“There is a need for major technological innovations and disruptions in e-mobility”Over the past two to three years, the government has been increasingly advocating electric mobility with the aim of increasing the share of electric vehicles (EVs) to 30 per cent by 2030. At a recent India Infrastructure conference on E-mobility and Charging Infrastructure, Abhay Damle, joint secretary, Ministry of Road Transport and Highways (MoRTH), spoke about the government’s policy measures to give a boost to the EV segment. Excerpts…
We need a three-pronged strategy for promoting electric mobility in the country – setting up good charging infrastructure, ensuring that original equipment manufacturers (OEMs) are willing to roll out EVs, and encouraging consumers to buy these EVs.
Charging infrastructure
India sells about 3.5 million cars and 20 million two-wheelers a year. Even if we consider converting 5 per cent of the vehicles into EVs four years down the line, we are looking at about 200,000 vehicles going electric every year. In order to supply power to these EVs, there is a need to set up 20,000-30,000 charging stations every year across the country.
Well-developed charging infrastructure is crucial for the expansion of EVs in order to give confidence to users to make the switch to these vehicles. While the central government will not get into setting up of charging infrastructure it will formulate policies and regulations to encourage the same.
The government might set up the initial nucleus of charging stations in order to kick-start the process. In this context, the National Highways Authority of India is formulating a “highway nest” policy and one of the elements of the policy is the setting up of charging infrastructure. In the near future, there will be a huge potential for private sector participation in the charging stations space.
The Ministry of Power (MoP) has also provided clarity on issues related to the setting up of charging stations – charging activity does not entail the resale of electricity and setting up a charging station does not require a licence (as per the Electricity Act, 2003). Further, the MoP has also proposed the creation of special tariff categories for charging stations.
Focus on OEMs
Another key facet of the electric mobility ecosystem is the need to stimulate the production of EVs. The need of the hour is to create a system where OEMs are motivated to manufacture EVs and this is being done by tightening the fuel efficiency norms. We have also introduced the corporate average fuel efficiency or CAFE norms which apply to all vehicles manufactured by a particular OEM and aim at improving fuel efficiency by 17 per cent by 2022. This is a difficult feat to achieve since it requires considerable engineering and will result in a subsequent increase in costs. This is expected to propel OEMs to switch a part of their production to EVs as only then will it be possible for them to meet the tightened fuel efficiency standards.
While world over there is greater focus on electric cars, in India, the focus is on e-three-wheelers, e-autos and e-buses. In India, we are looking at ways to reduce the cost of electric mobility. Though the capital cost of EVs is very high, if we consider the total cost of ownership (TCO), it can be justified. Also, taxing conventional vehicles at higher rates vis-à-vis EVs is not the right strategy. Pricing should be market determined and OEMs should work on cost reduction through greater localisation and indigenisation.
Demand creation
The reason why EVs are not being manufactured on a large scale in the country at present is because of a lack of buyers. Consumers need to be encouraged to buy EVs through incentives such as priority parking and exclusive entry to congested areas, as is being done globally. The MoRTH is taking several steps in this direction. For instance, in order to give EVs a distinct identity, the ministry has started providing green number plates for EVs. The distinctive number plates will allow for easy identification of EVs, which will allow preferential treatment in parking and free entry in congested zones among other proposed benefits such as concessional toll charges.
Further, we are planning to ask transport operators, fleet operators and cab aggregators to start introducing EVs in their vehicle fleet on an incremental basis, say, 2 per cent annually. The government has also removed the permit requirement for all EVs as this was a barrier to entry into the market. Earlier, the move was applicable only to e-rickshaws and it led to their mushrooming. However, it must be noted that the permit exemption does not mean that the vehicle does not have to be registered.
Conclusion
I feel that things will move faster once a robust battery regime kicks in. At present, there are impediments in the battery and storage solutions space. The available technology is just being applied to vehicles and a technological disruption is yet to come. There is a need for major technological innovations and disruptions in the electric mobility segment to increase the growth momentum.