Nepal Clears Legal Path to Convert Internal Combustion Vehicles to Electric

Kathmandu. The conversion of petroleum-powered vehicles (diesel and petrol) to electric (EV) in Nepal has been a topic of discussion for a long time.

However, implementation remained elusive. Previous governments had established legal provisions for converting petroleum vehicles to electric, but these policies were never practically implemented. For nearly five years, the policy remained confined to paper.

Furthermore, while the government formulated policies, the lack of clear legal provisions and procedures made practical application nearly impossible. Now, the government led by Balendra Shah has decided to move forward with implementation.

The Cabinet meeting held on Sunday cleared all previous legal hurdles, fully opening the path to convert old fuel-based vehicles into electric ones.

The government has taken this strategic decision in light of the potential crisis in petroleum supply due to rising tensions and war in West Asia. With this decision, old vehicles that were destined for the scrapyard may now receive an electric revival.

Government spokesperson and Minister of Education, Sasmit Pokharel, stated that the decision was made to arrange all necessary legal provisions to convert old vehicles into electric ones, aiming to reduce dependency on petroleum products and mitigate environmental pollution.

'While we are spending a large amount of foreign currency on fuel imports, we are unable to consume our own clean energy,' said spokesperson Pokharel. 'The legal issues previously seen in converting diesel and petrol vehicles to electric will now be resolved. This will prove to be a milestone in increasing Nepal's renewable energy consumption and reducing dependency on fuel.'

The government has been forced to implement the vehicle conversion policy due to the difficulties in petroleum supply.

Surendra Upreti, President of the Nepal Automobiles Dealers Association (NADA), welcomed the decision to convert petroleum vehicles to electric. He stated that the government must now prioritize infrastructure development and vehicle fitness testing for implementation.

According to Upreti, this was an important issue that had been under consideration for a long time and has now been passed by the government. He noted that converting existing petroleum vehicles to electric is feasible.

He believes that even vehicles that are 15-20 years old could potentially be converted. However, he noted that there are challenges in immediate implementation. 'It will take time to do it immediately because the necessary infrastructure is not currently in place,' he said.

He emphasized that while old vehicles can be converted, fitness testing is mandatory. 'There must be clear standards on which vehicles can be converted and under what conditions, after checking all technical aspects such as vehicle fitness and braking systems,' said Upreti.

He added that while this effort to reduce petroleum consumption is good, it requires preparation and a clear policy.

Similarly, Dr. Biraj Singh Thapa, an associate professor at Kathmandu University, said that the government's decision is not new. According to him, the policy existed previously but could not be implemented. However, it is positive that the Balen government has prioritized and made the decision.

He said, 'It can be expected that the provision, which was limited to paper, will now be implemented. Previously, there were problems due to the lack of various policy arrangements even after standards were set. Now, it is necessary to create procedures and implement it immediately.'

Past Efforts: Policy Existed, Permission Did Not

The Government of Nepal had opened the path to convert petroleum-engine vehicles to electric by publishing notices in the Gazette on 2078 Chaitra 1 and 2082 Mangsir 8.

The Ministry of Physical Infrastructure and Transport, using the special authority under Section 176 of the Motor Vehicles and Transport Management Act 2049, had relaxed the restrictive provision in Section 39, Sub-section (2) for three years.

Section 39 of the Motor Vehicles and Transport Management Act prohibits changes to a vehicle's engine, color, or chassis. Although there was a provision to obtain permission by paying 50 percent of the registration fee for such changes, there was a legal hurdle preventing changes to the vehicle's original specifications.

Even though notices were published in the Gazette in the past, no business owner or vehicle owner could convert their vehicles due to the lack of concrete standards and technical guidelines. The government claims that the current Cabinet decision will resolve all these technical and legal ambiguities.

• Why is vehicle conversion necessary?

According to Department of Customs data, electric vehicles worth nearly 15 billion rupees have been imported in the first 8 months of the current fiscal year. Although the rate of import is rapid, it is not economically feasible for everyone to buy a new EV.

On the other hand, old petroleum vehicles are destined for the scrapyard after 10-15 years. If the engines of those old vehicles can be removed and electric kits installed, one can drive an electric vehicle at a much lower cost compared to buying a new EV.

Old vehicles that would become scrap will be reused, domestically produced electricity consumption will increase, billions of rupees in petroleum imports will be saved, and urban air pollution is expected to decrease significantly.

• Successful Testing and Practice in Nepal

The concept of vehicle conversion is not new to Nepal. In 1993, under the leadership of engineer Dr. Govinda Raj Pokharel and with the support of USAID, diesel-powered three-wheeler Vikram Tempos were converted to electric.

Based on that successful experiment, 'Safa Tempos' are still running on the roads of the Kathmandu Valley. Recently, students at Kathmandu University (KU) successfully converted an old Maruti Suzuki car belonging to a former Vice-Chancellor of the university into an electric car.

Kathmandu University students are also testing the same car to run on hydrogen. Similarly, the National Innovation Center has long been advocating and working on technology and industry establishment for converting petroleum vehicles to electric.

Private sector organizations like the De Go Group of Companies also showcased a 2000-model old petrol car converted to electric at the 2019 NADA Auto Show.

Nepal has the necessary manpower and technical will for this. However, the lack of policy facilitation by the government had been a problem. The government's Sunday decision is expected to facilitate the process by opening the path policy-wise.

• Policy Conflict Between Province and Union

A major hurdle in the path of vehicle conversion is provincial law. Specifically, the Bagmati Province Motor Vehicles and Transport Management Act 2075 prohibits the conversion of vehicles older than 7 years to electric.

According to Bagmati Province law, vehicles up to 7 years old are considered new, so owners do not want to change the engine immediately. However, the real benefit is seen when converting 15-20-year-old vehicles.

Harmonizing the decision made by the Federal Government with provincial law appears to be the main challenge ahead. With the Federal Government taking the initiative, it is expected that concrete procedures will be formed in coordination with provincial and local levels to clear the path.