The future of electric vehicles in Sri Lanka


Well-known member
  • Jan 26, 2010

    Sunday, January 27, 2019
    Now that the Green Frontiers mission we started in December 2015 has reached it's objectives, the fast charging network of the country is reasonably spread out covering most of main routes and main outstation locations... and we have maintained and kept all this alive for more than 3 years. Moreover, this was done while keeping to low rates of Rs 50-60 rate and without enforcing membership fees.

    It's now time to evaluate what's the impact has been and what lies for the future of EVs in the country.

    For the moment, it looks like charging and range anxiety is not as big issues as they were. There are few new players who has entered into fast charging, CEB is also there. Several people are experimenting with battery solutions, Service providers and spare parts vendors are emerging etc.. Petrol vehicle taxes have gone up. One may think EVs might make a comeback. However, the looks can be deceiving...

    With the help of many partners and brave individuals and support from the community, we may have managed to prevent EVs from totally collapsing for 3 years, without any government help, but that's all there is to it. There is a limitation on what few individuals or an organization can do, in the absence of a national policy and active government help. Everywhere in the world where EVs has succeeded, that has happened only with active government help. EVs has not thrived in anywhere yet, without some form of state help.

    In Sri Lanka, EVs have started to come in numbers in 2015 when the import tax was just 5%. By around end of that year, the number of pure electrics and plugin electrics were around 4500. Then in November 2015 budget, the government has introduced the draconian new EV tax which suddenly penalize an EV import to as much as 50% of CIF value. Subsequent budgets and ministers boasted they have helped EVs but they were only number games. Final actual tax was always around 40-50% and to this date, the total number of EVs in the country stand only around 5000. The progress was virtually stopped in November 2015 and remains the same.

    When new arrivals of cars are scarce, any new investor, service provider or business will think twice before entering into EV sector. Market growth, which is a key indicator of any business analysis is simply not there. With this background, it is unavoidable that even the existing EV related businesses to be winding down. Fast chargers do not have enough cars on roads to sustain their business, once the existing chargers which are outside of warranty periods (that is most of the chargers in here) need to import parts to replace broken ones, most investors are bound to ask the question whether it's worth it. Same goes for other areas of support. New battery replacement related experiments and investments might also slow down. All this would affect the second-hand car market of EVs -which is already struggling- in a very adverse manner.

    All above issues will be non existant and EVs would thrive if only the EV tax is reduced at least partially. Therefore, the future and sustainability of EVs in here is going to be critically and directly depend on this years budget which is due in few days/weeks. Without a noticeable reduction of the EV tax, this environmentally vital sector will face a certain slow and painful demise in this year itself.

    One may think, there are other helps the government can do. We do not believe so. Most things some expect the government to do are actually not beneficial and even damaging. For instance, CEB has started put up fast chargers, one may think this is a good move, but this is Sri Lanka and here's how the situation will play out in the end. We are a notorious country for government waste, mismanagement and corruption. Sri Lankan Air lines, Mihin Lanka, Railway, CTB, Ceypetco, CEB are just few examples. One minister has said once that the total problem of Sri Lankan economy can be equated to the loss at CEB. Ceypetco, Sri Lankan airlines and other organizations listed also are very much capable of profit making but instead, they remain as burdens on tax payer and huge black holes which gobbles up our resources. Why ? the reason is that governments can not do business.

    Let's take fast charging. Very expensive brand of fast chargers arrived years after the tender proceedings, installed many months after arrival, some says that even the warranty periods are now expired. Some stations are still not even operational. Even if they become operational, how long they would remain so, who would take care of maintenance and proper operations? will a government institute which has other high priority tasks put on them will be passionate and dedicated to operating charging stations fluently for a long time? experience on our government service tells us otherwise. This is no body's fault. A government is inherently not suited do businesses.

    One day, there is a good chance that these expensive stations will be tendered and sold out cheaply due to small maintenance issues accumulated over many months and that would be a tremendous waste of public money. If the government or the CEB really wanted to encourage and promote EVs in here, they could have simply, granted a favorable electricity tariff to charging stations. proper supply lines which don't cause voltage fluctuations and equipment damage. While one department of the government is putting a tax and preventing EVs from coming here, another department of the same government is importing and putting up fast chargers for those very EVs the first department is discouraging!

    So it's our understanding and experience that the only and most effective way for the government to encourage and promote EVs in here is by reducing the import tax. Nothing else is needed and anything else will not be as effective. When more vehicles start to come, other services will naturally appear and develop. There is no need for the government to take the burden of importing batteries, putting up fast chargers, service stations etc. Those would just be avenues for public money wastage only. Government's main job is to provide legislation, policy and overseeing of proper implementation of those policies.

    We have done our best for the past 3 years to keep things together... the ball is now with the government, which is still not too late to save the electric vehicle.

    Ashoka Ekanayaka at 3:22 PM