GreenCell Mobility Secures Rs 300 Crore Credit for Uttar Pradesh Electric Bus Project

GreenCell Mobility, a Mumbai-headquartered company, has secured a significant boost for its electric bus project in Uttar Pradesh with a Rs 300 crore credit line from Sumitomo Mitsui Banking Corporation (SMBC), a leading Japanese financial institution.

Announced via a statement, the agreement outlines a long-term project finance facility extended by SMBC to GreenCell Mobility for its ambitious venture involving 350 electric buses in Uttar Pradesh.

The primary objective of this project is to curtail approximately 2.35 lakh tonnes of gross carbon dioxide (CO2) emissions throughout its contractual duration. This goal will be achieved by deploying 9-meter fully equipped pure air-conditioned (AC) electric buses across eight cities in the state.

Devndra Chawla, Managing Director and Chief Executive Officer of GreenCell Mobility, emphasized the significance of this green financing in advancing India’s electric transportation landscape.

The project finance facility provided by SMBC will support the procurement, operation, and maintenance of electric buses under the Faster Adoption and Manufacturing of Electric Vehicles in India (FAME-II) Scheme, which is overseen by the Uttar Pradesh Government's Directorate of Urban Transport.

Operated under a 10-year concession agreement, the project assures a fixed per-kilometer fee, thus mitigating traffic risk and ensuring a consistent revenue stream comparable to an annuity.

The Ministry of Heavy Industries has already sanctioned 7,210 e-buses as part of its ambitious FAME-II initiative, highlighting the government's commitment to sustainable transportation solutions.

This financing not only enables GreenCell Mobility to fulfill its obligations but also aligns with the nation's objectives to enhance the penetration of green vehicles within the category. In 2023, the bus segment encountered challenges, with its penetration rate dropping to 3.3 percent from 4.6 percent in 2022.

Hiroyuki Mesaki, SMBC India's Country Head, emphasized their commitment to supporting the transition towards cleaner transportation solutions through their financial expertise and global network.

This collaboration between GreenCell Mobility and SMBC marks a significant stride towards a more sustainable future, underlining the importance of partnerships in driving environmental progress and innovation in the transportation sector.