Battery-operated electric vehicles (EVs) will not get cheaper with the Road Ministry’s proposal to waive registration charges, as the government policy to adopt and make EVs faster mandates the use of Lithium-Ion and similar batteries which are expensive.

However, the overall cost of operating and maintaining the two- and three-wheelers could drop, says Vineet J Mehra, Managing Director, DOT, a company that uses only EVs to deliver goods in the last mile for Amazon, Swiggy, Walmart, Grofers, McDonald's and FreshMenu.

Use of EVs are likely to bring in some cost advantage in logistics operation. Fuel operating cost for EVs on a per kilometre basis is around 0.25 paise for a two-wheeler and 0.75 paise for a three-wheeler, against conventional vehicles which have a per kilometre cost of ₹2.5 and ₹3.5 respectively,” Mehra told BusinessLine .

The impact vis-à-vis initial acquisition cost of EVs and internal combustion engine vehicles would become more pronounced after the implementation of Euro-VI norms in April 2020, said Mehra adding that two- and three-wheelers with internal combustion engine would go up anywhere between 8 and 15 per cent at that time. The subsidies announced in the current government policy will make EVs an attractive buy, especially due to their low operating costs.

Funding difficult

DOT, which operates in 20 cities, said a major challenge is getting finance for EVs. There is need for policy intervention on financing of EVs, especially two-wheelers, for fleet operators like DOT, which will help not only in reducing the carbon footprint but will also create new jobs, said Mehra.

As EVs lack availability of related charging infrastructure, the overall cost advantage is minuscule now. But with economies of scale and proper charging infrastructure in place, the logistics cost could reduce remarkably in the future.

Responding to the Road Ministry’s proposal on Twitter, some stakeholders have already called for a waiver of road tax and toll charges. One response said several battery-operated vehicles are not registered in the first place. The move comes at a time when there is a government push to move towards electric vehicles in order to meet the sustainability norms.

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