India's Journey towards EV In three Parts: This is Part -I

STATUS OF VARIOUS SEGMENTS OF ELECTRIC MOBILITY AND LOW-CARBON PASSENGER ROAD TRANSPORT IN INDIA

INTRODUCTION

?We go back to the date India signed the historic Paris climate agreement along with more than 170 nations, marking a significant step that brought together developing and developed nations in combating global warming by cutting down on greenhouse gas emissions. At COP21, India had pledged to reduce its carbon footprint by 33-35% by 2030 below 2005 levels. It has also pledged to increase the share of non-fossil fuels-based electricity to 40 percent by 2030. Accordingly, it is an opportune time to shift to alternative fuel options to minimize air pollution and the rising crude oil import bill of the country so that we can meet our commitments at the global level. The transport sector in India is the largest user of oil and the second-largest source of CO2 emissions worldwide. India has seen a rapid increase in the adoption of automobiles in the last ten years. Currently, the Indian transportation sector accounts for one-third of the total crude oil consumed in the country, where 80% is consumed by road transportation alone. It also accounts for around 11% of total CO2 emissions from fuel combustion. The government of India had notified the National Electric Mobility Mission Plan 2020 which seeks to enhance national energy security, mitigate adverse environmental impacts from road transport vehicles and boost domestic manufacturing capabilities for Electric Vehicles. In addition to this, the Government has notified Phase II of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme to stimulate the market of EVs in the country, de-licensed the charging infrastructure business, and specified guidelines & standards for charging infrastructure for electric vehicle thereby opening up the market of public charging infrastructure & ensuring a roadmap for the development of charging infrastructure, and introduced various financial incentives to reduce the upfront cost of EVs and charging infrastructure.

While the Invdia journey towards EVGovernment of India has taken crucial steps towards faster adoption of EVs, there are several challenges and gaps existing in the EV ecosystem that must be addressed. In this context, taking stock of our status is in the interest of our country. It would stimulate concerted and coordinated efforts by Policymakers, Regulators, Utilities, OEMs, and other value chain players to understand the existing gaps in the current landscape of the EV industry in India and the key action items required for enabling accelerated adoption of EVs to support India’s vision of transitioning to sustainable and green mobility. We have also got critical input through deliberation.

About a Status quo analysis of various segments of electric mobility and low carbon passenger road transport in India. On behalf of the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU), the Nationally Determined Contribution-Transport Initiative for Asia (NDC-TIA) is a joint project of seven organizations’ and with the engagement of China, India, and Vietnam. It aims at promoting a comprehensive approach to decarbonizing transport i.e. a coherent strategy of effective policies that are coordinated among various sector ministries, civil society, and the private sector. The overall aim of the study, which is being implemented by a consortium of seven organizations together to support countries in facilitating and informing these stakeholder processes and in developing selected climate actions. This enables partners to make a sectoral contribution towards achieving their NDCs and increase ambition in transport sections of long-term strategies and 2025 NDCs. In this context, under the regional technical assistance program NDC-TIA; one of the activities was to “Perform a status quo analysis/investigation on different segments in India” (e.g., 2W, cars, trucks, buses, freights) under its International Climate Initiative (IKI). This analysis provided us with the existing status, opportunities, challenges, gaps, and way forward for low-carbon road transport in India. Different types and technologies, services, business models, standards, protocols, contributions to India’s long-term NDCs, and other climate action and clean energy targets were assessed for various segments of low-carbon road transport including electric mobility. The main objective or goal of this study is to examine the Low-Carbon Road Transport (LCRT)/E-mobility development, and accomplishments so far, supported by the policy, schemes, and regulatory interventions in India. The global average temperature is on a continuous rise and has been a cause of worry for leaders across the world. As per NASA, 19 out of the 20 warmest years have occurred in the 21st century. The rise in a change in global temperature was alarming level and therefore needed immediate global attention. The 21st yearly session of the Conference of the Parties (COP21) took place in Paris on 30 November 2015. It laid the foundation for the global climate change agreement that came into being on 04 November 2016. The central aim of the Paris Agreement was to strengthen the global response to the threat of climate change by limiting the global temperature rise to 1.5 - 2 degree Celsius above pre-industrial levels for the 21st century, along with increasing the ability of countries to deal with the impact of climate change. Worldwide, Energy Sector had contributed 73% of GHG emissions1 in 2016. Within the energy sector, transportation accounted for 7.9 GtCO2e in 2016, or 15% of total emissions. Temperature Anomaly (°C) Annual temperature means Lowes smoothing Status quo analysis of various segments of electric mobility and low carbon passenger road transport in India.

?Transport industry of India and emission challenges With one of the lowest motorization rates in the world (22 cars per 1,000 people), India is among the fastest-growing countries in the transportation sector. From 2011 to 2020, India’s domestic vehicle sales (2W, 3W, Passenger Vehicle, Commercial Vehicle) have grown at ~4% CAGR. With rising income and rapid urbanization, the Indian mobility market is expected to expand rapidly. Transportation, however, has contributed significantly to India’s overall GHG emissions. During the year 2016, the transport sector contributed to 270.6 MT CO2e of GHG emission, the third highest, only after the power industry and industrial combustion. Within transportation, road transport has been the highest contributor to GHG emissions. With the rising transport industry, India is also facing intense emission challenges. Air India, therefore, has a great opportunity to leapfrog towards decarbonizing the transport system to meet its NDC commitments and to overcome environmental issues which would likely become more severe, if remain unaddressed, as India has huge prospects for growth as India is experiencing acute challenges in controlling its carbon emissions, the country expects the emission level to grow even further as its transport industry is expanding. To tackle the emission from the transport industry, India is moving towards a “zero or low carbon emission” transportation model by promoting the use of alternative fuel vehicles and Electric Vehicles (EVs). In 2009, through its National Biofuels policy, India sets an “aspirational” target to blend 20% biofuels into the diesel and petrol mix by 2017. However, it has fallen well short of these targets. So far, it has attained only around 2% bioethanol and 0.1% biodiesel blend in 2018. Further, India came up with its first passenger vehicle fuel efficiency standards in 2014 which came into being in 2017. However, they are still less stringent than the EU norms. In addition, India has also set the national target of achieving 30% EV sales penetration by 2030 and launched National Mission on Transformative Mobility and Battery Storage to promote the localization of EV component manufacturing. Alongside the various central-level interventions, several states have also notified their respective policies for promoting Electric Vehicles which cover subsidy and tax exemptions, among other incentives, for consumers/ buyers. However, with all these efforts in place, the market for EVs in India has not picked up as expected. Low growth in this domain instigates to do a deeper analysis to identify the barriers, challenges, and gaps existing in the EV ecosystem that needs to be addressed to unveil the growth of e-mobility and other systems in India. ?

