Bihar’s Blueprint for Electric Vehicles: The 2023 Policy Decoded

Introduction

With the era of Electric Vehicles underway, sustainable and clean transportation has become the need of the hour. Keeping this in mind, Bihar has introduced its exclusive Bihar Electric Vehicle Policy for 2023.

This policy aims to encourage the adoption of electric vehicles (EVs) to reduce air pollution and dependence on fossil fuels. It includes a series of incentives and proposals designed to create a robust EV ecosystem.

Objectives and Mission

Bihar Electric Vehicle Policy 2023 is anchored in several key objectives:

• Developing an EV Ecosystem: The primary goal is to make Bihar a model state for developing an Electric Vehicle transport ecosystem.
• Robust Charging Infrastructure: A focus on developing an accessible and robust network of EV charging infrastructure.
• Fostering Innovation: Encouraging startups and investments in the field of electric mobility, including support sectors like IT, data analytics, and research and development.
• Environmental Improvement: A commitment to improving air quality and reducing pollution levels.

Incentives Offered

The Bihar Electric Vehicle Policy outlines various incentives to encourage individuals and businesses to switch to electric vehicles. These include:

• Subsidies on Purchase: The government offers direct subsidies on the purchase of EVs. This subsidy varies based on the type and model of the vehicle.
• Tax Exemptions: Electric vehicles are exempt from road tax and registration fees for a certain period of time.
• Charging Infrastructure Support: To address range anxiety, the government plans to set up an extensive network of charging stations. Subsidies are also provided for setting up these stations.

The Bihar Electric Vehicle Policy 2023 offers a variety of incentives for the early adoption of electric vehicles (EVs), covering different categories of vehicles that includes,

1. Electric Two-Wheelers

• Purchase Incentive: ₹5,000 per KWH for the first 10,000 electric two-wheelers registered in Bihar, with an upper limit of ₹10,000 per vehicle for SC/ST and ₹7,500 per vehicle for others.
• Motor Vehicle Tax Rebate: 75% rebate for the first 10,000 electric two-wheelers, followed by a 50% rebate on Motor Vehicle Tax for subsequent vehicles until the policy remains in force.
• Aggregator Compliance: Licensed aggregators must include a minimum percentage of electric two-wheelers in their fleet, increasing from 20% in the first two years to 50% by the end of the fourth year.

2. Electric Three-Wheeler (Passenger Vehicle)

• Motor Vehicle Tax Rebate: 50% rebate on Motor Vehicle Tax for electric three-wheelers (passenger vehicles) registered during the policy period.
• Permit Fee Exemption: Exemption in permit fee for all new registered electric three-wheelers (passenger vehicles).

3. Electric Three-Wheeler (Goods Carriage)

• Similar incentives as passenger three-wheelers, including a 50% rebate in Motor Vehicle Tax and exemption in permit fee.

4. Electric Four-Wheeler

• Purchase Incentive: ₹10,000 per KWH for the first 1,000 electric four-wheelers registered, with a cap of ₹150,000 per vehicle for SC/ST and ₹125,000 for others.
• Motor Vehicle Tax Rebate: 75% rebate for the first 1,000 vehicles, followed by a 50% rebate for subsequent vehicles.
• Aggregator Compliance: Aggregators are required to include a minimum percentage of electric four-wheelers in their fleet, similar to the two-wheeler policy.

5. Light Electric Motor Vehicle (Goods Carriage)

• Motor Vehicle Tax Rebate: 50% rebate on Motor Vehicle Tax.
• Permit Fee Exemption: Exemption in permit fee for all light electric motor vehicles (goods carriage) registered during the policy period.

6. Heavy Electric Motor Vehicle (Bus and Goods Carriage)

• Motor Vehicle Tax Rebate: 75% rebate for the first two years from the notification date, followed by a 50% rebate thereafter.
• Permit Fee Exemption: Exemption in permit fee for all heavy electric motor vehicles.

7. Common Provisions for All Categories of Vehicles

• Scrapping Incentives: Owners of electric vehicles are also eligible for scrapping incentives for old vehicles as per MoRTH notification.
• Compliance with FAME India Scheme: Incentives apply to electric vehicles that comply with the Technology Definition under the FAME India scheme.
• Subsidized Public Parking: Municipal authorities will provide subsidized parking for personal EVs, with a city parking plan including on-street parking and EV charging stations.

