Pakistan approves first electric vehicles policy

[ghazi52]

Pakistan approves first electric vehicles policy

Main goal is to cut emissions and tackle climate change


November 06, 2019

One of the main purposes of introducing EVs is to reduce greenhouse gas emissions.Image Credit:
Islamabad: Pakistan’s federal cabinet has approved the first-ever national Electric Vehicles (EV) policy in a bid to tackle effects of climate change and offer affordable transport.

In the first phase, the government will focus on converting 30 per cent of total number of vehicles, mainly cars and rickshaws, into EVs, said Adviser to Prime Minister on Climate Change Malik Ameen Aslam. The press conference was held after the policy was approved in a cabinet meeting chaired by Prime Minister Imran Khan.

“PM Imran Khan has special interest in green and sustainable development, which is why the Climate Change Ministry was tasked to come up with an Electric Vehicle Policy,” Aslam said.

Describing the details of the policy, he said that local car manufacturers had already completed most of the preliminary work, adding that he was surprised to see the acknowledgment by the manufacturers who are waiting to roll out their electric vehicles into the market. The target set for next four years is to convert 100,000 cars and 500,000 two and three wheeler vehicles to EVs.

Reducing cost while protecting environment

One of the key objectives of the policy is to offer affordable transportation to the people as the cost of electric vehicles is much lower compared to petrol, diesel, compressed natural gas (CNG) or other fuels. Another major purpose of introducing EVs is to reduce greenhouse gas emissions. “In developed countries, the greenhouse gas emissions from vehicles is around 20 per cent whereas in Pakistan it is 40 per cent, which the government aims to bring down with the introduction of electric cars, trucks, rickshaws, in order to reduce pollution and smog,” Aslam added.

Green Revolution to reduce imports, boost local industry
With the green revolution, Pakistan also hopes to reduce dependence on oil imports that could help save $2billion, incentivise the local car industry and create jobs. More than 3,000 CNG stations that have been shut due to gas shortage would be converted to EV charging stations. Pakistan is also planning to set up special units of electric car manufacturing in the Special Economic Zones being established under the China-Pakistan Economic Corridor (CPEC).


Collaboration and incentives

Climate and energy experts have hailed the policy but some are sceptical. “It is certainly good news but we have not seen much discussion on technical aspects and implementation framework,” said Asad Mahmoud, representative of National Energy Efficiency and Conservation Authority. He advised the government to involve all relevant stakeholders from energy to automobile industries for effective results.


Ali Amjad, an EV enthusiast with a background in engineering, said the primary focus should be cars and public transport because “converting bikes to electric vehicles has not been very efficient globally”. Amjad told Gulf News: “The catchphrase to attract people should be ‘save money’, rather than ‘save the environment because, let’s be honest, for most people, climate change isn’t a strong enough motivation to switch to EV. High speed, enhanced range, acceleration and comfort are the things the EV companies need to market to general public.”


Electricity shortages

But how can Pakistan switch to electric vehicles when it faces electricity shortfall? A 2019 report titled ‘Electric Vehicles in Pakistan: Policy Recommendations’ says by 2025, an excess of 15,000 MW peak generation capacity will be available in the system to spare for EVs and claims that “almost 500,000 EVs can be fully charged daily with a supply of just under 1000 MWs”. Researchers said introducing EVs in Pakistan can solve present and imminent problems of a number of sectors, including transportation, environment, economy and power.


Key Facts

• Target set to convert 30 per cent of vehicles into EVs


• 3,000 CNG stations to be transformed to EV charging stations

• 100,000 cars and 500,000 bikes and rickshaws to be converted to EVs in next 4 years


https://gulfnews.com/world/asia/pakistan/pakistan-approves-first-electric-vehicles-policy-1.67646114

 

[ghazi52]

Time of electric vehicles


The history of Pakistan’s automotive industry is one of the oldest in the Asian countries. The industry started semi knockdown production of trucks (Bedford) in 1949 by General Motors, which marked the start of the industry’s history after the independence from British India. Trade liberalization has not been supported by the automotive industry of Pakistan, which has led to consumers facing higher prices, low quality standards and inadequacy of competition in this sector. Being the sixth largest manufacturing subsector of the economy the automobile industry employs over 3.5 million workers, Pakistan’s auto sector has potential to create much value for the country and can also attract foreign direct investment and foreign exchange revenues by exporting vehicles.