THE CARBON BRIEF PROFILE:

India (access here) 4 Distribution of greenhouse gas emissions from the transport sector in India in 2014 by type (access here) India was ranked 5th in the world’s most polluted countries in 2019 and 6 of the world’s 10 most polluted cities were in India in 2019. The number of electric vehicles now and in the future will be great where the traffic flow is large, so the same as charging demand and the benefit of EVCSs. While rental fees would be lesser in the city outskirts than in the interiors, those are not suitable locations for ensuring maximum utilization of EVSE. User charges will be guided by rental and the level of utilization of charging stations. The choice for appropriate siting of an EV charging station is also dependent on whether the location has sufficient electrical grid capacity to absorb the EV load growth at present and in the future. To ascertain the same, a detailed framework is adopted by the developer for distribution network load flow analysis to determine: - Final set of location assessment Power network assessment or leased depending upon the respective state guidelines. The typical process for the acquisition of land and the degree of difficulty in seeking administrative approval. ?Type of land Typical process Degree of difficulty in securing Administrative approval Private developer creating Charging infrastructure for Government bodies Government 1. The government body makes a request to the District Collector (DC) for the transfer of land 2. If the land is not earmarked for any future development under the Town and country planning Act, the DC initiates the process of transfer/lease of land with the approval of State Government Difficult Private. ?The developer and the owner of the land either carry out a sale or lease transaction.?In addition, there are additional administrative approvals are required if the identified land is “Agricultural Land”. In such a situation, approval for a change of land use needs to be taken before using such land for purposes other than agriculture. Civil works and equipment selection as it is critical in setting up of EV charging station. The typical hardware infrastructure required to set up an EV charging station.

?Hardware required to set up EV charging infrastructure Source: ?Siemens - Electric vehicles (EV) charging EVConnect - EV Charging., Government mandate Equipment selection for the charging station must be in line with the government guidelines. For public EV charging stations, the Ministry of Power (MoP) notified its guidelines on October 2019. Key requirements mentioned therein are summarized below: ?The charging station should have an exclusive transformer with all related substation equipment including safety appliances. The charging station should include 33/11 kV lines/cables and associated equipment including line termination etc. ?The charging station must have appropriate cabling and electrical work to ensure safety. ?The charging station must have adequate space for charging and entry/ exit of vehicles. The charging station should have any of the chargers shown below: MoP Charging Infrastructure for Electric Vehicles Revised Guidelines Standards (access here) Note: 2W and 2W charging stations are free to use any charger other than those provided above. However, they must be in line with CEA’s technical and safety standard. ?The charging station must tie up with at least one online Network Service Provider (NSP) to enable advance remote/ online booking of charging slots. Transformer Safety switch Lighting panel EVSE Rectifier module (In case of DC charger) Switch gears Cabinet Visual Indicators/HMI etc. Auxiliary Supply Equipment Electricity meter Chord Connector Other EVSE Components Charge controller EVSE can be free-standing or mounted to a wall or ceiling. In the case of "Smart" charging, stations include communications hardware for use with software applications. AC EVSE shall be type tested by a third-party lab accredited by the National Accreditation Board for Testing and Calibration Laboratories (NABL) For long-range EV charging stations, at least two chargers of minimum 100 kW power output of different specification (CCS/CHAdeMo etc.) with single connector gun each should be installed. Beyond the government mandates, there are several other factors that influence the selection of an EVSE. There are multiple requirements that are required to be fulfilled by the EVSE operator while selecting the equipment. Some of the key such requirements are to be identified.

?It should adhere to Environmental requirements, Mechanical requirements, Protection requirements, Specific requirements, Functional requirements, Communication requirements, Billing and payment requirements, Performance requirements, Marking and painting requirements, and Cable requirements Environmental requirements. This includes the operational range of the EVSE in environmental conditions such as temperature, humidity, pressure, storage temperature, etc.

?Metering is another requirement of EVSE. Grid-responsive metering as per units’ consumption of the vehicle must be in place with the EVSE. The central system should be able to access the metering information from any remote location. Billing and payment requirement in the charging station: Billing should be done through a grid-responsive meter which is in line with Indian metering standards, and Payments should be compliant with authorized mobile payment platforms (BHIM, Bharat QR, UPI, etc.) User interface and display requirements The user interface and display of an EVSE system should have: ? ON/OFF (Start-Stop) Switches ? Emergency stop switch ? Visual Indicators ? Display ? Support language ? Display Messages ? User Authentication ? End of Charging Performance requirements The performance requirement of EVSE can be assessed based on the output voltage and current. The approved value of the performance parameters is defined in AIS 138 standards. Uncontrolled charging in peak hours Uncontrolled charging would lead to an increase in peak load demand, transformer overloading, line losses, and power losses shall become more relevant as EV penetration increases Choosing appropriate locations for placement of EVSE. The majority of consumers stated that lower emission from EVs is their primary reason for purchase. However, only 14% of consumers are willing to pay an additional Rs 3 Lakh for an electric vehicle in comparison to a similar conventional vehicle. ?

Even though consumers prefer EVs due to their low emission capability, they are not willing to pay extra for EVs. The majority of consumers expect the range of an EV to be more than 340 km for buying. Around 64% of consumers are willing to wait for at least 30 minutes to fully recharge a battery electric vehicle. Minimum driving range consumers are expecting from a BEV (km). Most consumers think that it is either the responsibility of vehicle manufacturers or the government to build publicly accessible EV charging stations and other infrastructure. The majority of consumers believe that vehicle manufacturers should install and operate EV charging infrastructure and high vehicle prices is one of the major bottlenecks in the adoption of EVs as Indian consumers are not willing to pay extra for EVs. Financial institutions – market landscape Financial institutions are one of the vital stakeholders that can catalyze the uptake of electric mobility. They enable stakeholders in realizing their electric mobility plan by helping them in financing various activities such as developing manufacturing units, upgrading/ augmenting the distribution networks, setting up EV charging infrastructure, or purchasing electric vehicles. The role of financial institutions in the uptake of electric mobility is substantial. ?There is no proactive participation of financial institutions in promoting electric mobility in India. Among all nationalized banks, only the State Bank of India has come up with a loan facility for electric car buyers at a reduced interest rate. State Bank of India introduced the country's first “Green Car Loan” (Electric Car) to encourage customers to buy electric vehicles. The scheme offers a 20 basis points smaller interest rate than the existing car loan schemes. Further, access to debt capital by the small and medium manufacturers of auto ancillary parts and start-ups venturing into EV manufacturing, is very difficult, as the financial institutions still consider EV as a nascent market with a high technological risk perception.

