Towards green mobility in Assam

The Electric Vehicle Policy of Assam, 2021 is aimed at incentivizing the adoption of Battery Electric Vehicles (BEV) to reduce air pollution in the state for mitigating climate change. Availability of adequate power for charging stations and affordability of power tariffs will be two key factors influencing the sustainability of the ecosystem of electric vehicles in the state. The policy is expected to give a boost to the adoption of BEV in the state under the phase II of the Central Government scheme of Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) India. The Central Government has notified Phase-II of the FAME India Scheme for five years with effect from April 1, 2019, with total budgetary support of Rs 10,000 crore. Penetration of the BEV in Assam was low under phase I of the scheme and it is yet to gain momentum even though the first two and half years of the current phase-II have already elapsed. To date, 1,12,778 electric vehicles have been sold in the country under the phase II of the scheme resulting in a saving of 68,239 litres of fossil fuel and a reduction of 1.55 lakh kg of carbon-di-oxide a day which demonstrates the importance of EVs in reducing vehicular pollution. The amount of CO2 released into the air in the state with over four million vehicles with internal combustion engines on roads can be well imagined with only 483 EVs sold with the majority (362) being e-rickshaw and 114 two-wheelers. Assam's policy envisages the deployment of two lakh vehicles, either under individual or commercial use by 2026 over the five years of the state policy. The policy also sets targets of 100% conversion of the public transport bus fleet, all government vehicles into electric buses by 2030 and phase out all fossil fuel-based commercial fleets and logistics vehicles in all cities by this decade. Apart from incentives for users for purchasing EVs, the establishment of adequate charging stations across the state will be critical for achieving these targets. The state policy has incorporated the announcement by the Ministry of Road Transport & Highways that battery-operated vehicles will be given green license plates and be exempted from permit requirements and the Ministry's advice to states to waive road tax on EVs. Subsidies and incentives will reduce the initial cost of EVs but the cost and efficiency of batteries will be a dominating factor in purchasing decisions for individual and commercial vehicle owners. The Central government's approval to production a linked incentive scheme for manufacturing of Advanced Chemistry Cell in the country is also targeted to bring down prices of batteries to reduce the cost of EVs. The state policy allowing 25% capital subsidy on equipment/machinery subject to a maximum limit of Rs 10 lakh to the first 500 commercial public EV charging stations but the spread of these charging stations will be a key factor for long-distance travellers overcoming the anxiety over availability of a charging station and adoption of EV. Reduction of Goods and Services Tax (GST) on EV from 12% to 5% and reduction of GST on chargers/charging stations from 18% to 5% fuelled demand for EV in the country. The state policy allowing petrol pumps to set up charging stations subject to qualifying fire and safety standard norms will allow the pump owners to remain invested in the automobile sector even though the adoption of EVs is targeted to bring down the demand for fossil fuel. The State Government shall exempt 100% electricity duty of EV charging stations during the period of this policy which will be an added incentive. While the policy states that incentives under all provisions of the North East Industrial Development Scheme (NEIDS), 2017 or provisions under any subsequent industrial policies for North Eastern Region declared by the Central Government shall apply to enterprises intending to set up facilities for manufacturing in the EV sector, the poor performance of all states in the region under NEIDS will continue to dampen the mood of investors in EV sector too until corrective steps are taken. Despite the low running and maintenance cost of EV as compared to fossil fuel vehicles, the high cost of batteries increasing the initial upfront cost and cost for replacement as well as the factor of long hours of charging time in roadside charging station for fully charging a battery during long-distance journeys are preventing mass adoption of EV across the globe. The Assam Government allows EV owners to deposit vehicle batteries that have reached their end of life at any charging point or swapping station and in return get a remunerative price for the battery. The policy will attract early adopters, but technological improvements and emission-free mandates will remain crucial for mass adoption which is critical for achieving the targets of reducing CO2 emission from vehicles on roads to the desired level.