Prime Minister Imran Khan recently chaired a meeting on climate change and decided to introduce EVsby setting up electric vehicle plants for the first time in Pakistan. The Prime Minister ordered the authorities concerned to ensure conversion of 30 percent of all cars running in the country into EVs by 2030.

Electric vehicles (EVs) have advanced significantly this decade, mainly because of decreasing battery costs, yet EVs remain more costly than fuel based vehicles over their useful life. Commercial success for EVs will require installing charging infrastructure that is accessible, easy to use, and relatively inexpensive—whether at home or in public locations. There are a lot of innovation going on in this segment and in coming months and years, we will see new technology. Therefore, the form this infrastructure will take is still uncertain, with a range of charging technologies currently available, much more is expected to emerge over the next five years.

Adviser to Prime Minister on Climate Change Malik Amin Aslam says; most countries are opting for EVs across the world and Pakistan is far behind in it and once introduced in the country, EVs will help save at least Rs2 billion worth of oil imported into the country besides reducing the country’s air pollution. The adviser said that smoke emissions from vehicles were a major source of air pollution in the country and it contributed heavily to smog during winter season in Punjab, especially in Lahore. In this situation, EVs would help lessen dependence on LPG and compressed natural gas stations, most of which were shut down because of gas closure on different days especially in winter in Punjab and these stations would be converted into charging docks for EVs.

So the big question is; will the transportation sector of the future be electrified? This question is at the core of the energy and transport debates these days. Various developed countries have now even enacted subsidy programs, are supporting the installation of a charging infrastructure, and are starting to develop regulatory initiatives to support and manage an electric vehicle fleet. In fact, some governments—including the United Kingdom and France—have announced that they will not permit the sale of new fossil-fueled automobiles after 2040. The car manufacturers that were initially skeptical about electric vehicles are now committing billions of dollars to their production. As per an estimate, by 2022 there will be 127 different fully battery-electric car models available for purchase in the United States alone.

The current range of equipment spans chargers that are best suited to home or office locations and for short trips, and much faster direct chargers for rapid refueling in public locations are yet to be tried and tested which would be best suited for longer journeys. The costs of charging infrastructure will both fixed (installation, utility service, transformers, and equipment) and variable (electricity charges). Operating cost of the chargers will actually determine the electricity tariffs. The total cost of power from fast charging stations would be higher than slower residential chargers unless the former can achieve sufficiently high utilization rates. As a matter of fact, commercial chargers are almost universally not economically profitable, suggesting a significant and sustained increase in demand will be needed for commercial charging infrastructure to deliver financial returns, and compete with other cheaper residential charging methods.

Pakistan is considering to have EVs whereas its electricity transmission and distribution network doesn’t support such initiatives in near term at least. The charging stations for EVs will require electricity which will be through distribution companies only unless someone makes its own electricity supply arrangement. Current network of distribution companies in Pakistan is weak and unreliable. Managing additional power demand from EVs is both a challenge and an opportunity for electricity distribution companies commonly known as DISCOs. High concentration of EV home charging during peak periods can overload local transformers. DISCOs may have to procure additional capacity, unless they are able to shift demand to off-peak periods. The tariff charges in Pakistan are different for off-peak and peak hours. Peak hours start from 7pm till 11pm. Tariff of peak hours are higher than off-peak hours. In USA, time-of-use electricity pricing, along with smart metering, have already been deployed in some states to incentivize off-peak charging and manage peak loads, respectively. Even in USA, it is still unclear whether the mechanism will be sufficient to offset increase on the demand whereas we are talking about Pakistan where electricity network is still decades old. But this should not be an excuse for not making progress on EV sector. Vehicle-to-grid technology, allowing EVs to serve as mobile electricity storage units, could complement these efforts but will need adequate incentives, which are not presently available worldwide. One of the things which will require special attention would be overall electricity tariff reforms and those are very essential.




Since last decade there has been a growing interest for EVs. Due to ever increasing oil pricing, depleting oil reserves and global warming and climate change challenges, it is being considered to have less reliance on fuel based vehicles. If EVs are successfully developed and cost is marginalized then reliance on imported fuel will also be reduced gradually whereas local resources will be more utilized such as hydro power. Pakistan has an immense potential of hydro power generation which should be utilized at full capacity.

