Recently, news has been coming heavily stitched with updates related to EV in a way or another. The buzz grows stronger every day. The government has allocated a major budget, companies are producing more and more electric vehicles, buyers are interested. The trajectory for a successful transition to EV is clear except for a major roadblock, inadequate charging infrastructure. The picture around charging, that brings all these pieces together, remains fuzzy, and although quite many private entities have been pledging to contribute to the charging infrastructure independently, a systematic national map is what is required.
The soil for EV started showing significant signs of fertility after the Department of Heavy Industries, on June 25, 2021, extended the Faster Adoption and Manufacturing of Electric Vehicles Phase 2 (FAME-II) programme, up to March 2024. Apart from that, PLI for advanced chemistry cell (ACC) batteries, state subsidies to end-customers for purchase of EVs and lucrative state fiscal incentives added to the prospects.
Going a step further, the government, after much wait, approved the PLI scheme for the auto sector, which predominantly includes green vehicles and advanced technology components. It includes two turnover-based schemes: Champion OEM Incentive Scheme for OEMs of EV and hydrogen fuel cell vehicles (HFCV), wherein an incentive ranging from 13-18% is offered; and Component Champion Incentive Scheme for advanced automotive technology components used in two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, tractors, etc, wherein incentive ranging from 8-13% is offered; with an additional incentive of 5% for the component manufacturers of EVs and HFCVs.
FAME-II earmarks an impressive Rs 1,000 crore for the development of electric vehicle (EV) charging infrastructure in India. However, despite two Expression of Interests (EOI) in the last two years, which targeted the deployment of close to 4,400 charging stations in cities and on highways, the utilisation of funds does not reflect anywhere to the extent it should.
This makes one thing clear, the need to look beyond mere allocation of funds. India needs to clearly talk on a national scale about some major aspects in the EV industry like the expected direct input from the private sector, designing a charging standard and looking into its further compliance, being prepared with solutions for common regulatory issues, streamlining implementation and making sure that local bodies and distribution companies (discoms) are adequately involved.
Apart from taking insights from global strategies, learning from states and cities which have been flag bearing the EV initiative and applying it on a national scale should be another important aspect of the approach.
The first step to a uniform charging network would be instilling coordination between the power and transport departments, with discoms facilitating this sync in the background. Land can happen to become another issue, bearing in mind how it follows a complex and multi-agency ownership pattern. All these factors, like for any other industry in its infancy, would need to work hand-in-hand right from cities to state levels.
It will be critical for the national strategy to suggest a framework for interagency coordination to ensure the effective deployment of charging stations. Delhi provides a good example of such an interdepartmental body. A Working Group (WG) has been formed to implement a coordinated strategy for Delhi EV charging infrastructure. It comprises the Dialogue and Development Commission of Delhi (DDC) —the Union Territory’s think tank, the transport and power departments, the state nodal agency for EV charging, all the discoms and municipal corporations of Delhi and Energy Efficiency Services Limited (EESL). The WG has been spearheading the implementation of all aspects related to Delhi’s EV charging.
The second point to look at is that EV charging would have varied requirements depending on the location and expected pattern of demands. Identifying use cases and determining priority vehicle segments form the bedrock of determining a city’s EV charging plan. Cities such as Delhi and Mumbai may prioritise two and three-wheeler segments and focus on the widespread installation of light EV chargers. But a city like Shimla may prioritise cars and therefore the deployment of fast-charging stations.
Similarly, a city with less access to private parking space may prioritise public EV charging stations more than a city where residents largely have this facility. The national strategy should provide flexibility to cities to identify and prioritise vehicle segments and charging use cases that they aim to promote under programmes like FAME-II.
The technical feasibility and economic viability of charging stations are site-specific. The operators themselves would best understand the flow of the market around them and how to function being profitable. It is, therefore, important that the government tenders provide maximum flexibility to charging station operators in determining their business model, ergo the best combination of EV chargers at a specific site or allowing for additional revenue streams such as advertisements from the charging stations.
In contrast, the EOI for installation of charging stations in cities should be kept bereft of this flexibility and should mandate a fixed number of chargers, at least a fast one at each location.
Incentives to improve the operational viability of charging stations must go beyond subsidising chargers and extend to other major costs associated with building the infrastructure. The tender for Delhi EV charging stations and the Maharashtra EV policy provides for defraying the costs associated with land and upstream electrical infrastructure which form a major chunk of the fixed and operating costs. These subsidies must be provided upfront to the charging station operator and not as a reimbursable cost. Any delay in these reimbursements can prove detrimental to a business in its nascent stage. The national strategy should consider providing these incentives in coordination with states.
The strategy should also lay down well-defined targets with clear timelines, provide frameworks for determining the geographical distribution of charging stations, and suggest fiscal measures that accelerate the setting up of such infrastructure. It must also identify the training needs at local level and institutional reforms. For instance, the Department of Energy in the USA had recently announced a national EV charging technical blueprint which would assess needs in terms of connectivity, communication, protocols and government fleet transition.
Ola Electric, which managed to sell ₹1100 crores worth of scooters in just two days of commencement of its sale, informed via its site that the regular maintenance check and service will be performed at the user’s home. While this might be a viable solution at the initial stages, with further growth of the EV sector, catering to each and every customer on-demand at home might not be a great road to go down.
That being said, the problems posed by lacking charging infrastructure are not unnoticed. Recently EVRE, an EV Charging Infrastructure player and Park+, a smart parking solutions brand, announced their partnership for establishing 10,000 EV charging stations across India over the next two years. Hero Electric also, on Friday said it has joined hands with EV start-up Massive Mobility to set up 10,000 charging stations across the country in next one year. The current scenario makes it evident that EVs are here to stay. The doubt does not lie in the possibility of change, but the ease with which it rings in. The picture goes beyond just strewing the landscape with charging stations. A systematic approach in the establishment of these charging stations right from the beginning is essential, if we aspire to see changes as soon as possible.