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How India’s taxi fleet can go electric

India has surplus electricity generation capacity and an additional 50,000 MW is in the pipeline. So electricity for EVs would not be a constraint.

analysis Updated: May 28, 2018 08:41 IST
India has 14 of the 15 most-polluted cities in the world, says the latest World Health Organization report. One of the ways to clean up the air will be to go for emission-free electric vehicles (EV). By pushing EVs, like China has done, India could leapfrog to the next generation of motor transportation and a green economy. (MINT)

India has 14 of the 15 most-polluted cities in the world, says the latest World Health Organization report. One of the ways to clean up the air will be to go for emission-free electric vehicles (EVs). By pushing EVs, like China has done, India could leapfrog to the next generation of motor transportation and a green economy.

But is India ready for a rapid transition? Here’s why I think so.

First, India has surplus electricity generation capacity and an additional 50,000 MW is in the pipeline. So electricity for EVs would not be a constraint.

Second, the technology for charging stations is available and the investment for setting up a charging station is modest. The electricity distribution companies could be given the responsibility to build charging stations and the municipal authorities could be tasked to ensure land and clearances.

Third, electric taxis can run without subsidies. The Energy Efficiency Services Limited (EESL), promoted by the State, is buying 10,000 electric cars for use by the central ministries. The rates will be the same at which they hire non-electric vehicles. The EESL is expecting this to be a commercially viable project and they are not seeking subsidies.

Fourth, at current costs and electricity tariff, electric cars are now commercially competitive with other cars for use as taxis. The higher capital cost is offset with lower running cost per kilometre. With higher volumes of production and the present high crude oil prices, the competitive cost advantage per passenger kilometre would only increase.

Once the charging infrastructure is in place, Delhi could announce that all new permits will be only for electric taxis. Thereafter, an aggressive time schedule of three years could be announced for replacing the entire existing fleet of taxis with electric ones. The same can be done for three-wheelers, buses and luxury taxis. In fact, electric three-wheelers and minibuses are ready for the market and they are competitively priced.

Buses may be a bit more expensive initially. But users would gladly pay more for cleaner air. The government could also choose to forego GST, either partially, or fully, on electric buses till prices come down. After the buses, smaller trucks could be targeted. Once the average car owner has used electric taxis for about a year and starts feeling comfortable, she may even begin to consider going in for an electric car.

With this, India would also get on to a less carbon-intensive growth trajectory.

Ajay Shankar is distinguished fellow, TERI

The views expressed are personal

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First Published: May 28, 2018 08:40 IST