The local auto parts manufacturing industry is criticizing the proposed national EV policy and urged the government to promote and protect the existing sector. Pakistan Association of Automotive Parts and Accessories Manufacturers (Paapam) said that the government needed to consider three categories — Hybrid Electric Vehicles (HEVs), Battery Electric Vehicles (BEVs) and Plug-In Hybrid Electric Vehicles (PHEVs) — under one policy to curb fossil fuel utilisation. EVs in Pakistan would solve many of issues, including air pollution, unmet capacity charges besides reducing fuel import bill and saving two-third cost of transportation. Pakistan’s EV introduction plans is to have 30 percent BEVs vehicle by year 2030.

The salient features of policy framework should be in line with the ground realities. Pakistan should have a three-step policy, in the first step from year 2020-25, the government should promote indigenisation in prevailing products and promote clean renewable energy program. In the second step from year 2026-30, the country can introduce HEV/PHEV promotion policy and build charging infrastructure and then from year 2031 onwards EV policy should be executed to achieve targets. India, USA, Thailand, and Indonesia are securing their auto industry by gradual shift from fossil fuel to EVs without affecting their existing auto industry. Paapam says that the government should govern local auto industry as per incentives given in Auto Development Policy 2016-21, and promote EVs in the next policy.

There was a time when the future of EVs was depended largely on a combination of high government subsidies, high oil prices, and dramatic improvements in battery technology. Today, the outlook is more positive, but several questions are still unresolved. Will battery powered EVs be competitive with conventional fueled vehicles in the next five to ten years? Will a cost-effective charging infrastructure emerge? What are the economic and financial challenges that must be overcome?

The most encouraging thing is that battery costs have fallen significantly in last five years and the size of battery packs has increased in developed countries. Improvements in battery technology over the past few years have been impressive. Today’s battery cells have higher energy densities and are much less expensive on a per kWh basis than they were just a few years ago. Lithium-ion (also called Li-ion) cells is attracting bulk of investment, and remain the preferred technology for giants like LG, Panasonic, and Samsung, the three largest producers. Lithium-metal technologies with much higher energy densities are in development.

Toyota Motor Corp aims to get half of its global sales from electrified vehicles by 2025, five years ahead of schedule, and will tap Chinese battery makers to meet the accelerated global shift to electricity-powered cars. The change illustrates the breakneck growth in the EV market, which is transforming the auto industry, and is also an acknowledgement by Japan’s top carmaker that it may not be able to meet demand for batteries on its own. Toyota is now faced with a higher-than-expected demand for cars that use batteries, rather than gasoline.

Without an accessible infrastructure that can re-charge an EV in a reasonable period of time, most motorists will be unwilling to purchase one, even if it is cheaper and its performance is better. The commercial success of the EVs requires the development of a charging infrastructure that is accessible, easy to use, and relatively inexpensive. Anyhow, the challenges facing EV deployment have become more tractable in recent years, but they are still considerable. The life cycle cost of ownership of BEVs has fallen substantially. New designs, better smart metering, charging equipment technologies, and a charging infrastructure that is convenient and price competitive will need to be developed and implemented. These are difficult but achievable tasks. Pakistan is planning to have EVs and it is right time to learn lessons from past mistakes and government should only allow EVs if they are manufactured in Pakistan instead of allowing big names to assemble EVs in Pakistan. Manufactures ask for volumes for installation of a manufacturing facility, Pakistan auto market can provide volume therefore, there should not be any further concession in this regard.

http://www.pakistaneconomist.com/2019/09/30/time-of-electric-vehicles/

 

[Ahmad Bhutta]

There should No tax on import of electric vehicles
Countries like Norway give subsidies on importing of such vehicles

 

[Syed1.]

My beef with this policy is that is it being seen from the angle of climate change (which is a fortunate byproduct) but electric vehicle policy should have been driven with the intention of leapfrogging the IC engine tech that we missed out on and instead be a global player in EVs.

Also focus of policy seems to be in "conversion" of existing vehicles to EVs, rather than producing new EVs from scratch for local use and export.

An EV policy that is just focusing on climate change is inherently inward looking and will not foster rapid industrialization.

 

[Fawadqasim1]

And who will be able to to buy it under the circumstances. e.g 660cc Alto is selling for 1.5 million

 

[Rusty]

Great policy!!

Local innovation is a must!
no assemblers with imported parts, but local ingenious designs.

