On the CV side, the Electric bus segment is seeing the most action, mainly on account of public sector demand due to the FAME II push, despite TCO not being favorable and the upfront price differential being significant.
Electric buses have also had a curious past in terms of Government policy. The category was initially not included for demand side incentives in the original FAME I policy launched in 2015. They were finally added via modifications in 2017 and two levels of incentives were provided on the basis of minimum localisation norms upto Rs 1 cr. Under Fame I, Electric buses were sanctioned both, under a capex (outright purchase) and an opex (cost per km) model. However, a majority, 74% of the buses were under an outright purchase model and given the lack of expertise within the state and city transport undertakings, many struggled. Under FAME II, all buses are operated only under an opex model, where the supplier or operator is responsible for procuring, operations, maintenance, etc and the state or city transport undertaking pays on a cost per km basis.