Representational photograph
| Photo Credit: MURALI KUMAR Ok
Electric buses are anticipated to be on the forefront of India’s electrification drive, with the section seemingly to witness wholesome traction going ahead, ICRA stated. E-buses will account for 11-13% of new bus sales by FY25, the credit standing company stated in a be aware.
“The traction within the e-bus section is already seen over the previous couple of years, with e-bus volumes in addition to penetration ranges bettering persistently, to 7% in FY23. Steady progress has been remodeled this era in the direction of assembly the e-bus deployment targets beneath the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, and that is seemingly to achieve tempo over the approaching months, until the scheme expires in March 2024, it stated.
Additionally, many state electrical automobile (EV) insurance policies have introduced particular targets and timelines for e-bus adoption, thereby making a roadmap for electrification, it added.
“Bus cost is the single largest cost element in the e-bus project, accounting for 75-80% of the project cost,“ said Kinjal Shah, Vice President & Co-Group Head, Corporate Ratings, ICRA Ltd. “The capital subsidy of ₹35-55 lakh per bus under the FAME II scheme can fund a large part of the project costs, up to as much as 40%, which augurs well for the viability of these projects,” Ms. Shah stated.
“Additionally, coupled with the significant savings on fuel costs (3-5x cheaper vis-à-vis conventional buses), these subsidies help lower the total cost of ownership of e-buses by 10-25% compared with conventional CNG or diesel buses,” she stated.
In addition to these state insurance policies and authorities schemes, the federal government has additionally sought to spur e-bus adoption by bid aggregation beneath tenders floated by Convergence Energy Services Limited (CESL).
With the improved volumes beneath these tenders due to demand aggregation, there was wholesome curiosity and participation by the unique gear producers (OEMs) within the first two tenders, even with out subsidies on supply within the second tender, ICRA stated.
However, CESL’s third tender noticed restricted OEM participation due to lack of a fee safety mechanism and a dry lease mannequin of operation proposed for it and had to be subsequently scrapped, it added.