For that, the government will have to set up a few state owned industries, and those industries need to target buses and trucks first and then move on to regular cars.

Also, as an incentive to phase out older polluting cars, they need to start having emissions control on older cars. If the car does not pass, it has to be fixed or sent to the junk yard.

 

[ghazi52]

NA approves Electric Vehicle Policy 2020

June 30, 2020

ISLAMABAD: The government on Monday got approval of National Assembly on Finance Bill 2020 and incorporated Electric Vehicle Policy 2020 and granted income tax exemptions to Sindh Institute of Urology and Transplantation (SIUT), Shaukat Khanum Memorial Trust and National Endowment Scholarship for Talent (NEST).

The income tax exemption has also been granted to Alamgir Welfare Trust and Foundation University. The government has deleted 25 percent FED on caffeinated energy drinks and reduced FED rate on cement.

According to passed Finance Bill 2020 by National Assembly here on Monday, the government included Electric Auto Rickshaw, 3-wheeler electric loader and electric motor cycle where the duty under Customs Act would be charged by 50 percent. This incentive will be applicable for five years starting from July 1, 2020. The Engineering Development Board (EDB) would scrutinize this scheme. There will be one percent duty on Electric buses, electric trucks and electric movers.

For small trailers assembling, on the 280 HP kit there will be 20 percent duty. The machinery and design plant for manufacturing of electric vehicles, there will be zero duty.

Federal Minister for Industries Hammad Azhar on Monday tweeted and stated that some amendments were tabled and passed along with Finance Bill on Monday. Some of its highlights included minimum tax waived for hospitality sector for 6 months (April till Sept), 0 percent minimum tax for Haj operators, further Federal Excise Duty (FED) reduced(total 50 paisa/kg) on cement.

The reversal of FED increase on caffeinated drinks and the government approved Electric Vehicle policy (2-3 wheelers, buses, trucks) incentives, mobile manufacturing incentives, exemption of GST from cotton seed cake, services for asset management telecom tower & data management at concessional 3% tax, he added.

The surplus funds of the Non Profit Organizations (NPOs) which are not spent during the year for welfare are taxed at the rate of 10% with certain exclusions. One such exclusion is funds which could not be spent due to any obligation or restriction placed upon the NPO by the donor. However, where the donor is an associate of the NPO, such a restriction can be a mechanism to shift profit to the NPO. Therefore, an amendment was proposed so that the above exclusion does not apply in case where the donor is an associate of the NPO.

Currently, engineering services have been included in specified services on which reduced withholding tax of 3 percent is applicable. The Bill proposed to exclude such services from the list of specified services.

The Act has now re-included ‘engineering services’ in the specified list along with other services of warehousing services, services rendered by asset management companies, data services provided.

The bill had proposed new entry “6a. Caffeinated energy drinks PCT code 2202.1010 2202.9900 25 percent of Retail Price”. Now Act has deleted this entry. Before bill, FED was levied on cigars, cheroots, cigarillos and imported cigarettes at 65 percent of ‘retail price’. Through bill the duty was increased to 100%. Now Act, the duty imported cigarettes of tobacco or tobacco substitutes [entry 8] is 65 percent of retail price. For Cigars, cheroots and cigarillos of tobacco and tobacco substitute the rate of duty will be 65 percent of retail price or Rs10,000/kg whichever is higher.

As per Bill duty on cement was proposed to be reduced by 12.5 percent from Rs2 to Rs1.75 per kilogram implying a decrease of Rs12.5 per standard bag of 50 kilogram. Now Act has further reduced duty from Rs1.75 to 1.50.

As per bill a new entry 55d was added whereby locally manufactured double cabin (4x4) pick-up vehicles except the vehicles were subject duty 7.5 percent ad valorem. Now Act has restricted this to vehicles booked on or before June 30, 2020 subject to the restriction or conditions specified by the FBR.

 

[Major Sam]

Govt. Should introduce safety and recycling policy also, other wise there will b exponential increase in low quality batteries and so does the accidents.

 

[Syed1.]

Govt. Should introduce safety and recycling policy also, other wise there will b exponential increase in low quality batteries and so does the accidents.

Yes good point, we don't want exploding batteries on our streets.

 

[baqai]

ghar par load shedding hu rahi hai tu new excuse for office will be "Sir light nahi thi gari charge nahi hui"