The Ministry of Heavy Industries has approved PM-eBus Sewa-Payment Security Mechanism (PSM) scheme on Monday, October 28, 2024, for the procurement and operation of e-buses by Public Transport Authorities (PTAs) with an outlay of Rs 3,435.33 crore.

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The scheme called "PM-eBus Sewa-Payment Security Mechanism (PSM)" will support the deployment of more than 38,000 electric buses (e-Buses) from 2024-25 to 2028-29, a release said.

The scheme will support the operation of e-buses for a period of up to 12 years from the date of deployment.

At present, the majority of buses operated by Public Transport Authorities (PTAs) run on diesel/CNG, causing adverse environmental impacts.

On the other hand, e-buses are environmentally friendly and have lower operational costs. However, it was anticipated that Public Transport Authorities (PTAs) would find it challenging to procure and operate e-buses because of their high upfront cost and lower realisation of revenue from operations.

The scheme addresses this concern by ensuring timely payments through a dedicated fund. In case of default of payments by public transport authorities, CESL, the implementing agency, shall make necessary payments from the scheme funds, which will be later recouped by the PTAs/State/UTs.

This initiative seeks to facilitate the adoption of e-buses by encouraging private-sector participation. The scheme will also lead to significant reductions in greenhouse gas emissions and also reduce the consumption of fossil fuels.

The scheme will provide benefits to all the Public Transport Authorities (PTAs) in the state/UTs who opt for the scheme.

(With inputs from agencies)