These incentives are part of Bihar’s strategic initiative to promote electric mobility, reduce environmental pollution, and develop a sustainable transportation ecosystem in the state.

Proposals for Charging Station Infrastructure

Categories of Chargers and Incentives

• Category-1 (AC Charger – Slow/Moderate): 75% incentive on the purchase of equipment/machinery and ₹10,000 as installation cost per charger, up to a maximum of ₹50,000 for the first 600 chargers.
• Category-2 (AC Charger – Fast Charger): 75% incentive on equipment/machinery and ₹25,000 for installation per charger, up to ₹150,000 for the first 300 chargers.
• Category-3 (DC Charger – Slow/Moderate): This is similar to Category-2 so the same incentives will be given.
• Category-4 (CCS/CHAdeMO Charger – Fast Charger): 50% incentive on purchase and ₹100,000 for installation per charger, up to ₹1,000,000 for the first 60 chargers.

Operational Models Proposed in Bihar Electric Vehicle Policy

• Private Charging Station: Encourages residential building owners, RWAs, and Co-operative Housing Societies to install at least one Bharat Electric Vehicle AC charger (3-Guns), with incentives as per Category-1.
• Semi-Public Charging Station: For non-residential building owners and market associations to install at least one Bharat EV AC charger (3-Guns), with incentives for a maximum of 5 EV chargers at a specific location.
• Public Charging Station (PCS): For commercial use, can be established on both government and private land. Government entities, as well as private entities, are eligible for incentives to establish PCS.

Power Tariff

• The state government will ensure electricity is provided at a reasonable rate for public and semi-public charging stations, with a 30% subsidy on the Power Tariff for the first three years. This subsidy is managed by the Transport Department.

Recycling Ecosystem – Battery and Electric Vehicle

• EV Battery Replacement: EV batteries typically require replacement once they degrade to 70-80% of their capacities. Bihar Electric Vehicle Policy notes that EVs may need their batteries changed twice over a 10-year lifespan.
• Battery Reuse and Recycling: The policy emphasizes the need for proper reuse or recycling of batteries that have reached their end of life. This is crucial due to the environmental risks associated with the disposal of EV batteries, which can release toxic gases and contain scarce and expensive materials like lithium and cobalt.
• Promotion of Recycling Businesses: The Bihar Electric Vehicle Policy encourages the reuse of EV batteries at the end of their life and promotes the establishment of recycling businesses. This effort will be in collaboration with battery and EV manufacturers, focusing on extracting rare metals from within the batteries and reusing them.
• Formulation of a Specific Policy: The Industries Department of the Government of Bihar, in consultation with the Environment, Forest & Climate Change Department, and the Bihar State Pollution Control Board, will notify a well-defined policy to encourage the reuse of batteries.

Policy Implementation

The implementation of the Bihar Electric Vehicle Policy is managed through a three-tier arrangement:

• State-Level EV Steering Committee: This apex committee reviews the effectiveness of the EV policy, makes decisions on policy directives, and monitors implementation. It consists of high-ranking officials, including the Chief Secretary of Bihar, the Development Commissioner, and heads of various departments.
• Transport Department EV Monitoring Committee: As the nodal department for policy implementation, this committee is responsible for the effective execution of the policy. It has the authority to sanction the expenditure of funds for various incentive schemes under the policy.
• District Level EV Committee: These committees, led by the District Magistrate, will oversee the local implementation of the policy and address any arising issues.

The structure of these committees ensures a comprehensive and multi-level approach to implementing the Bihar Electric Vehicle Policy, encompassing state, departmental, and district levels. This approach allows for effective monitoring, quick response to challenges, and efficient allocation and use of resources to promote EV adoption and infrastructure development in Bihar​

Financial Support and Partnerships

The policy also outlines financial support mechanisms and partnerships:

• Funding from State and Central Governments: To implement the policy effectively, the state government plans to leverage funds from both state and central schemes.
• Public-Private Partnerships (PPPs): The government aims to collaborate with private players to develop the EV infrastructure.

Environmental and Economic Impact

The shift to electric vehicles is expected to have a significant environmental impact by reducing emissions. Economically, it is likely to attract investments in the EV sector and create new job opportunities.

Challenges and Future Outlook

While the Bihar Electric Vehicle Policy is a step in the right direction, challenges such as the initial cost of EVs, charging infrastructure, and consumer awareness need to be addressed. The government’s commitment to overcoming these challenges will determine the success of the EV transition in Bihar.