India has seriously considered low-emission sustainable roadmap which supports development and building infrastructure for electric vehicles (EVs). These policy reforms have helped automakers with financial assistance, tax cuts, consumer benefits which inturn targets at acceptance of EVs in India. In this article, Pushkar Oak delves into the major challenges in the EV industry and ways to overcome the same.
The Indian electric vehicle (EV) industry saw 1039 sales last year and with
MG Hector launch some positive vibes came into the industry. As on Feb 2020, the company received around 50,000 booking for its hybrid kind.
There are some grey areas like range anxiety, charge anxiety, charging station which remain yet to be addressed. There exists a trust issue. Electric vehicle owners wonder whether or not the vehicle is getting charged, or whether the charging station is working properly. The trust issue with electric vehicle charging stations is something manufacturers and charging station providers are trying to solve. In other words, the quality of the electricity supplied from the grid to the charging stations always keeps fluctuating in India, and it varies from one location to another.
According to a MarketWatch, at present, there are about 250 public charging stations operating in India. In the coming days, the number of charging stations is expected to witness massive growth. As per Kenneth Research, the Indian electric vehicle infrastructure market is expected to grow at a compound annual growth rate (CAGR) of over 40 per cent till 2025.
Further, the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME II) extensively focuses on electric vehicle charging infrastructure. The Indian government is aiming at setting up 2,636 electric vehicle charging stations in 62 cities across 24 states and union territories by 2023.
But the real question is how many EV chargers would India need to support its overall goal of 30 per cent EVs on road by 2030. Many experts believe that there is a need for a transparent solution or a platform where the car owners can view nearest charging stations, record data and check the battery status of the vehicle in real-time to eliminate this fear. Commenting on the same, Varun Chaturvedi, MD and CEO of Volttic EV Charging, shares, “The company is developing safe and reliable EV charging infra for faster adoption of EVs within India. “For this to happen, we are installing a smart EV charging station where we can easily map the energy requirement with our analytics platform on the go,” he added.
Besides this, the quality of the electricity coming in from the grid plays a pivotal role in eliminating the ‘charge anxiety’ among the consumers as well as electric vehicle charging manufacturers.
Maxson Lewis, Cofounder and MD at Magenta Power and ChargeGrid, states, “The electric vehicle charging infrastructure in the country cannot be copy-pasted from international solutions. Challenges like heat, humidity, harmonics and humans are unique for the Indian ecosystem. Additionally, we have a low take off, which pushes electric charging station operators to focus on business outcomes.”
“The concept of stabiliser is unheard of or redundant in the European and the US market as the quality of electricity supplied from the grid to charging station is of the highest efficiency,” informs Lewis.
In the 2019 budget, Finance Minister Nirmala Sitharaman had announced an income tax exemption of up to Rs 1.5 lakh for people who’d buy electric vehicles on loan, which would lead to a total benefit of Rs 2.5 lakh to the taxpayer over the period of buying.
The government also brought down GST rates on electric vehicles from 12 to 5 per cent. However, the tax rebate failed to boost demand and in 2019, only 1,309 electric car units were sold between April and November.
The government’s FAME (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles) scheme announced in 2019, was a major boost for the industry, with the government allocating Rs 10,000 crores over a period of three years. The policy incentivises local manufacturers of EV components and allocated over Rs 1,000 crore for setting up charging infrastructure across India. However, the government has asserted that the benefits of FAME are limited to commercial vehicles only.
Budget 2020 was silent on electric vehicles and in fact, increased customs duty on imported CBUs (Completely Built Units) from 25 to 40 per cent, in a bid to promote local manufacturing.
Future of EV
Experts believe that all cars in the future will be electric. It is going to happen. But it will only happen if the targeted efforts of the Indian government are connected internally across other ministries. The automobile industry is one of the biggest contributors to pollution and aggravating the climate crisis: according to a study conducted by the International Council on Clean Transportation (ICCT), George Washington University and the University of Colorado Boulder in the US, about two-thirds of the deaths caused by air pollution could be linked to diesel vehicular pollution. Petrol- and diesel-powered cars also come with the additional baggage of fossil fuel pollution, one of the biggest contributors to the climate crisis. A report by Greenpeace South Asia states the cost of air pollution due to fossil fuel borne by India is almost 5.4 per cent of the total GDP. The same report states that the global cost of air pollution caused by fossil fuels is US$ 2.9 trillion.
“Electric cars will have a positive impact on the economy and the environment. India imports 80 per cent of its total crude oil needs, and electric vehicles could help it save up to US$ 100 billion in Forex reserves,” says Vinit Bansal, Cofounder and MD, EV Motors.
India is home to 20 of the most polluted cities in the world. A study conducted by TERI stated that
vehicular pollution contributes
28 per cent to PM 2.5.
Lastly, there is a need to address the challenges in the EV industry to make it a viable option. Government is to establish generation of renewable power for EVs, which once coupled will solve the problem of pollution and will improve air quality. Government has not yet expanded it charging stations across the country. Moreover, the time taken to charge and EV is also holding back from winning trust of the consumers.