Electric buses will represent 8-10% of new bus sales by 2025
Electric buses will account for 8-10% of new bus sales by 2025, as the government plans to push electric vehicles (EVs) onto the roads to reduce pollution in large cities and reduce reliance on it. of oil imports, according to the ICRA rating company.
Traction in the electric bus segment is already visible in recent months, despite the overall strain in the public transport segment over the past year and a half due to the pandemic. Although field deployment under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (Fame) program has been somewhat delayed due to challenges brought on by the pandemic, the rating companies said in a memo.
âElectrification in other geographic areas such as Europe is also gradually picking up. Also in India, significant incentives and subsidies have been announced through various programs aimed at lowering the cost of ownership and boosting adoption of electric buses, while many national electric vehicle policies have announced. specific electrification targets and timelines for buses, thus helping to create a roadmap for electrification, “analysts added.
They further noted that the gross cost contract (GCC) model, or opex operating model, has become the preferred route for electric bus adoption in India, especially as the Fame Two program offers a capital grant only for buses purchased on this route. . This model significantly alleviates the initial capital charge of cash-strapped SRTUs, while boosting electrification by increasing private participation in the segment.
The government has extended the second phase of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicle (Fame) program for two years until March 31, 2024 to boost sales of electric vehicles.
The Ministry of Heavy Industries also announced a 50% increase in incentives for electric two-wheelers to ??15,000 per kilowatt hour from ??10,000 per kWh. Under the new rules, the incentive cap will be limited to 40% of the total price compared to the previous cap of 20%. The Ministry of Heavy Industries has also mandated Energy Efficiency Services Ltd (EESL) to purchase 300,000 electric three-wheelers for various authorities.
âAmong the various automotive segments, buses would be among the first to benefit from faster electrification, especially for intra-urban operations. Although limited charging infrastructure, range anxiety and high capital costs have been the main disincentives to electrification in all segments, these are relatively low for the bus segment. . Overall, ICRA expects electric buses to account for 8-10% of new bus sales by fiscal 2025, âsaid Rohan Kanwar Gupta, vice president and head of industry, ICRA Ratings.
Never miss a story! Stay connected and informed with Mint. Download our app now !!