Considered the 4th largest economy of India that contributes around 8% to the country’s GDP, Uttar Pradesh or popularly known as U.P houses the highest number of MSMEs and is the strong foothold of the country’s automobile industry.
Contributing its share in promoting electric mobility across the state, the government of Uttar Pradesh put forward a comprehensive and detailed Electric Vehicle (EV) Policy draft in 2018.
The draft aimed to target the large population of the state by offering ample subsidies and incentives.
Finally, in August 2019, the Uttar Pradesh (UP) EV Policy was successfully approved and put into action.
Putting e-mobility at its forefront, Uttar Pradesh (UP) EV Policy laid out its vision and objective in the following manner:
Aims to set up Uttar Pradesh as the preferred destination for attracting all varieties of investments in electric vehicle manufacturing and charging infrastructure sector while promoting e-mobility in the state.
- Uttar Pradesh EV Policy has set its target to promote the adoption of EVs in the state to create a greener environment.
- The policy aims to create employment opportunities for both the supply-side and demand-side of EVs.
- The Uttar Pradesh (UP) EV Policy plans to create a conducive environment for switching Internal Combustion (IC) engines to Electric Vehicles (EVs).
- Encouraging Hybrid EVs (HEVs) and Plug-in-electric vehicles (PEVs) during the transition phase.
- The policy aims to develop a strong and sustainable ecosystem for battery management starting from the production stage to the disposal stage.
Uttar Pradesh (UP) EV Policy – Targets to Achieve
- Uttar Pradesh (UP) EV Policy plans to attract investments of over INR 40,000 crore in the next 5 years across the e-mobility space with an employment potential of 50,000 people.
- Aims to roll out 1000 electric buses (BEVs/FCEVs) while transitioning 70% of public transportation towards electrification running across identified green routes in identified 10 EV cities by 2030.
- The policy has set its target on phasing out all conventional commercial fleets and logistics vehicles towards EV and achieving 50% EV mobility in Goods Transportation in specified 10 EV cities by 2024 and all cities by 2030.
- Uttar Pradesh EV Policy aims to launch 1 million EVs, combining all segments of vehicles, by 2024.
- To facilitate e-mobility, the policy plans to build nearly 2 lakh slow and fast charging swapping stations by 2024.
Fiscal Incentives – Manufacturing Units
Land Subsidy (EVMUs and EBUs)
Under this subsidy, Mega Anchor Project which will be an integrated project listed in the Uttar Pradesh investment criteria and the Ultra mega battery plant defined in the policy will get a reimbursement of 25% of the cost of the land at the prevalent purchase or circle rate. Also, the incentive will apply only to some notified areas of the state.
Technology Transfer for alternate Clean Fuel Mobility
- According to the Uttar Pradesh (UP) EV Policy, EBUs manufacturing alternate clean sources of fuel for electric mobility that may include hydrogen-based fuel cells, methanol, biofuel-based fuel cells or solar-based cells, etc. will be supported in technology transfer.
- According to the policy, Anchor EBUs will receive a reimbursement of 100% of the cost of technology transfer for the first 5 vendor units and 75% towards the next 5 vendor units.
- Ultra-mega Battery plant is also expected to get a reimbursement of 50% of the cost of technology transfer. And only 5 such projects will be considered throughout this policy.
Policy Incentives Offered to Service Units
- According to the Uttar Pradesh (UP) EV Policy, a capital Subsidy of 25% will be provided on fixed capital investment (excluding land cost) to the first 100 charging stations subject to a maximum of Rs 6 lakh per charging station.
- To promote alternative fuel sources, establishing Hydrogen enabled refueling Infrastructure will be offered a 50% Capital interest subsidy on fixed capital investment (excluding land cost) in the form of reimbursement to the first 10 units in UP, with a maximum limit cap of Rs 50 lakhs per unit during the five-year policy period.
Environment Protection Incentives
To promote sustainable production measures, Uttar Pradesh (UP) EV Policy offers the Large, Anchor EVMUs/EBUs and Service units with,
Setting up Waste Treatment plant –Defined in the Large & Anchor EVMUs and EBUs, the policy offers a subsidy of 50% on annual interest on loan taken in form of reimbursement to establish a Waste Treatment Plant with a maximum cap of Rs 1 crore per unit.
Battery Recycling – Large, Anchor EBUs and Service units are also offered a Capital Interest Subsidy of 50% per annum during the policy period in the form of reimbursement on loan taken for procuring equipment or machinery for battery recycling.
Incentives for Establishing Private EV Parks
Under the Uttar Pradesh (UP) EV Policy, the government plans to offer certain subsidies to the developers of private EV parks & clusters with plug-and-play facilities. Given that the park must be covering over more than 150 acres of land and include,
- R&D and Testing Centers
- Battery manufacturing/ handling areas
- Common facilities
- Manufacturing area (components, sub-components, sub-assemblies, etc.)
- Recycling ecosystem, waste treatment facilities, etc.
EV Mobility Incentives
In order to achieve the target of residing 1 million EV vehicle owners in the state by 2024, the UP government has come forward with a few incentives to lure the residents to switch towards electrification. The incentives are prioritized for first 1,00,000 buyers and include,
- 100% exemption offered for Vehicle registration fees
- 100% exemption given on road tax for 2-wheeler EVs and 75% road tax exemption for other EVs
- And the Department of Industries, Government of Uttar Pradesh will also integrate the mobility incentives provided by the Indian government to promote Electric vehicles and Mobility.
Research and Development
Apart from encouraging a conducive ecosystem of e-mobility in the state, the Uttar Pradesh (UP) EV Policy aims to promote research and development (R&D) of the EV space with the following measures,
Promotion of Start-ups & Entrepreneurial Ecosystem- A start-up fund will be mobilized in order to promote the field of entrepreneurship in the electric vehicle sector. Incubation centers facilitating EV mobility and innovative EM models will be offered lucrative incentives as per the prevailing UP Startup Policy.
Research Tie-ups & Testing Facilities Encouraged – Shaping the EV ecosystem in a refined model, the Uttar Pradesh (UP) EV Policy aims to establish high-quality testing facilities for EVs. And promote universities to tie up with private players to focus on next-generation battery chemistries, fuel cells systems, powertrains, automotive electronics and electric road systems, etc.
Patents & Certifications – MSMEs defined in the policy will be eligible to receive financial assistance according to the state policy and is limited to 75% of the cost, with a maximum cap of Rs 25 lakhs for obtaining patent registration and 50% of all charges, subject to a maximum of Rs 5 Lakhs paid for obtaining quality certification.