By Srijan Naayak and Disha Sirohi
India’s urban transportation sector is at a crucial turning point as it strives to achieve its net-zero carbon emissions target by 2070. Electric buses (eBuses) are central to this transition, addressing sustainability challenges while enhancing urban mobility. To support this shift, the Indian government has unveiled an ambitious plan to introduce electric buses in nearly 170 cities, backed by a budget of approximately $7 billion through 2034.
Overview of E-buses
India is aggressively pushing towards an electric bus future. The country’s objective is to have 50,000 electric buses operating on its roadways by 2030, which presents a substantial challenge due to the fact that the majority of the current fleet of 1.5 million buses is powered by diesel.
Various companies and authorities are taking proactive measures to reach the targets set. In March 2024, JBM Ecolife Mobility secured a contract to operate 1,390 e-buses under this scheme, emerging as the top bidder for the procurement, supply, operation, and maintenance of approximately 65 per cent of the total electric buses. Similarly, GreenCell Mobility in March 2024 deployed a fleet of 150 electric buses in Surat, Gujarat which is expected to offset 99,747 tonnes of carbon dioxide equivalent.
The Karnataka State Road Transport Corporation (KSRTC) plans to introduce eco-friendly electric buses on prominent routes in Dakshina Kannada district and inter-district destinations. In February 2024, the state government sanctioned 45 electric buses to the Mangaluru division and 40 buses to the Puttur division, with the process of handing over the vehicles underway.
Under FAME I, 425 electric and hybrid buses were deployed across various cities in the country with government incentives worth Rs. 2.80 billion. While in Phase-II of FAME, the Ministry of Heavy Industries (MHI) sanctioned 6,862 electric buses with incentives worth Rs. 30.09 billion of which 4,901 e-buses have been deployed as of August 2024. Out of total buses deployed, the most no. of e-buses were deployed in Delhi followed closely by Karnataka and Maharashtra.
As part of the proposed, FAME-III, the Indian government is considering significant changes to the FAME scheme, including a 50 per cent domestic value addition (DVA) requirement and removing phased manufacturing programme (PMP). It has a target of replacing 8, 00,000 diesel buses with electric ones over the next seven years.
Over the last three years, Delhi has purchased 1,100 electric buses, and Mumbai has added 900. By 2025, Mumbai plans to add 2,400 electric buses, while the Delhi government aims to electrify 80 per cent of its fleet.
Meanwhile, in September 2023, the United States and India announced a collaboration to deploy 10,000 made-in-India electric buses in Indian cities. This partnership aims to mobilise financing for these buses, expanding electric public transportation options, creating cleaner cities, and promoting healthier communities.
Furthermore, Ashok Leyland has been awarded an order for 552 buses from the Tamil Nadu State Transport Corporation (TNSTC) under the ‘Mobility for All’ initiative, for municipal operations. The order is valued at Rs 5 billion.
Overcoming challenges
The implementation of e-buses in the urban transport got a major impetus with the implementation of FAME-I and FAME-II however, the adoption of the buses has still been low.
The major hurdles faced by the stakeholders include higher capital costs compared to their conventional counterparts. Majority of the State Road Transport Undertakings (SRTUs) operate under losses due to the huge gap between the operations cost and the revenue earned.
Moreover, standardization of e-buses models for intra city operations, development of de-risking solutions for timely payment of contracted bus services, well planned opportunity and depot charging to avoid the requirement for large-size batteries, thereby lowering the procurement cost are some of the measures which are requisite for increasing the e-buses adoption in the country.
In order to advance the integration e- buses in India’s public transportation, the government needs to incentivise green technology adoption, enhance infrastructure for refuelling and charging, and foster public-private partnerships.
The way forward
The E- buses ecosystem is plagued by significant challenges barring the growth and adoption of e-buses in India. Despite these challenges as per ICRA, India has managed to achieve e-bus penetration in India to reach around 7 percent as of FY 2024.
With focus on measures like expanding the green bus fleet, increasing the number of refuelling and charging stations with an emphasis on renewable energy sources continued investment in research and development (R&D) and streamlining regulatory processes will be critical to enhance the performance and cost-effectiveness of green buses and successfully transition to sustainable transportation and meet the ambitious environmental targets.