Delhi to offer cash to scrap old cars, switch to electric vehicles

The incentives will be granted only to registered owners of scrapped vehicles, ensuring transparency and preventing misuse of the scheme.

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NEW DELHI: Delhi govt is set to roll out a new policy aimed at accelerating the adoption of electric vehicles (EVs) by offering financial incentives to individuals who scrap their old vehicles and switch to cleaner alternatives.Under the scheme, individuals who scrap their old, Delhi-registered BS-IV or older vehicles at authorised facilities will be eligible for monetary incentives, provided they purchase a new electric vehicle within six months of receiving a certificate of deposit.The structure of incentives varies depending on the category of vehicle being purchased. For electric two-wheelers, buyers will receive an incentive of ₹10,000 upon scrapping an eligible older vehicle. Those opting for electric three-wheelers (L5M category) will be entitled to ₹25,000. The scheme will offer the most significant benefit in case of private electric cars, with buyers eligible to avail themselves of an incentive of ₹1 lakh. However, this benefit will be restricted to vehicles with an ex-factory price of up to ₹15 lakh and will be available only to the first one lakh eligible applicants – indicating a targeted approach to maximise early adoption, according to a draft prepared by govt.All incentives will be disbursed directly to beneficiaries through direct benefit transfer (DBT).

Applicants will be required to submit their claims through a process, which will be notified by the transport department. The policy is likely to be announced during the Delhi budget session next week.

The incentives will be granted only to registered owners of scrapped vehicles, ensuring transparency and preventing misuse of the scheme, an official said.

Govt also plans to extend substantial relief through exemptions on road tax and registration fees. All electric vehicles registered in Delhi could be eligible for a 100 per cent exemption on these charges until March 31, 2030. This is expected to significantly reduce the upfront cost of owning an EV, making them more attractive to consumers, said another official.The policy also introduces a graded approach for electric cars based on their price. Electric cars with an ex-factory price of up to ₹30 lakh will qualify for full exemption from road tax and registration fees. However, vehicles priced above ₹30 lakh won’t be eligible for these exemptions, reflecting govt’s focus on encouraging mass-market adoption rather than subsidising luxury segments, he said.

The initiative aligns with Delhi’s ongoing efforts to tackle air pollution, a persistent challenge. By incentivising the scrapping of older, more polluting vehicles and promoting electric mobility, govt hopes to create a cleaner and more sustainable urban transport ecosystem, the official said.

An analysis of total registered vehicles in Delhi, categorised by fuel type, shows a mixed uptake for electric vehicles. While EVs are increasing in categories like three-wheelers, goods vehicles, e-buses and e-rickshaws, their penetration is too small to make a dent in the petrol and diesel segment, which is a major source of pollution.

From Jan to Sept 2024, 2.7 lakh petrol two-wheelers and 26,613 electric two-wheelers were registered. During the same period next year, 3.2 lakh petrol two-wheelers, including those running on ethanol-blended petrol, and 27,028 electric ones were registered, govt’s Vahan data shows.