Rajasthan Lays Thrust on Electric Vehicle Manufacturing in its EV Policy 2022

The policy has set an EV manufacturing target of 3.5 million units a year

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The Rajasthan EV policy 2022 lays out financial and non-financial incentives and initiatives that would support the adoption of electric vehicles (EV) and seeks to promote EV manufacturing and related industries and set up a wide network of charging stations.

The policy proposes training programs to create a skilled workforce to support the electric vehicle ecosystem. This will be done by adding enabling incentives in Jaipur, Jodhpur, Kota, Udaipur, Bikaner, Ajmer, Bharatpur, and Alwar under the Rajasthan Investment Promotion Program-2019.

All vehicles with advanced batteries having passed all the eligibility and testing conditions specified under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II) program and purchased and registered in Rajasthan will be eligible for incentives.

This includes transport and non-transport electric two and four-wheelers, electric buses, and electric three-wheelers (e-rickshaws, goods, and passenger transport).

The category-wise target would be adding 15% electric vehicle share in new vehicle registrations of two-wheelers, 30% in three-wheelers, 5% in four-wheelers, and phased transition to e-buses used in routes connecting priority cities.

The policy will be valid for five years.

Rajasthan EV Policy Table

Manufacturing Target

Special zones along the Delhi-Mumbai industrial corridor would be promoted for manufacturing EVs.

Several incentives and exemptions would be rolled out to handle the upfront purchase cost and improve awareness.

Exemption from motor vehicle tax, exemption from the requirement of a permit, SGST reimbursement to all EV categories, and upfront incentives to purchase two-wheelers and three-wheelers would be provided.

For EV enterprises, investment subsidy of 75% state tax due and deposited for seven years, reimbursement of 50% of employer’s contribution towards employees EPF and ESI for seven years, exemption from 100% payment of electric duty, land tax, market fee, stamp duty and conversion charges payable for change of land use and conversion of land for seven years would be provided.

Charging Infrastructure

The policy aims to create EV charging stations across the state. A nodal agency will be set up for charging infrastructure.

The charging stations will comply with standards specified by the Ministry of Power, Government of India, and Rajasthan State Electricity Regulatory Commission.

Setting up charging stations will be a de-licensed activity, requiring no special permissions.

Swapping Stations

The policy proposes all incentives and tariffs that apply to charging stations will also apply to battery swapping stations. Domestic charging will be treated similarly to domestic consumption.

Public charging stations will be allowed to purchase power from any source through open access.

Enterprises investing up to ₹2.5 million ($31,380), a 5% interest subsidy or term loan for five years subject to a maximum of ₹200,000 ($2,510) or capital subsidy equivalent to 20% of the investment made in equipment, subject to a maximum of ₹5 million ($62,762) will be provided.

State Goods and Service Tax (SGST) reimbursement on fast-charging EV supply equipment for private enterprises will be provided. Under the reimbursement of cost towards the upstream electricity infrastructure, public charging/swapping stations will be reimbursed 100% of the upfront cost.

The Rajasthan Electricity Regulatory Commission will issue separate tariffs for public charging stations.

The energy charges for a public charging station (LT) would be ₹6 ($0.075). The fixed charges would be ₹40 (~$0.50)/HP/month of the sanctioned connected load. The energy charges for a public charging station (HT) would be ₹6 ($0.075). The fixed charges would be ₹135 ($1.70)/kVA/month.

Time of Day (ToD) rebate of 15% on energy charges will apply from 11 am to 6 pm. The public charging station’s tariff will apply to battery charging and swapping stations.

Renewable energy-based charging

The Rajasthan Solar Energy Policy 2019 identifies the addition of charging stations as one of its primary goals.

From allotment of land at a 50% concessional rate for the first 500 charging stations installed within the first five years to offering up to ₹500,000 ($6,275) per charging station on an actual cost basis for the first 100 charging stations, the incentives are many.

The policy also allows charging station service providers to set up renewable energy generation plants within their premises for captive use. They can also draw renewable power through open access from projects within the state. In such a scenario, the charging station service providers will be able to avail the following benefits:

  • Banking of energy at the drawal end will be for captive consumption or third-party sale. Charges shall be adjusted in kind at 10% of energy delivered at the point of the drawal. The drawal of banked energy will not be allowed at peak hours, and unutilized banked energy at the end of the year shall be allowed to lapse.
  • The electricity consumed by power producers for captive use within the state for usage at the charging station will be exempted from electricity duty for seven years from the commercial operation date.
  • Solar power projects set up for a capacity of 500 MW (solar, wind, solar-wind hybrid, with or without storage, taken together) for captive use or third-party sale within the state after the commencement of the policy or up to March 2023 will be exempted from 100% transmission and wheeling charges for ten years from the date of commencement of the charging station. This applies to an individual plant capacity of a maximum of 25 MW.

The Ministry of Heavy Industries (MHI) approved 2877 EV charging stations in 68 cities across 25 states and union territories under the second phase of the FAME-II program.

Rajasthan’s EV policy 2021, focused on ramping up sales of electric two-wheelers and three-wheelers.

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