If there is one thing Nepal’s annual budget is consistent about, it is being inconsistent. In 2020, the government reduced the taxes on electric vehicles, the next one re-imposed it for electric SUVs while cheaper vehicles were still taxed less, this year Finance Minister Prakash Mahat increased the tax on smaller EVs and electric vans while inexplicably reducing the tax on luxury SUVs. &nbsp; By increasing the tax on entry-level battery-powered vehicles, the government has effectively discouraged the public from switching to clean energy at a time when Nepal is all set to have year-round electricity surplus. The decision also undermines the government’s own decarbonisation goals. &nbsp; Continued proliferation of diesel and petrol vehicles will also keep worsening air pollution in the cities, affecting public health. &nbsp; Customs and excise tax on electric cars between 50-100KW has increased by 5% and 10%, meaning they now have to pay 15% customs tax and 10% excise duty, the latter of which was not applicable before. Vehicles in this bracket include electric public utility vans, battery-operated microbuses and smaller e-cars which were gaining popularity across Nepal. Read also: <a href="https://www.nepalitimes.com/here-now/an-electric-shock-to-nepals-energy-future/">An electric shock to Nepal’s energy future</a>, Ramesh Kumar “This is a blatant disregard for the country’s environment policies because the government has significantly increased the tax on more affordable EV options,” says environmentalist Bhushan Tuladhar. “To add insult to injury, they have slashed the tax on bigger vehicles. This is suspicious, especially as it does nothing for government revenue even if that was the reasoning. It’s not just EVs, even the taxes for higher-end 350cc motorcycles have also been lowered.”&nbsp; Indeed, mid-range and high-end EVs enjoy reduced tax rates or a very minimal increase. Customs and excise for 100-200KW EVs is down from 30% to 20%. Similarly, customs duty for 200-300KW EVs has gone down from 45% to 40% while excise remains the same at 45%. Customs for EVs in the 300KW or above bracket is set at 60-80% against 60% previously with excise maintained at 60%. EVs with 100KW motors will now be at least 20% more expensive.&nbsp; ‘It is deliberate sabotage,’ wrote Atmospheric Scientist Arnico Panday who is also a central committee member of the RSP, the fourth largest party in Parliament on Twitter. ‘The present leadership does not care about clean air, health, people, domestic energy, new technology or the country's future, &amp; probably got bribed by dealers of polluting vehicles in segments with popular EVs.’ The government has changed the tax rates for EVs five times in two years, disrupting the market and raising suspicions that the rates are adjusted based on political patronage of power lobbies among car importers. Especially egregious is the increase in the tax of electric micro-buses which had started becoming a popular form of public transport, and fingers are pointing to diesel microbus importers. &nbsp; “The tax hike is also unfair from a social justice aspect as we are essentially denying those who could otherwise afford entry-level EVs,” says climate activist Shilshila Acharya. “Our EV landscape is being shaped by vested interest groups.” Read also: <a href="https://www.nepalitimes.com/here-now/potholes-on-the-highway-to-nepal-s-ev-future">Potholes on the highway to Nepal’s EV future</a>  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20230609020628_e4164e59b5982f63d1246eaebbbb6c118a33f051112cdf9885d2c430fd64d862.jpg" data-media-id="editor_2" data-image-id="20230609020628_e4164e59b5982f63d1246eaebbbb6c118a33f051112cdf9885d2c430fd64d862" data-rendition-name="original" width="3000" height="2000" loading="lazy" alt="ELectric bus NT"> <figcaption>Photo: GOPEN RAI</figcaption> </figure>  By 2024 Nepal’s peak power generation capacity is expected to reach 4,500MW while domestic demand will only grow to 2,000MW at current rates of consumption. Much of this surplus therefore risks being spilled. And as of now, Nepal is not allowed to export more than 420MW to India which has rejected any and all Chinese involvement in Nepal’s hydropower projects. Tax incentives for electric public transport would reduce Nepal’s growing petroleum import bill, and improve air quality. Air pollution was the direct cause of over 42,000 deaths in Nepal in 2019.&nbsp; “Our policies contradict our climate targets, but more importantly they make no sense even from an economic point of view,” adds Acharya who is with the Avni Centre for Sustainability. She adds: “We want to reduce our trade deficit and increase the consumption of hydropower. Electric vehicles would have been the best strategy going forward and yet we keep changing our mind about taxing them.” At COP26 in 2021 in Glasgow, Nepal’s prime minister committed to achieving net zero by 2045 and increasing the sales of private electric vehicles to 25% by 2025 and 90% by 2030. Electric public transport would be 20% by 2025 and 60% by 2030. Read also: <a href="https://www.nepalitimes.com/news/e-2-wheelers">e-2 wheelers</a> Another sign of contradictory policies was the signing of two petroleum pipeline deals during Prime Minister Dahal’s visit to New Delhi last week. Both India and China have publicly announced that they would stop manufacturing petrol cars by 2030. By that time, Nepal will not be able to import fossil fuel-powered vehicles even if it wanted to. But perhaps the biggest letdown is the disincentives on switching to electric buses. The budget provides no concessions to electric public transport. India subsidies electric buses, but in Nepal government ministries have been putting up obstacles on charging station to run 40 electric buses by Sajha Yatayat.&nbsp; Within the electric vehicle bracket, it is the electric buses that benefit any country the most. Reliable public transport is accessible to most people, discourages consumerism and reduces traffic. “Things we could do immediately to correct our course of action is reduce the tax on electric micros, the market will boom benefiting small time entrepreneurs and help finance electric buses to rapidly shift to cleaner energy,” says Tuladhar who is also the director of Sajha Yatayat. He adds: “We could use the Rs4 billion already collected as pollution tax, just 5 million will buy 200 electric buses. If you must tax something, increase the pollution tax which is less than 1% of all the taxes we pay, and then divert the fund for clean alternatives.” Read also: <a href="https://www.nepalitimes.com/news/nepal-goes-electric-but-conditions-apply">Nepal goes electric, but conditions apply</a>, Ramesh Kumar Corrigendum: Corrected some new car prices from print edition.

