Maharashtra EV Policy 2021: State Incentives On Electric Vehicles Explained

After much delay, the Government of Maharashtra has finally rolled out the revised 2021 EV policy in the state. Under the new policy, the government is offering substantial cost benefits and incentives on electric vehicles, in addition to what the central government offers under the FAME II (Faster Adoption and Manufacturing of Hybrid and Electric vehicle) scheme. In order to further encourage buyers to go for EVs over a vehicle with an Internal Combustion Engine (ICE), the state is also offering an early bird incentive until December 31, 2021, bringing the cost further down. Additionally, the government is also offering additional incentives on vehicle scrappage.

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In addition to the standard incentives, Maharashtra is also offering Early Bird incentives, with additional benefits of Rs. 5000/kWh, capped at Rs. 1 lakh

The standard incentives on all kinds of electric vehicles except for e-Buses for State Transport Undertaking (STU) stand at Rs. 5,000 per kWh. However, there is a limit to the number of vehicles eligible for the incentive and also a capping amount for each category. However, it must be noted that all electric vehicles with a fixed battery are eligible for a 100 per cent incentive, but the ones with swappable batteries are eligible for a 50 per cent incentive of the OEMs and 50 per cent of the battery provider. As for the special Early Bird incentives, Maharashtra is offering EV buyers an additional benefit of Rs. 5000/kWh, which can go up to Rs. 1 lakh. However, this is only eligible for electric vehicles purchased before December 31, 2021.

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An electric scooter like Ather 450, with a 2.9 kWh battery, is eligible for total incentives of up to Rs. 25,000 in Maharashtra

For example, an electric scooter like the Ather 450X, which has a 2.9 kWh battery pack, should get incentives up to Rs.14,5000, however, the cap on electric two-wheelers is up to Rs. 10,000 (increased from previous Rs. 5000 limit) so that is what customers will get. However, with the Early Bird incentives, a customer buying an Ather 450X is also eligible for an additional incentive of up to Rs. 15,000 (amount will differ for vehicles with different battery capacities) bringing the total benefits close to Rs. 25,000. For an electric four-wheeler like the Tata Nexon EV which comes with a 30.2 kWh lithium-ion battery pack, standard incentives will be up to Rs. 1.5 lakh. However, under the early bird incentive, you can get an additional incentive of up to Rs. 1 lakh, bringing the total cost down by Rs. 2.5 lakh. These incentives are only valid for the first one lakh electric two-wheeler and the first 10,000 electric four-wheelers.

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The Government of Maharashtra is also offering additional vehicle scrappage incentives. So, if you scrap your combustion engine two-wheeler, three-wheeler or four-wheeler, at an authorised scrappage centre, and show the certificate while purchasing an electric vehicle, you can get an additional discount. The scrappage incentives have been capped at Rs. 7,000 for a two-wheeler, Rs. 15,000 for a three-wheeler and Rs. 25,000 for a four-wheeler.

Incentives on electric buses, which will be only for STUs, will be 10% of ex-factory cost, capped at Rs. 2 lakh for first 1,000 electric buses

Maharashtra government is also announced an Extended Battery and Buyback Agreement, which will be eligible for electric vehicle manufacturers offering a 5-years warranty and buyback for batteries. The incentive on assured buyback (up to 5-years with depreciation rate not more than 7.5 per cent stands at 6 per cent of total vehicle cost, capped at Rs. 10,000. The same for battery warranty of at least 5-years is 4 per cent of vehicle cost, capped at Rs. 10,000.

It's important to know that all the incentives announced by Maharashtra Government will be in addition to the subsidies offered under the FAME II scheme by the Government of India. Also, these incentives will be availed by manufacturers, who will in return pass it on to customers in the form of price cuts on ex-showroom rates. This means the price you pay as a customer will be the final price will the incentives included. With this EV prices are expected to be one of the lowest in the state of Maharashtra.