To say that an Electric Vehicle (EV) revolution is sweeping India may be a bit of an overstatement, but it is true that EV sales are in the fast lane and the country will see an EV revolution in the not-so-distant future. In 2022, a record 10.54 lakh EVs were sold in the country, a growth of more than 200% over the 3.44 lakh units sold in the previous year. Sales surged across categories giving the EV industry several reasons to celebrate.
Still, EV sales accounted for just 4.7% of the overall vehicle sales. While the high upfront cost of EVs is a major reason why many potential EV buyers are in a wait-and-watch mode, reports and anecdotal evidence show that concerns over the range of EVs and lack of adequate charging infrastructure are the other reasons. Be mindful that while the range of EVs has improved quite a bit, it is not yet good enough for long-distance travel, and the charging infrastructure cannot be set up overnight.
It is hardly a surprise that the EV industry has already zeroed in on the answer to overcome these challenges. The solution is battery swapping. It is a technology where a battery that has run out of charge or is about to be replaced with a charged battery at a station. Imagine a place very similar to petrol pumps. Battery swapping has the potential to enhance the pace of adoption of EVs. By 2030, the central government wants 30% of all vehicles to be running on electricity. Battery swapping can play a critical role in making this happen.
Incidentally, the government also announced the draft Battery Swapping Policy last year to support the adoption of EVs by promoting battery swapping technology implemented via Battery as a Service (BaaS) business model. The policy also aims to address key technical, regulatory, institutional, and financing challenges that will help develop battery swapping ecosystems to unlock the large-scale adoption of battery swapping. As G20 President, India is playing a vital role in Clean Energy push on global stage. And, India is fast becoming a global platform for some of the biggest conferences and exhibitions such as India Energy Storage Week 2023, to further accelerate India’s Clean Energy and EV drive.
While the EV industry is looking to scale up the charging infrastructure, charging the drained-out battery takes time. The minimum time needed to fully charge an EV battery is two to three hours. As against this, battery swapping technology will allow EV owners to go to a swapping station and get the battery quickly replaced with a pre-charged one in just minutes. The reduced vehicle downtime would be especially beneficial for commercial vehicles and long-distance travellers. Charging stations require more space since vehicles need to be parked next to the chargers. Battery swapping stations address this problem too since batteries can be stacked on top of each other. This will also help in doing away with the large investments needed to set up charging stations.
The biggest advantage of battery swapping is that it can help reduce the cost of EVs. Battery is among the most expensive components of EVs and this is expected to be the case until the industry achieves a significantly bigger scale, which is likely to take a few more years. With battery swapping, manufacturers can sell the vehicles without batteries, which will significantly reduce the upfront cost. Customers can pay a subscription fee to service providers for battery services throughout the vehicle's lifetime under the broader umbrella of BaaS. This single move can lead to a big reduction in the cost of EVs and make them affordable for more customers.
On the face of it, it is a no-brainer that the battery swapping can be a game-changer. And while the technology has been around for quite some time now, it has not yet taken off due to multiple challenges. Different EVs have batteries of different shapes and sizes. The EV industry will need to work on the standardisation of batteries to make battery swapping a reality. Standardisation can promote interoperability, making it easier for EV owners to use different battery swapping stations without compatibility worries. This can also encourage a wider adoption of EVs.
In all this, the government has a very critical role to play, and this goes beyond offering subsidies and tax benefits. The government will need to bring together EV companies, original equipment manufacturers and technology startups to give a push to ongoing R&D efforts in the EV space. I am happy to note that the Indian government is already working in this direction. In addition to efforts to augment the driving range of batteries, all the key stakeholders will need to work together and focus their attention on standardisation of batteries to make them compatible with EVs of different brands. There is also a need to enhance the battery swapping infrastructure to make battery swapping easily and widely available.
Not only is the battery swapping technology expected to lead to greater adoption of EVs, but it is also a must for the transition to clean mobility to decarbonise the transportation segment, one of the biggest sources of greenhouse gas emissions. The adoption of EVs will reduce tailpipe emissions since EVs have zero tailpipe emissions. India is home to some of the most polluted cities in the world, and a shift to EVs can help in reducing air pollution and improving air quality. A shift to renewable energy sources to ensure EVs are powered by solar or wind power can lead to a reduction in emissions from the power sector too.
To conclude, battery swapping appears to be the best available option at this moment to accelerate the adoption of EVs. It has its share of challenges too, but efforts are already underway to address them. I am confident the results of all the stakeholders working in tandem will start becoming visible soon.
(Ashok Thakur, the author, is Director of Strategic Initiatives, Customised Energy Solutions (CES)-one of the fastest growing energy consulting & services companies in the world. The views expressed here are personal)
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