?Therefore, it is very difficult for such players to raise capital from lending institutions. However, the established OEMs are relatively in a comfortable position to raise debt funds, based on the strength of their balance sheet. The industry needs the support of financial institutions in bridging the gap to access finance for increased offtake of EVs. There is an increasing need to consider electric mobility as a priority sector for lending, to catalyze large-scale uptake of EVs in the country. We can summarize as Commitment towards GHG reduction, huge dependency on imported crude oil, high urbanization, and growing population are the key drivers that could propel the transition from conventional mobility to electric mobility. Policymakers and regulators have taken a collective effort to promote electric mobility in India. DHI introduced FAME schemes (I & II) to spur the EV demand whereas MoP notified guidelines on the installation of charging infrastructure. Electricity regulatory commissions have also brought out special tariffs for EV charging, and ARAI has introduced standards for AC & DC charging. MoHUA has amended Building Bye-laws and Urban and Regional Development Plans Formulation and Implementation Guidelines to make charging infrastructure development an integral part of urban planning, development, and construction. Along with the policy efforts by the Govt. of India, states have also come out with their independent EV policies to help uptake of electric mobility. Although the central government and state government are putting substantial efforts to drive EV adoption in India, traction can only be seen in 3W and 2W segments. The 3W segment, particularly e-rickshaws, is driving the high adoption rate of EVs. For 2W the major drivers are lower operational cost and ease of charging at home with available infrastructure. However, EVs still need to achieve cost parity with ICE vehicles for large offtake by consumers, especially in the 2W segment. The high cost of EVs is identified as the biggest bottleneck in the adoption of electric vehicles in the country. The exclusion of 4W private vehicles from FAME – II eligibility for demand incentive along with multiple issues related to high cost, unavailability of adequate charging infrastructure, range anxiety, etc. is causing this segment to witness lesser adoption of EVs. E-buses have not witnessed the required level of traction as envisaged under various policies. Even after allocating more than 40% of the total incentive pie for e-buses under FAME – II, no significant traction has been observed. The mandatory requirement of procuring e-buses on the GCC model needs to be re-looked with consideration for relaxing the requirement of huge bank guarantees as security to increase the uptake of e-buses. From the supply-side point of view, there are several constraints. For battery manufacturing, India lacks in access to raw materials (mineral resources).

EV Auto Ancillary In India

EV auto ancillary in India is also at a nascent stage with limited manufacturing capabilities. Huge dependency on imported auto components (mainly electronic and electrical) acts as a barrier to attaining price parity with ICE vehicles. Phased Manufacturing Program, Aatma Nirbhar Bharat, and incentives announced by several states in their EV policy are expected to strengthen the supply-side scenario in the medium to long run. FAME II scheme allotted 10% of its overall outlay for EV charging however, there has been no significant growth in the development of EV charging infrastructure. Administrative procedures of land acquisition and electricity connection, lower utilization of charging infrastructure, absence of provisions for recovery of expenditure through tariffs, absence of regulatory provision for participating in the ancillary market, etc. are some of the challenges industries are currently facing.

Discoms have not been mandated to actively participate in the development of charging infrastructure. Further, as highlighted above, there exists no regulatory clarity on allowing capex for charging-infra development as a pass-through in tariffs. With their inherited capability of existing infrastructure, existing consumer base, and superior technical skills, the role of distribution utilities will be crucial for the uptake of EV charging. Discoms need to actively participate in planning for EV charging infrastructure. Random charging of EVs may put a strain on the grid. Harmonics from EV charging stations will also impact the power quality of the system. There is a need to carry out an analysis and determine the need for strengthening the distribution network in order to integrate EV charging stations. Battery constitutes approximately 25 - 40% of the vehicle cost. Battery swapping model allows to take out of the cost of battery from the upfront cost of EVs. The cost can be reduced, and a better value proposition could be offered to consumers for the adoption of EVs with prices at par or lower than the ICE vehicle. However, the lack of policy guidance on standardization of battery for EVs, and huge upfront capital requirement is posing a challenge in the massive uptake of battery swapping business model. To incentivize charging infrastructure development, the regulatory commission needs to play an active role. This can include the following: ?Devising mechanism for recovery of investment made by discoms as part of the tariff. ?Incentivizing charging infrastructure developers by allowing them to participate in the real-time and ancillary power market. Developing framework to promote managed charging Although there are still challenges across the EV landscape, private players are betting heavily on the success story of EVs in India. Many start-ups have entered manufacturing of EVs in the past 5-7 years and conventional vehicle manufacturers, both domestic and global, are also launching EVs in the Indian marketplace. Similarly, several players have ventured into the development of charging stations and have substantial plans for developing charging stations as well as battery-swapping stations across India in the future. ?

?Gaps in EV landscape Policymaker and Regulator EV Component OEMs Battery OEMs Distribution companies EVSE and battery swapping Consumers Financial institute Too many riders put in FAME scheme to avail subsidy – localization, recertification, max. speed Regulatory uncertainty in allowing capex investment for developing charging infrastructure as pass-through No mandate for EV adoption in FAME/ State EV policies Lack of focus on skill development on battery technologies Availability of limited suppliers Lack of strictness in implementation of localization targets Availability of limited financing options Delay in providing connectivity to charging infrastructure Lack of support for the promotion of workplace charging Lack of standardization Limited availability of charging infrastructure Limited travel range of EVs Lack of awareness Availability of limited financing options High charging time No mandate for Financial Institution to providing funding for electric mobility (as priority sector lending) and No mandate for Discom to develop charging infrastructure. Lack of regulatory guidance on investment approval. Marking into five categories: Policy risk Financial risk Supply chain risk Technological risk Other risks EV Component OEMs - Non – implementation of policy measures after announcement - Phasing-out of subsidy support/ posing stiffer norms for availing incentives - Policy risk associated with import-export of automobile component - Introduction of any policy mandating investment in recycling of battery - High cost of funding due to perceived high technology risk by FIs - Exchange-rate risk due to import dependency for auto components - Investment recovery risk - evolving business models, limited charging infrastructure - Insufficient access to mineral resources for manufacturing critical components indigenously - Quality of indigenously manufactured auto ancillary component - Demand-supply issue of indigenous auto ancillary component due to limited manufacturing capacity - Geo-political risk -unstable relationship with China (import dependency on China) - Fast evolution of technology (especially in Battery) – risk of obsolesce - Battery prices may not go down as predicted (may be due to demand-supply mismatch) - Interoperability - Price versus performance - risk of technology preference - Uncertain consumer preference - High wage rate of skilled manpower/ shortage of skilled manpower - Evolving safety standards and their compliance related risk - Environmental concern – battery scrappage or recycling issues Battery OEMs Distribution companies - Uncertainty around government funding support for network upgradation - High cost of supply than approved EV tariff (accrual of EV tariff subsidy - Risk associated with new vendor performance (EVSE vendors), in case it enters into business of - Unpredictable EV demand – technological limitation in managing charging - Shortage of manpower within Discom for doing core business. ?New technology (say Hydrogen) replaces EV technology leading to stranded assets. Cyber security threat in sharing Discom data interface with EVCS owned and operated by third-party - Network behaviors with high EV penetration – power quality/ safety additional role as SNAs/ facilitator for the development of EVCI - Operational risk in providing charging service. (in case discom enters into the such business) – payback may be calculated considering EV demand assessment, traffic density, city planning, urbanization, etc. EVSE and battery swapping - No roadmap for EV adoption. Uptake of EVSEs and increase in EV adoption posing a chicken-egg problem - Policy risk associated with import-export of EVSEs

?Overall performance of Indian MSME especially in Power electronics - Software integration issues, due to the presence of - Change in technical specification – risk of obsolescence - New technology (say Hydrogen) replaces EV technology - Battery technology change which may make existing charging stations obsolete - Evolution of interoperability measures/ mandates - Regulatory compliance for power purchase (say RPO/HPO compliance) - Operational risk - payback may be calculated considering EV demand assessment, traffic density, city planning, urbanization etc., leading to investment recovery risk - Consumers preferring home charging. Limited availability of charging infrastructure - Newer manufacturing unit of EV auto component may pose quality concern - Longer duration of charging (fast DC charging is not supported by existing batteries used in 2W and 3W - New technology (say hydrogen) may replace EV technology – the risk of obsolescence - Risk associated with battery quality and safety –

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Recommendations for uptake of electric mobility in India:

National / State level policy should be formulated for incentivizing Distribution Utilities on investing in the development of EV charging infrastructure In line with international case studies, a Charge-ready infrastructure program to be launched mandating Discoms to spearhead the development of charging infrastructure by leveraging their technical capabilities, international case studies shall be capitalized to align Discom role in charging infrastructure ecosystem Electricity Regulator to be mandated to provide mechanism for approval for Rate-basing of utility investments in building EV charging infrastructure Electricity Regulator should design and implement TOU tariffs for EV charging Technical standards for charging equipment in the case of Managed charging should be designed and approved Designing electricity market structures for participation of EVs. Electricity regulators shall be mandated to devise mechanisms for allowing charging infra developers in the demand response market. Policy considerations to be deliberated for workers in the ICE Auto Ancillary industry (primary mechanical) to skill them suitably for working in the EV auto ancillary industry (primarily electrical and electronics) Standardization of batteries should be done to enable battery swapping a plausible business model catering primarily to commercial vehicle Financial Institutions should be encouraged to extend their lending facility to electric mobility sector. Existing scheme/policies designed for promoting electric mobility needs to be fine-tuned, based on the scheme/policy performance and market expectations. For example, riders who are availing of subsidies could be re-examined.

?Many of the new technology related to managed charging of EVs has been introduced first using a pilot platform. The results for these pilots are then used to carry out large-scale deployment of technology. While standards and guidelines introduced in India do provide provisions for a communication protocol between EVSE and other stakeholders, there has been no pilot initiative on large-scale managed charging pilots. Utilities and regulators across India need to take the initiative on introducing pilot projects which can demonstrate the benefits of managed charging of EVs. It has been observed that having dedicated tariffs and incentives for EVs encourages adoption. While few states in India have taken EV policy initiatives, many states are yet to introduce EV-specific tariffs for public and home charging as well as incentives under state policies for purchasing EVs and setting up home and public charging stations. National-level policy for Urban Local bodies/municipalities, etc. to issue Charger Deployment plans and undertake investments in PCS through loans from Central government. The same could be converted to grants on timely achievement of milestones subject to the local authorities tying up with designated government agencies for implementing the rollout plan. Adopt a framework for state-level/city-level authorities to undertake competitive bidding for the allotment of zones for PCS installations. Develop frameworks for public-private partnerships/franchisee agreements for developing EVCS. Explore innovative business models for the development of charging stations. For EV users, interoperability, or “e-roaming,” means that users can charge at any station with a single identification or payment method and that all charging stations can communicate equally with vehicles. For this to work seamlessly, common standards for charging network operators must also be established A key enabler for smart charging and other vehicle-grid integration aspects is collaboration among various stakeholders. There is a need to create a common platform that can bring together the expertise of all stakeholders. regulation and technical standards for electric mobility and LCPRT Conducive policies and regulations play a vital role in unleashing the potential of new technology and opening corridors for new opportunities. Similarly, technical standards play a major role in streamlining of technological development, and compatibility of various systems and components used in the value chain. It also ensures the safety and reliability of new technologies which in turn increases consumer confidence.

?Central policies As EVs are at a nascent stage, policy, and regulatory measures are crucial to provide a push to the development of the electric mobility ecosystem. Globally, the policy and regulatory measures have focused on providing various fiscal and non-fiscal incentives for the adoption of EVs and charging infrastructure. Realizing the need for the transition to cleaner technology, the government has been leapfrogging in developing various policies and support structures for increased adoption of EVs. There have been several policies issued at different stages of the journey of the Indian automotive sector which are aimed at the adoption of clean fuel and electric mobility. These policies and interventions are highlighted subsequently. ?National Electric Mobility Mission Plan (NEMMP) Adopted in 2013, the National Electric Mobility Mission Plan (NEMMP) 2020 laid down the vision and roadmap for EV penetration in India. NEMPP outlines incentives along four priority areas for EVs viz. demand incentives, manufacturing of EVs, charging infrastructure development, and research and development. The Mission aims to achieve 6 to 7 million on-road electric vehicles by 2020. In terms of the assessment made by the joint Government-Industry study, the total investment requirement envisaged in the mission document for setting up the required infrastructure to achieve the target (both power and charging infrastructure), is summarized in the following table:?Review of policy, regulation, and technical standards for electric mobility and LCPRT

?Centre for High Technology (CHT) (MoP&NG) There is a significant reduction in acceptable Sulphur content in Gasoline under BS-VI Diesel For diesel the quality is primarily identified by below three contents: Sulphur Content Sulphur is a form of impurity present in gasoline. The BS VI standard has limited Sulphur content to 10 ppm in gasoline fuel. The compression ignition quality of diesel fuel influences cold start-ability, exhaust emissions, and combustion noise. Polycyclic Aromatic Hydrocarbon (PAH) Content Polycyclic aromatic hydrocarbons (PAHs) are a group of more than 100 chemicals that are also called polynuclear aromatic hydrocarbons. Exposure to PAH can lead to irritation of td breathing passages and can be a cause of cancer. rams. The formula for the calculation of average fuel consumption standard is provided below: ?????????????? ???????? ?????????????????????? ???????????????? = ?? × (?? ? ??)+ ?? Where: a is the Constant Multiplier b = Fixed Constant; c = Fixed Constant; W = Weighted average of unladen mass in kilogram (kg) of all new said motor vehicle, manufactured or imported for sale by the manufacture Values of constants a, b and c along with calculation formula.

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?From FY23 onward, the standard assumes an average car weight of 1145 kg and requires the average fuel consumption to be less than 4.77 l/100km. The average Fuel Consumption Standard is the fuel consumption in petrol equivalent per liter per 100 kilometers by the manufacturer. ?Developing solutions for the Indian market focusing on the economy of scale for low-cost emission control systems and technologies ? Partnering with technology leaders and building capabilities through joint ventures, domestic OMCs can move up the value chain. Lack of competent/ skilled manpower on the new technology. Packing DPF, SCR & EGR efficiently in the limited space without compromising on fuel efficiency. To integrate and optimize engine/ engine technology as per the Indian driving cycle and calibrate/ validate in a given short time frame. To design a cost-effective and robust system for Indian conditions in three years. ?

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. The CAFE standard prescribes the minimum average mileage per gallon (mpg) a vehicle class must meet. In the USA, CAFE standards are regulated by the US Department of Transportation’s (DOT) National Highway Traffic and Safety Administration (NHTSA). NHTSA sets and enforces the CAFE standards, while the Environmental Protection Agency (EPA) calculates average fuel economy levels for manufacturers, and also sets related GHG standards. Some of the salient features of CAFé norms are given below: ?Reduces the overall fuel consumption of the economy; ? Increases the availability of alternate fuel vehicles; ?Promotes advancements in innovative technologies; ?Reduces overall GHG emission of the country and improves air quality; ?Provides credit to the auto manufacturers for exceeding the standard requirement; ?Penalize the manufacturers for not meeting the minimum standard requirement In India, the CAFé norms were proposed by Ministry of Power in collaboration with Bureau of Energy Efficiency (BEE) which set the fuel consumption targets for every automaker in the country. India targets cars to become 30% or more fuel-efficient in 2022, and 10% or more by 2021. India has set a target for 113 gm/km of CO2 emissions from passenger cars. ?It can be observed that India, China, and Japan have CO2 emission targets for the year 2020/22, whereas, the European Union and the United States of America have emission targets for the years 2021 and 2025 respectively. Collecting and freezing the sales data for M1 category vehicles in India Calculation of annual CO2 emission performance, comparing with the target annual CO2 emission performance, and calculation of fuel savings in petrol equivalent. India published the fuel efficiency standards for commercial heavy-duty vehicles (HDVs). By doing so, India became one of the first countries in the world to publish a fuel efficiency standard for HDVs. Standard applicability: These standards are applicable for Heavy duty commercial vehicles of category M3 and N3 with gross vehicle weight exceeding twelve tons. Category M3: A vehicle used for the carriage of passengers, comprising nine or more seats in addition to the driver’s seat and having a GVW exceeding 5-ton Category N2: A vehicle used for the carriage of goods and having a GVW exceeding 3.5 tons but not exceeding 12 ton As per this standard, manufacturers need to demonstrate compliance by testing their vehicles over the constant speed fuel consumption (CSFC) test procedure. Under this procedure, trucks are tested at constant speed on a test track at 40 and 60 kmph, whereas, buses are tested at 50 kmph. The first phase of the standard (Phase 1) came into effect in April 2018, while Phase 2 is scheduled to be effective from April 2021. Under the standard, the fuel consumption of each vehicle of a given category must be less than the fuel consumption value derived from the equation provided in the standard. The standard, however, is applicable for vehicles complying with BSIV standards.

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?In July 2019, India published its fuel efficiency standards for light and commercial vehicles. Standard applicability: This standard is applicable for Light and Medium commercial vehicles of categories M2, M3, and N2 with gross vehicle weight between three and a half tons to twelve tons. Category M2: A vehicle used for the carriage of passengers, comprising nine or more seats in addition to the driver’s seat, and having a maximum Gross Vehicle Weight (GVW) not exceeding 5 tons Category M3: A vehicle used for the carriage of passengers, comprising nine or more seats in addition to the driver’s seat and having a GVW exceeding 5 ton Category N2: A vehicle used for the carriage of goods and having a GVW exceeding 3.5 ton but not exceeding 12 ton.

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Value creation signifies transforming resources into products and services. Value communication denotes the delivery of the value proposition as a message to the target groups. Value capture describes the ability of the value proposition to transform into a revenue stream. Value delivery defines the means by which enterprises establish interactions with the customer in order to provide value. The report will assess existing business models in the electric mobility space using the above-mentioned framework. Key business models promoting the uptake of electric mobility An overview of potential areas for business, within the electric mobility value chain. ?However, for the purpose of this report, primarily, only those business models have been assessed that can potentially promote the uptake of EVs among end-consumer (B2C businesses). ?Mobility is essentially the most significant area where the actual uptake of electric vehicles will take place. This value area focuses on business models that use EVs or batteries to provide a set of services to customers. It focuses on how the introduction of EVs or battery services will add value to the customers, and eventually encourage businesses and customers to adopt EVs. In line with this, the mobility segment is divided into two categories: electric vehicles, and traction batteries. Each section will evaluate how business models under both categories would create value for customers. Electric vehicles Public perception of the shared economy (such as goods, mobility, properties, etc.) has changed substantially in the past few years. Customers are increasingly preferring shared/ on-demand vehicles that are highly cost-effective as against personal ownership of vehicles. Customers have shown interest in business models and services that offer them an alternative for owning a vehicle along with providing all the facilities/ luxury of vehicle ownership. New mobility business models are effectively changing the way people move. Overview of this shift from traditional business models to new mobility models and services. Micro-mobility includes vehicles such as bicycles, skateboards, electric bicycles, electric scooters, Segways, etc. However, worldwide, electric scooters have emerged as a preferred choice among all vehicle types that facilitate micro-mobility. Characteristics of electric scooters that enable it to be a preferred choice include their ease of use, acting as a faster alternative to public transportation, and being easier to use than conventional bicycles. In micro-mobility, bike sharing has evolved as a prominent business model that has been widely adopted across many countries. Bike sharing provides affordable access to users for short-distance trips, mostly in urban areas. Some bike-sharing services use docking stations for drop-off and pickup (e-bike can be picked up from and returned to any station or kiosk), while others use smartphone apps to provide a dock-less option (e-bike can be picked up and left to any location). There are various companies operating in bike sharing model with different ownership structures such as Zypp (India), owned and maintained privately; Capital Bikeshare (Washington), owned and maintained publicly; CitiBike (New York), publicly owned but privately maintained by the company called Motivate. Some of the emerging micro-mobility companies in India are: A business model review of a few of the above-mentioned bike-sharing companies is provided below a) ZYPP Started as Mobycy, Zypp was India’s first e-bike / e-scooter sharing platform that does not utilize a docking station. The company allows users to book an e-bike with an upfront fare estimate based on origin and destination coordinates.

Zypp is a dockless platform and it requires customers to park the bike anywhere after use. The company provides services such as bike rentals to end-users, delivery of groceries by commercial users as well as delivery of food items, etc. The company currently operates in Gurugram, Delhi, and Noida. Zypp offers e-scooter renting at Rs. 109 per day and offers battery swapping at Rs. 1066 Station fewer e-bikes; Fully electric fleet; owns battery swapping station; low-speed vehicles (top speed 25 kmph) exempted from license requirement; customized plans for customers; maintenance support Key partnerships: ?Spencer’s Retail for last-mile delivery. Partnered with Zomato and Swiggy ? DMRC and local authorities for parking of e-scooters Key resources: ? E-bikes ? Battery swapping station ? Technology Key processes: ? Fleet management ? Battery swapping station management ? Mobile application management Story/ Channel for communicating value: ? Social media ? Mobile application based booking and payment Cost structure: ? Bike and battery cost ? Bike maintenance cost ? Maintenance of battery swapping station Revenue stream: ? Rental fees from every ride ? Revenue from last-mile delivery ? Revenue from battery swapping Distribution channels: ? Customers to locate nearest pickup point of the ride Customer segments:?

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Daily short-distance riders Micro-mobility offers an economical solution to cover distances that are neither walkable nor long enough to hire expensive taxi rides. This mode of transportation will thus prove to be highly effective in areas where public transport is either expensive or the distance to be traversed is substantial. Moreover, in a country like India where traffic density is very high, EV-enabled micro-mobility has the potential to become the preferred choice for last-mile connectivity as it has the potential to save substantial commuting time. To provide an adequate boost for increased uptake of EVs in the micro-mobility space, India needs to provide special infrastructure such as dedicated EV lanes, common parking lots for micro-mobility vehicles, etc. Existing Smart-city missions could embrace the micro-mobility concept and provide the requisite infrastructure by earmarking dedicated lanes, EV zones, etc. EVs would be key in the growth of micro-mobility, as it provides a cheaper and faster alternative for transportation. However, focusing on building complementing infrastructure is equally important for this business segment to grow. ?Ride-Hailing Similar to Uber or AirBnb, the ride-hailing business model revolves around creating a two-sided market that connects the end user with the service provider over a technology-enabled platform. Such business models would also discourage private car ownership and provide an additional source of income for drivers of private vehicles. These services rely on smartphone apps to connect willing passengers with drivers who provide rides (for a fee) in their private vehicles. Transportation Network Companies (TNCs) design and operate these online platforms. Most TNCs function as digital marketplaces linking self-employed drivers with customers, while collecting a fee for making the connection. Key examples of the same are Ola, Uber, Lyft, Didi, tric mobility, and low-carbon passenger road transport in India. SmartE is a 3W—all-electric—mobility service provider, which offers services to commuters to meet their requirement of first & last-mile connectivity. Currently, SmartE is providing its commuting services in major urban cities of India. ?Affordable pricing scheme; Minimum waiting time; Ecofriendly mode of transportation Key partnerships: Charging infrastructure: Exicom; Power Grid; NTPC Battery swapping infrastructure: SUN mobility Land for parking: Delhi Metro; Rapid Metro Gurgaon Key resources: ? Vehicle (3W) fleet size of 600 in Delhi NCR region ? Pilot of battery swapping model Key processes: ? Fleet management Story/ Channel for communicating value: ? Social media ? Mobile application based booking and payment Cost structure: ? Fleet management ? Maintenance of charging infrastructure ? Vehicle parking Revenue stream: ? Rs. 10 for its first pit stop (fixed cost for first 2 km) and Rs. 5 per km thereafter ? Initially started on a commission-based model where it was charging operating commission from drivers. Now, it owns and manages vehicles. ? Smart ads: Revenue generation from hyperlocal advertising on vehicles Distribution channels: ? Online booking; operates on route within a range of 5 km Customer segments: ? Fixed point-to-point commute: Service to and from the metro, bus stations, residential colonies, corporate hubs, shopping areas Ride-hailing business reduces the cost of owning a vehicle and at the same time ensures convenience to customers. The inclusion of options for hassle-free online payment also increases its adoption by customers. However, due to the unprecedented COVID-19 outbreak, ride-hailing businesses have been severely impacted, as consumers have been wary of resorting to such services on the backdrop of increased risks of infection. This has led to disruption in the operations of ride-hailing businesses in several cities in India. During April and May 2020, OLA’s revenue declined by almost 95%. Customers have now shifted to the traditional method of using their own vehicles for commuting. Covid-19 impact: Indian consumers may move away from ride-hailing services (access here). ?How the pandemic has hit Ola, Uber hard in India. Sharing Car sharing follows a similar concept as bike sharing; however, it is preferred for longer distances. It is a short-term car rental, hired on either an hourly basis or per kilometer basis, or a hybrid of both. In this type of service, electronic systems allow unattended access to vehicles with fuel and insurance charges bundled into the rental charges. Car sharing can be round-trip, one-way, free-floating, or station-based. In round trips, the user is required to return the vehicles to their original pick-up stations after use, whereas, in a one-way system, the user can pick up and park the vehicle at any authorized parking spot. In the station-based car-sharing model, users could pick up and return the vehicle at designated rental stations only. Whereas, in free-floating, the user locates the nearest available car using the mobile app, uses it, and then drop-off at any location. Car sharing is enabled through three types of common business models based on the relationship between the service provider and the consumer. These business models include 1) business-to-consumer (B2C); 2) business-to-business (B2B); and 3) peer-to-peer (P2P). ?Car sharing business models based on service provider and consumer relationship Source: 105 eMaaS – Electric Mobility as a Service - eMaaS Consortium – June 2020, Deloitte analysis Business-to-Consumer (B2C): In a B2C model, the service operator offers individual consumers access to a fleet of vehicles through memberships, subscriptions, user fees, or combination of pricing models. Examples of B2C include Zipcar and Enterprise CarShare (roundtrip), and SHARE NOW (free-floating oneway). Business-to-Business (B2B): In a B2B model, the service operators offer access to their vehicles to employees of a company with which it has entered into a contract for a fixed period of time. The service operator bills the company through a fee-for-service or usage fee,. Such business models serve the need of offering convenience to employees in completing work-related trips. Owing to the similarity in services between B2B and B2C models, it is found that the same service operators exist in both B2B and B2C markets.???Last mile delivery after COVID-19: A world of things to solve (access here) Station-based Free floating corporate sharing (B2B) Private sharing (B2C) Peer-to-Peer sharing (P2P) Off-premise fleet On-premise fleet round trip. However, companies such as Lithium Urban operate only in the B2B segment by positioning themselves as premier service operators for businesses. Peer-to-Peer (P2P): The P2P model (sometimes referred to as personal vehicle sharing) is like round-trip car sharing. In this model, the vehicle usually consists of private car owners who are willing to rent out their vehicles when they are not using them. This model offers an additional revenue stream for the vehicle owners. Drivezy is an example of a car-sharing company that offers a P2P sharing facility in India. Some of the major players in car sharing are: Lithium Zipcar Car2go Enterprise CarShare a) Lithium Urban Technology Lithium Urban Technologies owns a fleet of Electric Vehicles (EVs) and associated charging infrastructure, backed by a strong technology platform for telemetry, GIS, employee transport management, scheduling, rostering, and analytics-based optimization. The company positioned itself as a premier B2B service operator. The company operates its fleet through trained and certified drivers. Eco-friendly mode of transportation; Safe, secure, and hassle-free option for corporate commutation; 24X7 service Key partnerships: ?Collaboration with Mahindra & Mahindra for procurement of EVs, Fourth Partner Energy and Lithium Urban Technologies entered into a partnership to build solar-powered charging infrastructure Key resources, ?Over 100 charging stations, ?Fleet of 500 cabs Key processes, Establishing charging infrastructure at corporate office complexes, ?Fleet management Story/Channel for communicating value: ?Social media, Mobile application based booking Cost structure: ?Cost of vehicle, Fleet management. Charging infrastructure maintenance Revenue stream: ?Corporates invoiced on a monthly basis for the number of cars contracted, irrespective of the miles driven. Corporates are separately charged for electricity bills of charging stations Distribution channels: ?

??Customer segments: Fixed point-to-point commute: B2B with Tesco, Unisys, Accenture, Adobe Systems, VMware b) Zipcar Zipcar focuses on urban areas and college campuses across Europe and North America. The company strives to offer a wide selection of cars that serve multiple purposes, including moving apartments or hauling office supplies. The company has several partners with which it works, to enhance its value proposition. For example, Zipcar works with local authorities to secure free parking on public streets for its members; it works with city councils to set up electrification bays for the EV portion of its fleet; it provides its members with discounts to local businesses that it partners with and it integrates its network with public transport. Depending on the subscribed package, members pay a monthly subscription fee. In addition, subscribers pay trip fees based on car usage (time duration for total trips in a month) and overcharge fees, if any. The company does not require subscribers to pay any upfront security deposits. Discounts to local business partners; Free Street parking; Offers electric cars; Fuel, city congestion chargers, insurance & 60 miles/ day included in membership; No deposit required Key partnerships. Car2Go Launched in Germany in 2009, Car2Go is the world’s first free-floating car-sharing service operating across 26 locations in eight countries. The free-floating business model allows Car2Go members to take one-way trips and park their cars within specified zones. The company aims at attracting customers who want to drive premium car models including Businesses/corporates. The organization has some electric cars available in its fleet as well. Car2Go’s real-time reservation system allows customers to book cars just 20 minutes in advance. Its value proposition also provides drivers with free parking in public car lots and awards them with free minutes for refueling or recharging cars. Customers pay a small subscription fee plus rates based on both the time and kilometers driven. The company does not require subscribers to pay any upfront security deposits. Free parking in public car lots; no deposit required; no insurance, fuel, electricity cost; 24x7 availability; credit given for refueling or recharging the car Key partnerships: line platform provided by the service providers merely acts as a tool to match demand and supply on a particular travel route. However, the absence of any checks and balances for the safety and security of travelers using such platforms is a concern. Instead of such issues, this business model has been gaining traction among price-sensitive travelers. Some of the companies in the ride-sharing business are a) BlaBlaCar claims to be the world’s leading long-distance carpooling platform provider. Its platform connects people looking to travel long distances. ? Connects drivers and passengers who travel to the same destination; economical means of transport; revenue for drivers/ vehicle owners Key partnerships: ? Vehicle drivers ? Car insurance players ? Hosting/ architecture providers Key resources: ? Driver community and their cars ? Web-based platform and apps Key processes: ? Product development ? Marketing and promotion Story/ Channel for communicating value: ? Website ? Social Media platforms Cost structure: ? Cost of hosting (servers) ? Marketing Revenue stream: ? Fixed commission from drivers ? Monetizing through implementing Internet payment system Distribution channels: ? Online apps Customer segments: ? Drivers; Vendors; Passenger Ride sharing promotes the concept of increased asset utilization, mostly among private vehicle owners. It is an attractive business model that leverages shared mobility to reduce the cost of travel for both, the vehicle owner/driver and the co-traveler. As ride-sharing is offered by non-corporate entities (vehicle owners), it has minimum overheads involved compared to car-sharing or ride-hailing, which is managed and operated by corporate firms.

Car subscription has gained a lot of traction in the last few years, as a behavioral shift has been observed in personal mobility (consumers are shifting away from owning a vehicle). Traditional subscription models included personal contracts and long-term leasing arrangements. Now, customers are preferring flexible monthly contracts inclusive of bundling insurance, maintenance, and other costs. The car subscription model provides customers with an experience of a private vehicle but saves them from paying the heavy upfront cost of owning the vehicle. Businesses with car subscriptions are offering customers a wide range of vehicle options suitable to their requirements with the flexibility of selecting desired period. Many OEMs such as Volvo, Porsche and BMW72, and other independent platform providers are introducing new subscription schemes to attract and encourage customers to experience personal mobility under car subscriptions. Some of the businesses operating in car subscription are: a) Zoomcar Founded in 2013, Zoomcar is India's first 100% self-drive car rental company. It allows the user to rent cars on an hourly, daily, weekly, or monthly basis. Zoomcar uses Zap app to help customers to list their cars on the company platform. As per Zoomcar’s business model, the vehicle owner is responsible for the service, maintenance, and related expenses of the car. For monitoring, Zoomcar uses its proprietary IOT devices to determine the health of a car on a real-time basis. ? Fuel cost covered by ZoomCar; Flexi pricing packages; 24x7 roadside assistance; damage insurance Key partnerships: ? Partnership with Mahindra Electric and Ford Key resources: ? Private car fleet offered ? Data and inventory ? Online platform Key processes: ? Procurement ? Vehicle maintenance ? IT operation/ platform development ? Marketing Story/ Channel for communicating value: ? Website ? Social Media platforms Cost structure: ? Fleet maintenance ? Park location rental ? Fuel cost.

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OEMs’ Subscription Plans Could Revolutionize Auto Industry

??Insurance Revenue stream: ?Subscription fees (6, 12, 24 months) ?Rental fees per hour Distribution channels: ?Pickup service Customer segments: Drivers, travelers Car subscription offers an economical alternative to long-term car leasing. The car subscription offerings are highly flexible and economical for the customer. Customers now have the option of accessing the cars even for their hourly needs. This business model will be benefitted from the adoption of EVs, as the reduced operating cost (vehicle charging cost) would enhance the value proposition of this business model. Following the COVID outbreak, the car subscription business is expected to increase as it allows customers to lease the vehicle for personal use without the need of paying a hefty amount for the purchase of a vehicle, at the same time it minimizes the risk of sharing vehicles with anyone (during the contract period). E-Roaming In an EV charging process, the EV user has direct contact with the Electro Mobility Service Provider (EMSP) and Electric Vehicle Supply Equipment Operators (EVSEO). Each individual EMSP has an “EVSE usage contract” with one dedicated EVSEO. The EVSEO enables the use of its charging infrastructure by the EMSP’s client (i.e. EV user) while the EMSP ensures the payment of the charging service fee to the EVSEO. In some cases, the role of EMSP and EVSEO is played by a single entity; termed as Charging Service Provider (CSP) Entire charging infrastructure managed by the CSP/ EMSP with which the EV user has entered into a contract, is considered as “home network” for the contracted EV user. EV users generally sign a contract with different CSP/EMSP. Under this arrangement, EV user is allowed to charge his/her vehicles from those charging stations only that are managed by CSP/EMSP they have contracted with. Home network illustration for an EV user Source: ?Jure Ratej, Borut Mehle, Miha Kocbek, 2013, “Global Service Provider for Electric Vehicle Roaming. However, the challenge arises when the customer (EV user) needs to charge the vehicle in an area where the infrastructure of contracted CSP does not exist. In such cases, the customer needs to sign additional charging service contracts with multiple CSPs, leading to the customer receiving multiple monthly bills. This also requires the customer to maintain multiple RFID cards for each geographical location/area. Interoperability appears as an ideal solution for such challenges. In interoperability, service providers engage in B2B contracts with each other, eliminating the need for customers to enter into contracts with each service provider. Such an arrangement allows customers to charge their vehicles with any CSP/EMSP (network partner), eliminating constraints in charging across different geographies. This approach of providing a seamless charging experience to users in their “home network” as well as in “visited networks” (locations, where contracted CSP, does not own charging infrastructure) is known as e-roaming. E-roaming enabled EV users to charge their vehicles from charging stations that do not belong to their home network. In case the EMSP does not have any usage contract with EVSEO, all the charging sessions will be done via roaming. a) E-clearing is one of the largest e-roaming platforms in Europe, with more than 1,06,000 connected charge points and 8,80,000 active drivers. The company was set up in October 2014 as a joint venture of the Dutch foundation ElaadNL and smart lab Innovationsgesellschaft mbH from Germany. E-clearing offers an open B2B platform to all market players in electric mobility. It enables cross-network interoperability in the charging of electric vehicles and related value-added services. Through the offered platform, electric mobility players can share the data necessary for user authentication, billing, real-time information, and other continually expanding use cases.

??Payment services Cash has been the traditional mode of payment for many decades. However, growth in e-commerce and the widespread use of mobile devices have opened new avenues for payments via digital means. Mobility service providers in general, are tying up with payment gateways to offer hassle-free cashless services. Mobility service providers such as OLA have their own mobile wallet – OLA Money, that allows the deduction of ride charges directly from the OLA Money account on availing of OLA services. With the increase in shared mobility, payment gateways are finding increased significance and usage. With respect to EVs, the payment services will be used predominantly for two purposes: for utilizing EV mobility service from an operator, and for charging EVs. Potential payment methods are used for two purposes.

?Point of Sale; UPI: Unified Payment Interface; USSD: Unstructured Supplementary Service Data Overview of all the payment methods mentioned in Traction battery Batteries contribute to ~40% of the overall cost of EVs (Chapter 1), therefore, businesses providing service in battery segment, and delivering value in terms of reducing the overall cost of EV, can play a huge role in promoting the uptake of EVs. In this section, we will discuss potential services/ processes related to batteries that a business can take up and help in reducing the overall cost of ownership for EV buyers. 4.2.1.2.1 Battery recycling Technology such as lithium-ion, is predominantly used in EV batteries worldwide. The lithium-ion batteries mainly comprise rare elements such as Lithium, Nickel, and Cobalt. With the growth in the EV industry, the use of these rare elements is expected to increase and therefore could lead to supply chain issues in the future as the availability of these rare elements is concentrated in a few countries only. Battery recycling is an effective way to ensure optimal utilization of such rare elements along with meeting the rising demand. Recycling batteries reduces negative environmental impact as well as has the potential to reduce the overall cost of a battery (and therefore EVs’). Battery recycling provides strategic benefits to the manufacturer as it uses materials that are readily available. It is also understood that, at times, the raw material from the recycled battery is of higher quality than the original raw materials as they already have gone through refining processes, and, therefore need Figure 166 Overview of a battery life-cycle with recycling Source: 109 Sourcing resources: How efficient battery recycling helps reduce costs and emissions (access here) Raw material production Electrode production Battery cell production Battery module production Battery recycling Battery pack production Credit/ Debit PoS card Mobile Wallet QR Code *99# Mobile USSD Banking UPI Payment Payment for using EV mobility service Payment for charging EV Status quo analysis of various segments of electric mobility and low carbon passenger road transport in India | Review of Services and Business Models in electric mobility 179 less pre-processing.73 This in turn helps the manufacturer to produce a cheaper battery and consequentially increase the affordability of EVs. World Economic Forum (WEF), in their report, suggests that battery recycling holds the potential to provide 13% of the global battery demand for cobalt, 5% of nickel, and 9% of lithium in 2030.74 However, the major challenge faced in battery recycling is the “high cost of recycling”. The economic viability of the battery recycling process depends upon factors such as the costs of collecting, handling, and disassembling the batteries. Once the recycling process is completed, the viability also depends upon the scale of reliability and material value of the batteries recycled. Policymakers may consider providing financial assistance/ incentives to the high-quality recycling processes, and promote the creation of a battery recycling industry in the country Promotion of battery recycling will encourage the evolution of new business models such as trading of recycled raw materials in the exchange market, or physical reuse of aged batteries in other applications (e.g., as energy storage systems). India, acknowledging the importance of battery recycling, released a draft “Battery Waste Management Rules, 2020” which laid guidelines on the effective recycling of batteries along with the responsibility of all value chain players. Battery Waste Management Rules, 2020 (access here) Battery subscription is key to reducing the upfront cost of electric vehicles (especially e-buses). In Battery Subscription, batteries are provided to vehicle operators on a subscription basis, charging for use on daily or per kilometers rates.

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