In a bid to boost the sales of electric vehicles in our country, the Department of Heavy Industries (DHI) has revised the FAME II scheme. As per the recent amendment, the government has increased the subsidiary on electric 2-wheelers from Rs 10,000/kWh to Rs 15,000/kWh with a maximum limit of 40% of the cost of the vehicle (up from 20 percent earlier). This will make electric two-wheelers more affordable and help to narrow the price gap between ICE-powered and electric two-wheelers.
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Apart from subsidies on electric two-wheelers, the government has also notified for aggregation of electric buses and three-wheelers on a large scale. Under this, Energy Efficiency Services Limited (EESL) has been directed to purchase 3 lakh electric three-wheelers. In addition, EESL will also bring the cost of electric 3-wheelers at par with the traditional ICE-powered (internal combustion engine) 3-wheelers and increase the demand for electric buses on OPEX basis in nine cities with a population of over 4 million such as Mumbai, Pune, Chennai, Kolkata, Surat, Ahmedabad, Delhi, Hyderabad, and Bengaluru.
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Of the Rs 10,000 crore subsidy allocated in the FAME-II scheme, two-wheelers are the biggest beneficiaries; however, these incentives are applicable only to those electric two-wheelers that offer a minimum range of 80km on a single charge and a minimum top speed of 40kmph. That means popular electric two-wheelers like the Ather 450X, TVS iQube, Bajaj Chetak, Ultraviolette F77, Revolt RV400, Okinawa Ridge Plus, Okinawa i-Praise range and many upcoming EVs falling in this category will get the benefit of this scheme. In fact, Bengaluru-based Ather Energy has already announced a reduction in the price of the 450X by up to Rs 14,500, which is a huge drop. So, the Ather 450 Plus will now be retailed at around Rs 1.12 lakh, while the 450X will cost you nearly Rs 1.35 lakh (ex-showroom Delhi). The brand will soon update the revised prices.
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For those who aren't aware, the funds allocated under the FAME-2 scheme are for three years (from 1st April 2019 to 31st March 2022) and is meant to be used to subsidize 5,00,000 electric three-wheelers, 1 million electric two-wheelers, 55,000 electric 4-wheelers (including Strong Hybrid) and 7000 e-buses. As of now, only 76,443 electric vehicles have been sold under this scheme.
