Policy innovations surrounding End-of-Life Vehicles (ELVs) in India have been evolving in response to the growing need for efficient recycling and scrapping processes. Over the years, several government initiatives and regulations have aimed to address the shortage of ELVs, a significant challenge in the recycling industry. PK Banerjee, Executive Director of SIAM, discusses the policy advancements and their impact on managing ELVs.
Improvements in the ELV Situation
The shortage of ELVs has long been a pressing issue, but significant strides have been made in recent years to address this challenge. The introduction of the Vehicle Scrappage Policy (2020), coupled with the draft End-of-Life Vehicles (Management) Rules, 2024, marks a major step forward. These policies aim to phase out old, inefficient vehicles by increasing the cost of re-registering vehicles older than 15 years, encouraging owners to scrap them. Additionally, a central government policy mandates that all government vehicles be scrapped after 15 years, while private and commercial vehicles are evaluated based on fitness tests conducted at Automated Testing Stations (ATS).
Another key development is the expansion of Registered Vehicle Scrapping Facilities (RVSFs). Currently, over 100 such facilities have been approved, with around 60 operational across India, boosting the capacity to handle ELVs. However, one of the major challenges remains the informal sector, which handles much of the vehicle dismantling and recycling. Efforts are underway to formalize this sector, but many vehicle owners are still reluctant to scrap old vehicles due to various factors, including lack of awareness, sentimental attachment, and regulatory enforcement.
Government Response to the ELV Segment
The Indian government’s response to the ELV segment has been multifaceted. Along with the Vehicle Scrappage Policy and ELV Management Rules, the Central Pollution Control Board (CPCB) issued ELV guidelines in 2023, providing a framework for the safe dismantling, recycling, and disposal of ELVs. The government’s policies emphasize fitness testing for older vehicles, and if these vehicles fail the tests, they are designated as ELVs, to be scrapped.
To further encourage scrapping, the government has introduced incentives such as tax rebates, discounts on new vehicle purchases, and waivers on registration fees for those who scrap old vehicles. Additionally, new standards like AIS 129 outline specific requirements for ELV management, ensuring that the process is both environmentally responsible and efficient.
Impact of Electric Vehicles
The growing adoption of electric vehicles (EVs) presents both challenges and opportunities for ELV management, particularly in terms of metal recycling. EVs use fewer conventional metals like steel and aluminum, which could impact the profitability of recycling operations that rely on metal recovery. However, EVs incorporate valuable materials such as lithium, cobalt, and nickel, especially in their batteries and motors. These materials are critical for the future of recycling, and investing in advanced recycling technologies will be crucial for recovering these elements and maintaining the viability of ELV recycling.
Policy Support and Future Prospects
Looking ahead, government incentives, environmental regulations, and strategic investments in infrastructure will play a vital role in sustaining ELV management over the next decade. The central portal and the establishment of RVSFs are critical in promoting a circular economy within the automotive industry. Organizations like SIAM, alongside government and non-governmental bodies, are raising awareness through conferences, media campaigns, and public education about the economic and environmental benefits of vehicle scrapping.
Entering the ELV Segment
For those interested in entering the ELV segment, the government has already established a solid regulatory framework and a central platform to support ease of doing business. With about 60 RVSFs already functioning and plans to expand further, now is an opportune time to invest in the growing ELV recycling sector. As the final notification on ELV management nears, a clearer and more conducive environment will be in place, fostering recycling and supporting a circular economy in the automotive sector.
Regulatory standards, technological advancements, and stakeholder involvement are crucial to improving ELV management. The focus on recycling innovations, public awareness, and formalizing the informal sector are essential steps toward creating a sustainable and efficient ELV ecosystem. The ongoing policy support ensures that ELV management continues to evolve, adapting to the changing landscape of the automotive industry, particularly as EV adoption grows.
Source: MRAI’s Material Recycling Volume 6 Issue 6
