"A battery recycling center shall be established for the reuse of EV batteries"

Gopikrishna Nyaupane, the former General Secretary of the Nepal Automobiles Association (NADA), brings a wealth of experience from the automobile sector. He has also held significant roles, including Director at Machhapuchhre Bank, General Manager at Udaypur Cement, and senior positions in over a dozen social organizations. A chartered accountant and a lawyer, Nyaupane is currently the Managing Director of Hillside College of Engineering. In the following edited excerpt from an interview with aarthiknews.com, he shares his insights on electric vehicles (EVS):

1. What benefits do electric vehicles (EVs) offer, considering their growing presence in the market in recent years?

A few years ago, Nepal only imported diesel and petrol-powered vehicles. However, electric vehicles have gradually gained a larger market share. The primary reason for this shift is the numerous benefits EVs offer. Notably, EVs do not emit carbon dioxide or harmful gases, making them environmentally friendly.

In cities like Kathmandu, where air pollution is a serious issue, the use of electric vehicles can help mitigate such pollution. The positive environmental impact of EVs has been recognized globally, prompting many countries to discourage the use of diesel and petrol-powered vehicles. This trend is also evident in Nepal, where the environmental benefits of EVs are driving their popularity.

In terms of operational costs, electricity is much cheaper than petrol or diesel, which reduces the overall cost of running an electric vehicle. As Nepal continues to increase its hydroelectric power production, there is potential for even lower electricity rates. The country imports about 15% of its total petroleum needs, so a shift to electric vehicles would reduce petroleum imports and help lower the trade deficit.

In terms of operational costs, electricity is much cheaper than petrol or diesel, which reduces the overall cost of running an electric vehicle

The government's policy to promote electric vehicles has also contributed to their increased adoption. Additionally, while petrol and diesel vehicles require frequent maintenance, such as oil changes and engine repairs, EVs have much lower maintenance costs, offering significant long-term savings.

2. The government seems to be increasing taxes on the import of electric vehicles to boost revenue. What are your thoughts on this?

The government should prioritize policies that support the growth of the electric vehicle market, such as offering tax exemptions, subsidized loans, and expanding charging infrastructure. This is not the time to discourage EV adoption. Instead, the government should encourage financial institutions to invest in eco-friendly initiatives, thus creating a favorable environment for the growth of electric vehicles.

While the government has imposed high taxes on petrol and diesel vehicles, the same fiscal policies are hindering the growth of electric vehicles. A possible approach could be to introduce an environmental tax on the electricity used to charge EVs, though this should not be seen as a long-term solution. The long-term answer lies in expanding hydropower production and exports, which would contribute to the nation’s prosperity

Although reducing the import of electric vehicles may initially appear to result in lower revenue, the long-term savings from reduced fuel imports can have significant economic benefits. These savings could be reinvested in energy production and industrial development, creating jobs and increasing revenue sources.

3. There have been complaints about the insufficient number of charging stations and the poor service at existing ones. How should this issue be addressed?

Currently, the country has not established enough charging stations to support the widespread use of electric vehicles. Additionally, in rural areas, inconsistent electricity supply remains an issue, and some areas still experience load shedding. As the number of electric vehicles increases, maintaining a stable electricity supply will become even more challenging. Even if hydroelectric power production increases, transmission line limitations could hinder a reliable supply.

To address this in the long term, electric vehicle importers, in collaboration with the Nepal Electricity Authority (NEA), should focus on establishing fast-charging stations that provide efficient, reliable service. Expanding the charging network and improving the reliability of electricity supply will also be crucial, and the NEA should prioritize the construction of transmission lines to improve access to electricity.

4. Electric vehicles are often considered expensive. What is your view on this?

While electric vehicles may seem more expensive than their petrol or diesel counterparts at first glance, especially when considering the higher upfront cost and monthly bank installments, they offer substantial long-term savings. The low fuel and maintenance costs associated with EVs ultimately make them more cost-effective for consumers.

5. Concerns have been raised about battery management. How can this be addressed?

Electric vehicle batteries typically lose 30-40% of their capacity over time, after which they need to be properly recycled to prevent environmental harm.

Electric vehicle batteries typically lose 30-40% of their capacity over time, after which they need to be properly recycled to prevent environmental harm

Nepal has great potential for reusing EV batteries. Despite delays in major projects, the Nepal Electricity Authority could repurpose old EV batteries for energy storage. An EV battery's lifespan is generally 8 to 15 years, and when its capacity drops below 30-40%, it is no longer viable for vehicle use but can still serve as a useful storage solution.

6. How can old electric vehicle batteries be used by the Nepal Electricity Authority?

Nepal experiences seasonal fluctuations in electricity production, with lower output in winter and higher production during the monsoon. Old EV batteries can be used to store excess electricity generated during periods of high production and then used during peak demand times, such as in the morning and evening. This would reduce pressure on the national grid. Countries like Japan, Germany, and the U.S. are already using similar systems for grid storage.

Old EV batteries can be used to store excess electricity generated during periods of high production and then used during peak demand times, such as in the morning and evening

7. Could electric vehicle batteries be used in solar energy systems?

As solar energy use grows in Nepal, old EV batteries can be repurposed as storage for solar energy, particularly for use at night or during cloudy periods. In rural areas, where access to the national grid is limited, repurposed EV batteries could be used in microgrids powered by solar energy. These batteries could serve as backup storage for both residential and commercial solar systems, similar to the solutions developed by companies like Tesla and Nissan.

8. Could a battery recycling plant be established in Nepal?

Currently, EV importers in Nepal rely on battery recycling industries in India. However, as the number of electric vehicles increases, Nepal will need to recycle thousands of EV batteries annually. This would allow for the extraction of valuable metals like lithium, cobalt, and nickel, which can be reused to make new batteries or in other industries.

Establishing a battery recycling plant in Nepal would eliminate the need to rely on other countries. While setting up such an industry would require significant investment, a public-private partnership could make it feasible. However, managing the hazardous components of these batteries requires strict regulations and precautions. Currently, there is no clear policy on battery collection and reuse in Nepal, so creating comprehensive policies is essential.

Establishing a battery recycling plant in Nepal would eliminate the need to rely on other countries. While setting up such an industry would require significant investment, a public-private partnership could make it feasible

9. With the parliamentary budget session underway, what policy measures should the Nepalese government adopt in its budget to promote electric vehicles?

High taxes and fees have made electric vehicles expensive, despite their promotion in government policy. Customs duties on EVs range from 10% to 60%, and although road tax for electric vehicles is lower than for petrol or diesel vehicles, higher-capacity EVs like buses and trucks are taxed more. A 13% VAT is also imposed on EVs, and import taxes apply when replacing their batteries.

Despite the lower operational costs of electric buses, in particular, compared to petrol and diesel taxis and buses, the high initial purchase price and taxes discourage businesses from adopting them. While businesses are interested in replacing old buses with electric ones, the prohibitive costs prevent them from doing so.

Despite the lower operational costs of EVs compared to petrol and diesel taxis and buses, the high initial purchase price and taxes discourage businesses from adopting electric buses

Given the high taxes on electric vehicles, businesses are hesitant to replace old vehicles with new electric ones, contributing to rising pollution levels. Therefore, the government should adopt a more flexible and supportive approach in the upcoming budget to make EV adoption easier and more attractive for businesses.