The past few months and almost the same time last year offered several opportunities for me to capture some really splendid photographs of the sky. The air has never been cleaner and the skies in Delhi had never been clearer and blue – all thanks to the lockdown that forced man to stay shut and machines to stay put. With no vehicles on road, we experienced what it is to live pollution-free. Unfortunately, no vehicles on road are not the permanent solution to this global problem – clean, green mobility is.
Electric mobility was the earliest bet that India took to promote clean mobility and having tracked this space for almost a decade now, since the early days of the National Electric Mobility Mission Plan (NEMMP), I realize we have come a long way. Industry push, consumer awareness, improving economics, global trends and most importantly policy push played a pivotal role.
Policies at the Central and State government level have tried to create an impact in their own way. While new opportunities have continued to emerge, there have been even new challenges and learnings from the past. As we complete almost a decade, it is high time to assess the role of our policies across states and calibrate them to create a One India One Policy for electrification.
Over the years, several state governments came out with their own state-specific EV policies. A first look indicates that the coverage of these policies has not been consistent across demand, supply, charging and technology-related areas. Across the central and state policies, the structure and quantum of incentives have been different. Another prominent issue seems to be the choice between what is easy versus what is most impactful.
Many state policies are still focused on promoting formats like e-rickshaws over other better higher impact segments. The spontaneous uptake of e-rickshaws due to favorable economics and the rapid proliferation along with the need to regulate this segment, address safety and environmental concerns need no refresh. The question is – will this segment define the future of electric mobility in India?
Some state policies still lean on the usage of hybrid vehicles while the nation decided to leapfrog to fully electric mobility. Finally, none of the policy guidelines defines the markers for successful execution as there is no mechanism to measure the effectiveness and impact of these policies.
The automotive industry went through difficult times in the last 2 years. Transition to BS6 and lockdown due to the pandemic have been among major disruptors which placed the electrification agenda low on priority.
Post-Covid when shared mobility has been impacted, segments like e-rickshaws and e-3 wheelers have been disrupted. As the market bounces back, we have seen renewed excitement for electrical vehicles and therefore there is a stronger need to align policy across center and states. For a market witnessing rapid technology and business innovation, the policy support also needs to evolve to stay relevant.
We have now seen a few years of electric mobility and now have more data on products, performance and user experience which should form a basis of any refreshed policy guideline. The charging ecosystem has been growing with several players and business models in the market. We need to relook at the charging standards announced sometime back and possibly get them in line with global markets.
The focus should be future-ready specifications, type of chargers, cost of hardware, interoperability and platform integration. With the planned incremental generation capacity of 300 GW, power availability for electric mobility would not be a challenge however quality and unit economics would be important for charging infrastructure business.
As the awareness and adoption of e-mobility have increased, the industry has become more conscious about emerging issues of e-waste management, vehicle and battery afterlife and second life usage of batteries.
Unlike lead-acid batteries where 90% of disposed of batteries end up in the informal sector, lithium and advanced chemistry batteries will need an organized and environmentally sustainable process for recovery, recycling and reuse. We need to acknowledge the issue and put in place mechanisms to grow the afterlife segment as an organized industry. India is rolling out its flagship vehicle scrappage policy. This opens up opportunities for automotive companies and new players to formalize end-of-life vehicle management. The readiness of this sector to handle traditional internal combustion engine (ICE) and electric vehicles is important.
The next sprint to align and create a One India One Policy should consider relevant trends and outlooks. While all segments will see adoptions of electric mobility, the penetration will be led by smaller format 2 and 3 wheelers. The pandemic has also shifted the usage for shared passenger mobility to goods and freight mobility in the last mile. Recent consumer experiences have shown the example of gaps between the promised and actual range of vehicles and potentially other quality concerns.
Any future enablement should ensure not just electrification but greater thrust on quality and performance which is equivalent of traditional ICE vehicles. Finally, for scale and standardization to drive network effects in areas of charging and battery swapping, it will be important to establish a greater level of alignment at the industry level. While a policy will set the direction, it is really the industry that will have to collaborate on technology and content standardization to drive scale and interoperability.
Commercial viability is key to drive growth in electric mobility, but policies play an equally important role in realizing commercial viability faster. Our next sprint of policy alignment will put the necessary guardrails to define the next decade of vehicle electrification. Clear, blue skies will hopefully be a permanent view outside my window then.
Author: Rahul Mishra, Partner, Kearney
Disclaimer: The views and opinions expressed in this article are solely those of the original author. These views and opinions do not represent those of The Indian Express Group or its employees.
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