Why proposed amendments to the Electricity Act, 2003 is likely to boost electric vehicles

At present, the transportation sector in India accounts for one-third of the total crude oil consumption of the country, out of which 80 percent of the consumption of the said oil is being consumed by road transportation. In order to reduce dependability on crude oil, the Central Government has launched the National Electric Mobility Mission Plan (NEMMP) 2020 in the year 2013, which aims to achieve national fuel security by promoting hybrid and electric vehicles in the country.

Accordingly, the Central Government, under the scheme of Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME Scheme) is incentivising the use of Electric Vehicles (EVs) and development of the required ecosystem. For the overall development and adoption of EVs in the country, it is necessary to create an enabling framework and infrastructure (eg EV charging stations) for a shift from the current (oil based) mode of transportation. Pertinently, EV charging business involves sale/supply of electricity.

Regulatory framework

When an EV owner charges the vehicle, he/she is buying electrical energy from such EV charging station, entailing a sale and purchase of electricity. Further, the EV charging station would be required to maintain an infrastructure that connects the grid for sourcing the supply of energy and thus maintain an electricity system in terms of the provisions of the Electricity Act, 2003 (Electricity Act).

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