Sonia Awale

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1 step forward, 2 steps back in Nepal

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161124/636d18449c7e80680e0ac7b6jpeg.jpg" alt="" width="960" height="640"/><figcaption>Chinese electric two-wheeler company Yadea's electric mountain bicycle, the Yadea SS800.</figcaption></figure>Even as <a href="https://www.nepalitimes.com/latest/e-vehicles-prepare-for-post-lockdown-boom/" target="_blank" rel="noopener noreferrer">importers try to meet increased demand</a> for electric cars following the <a href="https://www.nepalitimes.com/latest/new-nepal-budget-sparks-electric-comeback/" target="_blank" rel="noopener noreferrer">reinstated tax rebates </a>on battery-operated vehicles, electric two-wheelers remain relatively on the sidelines.Now, here come electric bicycles which purists have problems with, but are catching on despite the steep price tag.In 2018, Nepal’s oldest bicycle shop <a href="https://pancbike.com.np" target="_blank" rel="noopener noreferrer">Pancha Asta Narayan Cycles</a> (Panc) began to roll out Electric Conversion Kits (ECKs) that turn regular bicycles into e-bikes. Now the shop is also importing battery powered bicycles.This year, Kuzu Nepal, the distributor of the Chinese electric vehicle company Yadea’s two-wheelers, introduced four of its all-terrain electric mountain bicycles in Nepal: the Yadea SS1000, SS800, YS500, and YT500.<a style="font-size: 15px; letter-spacing: 0.01em;" href="https://yadea.com.np" target="_blank" rel="noopener noreferrer">Yadea Nepal</a>’s customer base has grown steadily since then. It has sold 30 electric bicycles in recent months. Interestingly, the higher-end SS1000 and SS800 are bestsellers, says Ritesh Shrestha of Yadea Nepal. Most customers are avid Kathmandu-based long-distance cyclists, doctors, and expats.However, the company recognises that the reach of e-bikes is limited and that they may not be for everyday Nepali users.“Our customer base is largely people who know their bicycles, and people over age 35 who want a less taxing mode of a healthier lifestyle,” says Shrestha.He recalls some recent feedback from a young client who purchased an e-bike recently, but his father has been using it to commute to and from work:“The Dad told us that despite not being in top form, the rides are not stressful or tiresome, and his commute is helping him to exercise.”The primary objective of an electric bicycle is to enable a healthy way of travelling and enhance one's performance. Cyclists need not exert nearly as much energy pedalling, and can ride further without taxing their bodies.Among the four all-terrain e-bikes, the Yadea SS1000 and SS800 mountain bikes are for Nepal’s off-roads, while the YS500 and YT500 models are more suited to urban and city roads. The high-end Yadea SS1000 is the most expensive at Rs430,000, while the two city bikes are priced at Rs250,000 each.Yadea e-bikes use a Samsung lithium-ion battery attached to the down tube of the bicycle frame, which takes four-and-a-half hours to fully charge for the SS1000 and SS800 bicycles, while the YS500 and YT500 models take six-and-a-half hours to charge fully.The bicycles are equipped with the company’s independently developed 350W Fusion mid-motor located near the bicycle’s bottom bracket, which provides a maximum torque of 85NM.The controls of the bike, which allow the rider to manage the motor input according to levels, are on the left handlebar, with a display monitor at the front. The bikes have 11 gears that can be changed using a tab along the right handlebar.Nearly 80% of all registered vehicles in Nepal are privately owned two-wheelers, most of them polluting fossil fuel guzzlers, and contribute 8% to total emissions from transportation.And while battery-powered electric scooters and motorcycles significantly reduce greenhouse gas emissions, some point to the “redundancy” of e-bikes, as bicycles require no fossil fuel to begin with.“Electric bicycles, and electric two-wheelers in general, haven’t made an impact in Nepal like electric four-wheelers,” says Lokesh Oli of Olizstore, who has tested and reviewed several electric vehicles, including Yadea’s SS1000 e-bike, and posted videos on YouTube.The expensive price tag is a drag. Many viewers commented on Oli’s review of the Yadea SS1000 that they would rather buy new motorcycles than spend so much on electric bicycles.Other companies that promote e-bikes in Nepal agree with the public consensus and sell the bicycles without much exposure or promotion.“Considering the costs as well as exposure, e-bikes in Nepal, whether they be for the daily commute or more long-distance off-road travel, are currently for hobbyists,” he adds.However, Oli, who grew up cycling to and from school and around his village, as well as for a few years after he relocated to Kathmandu, is optimistic about the future of battery-operated bicycles.“This is true especially as bicycles remain the primary mode of transport for much of Nepal’s population outside the Valley,” he adds.People across Nepal own bicycles for travel and business, and access to e-bikes would reduce their effort as well as make them more efficient.

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1 step forward, 2 steps back in Nepal

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