The Delhi government is planning to extend the green cess, which could make petrol and CNG cars more expensive. This proposal will be part of the Delhi draft EV policy, which is expected to be released next month. Delhi residents wondering about the new EV policy can find the full details here.
The government introduced the green cess in the EV policy in 2020, which was set to end in August 2023, but later it was extended till March 2026. As we approach another expiration, the government has prepared a new draft policy.
With the new policy, the government plans to promote the sale of electric vehicles as the CNG and Petrol will be expensive. The government’s senior transport official has shared the expected changes to the policy, but the government has yet to confirm.
What is the proposed green cess plan under the EV Policy?
The Delhi government started the green cess around five years ago, and it has been extended beyond its last expiration. Now that we are near the expiration, the government has proposed to extend the policy with the following proposals:
- The government plans to impose 1% to 2% green cess on all new petrol and CNG vehicles, increasing the price of these vehicles.
- The proposed plan will also increase the current 1% green cess on the diesel vehicles by 2% after the expiration.
So, with the new plan, people buying cars in Delhi and registering them can expect to pay an extra tax of 1% to 2% on Petrol and CNG vehicles, and this cess will go to the State EV fund that will help in incentivizing the EV vehicles and bridge the price gap between EV and other vehicles.
What are the EV incentives under the Delhi EV Policy Plan?
Under the Delhi EV Policy Plan, the government offers many incentives to the residents, such as a 25% subsidy (up to ₹5,500) on e-cycle purchases, ₹5,000 per kWh of battery capacity for two-wheeler vehicles, and ₹30,000 for e-rickshaws and e-carts.
The proposed Delhi EV Policy Plan offers the following incentives if it is approved by the Cabinet:
- The government plans to support the replacement, scrapping, battery swapping, charging infrastructure, and retrofitting support to EV buyers.
- The government plans to 3% lower interest rates for commercial EV loans and 4% lower rates for private two- and four-wheeler vehicles, making EVs more affordable for buyers as the government pays part of your loan interest. The interest subvention on EV loans makes your EMI smaller and reduces the upfront cost.
What is the proposed Delhi EV policy plan timeline?
The Delhi EV Policy Plan was introduced in 2020 by the Delhi government to and it was later extended till March 2026. So, to have the policy plan continue, the government will have to get the new proposed plan approved before March 2026.
According to reports, the government can release the new proposed plan by January 2026 and plans to finalize it by March 2026 if the Cabinet approves it. However, the residents should know that the government allows a short extension of an additional 15 days if the policy expires, to draft a new policy.
| Policy expired on | March 2026 |
| Proposed Policy Release | January 2026 |
| Finalizing the proposal plan | By March 2026 |
How will it affect Delhi residents buying cars and EV progress?
The government introduced the Delhi EV policy plan and green cess to encourage buyers to buy Electric vehicles to promote eco-friendly ways and enhance the EV infrastructure. With the proposed plan, let’s see how this will affect the Delhi residents and EV progress in Delhi:
- According to reports, Delhi has 111,000 EVs registered out of the 800,000 vehicles this year, which is great progress, and the government expects the number to increase with the draft plan.
- Currently, Delhi has a 12 to 14% monthly EV registration due to EV policies and people drive to save the environment. With incentives and support, the government can expect more people to choose EVs over other vehicles as they will be more affordable.
- The new policy can increase the price of Petrol and CNG vehicles for people buying and registering the vehicle in Delhi after the implementation of the new proposed plan, if it is approved.
The Delhi government proposed a plan for the Delhi EV policy plan, and the green cess is yet to be confirmed, but the officials did release some information about the proposal. The officials say the government plans to control pollution, promote EV adoption, and balance revenue through the new draft policy.
