SMEV (Society of Manufacturers of Electric Vehicles) has called upon the Government to levy an additional Green Tax on ICE vehicles to incentivise EV adoption and support reducing pollution-creating crude oil imports.
As per the association, this Green tax would also rationalise the expected drop in EV sales due to the reduction in subsidies starting this month. It believes that an increase in taxes to the tune of 100 basis points on traditionally polluting ICE two-wheelers will be required to fund subsidies for e2Ws and put the FAME scheme back on track.
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Pointing out that an average ICE two wheelers emit nearly 300 grams of CO2 per km, the association said that with an average km run of 30 km per day (lifetime mileage of 70,000 km), the CO2 burden from ICE scooters was a humongous nine kg of CO2 per vehicle per day. With sales in FY23 of 15,862,087 units, the emission is almost 142 million kg of CO2 released in the atmosphere per day – and a mind-blowing 333 billion kg of CO2 - for the lifetime of the FY23 ICE scooters - which has potential long-term health - and financial implications for the country.
Quoting NitiAayog, which has established that electric vehicles are much more efficient since they convert around 60% of the electrical energy from the grid to power the wheels, whereas petrol or diesel cars can only convert 17%-21% of the energy stored in the fuel to the wheels, which the SMEV said indicates a waste of around 80%.
Sohinder Gill, Director General, SMEV reiterating the association’s recommendation, said, “It is time that the EV sector is allowed to compete at par with ICE vehicles. While we are tackling awareness and adoption issues as an industry, the biggest hurdle is the cost of ownership as India is a price-sensitive market. Additional Green Taxing of ICE vehicles will not only bring EV and ICE at the same level but also encourage bigger OEMs to enter the EV market with confidence and a long-term outlook, which will benefit the country.”