Government approves PM-eBus Sewa PSM scheme for e-buses • EVreporter

On October 28, 2024, the Government of India approved the PM-eBus Sewa-Payment Security Mechanism scheme through the Ministry of Heavy Industries. This initiative aims to establish a Payment Security Mechanism Fund for the procurement and operation of electric buses (e-Buses) under government-sponsored programs. The scheme is designed to mitigate payment delays and enhance the financial viability of OEMs/operators involved in Concession Agreements with Public Transport Authorities (PTA).

Objectives:

• Provide payment security against defaults by PTAs.

• Establish a mechanism for recouping funds from parent State Governments/UTs in case of non-repayment.

• Support capacity building and innovative technologies for PTAs.

Salient Features:

• Coverage: The scheme aims to support 38,000 e-buses.

• Target Beneficiaries: PTAs and OEMs/operators.

– PTAs must adopt the Gross Cost Contract (GCC) model and register a Direct Debit Mandate with RBI and procure through Convergence Energy Services Limited (CESL) or comply with Payment Security Mechanism (PSM) guidelines for direct procurement.

– OEMs/operators must enter into Concession Agreements with eligible PTAs.

• Duration: Payment security coverage for up to 12 years for each bus deployed under the scheme.

Financial Outlay:

The total financial outlay for the Scheme is ₹3,435.33 crore.

Implementation Mechanism:

1. Process for OEMs/operators:

• PTAs will maintain an Escrow Account.

• OEMs/operators will submit invoices as per the Concession Agreement.

• Defaults by PTAs will be reported to CESL.

2. Fund Disbursement:

• CESL will review and approve payment requests.

• Approved amounts will be disbursed to the Escrow Account.

3. Repayment Mechanism:

• PTAs must repay the disbursed amounts within 90 days, including a Late Payment Surcharge (LPS).

Steering Committee:

A steering committee has been formed to oversee the scheme, comprising members from relevant ministries and CESL.

Implementing Agency:

Convergence Energy Services Limited (CESL) will implement the scheme. Detailed guidelines for operation will be issued separately.

Also read: Cabinet approves PM-eBus Sewa PSM scheme for 38,000 e-buses