BaaS Industry in India – Premature Hatching of the Golden Egg?

As the Battery-as-a-Service (BaaS) market grows in the country, a truly standardized and inter-operable BaaS ecosystem would require deep integration, data exchange, and a cohesive operating model between the following stakeholders:

• Battery OEMs
• Battery-as-a-Service Operator or Energy-as-a-Service Operator
• Vehicle OEMs
• End Users (Fleet Operators, Personal Mobility Users, etc.)
• Regulators

By all practical means, it is a mammoth task to bring such large and diverse stakeholders on a common ground. Standardization is being pursued in the context of battery pack dimensions, connectors, and communication protocols. While on paper standardization makes absolute sense to optimize the shortage of real estate and power infrastructure across metros, towns, and villages in a large country like India, we must also review the idea from the perspective of the ecosystem partners.

Regulators dons the hat of Engineers

Right now, the key priorities of the EV ecosystem should be to implement, learn and innovate. It is almost impossible to predict which technologies will emerge as the market leader. Hence, it is logical to stay technology-agnostic.

Let’s imagine the impact of standardization of batteries – which would be just like standardizing the fuel and the fuel tank of a conventional vehicle to an one-size-fits-all solution. In the recent past, we have seen that with newer battery chemistries, better battery management systems, and superior charging tech it is possible to do more with less. In fact, in the last few years, the battery storage capacity for a given size has doubled due to improved energy density.

Standardization doesn’t stop at battery dimensions, connectors, and communication protocols; compatibility is also required in electric vehicle components that are accepting swappable batteries. These components include a powertrain (battery pack, inverter, electric motor), and an IoT-enabled vehicle control unit, etc. It would be practically impossible to get the entire industry, including firms of all sizes and maturity levels, to agree on full standardization and compatibility. This might also result in swappable batteries accidentally or carelessly getting pulled into incompatible powertrains with unintended consequences.

Any regulatory dictates will inhibit the engineers from thinking and implementing innovative solutions. Worst still, it could lead to a?jugaad?mindset.

Forcing the BaaS operators to become the new OMCs

Network and location are the biggest USPs of an oil marketing company. One doesn't have to think twice about where to get the next feed of petrol or diesel for their ICE vehicle, as there is hardly any product differentiation. Should the BaaS industry which is still nascent be set for a similar fate?

India’s fast-growing electric vehicle market requires millions of dollars of investments in BaaS and charging infrastructure. Pushing product differentiation and innovation out of the window might seriously affect the scope of attracting the best domestic and foreign BaaS operators in the market.

In an industry with rapidly developing technology and pressure for stringent safety measures, that would give a real estate player or a parking operator the same leverage as a Battery OEM.

Make in India – Weighing the Scale over Innovation

Any move for standardization may dramatically push down India’s proposition as an attractive BaaS market for multi-national companies investing billions of dollars in cutting-edge battery technology and new chemistries. In the long run, this might dent the Make in India vision of attracting and localizing best-in-class technology for our electric vehicle ecosystem.

Although servicing of common parts will become easy, standardization might result in opening floodgates to cheap-quality imports. This will be a new headache for the industry and the Government's aim to become?Atmanirbhar.?

It is well documented that industrial powerhouses like Japan, Korea, and Taiwan did years of skunk work?to adapt foreign technologies to domestic applications. Today, shop floors of an Indian EV and battery OEMs are no different, striving for a better product-market fit. Everyday engineers are hustling to adapt, improvise and evolve the tech transferred from foreign partners to Indian weather conditions, usage patterns, and budgets. Come in standardization and many of these sparks of innovation might be dowsed.

And what about our Make for World vision? How many countries will be willing to accept technologically inferior and laggard products?

BaaS Ecosystem – Buck Stops with Whom?

In the real world, batteries in a BaaS ecosystem will be subject to varied charging and discharging patterns, depending upon the usage and charger ratings.

Imagine a battery pack that has been charged at five different charging pods in a week and used by 5 different users including in an e-scooter of an office goer, delivery executives of e-commerce companies, and a tourist using shared EV. All these users have different driving behaviors, and all five charging companies might have minor variations in charging speeds. Not to mention the vehicles, where these batteries were swapped, might have variations in power trains and battery placements.

Although Open Charge Point Protocol (OCPP) has been proposed as a panacea to data sharing and lifecycle assessments of batteries, there are several open-ended questions about who assumes the risks of premature battery degradation and eventual safety hazards like thermal runaways.

Another risk could be pilferage, where chargers with standardized connectors might be easily available as a commodity in the market. And customers might be tempted to charge batteries borrowed from the BaaS network at home or in non-compliant setups.

All things considered, the Government should maintain a technology-agnostic view of the BaaS industry and should let the industry arrive at convergence on which areas can be taken up for standardization and at what time. This will attract many more operators with varying risk appetites and investment capacity to a large and fast-growing market like India, and help create a thriving BaaS ecosystem that is built for the world.

Authored by Divay Pranav, Director, Policy & Partnerships at Yulu