A steady momentum has been building up in India on the clean and renewable energy front. The government has been working to affect a radical shift in our energy production and consumption patterns to reduce the dependence on fossil fuels. According to last year’s third National Electricity Plan (NEP3) forecast, India will exceed, ahead of schedule, the renewable energy target of 40% total electrical capacity for non-fossils by 2030, established at the Paris Climate Conference in 2015.
To reinforce its commitments, the government intends for all vehicles sold in India to be electric by 2030. Given that the electric vehicle (EV) industry has been struggling with adoption since its launch in India almost a decade ago, this might seem like a quixotic goal. However, the recently released NITI Aayog report on mobility transformation outlines a feasible and phased approach to achieve this goal. Developed in partnership with the Rocky Mountain Institute, it presents governments’ vision of a shared, electric and connected mobility paradigm, where mobility is a service based on an electric fleet, enabled by the convergence of low-cost technologies, smart designs, innovation and supportive policies.
India is leading by example by committing to go all electric for government-use
Among the states, Karnataka has taken the lead in formulating the country’s first comprehensive EV policy supporting complete ecosystem from manufacturing to deployment of charging stations.
This multi-pronged approach aims to fix the challenges of traffic congestion, pollution and soaring fuel costs by developing an ecosystem revolving around EVs.
The main reasons behind poor adoption of EVs in India are range anxiety, high capital costs and long charging time. Consumers are worried about paying much more upfront than traditional vehicles, and then having to worry about whether the EV will run out of juice at an inconvenient place with no access to a plug point, since there is practically no recharging infrastructure.
These perceived downsides overshadow the benefits of very low running costs and zero tailpipe emissions.
Although it has increased significantly in the last few decades, India still has a relatively low rate of vehicle ownership. We are a country that relies heavily on public transport, and the government plans to cultivate this familiarity by making public transport more convenient and environment-friendly, by expanding the electric bus fleet.
However, the current generation of electric buses with traditional battery technology are prohibitively expensive—at 4-5 times the cost of a diesel bus. The Himachal Pradesh government recently bought 25 electric buses from Goldstone Infratech, manufactured in tie-up with BYD Auto of China, for Rs 2 crore per bus. Some other states and city transport corporations are also considering buying electric buses, but costs are prohibitively high.
Battery swapping the way forward
To bring down the capital cost of an electric bus and handle the long distances of bus routes, among the various solutions being looked at, reports are recommending two—reducing the battery size and adopting swappable battery technology. The industry seems to be working in this direction, as it is particularly relevant for state transport agencies, because without much expenditure they can create indigenous green fleets.
Coming to smaller EVs, the popularity of ride hailing and sharing services like Ola and Uber is evidence that people living in congested urban centres are fed up with driving and maintaining vehicles under stressful conditions. Incentives for communal EVs like auto-rickshaws, cabs and buses are meant to encourage usership rather than ownership. The economies of EVs are such that there is a good return for high-mileage use, making them better suited for commercial use.
The new swappable batteries can go a long way in addressing most adoption issues, including cost. The government is proposing standardisation, allowing manufacturers to have standard products that will allow mobility providers to be able to buy multiple platforms of vehicles with similar energy sources. This will give the operator a much wider platform of vehicles to use with common infrastructure and energy costs.
The government’s agenda also focuses on developing an ecosystem to support the EV industry—helping stakeholders to stay connected—enabling a high-functioning EV-driven public transport system. For example, an electric bus heading for the last-mile stop can signal to EV taxis in the area about how many passengers it will be offloading. This ensures optimum onward journey options for disembarking passengers. Or EVs can communicate with refuelling stations about battery requirements, so there is never any danger of being stranded. Such connected vehicles are also a step towards the inevitable progression to autonomous vehicles.
Further, a well-connected ecosystem helps develop effective and real-time big data analysis for continuous integration and improvement. As states invest in Smart Cities, they must incorporate the infrastructure necessary to help make the EV vision a reality. A convenient network of recharging and swapping stations, and car parks and bus depots that provide charging points and batteries for swapping, will benefit the nation economically and environmentally.
The auto industry is flourishing and India is becoming an export hub for small and medium-sized cars. This makes the industry well-poised to go all out on electric, especially with policies that enable entrepreneurial environment. It’s time for the auto/EV industry to collaborate with technology and mobility solution providers and OEMs to capitalise on this potential and make the move to electric. In fact, I would say it is an imperative that the industry move quickly to get ahead of this inevitable disruption and reap the rewards.
The author is non-resident scholar at Carnegie India, a global think tank, responsible for technology policy initiatives