Un­cer­tain­ties are ham­per­ing the growth of In­dia’s EV charg­ing net­work

It is im­pos­si­ble to imag­ine an EV-only fleet on In­dia’s roads without the strong back­bone of a charg­ing in­fra­struc­ture. Even though the sec­tor has at­tracted the in­volve­ment of many con­glom­er­ates, de­mand hasn’t picked up yet and in­vest­ments are slow.

Electronics Bazaar - - Contents - By Shruti Mishra

As the de­mand for elec­tric ve­hi­cles gains mo­men­tum glob­ally, many new firms are com­ing to­gether to de­velop a con­crete sup­port­ing in­fra­struc­ture, which in­cludes charg­ing sta­tions. Ac­cord­ing to a new re­search re­port pub­lished by Mar­ket­sandMar­kets, the global mar­ket for EV charg­ing sta­tions is ex­pected to grow from US$ 5.30 bil­lion in 2018 to US$ 30.41 bil­lion by 2023, at a CAGR of 41.8 per cent. The re­port cites that in­cen­tives, sub­si­dies and fund­ing from gov­ern­ments; a hike in de­mand for EVs, grow­ing con­cerns about en­vi­ron­men­tal pol­lu­tion and heavy in­vest­ments by au­tomak­ers are driv­ing the global mar­ket for EV charg­ers, world­wide.

In In­dia, too, these key mar­ket driv­ers are work­ing equally well. Re­cently, the Min­istry of Power clar­i­fied that no sep­a­rate li­cens­ing is needed for set­ting up EV charg­ing sta­tions. This is un­doubt­edly a strong and sup­port­ive step for the EV charger busi­ness, and will aid the growth of the elec­tric mo­bil­ity sec­tor in In­dia.

Other ini­tia­tives, too, have been taken by both the gov­ern­ment and pri­vate sec­tor to en­hance the re­quired in­fra­struc­ture in In­dia. The Min­istry of Power has al­ready started work­ing to­wards NITI Aayog’s plan to have only elec­tric cars on the road in In­dia by 2030. The min­istry is pro­mot­ing nu­mer­ous EV in­fra­struc­ture ini­tia­tives through its var­i­ous pub­lic

sec­tor com­pa­nies (PSUs) such as the Na­tional Ther­mal Power Cor­po­ra­tion (NTPC), Bharat Heavy Elec­tri­cals Ltd (BHEL), En­ergy Ef­fi­ciency Ser­vices Ltd (EESL) and Ra­jasthan Elec­tron­ics (I) Ltd (REIL). Sim­i­larly, the Cen­tre has ini­ti­ated sev­eral pi­lot projects and has al­ready in­stalled 25 charg­ing sta­tions in Ben­galuru, with a plan to ex­pand this pro­gramme to other met­ros as well.

De­spite such en­cour­age­ment, In­dia is still far be­hind the de­vel­oped world in the set­ting up of a sus­tain­able en­vi­ron­ment for both EVs and EV charg­ing sta­tions. Right now, the efforts of the in­dus­try are largely fo­cused on launch­ing new vari­ants of EVs, and do not ad­e­quately ad­dress the need for suit­able charg­ing sta­tions. What is wors­en­ing the sit­u­a­tion is un­cer­tain and un­clear gov­ern­ment strate­gies, which are send­ing mixed sig­nals to in­vestors and pre­vent­ing the speedy roll-out of sup­port in­fra­struc­ture.

Let’s take a look at some of the in­her­ent chal­lenges that the In­dian EV charg­ing mar­ket is fac­ing at present.

The need to gen­er­ate de­mand

Although the mar­ket for EV charg­ers is boom­ing glob­ally, it is still at a bud­ding stage in In­dia and is largely re­stricted to pi­lot projects. The in­dus­try is at present mostly dom­i­nated by small and un­or­gan­ised play­ers be­cause of the lim­ited scale of busi­ness and an un­cer­tain com­mer­cial model. These com­pa­nies are too small to set up the com­plete city-wide charg­ing in­fra­struc­ture, and are mainly of­fer­ing home based charg­ing so­lu­tions.

