Informist, Wednesday, Sep 11, 2024

--Cabinet Oks PM E-DRIVE scheme for 109 bln rupees

--Cabinet Oks 34.35 bln rupees for PM eBus payment security mechanism

AHMEDABAD - The Union Cabinet today approved a scheme to promote electric mobility in the country at an outlay of 109 bln rupees for two years. The primary objective of the scheme, called PM Electric Drive Revolution in Innovative Vehicle Enhancement, or PM E-DRIVE, is to expedite the adoption of electric vehicles by providing upfront incentives for their purchase, as well as facilitating the establishment of essential charging infrastructure, the government said in a press release.

The new scheme will replace the temporary Electric Mobility Promotion Scheme, which is set to expire this month. The scheme was introduced after the second phase of Faster Adoption for Manufacturing of Electric Vehicles scheme, or FAME, which expired in March. The scheme had an outlay of 5 bln rupees for a period of four months, starting April, and was later extended by two months.

The second phase of FAME was rolled out in 2019 with an initial outlay of 100 bln rupees for three years. It was later extended up to March 2024, with an additional outlay of 15 bln rupees.

Several new-age original equipment manufacturers, particularly two-wheeler companies, and industry bodies have been urging the government to continue with the subsidies. The demand subsidy given under the scheme has been instrumental in driving the early-stage adoption of electric vehicles in the country.

As part of the PM E-DRIVE scheme, 36.79 bln rupees would be given as subsidy or demand to incentivise electric two- and three-wheelers, electric ambulances, electric trucks and other emerging electric vehicles. The government expects the scheme to support 2.48 mln electric two-wheelers, 316,000 electric three-wheelers and 14,028 electric buses.

As part of the scheme, the ministry of heavy industries would issue e-vouchers to the buyers of electric vehicles. The buyers would need to generate an Aadhaar authenticated e-Voucher from the scheme portal at the time of the purchase of an electric vehicle. The buyer would then hand the e-voucher to the dealer, who would have to upload the e-voucher on PM E-DRIVE portal to claim reimbursement.

The scheme has also allocated 5 bln rupees each for deployment of e-ambulances and e-trucks. To address the need for installation of public electric vehicle charging stations, the scheme proposes to spend 20 bln rupees to install 48,400 fast chargers for electric two- and three-wheelers, 22,100 fast chargers for electric four-wheelers, 1,800 fast chargers for electric buses.

The government also proposes to spend 7.8 bln rupees to upgrade test agencies in the electric vehicle ecosystem.

PSM SCHEME

Other than PM E-DRIVE scheme, the Cabinet also approved PM-eBus Sewa-Payment Security Mechanism scheme, or PSM scheme, with an outlay of 34.35 bln rupees. The PSM scheme is for procurement and operation of electric buses by public transport authorities.

The scheme will support deployment of more than 38,000 electric buses from 2024-25 (Apr-Mar) to 2028-29 (Apr-Mar). The scheme would support the operation of electric buses for a period of up to 12 years from the date of deployment.

Public transport authorities generally do not induct electric buses into their fleet due to the high capital cost. The e-buses are generally inducted into the fleet for public transportation through public-private partnership or on a gross cost contract model. Public transport authorities are not required to pay the upfront cost of e-bus under the gross cost contract model. Instead, original equipment manufacturers or operators procure and operate e-buses for public transport authorities on monthly payments. However, the original equipment manufacturers or operators are hesitant to engage in this model due to concerns about potential payment defaults.

The scheme, government says, would ensure timely payments to operators through a dedicated fund. In case of default by the public transport authorities, the implementing agency shall make requisite payments from the scheme funds, which will be later recouped by the public transport authorities, state and union territories. End

Reported by Sunil Raghu

Edited by Ashish Shirke

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