost of ownership of these vehicles through incentives offered under phase 2 of the Union government’s Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (Fame) scheme, state government subsidies, support from EV makers and carbon credits that will be earned under the United Nations’ Clean Development Mechanism (CDM).

“Our vision, with the procurement of 25,000 two-wheeler electric vehicles, is to make Andhra Pradesh go electric. We have been effectively providing affordable and clean power and a fillip to e-mobility will make a further push towards clean energy adoption. Electric two-wheelers for government employees will boost energy and financial savings and we hope more and more people will also make a shift to EVs," Andhra Pradesh’s energy minister Balineni Srinivasa Reddy said in the statement.

Around 22 million petrol two-wheelers are sold every year in India. Switching a portion of these will help the country trim its crude import bill that totalled $101.4 billion in 2019-20.

“Andhra Pradesh’s decision to go electric will accelerate e-mobility adoption in the country, hopefully providing a blueprint for other states to adopt," Mahua Acharya, CESL’s chief executive and managing director, said in the statement.

The plan involves nearly halving the price of these two-wheeled EVs from the current about 1,40,000 to about 75,000. Prices of the two-wheeler models could, however, vary due to subsidies and taxes in each state.

“These electric vehicles will be provided to state government employees of Andhra Pradesh and the number may increase as per requirements," the statement said.

The electric vehicle arm of ride-hailing firm Ola, Hero Electric, Mahindra Electric Mobility and Kinetic Green Energy and Power Solutions are in talks with CESL to supply electric two and three-wheelers as well as charging infrastructure as reported by Mint earlier.

As part of its push towards EVs and to turn India into a global hub for the manufacturing of EVs and their components, the government has announced a 18,100 crore production linked incentive (PLI) scheme to make lithium-ion cells.

The Union government recently modified the marquee Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (Fame) scheme by increasing the incentive for electric two-wheelers to 15,000 per KWh and allotted the demand aggregation of electric three-wheeler and electric bus components to EESL. The Centre also extended the Fame scheme, created to curb vehicular emissions and dependence on fossil fuels, by two years till 31 March 2024.

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