Home / Industry / Infrastructure /  New model likely for e-highway bids


The Union government is planning a new bidding model for the upgradation of existing highways into electric highways, two people aware of the development said. The new Annuity Hybrid for E-Mobility (AHEM) model will be a variant of the existing Hybrid Annuity Model (HAM) used to bid out highways.

An electric highway refers to a highway with adequate charging infrastructure at regular intervals, with dedicated public electric vehicles plying on the route.

“The government has come up with a derivative of the HAM model for upgradation of highways into e-highways. This model, which includes a public-private partnership (PPP) mode of services, would be used for the upgradation of highways to e-highways in the country," said one of the two people mentioned above, both of whom spoke on the condition of anonymity.

Charging stations on these highways will operate in the PPP mode, equally owned by government entities, private companies and local residents whose land is used to build the highway and the infrastructure.

The model was framed by National Highways for EVs (NHEVs), a pilot programme run by Ease of Doing Business, a technology piloting agency of the government. Under the pilot programme, charging infrastructure has been created on the Delhi-Agra route (Yamuna Expressway) and the Delhi-Jaipur route (NH-8). A report on the trials is expected to be submitted soon.

Abhijeet Sinha, national programme director at Ease of Doing Business said: “If this model is successful in showing the profitability e-mobility creates, it is more than success. The model would show the pattern (for future projects). So far, there was no model to fund electric infra on highways. As this is based on annuity, this model is good enough to give confidence to investors."

“Successful trial runs on the two stretches have given confidence for going ahead with this model across the country," the second official cited above said.

Under AHEM, the government also plans to run electric buses and taxis on PPP mode. The NHEV trial found that e-bus and taxi operators will be able to break even within 36-40 months, and the cost of travel by both e-buses and e-taxis for passengers would be way below the cost incurred on their conventional counterparts. The AHEM model can change any 300-km highway or expressway into an e-highway in 90 days with charging stations, EV car fleets and buses, along with roadside assistance and lower priced EVs for non-stop running on the stretch to secure their repayment, according to experts.

AHEM involves annuity payment to contractors for the initial investment made by them in fixed amount for a period of 12 months. Thereafter, variable annuity is to be paid to the contractors or developers in the remaining period for expansion so that entire capital investment is recovered, and the project attains breakeven in 36 months.

Experts said AHEM gives enough liquidity to the suppliers of EV charging infrastructure and owner PSUs. The financial risk of the investor or bank is shared by the PSU, operators and insurance companies. Allocation of charging stations to interested power and petroleum PSUs is to be done by their parent ministries according to their willingness and interest in e-mobility.

HAM combined two infrastructure construction models: Build-Operate-Transfer Annuity and Engineering, Procurement and Construction (EPC). EPC makes up 40% of HAM, while the rest is BOT-Annuity.

According to ratings agency Icra Ltd, about 105 HAM projects involving bid project cost of 1.22 trillion are expected to become operational in the next two years, of which about 0.90 trillion of debt linked with these projects could be refinanced.

In the past few years, India has laid major emphasis on the EV space and the construction of e-highways and e-corridors. On Monday, Mint reported that India is in talks with Germany’s Siemens AG to develop e-corridors in the country.

Rituraj Baruah
Rituraj Baruah is a senior correspondent at Mint, reporting on housing, urban affairs, small businesses and energy. He has reported on diverse sectors over the last six years including, commodities and stocks market, insolvency and real estate. He has previous stints at Cogencis Information Services, Indo-Asian News Service (IANS) and Inc42.
Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Recommended For You
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout