Sustainable Electric Transport for Nepal (SET4NPL)

Public transportation in Nepal primarily consists of large buses, minibuses, and microbuses. While large buses are the most common mode of transport, especially for intercity travel, minibuses, and microbuses are popular for shorter distances within cities. However, the quality and reliability of public transport is low, the costs of imported fuel are high, and the diesel-powered buses contribute to poor air quality and cause high GHG emissions.

Electric mobility is regarded as the most promising solution to improve public transport. The country’s large hydropower capacities for electricity generation can be used to power a carbon neutral, green electrification. However, high upfront costs for electric buses, insufficient experience, a lack of charging infrastructure, and unfavourable financing conditions hinder the uptake of e-mobility in the public transport sector.

Focusing on Nepal’s public transport sector, SET4NPL is supporting the introduction of 3,500 prequalified electric mini- and microbuses through attractive business models and financing mechanisms as well as a charging and electronic ticketing ecosystem, to enable a shift from combustion to electric vehicles. The project works together with public transport operators, the private sector, financing institutions, ministries, donors, and the national electricity authority.

SET4NPL aims to unlock private investments for electric mobility by introducing four primary financial instruments: A subsidy mechanism to kick-start the uptake, a loan and a leasing/renting scheme to offer fair and affordable financing conditions, and a partial first loss guarantee to increase willingness of banks to finance the new technology.

By supporting only electric mini- and microbus models that fulfil minimum quality criteria the project assures good performance of the vehicles and will demonstrate the benefits, making electric mobility the preferred option. Simultaneously, public fast charging stations, digital charging and ticketing solutions including real time data and modern payment options, and safety features amongst others will make public transport services more reliable, convenient, and accessible. In addition, the measures will lead to reduced emissions and improved safety for female passengers.

Project Information


Country: Nepal

Duration: 2023 – 2028

Status: ongoing

Funder: Mitigation Action Facility


  • Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH
  • Global Green Growth Institute (GGGI)

Political Partners:

  • Ministry of Physical Infrastructure and Transport (MoPIT)
  • Ministry of Forests and Environment (MoFE)

Further Links: