Will we be EV ready by 2030?

An editorial by President?Vinkesh Gulati?in today’s all India edition of?#HinduBusinessLine

https://www.thehindubusinessline.com/opinion/will-we-be-ev-ready-by-2030/article35883538.ece

#EV?#evehicles?#evfuture?#BusinessLine?#articles?

?Sai Giridhar Raj Kumar?Saharsh Damani?Ashish Kale?John Paul Kuttukaran?Prakash Rao Kanumilli?Nikunj Sanghi?FICCI?Confederation of Indian Industry?ACMA India?Automotive Skills Development Council?FADA New Delhi

Are we EV-ready: Will it be a reality by 2030?

India’s recent push for electrification in the automobile sector can be considered a ‘zeitgeist’ of the sector today. From the government’s recent forward-thinking EV policies to market analysts recommending stocks that might benefit from this gradual transition, Electric Vehicles (EVs) have become the new buzzword in India. The question is: will the adoption of EVs in India become a reality in the next decade or is the industry merely seduced by a pipedream?

India started the EV push in 2013?under?the National Electric Mobility Mission Plan (NEMMP) 2020 and, eight years later, we are at a petty 0.79% penetration rate of EVs. According to a FADA study,?out of over 26,500 automobile outlets in India, barely 500 sell electric vehicles.

The government launched FAME India in 2015 to promote eco-friendly vehicles. In its second phase, i.e. FAME 2, the government is supporting electrification of public and shared transportation through subsidised electric vehicles, including buses, passenger cars and two-wheelers. The Department of Heavy Industries (DHI) has also announced a 50% increase in incentives for electric two-wheelers to Rs 15,000 per kilowatt-hour (kWh) from Rs 10,000 per kWh. According to the new rules, the cap on incentives will be limited to 40% of the total price compared to the earlier cap of 20%. DHI has also mandated EESL to procure 3,00,000 electric three-wheelers for use by different authorities.

However, the familiar hesitancies of range anxiety and lack of charging infrastructure persist. A major barrier in the adoption of EVs is the lack of diversity in models and production constraints due to the battery pack being imported.

With most Indian OEMs launching EV products over the coming years, we can surely say that EVs will command a respectable volume in the industry. All manufacturers share the goal of reducing greenhouse emissions, and there is no better way to meet EV objectives than by improving infrastructure, keeping consumer costs down, and taking advantage of the thousands of dealerships already spread throughout India.

If we want to sell electric vehicles in double-digit percentages, the answer lies in the battery pack. The battery pack of electric vehicles, usually Lithium-Ion batteries, accounts for about half the cost of the vehicle and is currently fully imported. India differs from other developed markets as consumers here want comfort, safety and technology, in a cost-effective manner.?

At the current prices, the average battery cost for a typical electric vehicle works out to about INR 5Lac + for a Passenger Vehicle. To me, the inflexion point for mass EV adoption will be when the effective cost of an electric vehicle matches the cost of an Internal Combustion Engine (ICE) vehicle in India.?

The problem of range anxiety also persists. While most expensive passenger electric vehicles can travel 250-400 kms or more before needing a charge, consumers wanting mainstream models remain anxious about whether their EV will run out of charge in the middle of their commute.?

Another key challenge is that charging stations are the backbone of EV infrastructure but we do not have a sufficient number of them. Should municipalities and companies support EV charging? Yes, as this will help building owners attract tenants, retailers attract shoppers and the hospitality industry attract travellers. The lack of robust charging infrastructure is keeping customers away from purchasing an EV. There is also a peculiar issue with metros like Delhi and Mumbai, where parking is a major problem (only 20% available) as compared to metropolitan cities in countries like Japan where 80% of people have a fixed parking spot. So how would setting up charging stations work in residences?

However, once people buy an EV, customer satisfaction is high. Most consumers use the EV as their secondary vehicle, but there are only a handful of people who can afford two cars when in India there are only 23 cars/1,000 persons.

The EV is far cheaper to maintain than an ICE vehicle. For one, it runs on an electric motor, not a complex engine. Hence, it is 30% cheaper to service and maintain. Electric cars also need fewer fluids – only coolant to regulate the battery temperature. Like with all cars, an EV’s brake disks and pads will require maintenance. However, the tyres of EVs can wear out faster than ICE vehicles due to the high torque generated upon pressing the pedal. Regular check-ups of electrical systems including the battery, electrical motor and minor electronic systems are necessary. Companies are also providing battery warranties of three to eight years to boost confidence. Also, EVs will cost less than Rs 2/km, whereas ICE vehicles do not cost less than Rs 6-8/km.

The lack of charging stations, relatively higher purchase price of EVs compared to ICE vehicles and not so clear long-term planning and goal setting on the part of the Centre and state governments are the top three barriers against EV uptake. But with the correct investment in charging infrastructure, increasing the range of available options and reducing the cost of battery packs, India can surely attain this goal by 2030.