Written by Ashok Khanna The intent to move towards electric vehicles (EVs) and hybrid is the right step, but the road towards the destination needs some holistic navigation. With rising disposable income and better road infrastructure, millions of new four-wheelers and two-wheelers are getting added on Indian roads. As per reports, passenger vehicle sales are expected to be around 3.2 million units in FY18. Total car sale in 1993 was 1.6 lakh units. In March 2018, a well-known car manufacturer sold that much in a month. This reflects the insatiable demand for automobiles and this has led to challenges on multiple fronts. One is the rising oil import bill and second is the impact on the environment on account of pollution. Taking cognisance of these factors, the government has taken the right step to reduce the dependence on fossil fuels and rely more on non-fossil source of energy. The National Electric Mobility Mission Plan (NEMMP) 2020 in 2013 and then the Faster Adoption and Manufacturing of Hybrid & Electric Vehicles (FAME India) under NEMMP 2020 in the Union Budget 2015-16 pushed for early adoption and market creation of EV and hybrid technologies in India. Moving from a strategic framework, what needs focus in the time to come are the building blocks that will help achieve the outlined objective. Adoption For India to switch to EVs and hybrid vehicles faster, players will have to work on one mantra that drives Indian customers when it comes to automobiles — mileage. To cite an example, for a fleet bus owner, the incentive to move to EV buses will be when one’s able to do a round trip on a single charge. So, presently, if a single charge enables one to run 500 kilometres (km), the next re-charge take will place after a round trip, making it viable for the transporter. Presently, the lack of long-range performance of the battery on a single charge to complete the journey is clearly one of the inhibitions. Second, charging stations that enable quick charging of a vehicle. Imagine if the same transporter has to wait for 6-7 hours for an electric bus to recharge before it can do another trip, the math simply does not add up. Moreover, the need for adequate infrastructure in the form of a network of charging stations is necessary. Currently, charging infrastructure for the available set of vehicles is low with less than 250 EV community charging stations. Some effort are being made on this. However, a lot of infrastructure building needs to be done. As we move ahead, we have to envisage a scenario where there is a mix of public, home and even office charging stations across the city. Technology Suppose, you bought an EV five years ago. Today, you want to sell your EV, but realise that the cost of the vehicle is still the same. There is no depreciation and, therefore, there is no market for second-hand EVs. It’s not a possibility now given the nascent market, but if the cost of the battery, which is the heart of an EV, remains the same, we will see a thriving market emerge similar to petrol or diesel vehicles. Currently, the cost of the batteries is around 40-50 per cent of the total cost. This means that the cost of a battery needs to reduce for these vehicles to become affordable, enable re-sale and eventually, become a market place. This can only happen if domestic manufacturing of batteries takes place, thus reducing imports from markets like China. Right now, the EV and hybrid vehicles industry is at a nascent stage. It needs further fillip where the industry and the government need to come together to avoid a chicken and egg situation. The effort to create the necessary infrastructure and benefits by the government should be in tandem with the industry’s endeavor to create a domestic manufacturing base, particularly on batteries that enables cost reduction. Aspects like charging time brought down to about half an hour with every charge capable of handling over 800 km run are important considerations. Add to that reduction is the cost of batteries which will make the vehicle price-competitive and a value buy for customers, apart from the obvious environmental benefits. As the eco-system gets created, one will also see increased participation by banks and other financial institutions as lenders. To sum up, the initial steps in the right direction has been taken and the party’s just began. But it will take everyone to tango to paint the town green.
