The subsidy for electric buses provided by Rural Electrification Corporation (REC) Ltd than tripled, reaching over 10,000 buses in FY24. Disbursals increased from Rs 2439 crore in FY23 to Rs 7124 crore, indicating that State Transport Undertakings across are seeing a major uptick in the utilization of electric buses.
At an event in Mumbai last week, Vivek Kumar Devangan, Chairman and Managing Director of the government-backed REC, stated to Autocar Professional that he anticipates REC to finance over 50,000 electric buses over the next two to three years due to strong demand.
In addition to electric buses, REC has projected a tenfold increase in funding to over Rs 3 lakh crore by 2030 for the full range of renewable energy sources.
According to REC CMD, funding for all green energy projects—which combine solar, wind, and electric mobility—has jumped by 533% for the fiscal year that ended in 2023–2024, from Rs 21,554 crore in FY23 to Rs 1,36,516 crore. This increase includes money for green hydrogen and electric mobility.
Top officials at the company have disclosed that it plans to fund the OEM’s gross cost contracts (GCC model) that come from different state transportation projects, the Indian government’s PM E Bus Sewa program, and private transportation companies looking to expand their fleet of diesel-powered buses with electric models.
TSC Bosh, Executive Director of REC, stated that the company will ‘play one of the largest roles in the country in funding bus programs’ for RFPs issued by various state transport companies and supporting full ecosystem support for India’s electric bus mobility journey, including private players. This indicates a strong preference for green hydrogen and electric mobility projects, particularly electric buses.
“We have aggressive plans to promote electric mobility in both the state transport bus industry and private tour and travel operators who want to transition to electric mobility, which is why we have outlined funding plans for 50,000 buses,” Bosh also revealed.
After making no payments in FY23, REC Ltd. spent Rs 7997 crore on green hydrogen projects in FY24.
The amount of money the corporation has invested in solar energy has more than doubled, from Rs 9031 crore in FY23 to Rs 20,956 crore in FY24.
According to his prediction, green hydrogen prices, which are currently about USD 5–6, are expected to drop to USD 1 by 2026–2027. This is in line with the price of solar power, which was previously costing Rs 16 per kWh but has since dropped to Rs 2.5–3 per kWh as more companies enter the market.
Because green ammonia is in high demand in Western European nations like Germany, France and the United Kingdom, REC intends to provide funding for the production of green ammonia.