There is also a dearth in de­mand for these sta­tions. Kedar So­man, a part­ner at Plug­inIn­dia (an on­line fo­rum fo­cused on pro­mot­ing the use of EVs) ex­plains, “Cur­rently, the num­ber of elec­tric four-wheel­ers is tiny and they are mostly charged at home. The num­ber of two-wheel­ers is ris­ing fast, but these have enough charge to cover the daily travel needs for most peo­ple. Thus the de­mand for these charg­ing sta­tions is not there, yet.”

How­ever, ex­perts think that this shortage in de­mand will be short lived. Once the in­dus­try starts rolling out EVs in full swing, home based charg­ers will lose their mar­ket share be­cause of their slow charg­ing rates and low ca­pac­ity, as com­pared to the pub­lic charg­ing sta­tions. “As the range of elec­tric ve­hi­cles in­creases, more and more out­sta­tion trips will be pos­si­ble, thus in­creas­ing the de­mand for charg­ers on high­ways. As the big­ger ve­hi­cles like SUVs turn elec­tric, we will also need faster charg­ers for big­ger bat­ter­ies,” So­man adds.

Charg­ing sta­tions that are placed in com­mer­cial ar­eas will be used the most. They should be lo­cated at spots that will en­sure that the EVs stay on the road for longer pe­ri­ods of time. As per the Mar­ket­sandMar­kets re­port, set­ting up charg­ing sta­tions at pub­lic places such as shop­ping malls, com­mer­cial build­ings, air­ports and restau­rants will pro­vide con­ve­nience to the end users. This will def­i­nitely in­crease de­mand and boost the adop­tion of elec­tric ve­hi­cles in the coun­try.

The in­vest­ment sce­nario

Cur­rently, In­dia has just over 200 EV charg­ing sta­tions set up across the coun­try, which is rais­ing a few con­cerns. If the tar­get set for 2030 is to be reached, then in the com­ing years, there will be a great need for charg­ing sta­tions. Ex­perts be­lieve that the in­dus­try will be able to ful­fil this need only when there is a clear-cut pol­icy from the gov­ern­ment, which will open the doors for fund­ing.

The big­gest road­block af­fect­ing the build-up of EV charg­ing sta­tions in In­dia is the ab­sence of in­no­va­tive busi­ness mod­els. An un­clear road map, with ad hoc an­nounce­ments by OEMs launch­ing their EV fleets, is cre­at­ing con­fu­sion and ob­struct­ing the path of in­vest­ments. To make has­sle-free and quick in­vest­ments, So­man be­lieves that the sec­tor needs to seek clar­ity from the gov­ern­ment on three fronts — the gov­ern­ment’s ob­jec­tive for EVs, in­cen­tives for pro­mot­ing the pro­duc­tion of EVs, and the elec­tric­ity tar­iffs and reg­u­la­tions. He says, “Other fac­tors such as oil prices and the pace of bat­tery tech evo­lu­tion will de­ter­mine how eco­nom­i­cal elec­tric ve­hi­cles will be­come as a main­stream so­lu­tion both in terms of in­vest­ments and busi­ness ac­tiv­ity.”

Ex­perts feel that per­mit­ting 100 per cent FDI un­der the au­to­matic route, as in the au­to­mo­bile sec­tor, will help in at­tract­ing for­eign in­vest­ments. The con­tin­u­a­tion of a free and open mar­ket will help pro­mote tech­nol­ogy trans­fers, and will open up the prospects for new busi­ness mod­els. Neeraj Kumar Sin­gal, di­rec­tor, Lightyear In­frat­ech, Semco Group, says, “Apart from FDI, there should be pub­licpri­vate part­ner­ship as well to sup­port the charg­ing in­fra­struc­ture be­cause a sin­gle or­gan­i­sa­tion will not be able to serve the needs of the whole coun­try.” He adds that if util­ity com­pa­nies part­ner with the pri­vate play­ers, it will help them in sell­ing en­ergy and will cre­ate a win-win sit­u­a­tion for both part­ners.

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