In order to accelerate the scale of EV use in India, we need to generate awareness about the value proposition for consumers. The running cost of an EV is Rs 1.10/km (USD 0.015) as compared to the running cost of petrol and diesel cars at Rs 6 (USD 0.085) and Rs 5.50 (USD 0.078) per km respectively. The long-term savings generated by the transition to EVs from internal combustion engine (ICE) vehicles must be communicated to the consumer in clear terms.
Secondly, it is equally important to instil a sense of confidence in customers. Establishing a robust charging and supporting infrastructure is the first step to generate consumer confidence. The second phase of the ‘Faster Adoption and Manufacturing of Hybrid and Electric Vehicles’ (FAME 2) scheme has earmarked Rs. 10,000 crore (USD 1.43 billion) for setting up EV charging stations in India. It is noteworthy that FAME – 2 emphasizes a robust shared electric mobility ecosystem. I firmly believe that innovative business models will also help to accelerate the scale of EV adoption in India.
Innovative business models
Sustainable solutions will become widely adopted when they have a strong business case. Under our bulk procurement model, Energy Efficiency Services Limited (EESL) aggregates demand which is stimulating domestic manufacturing and driving down prices – thereby creating a customer-conducive effect.
With a vision to make energy efficiency a way of life, EESL is implementing the world’s largest energy efficiency portfolio in India. We aim to become a Rs-10,000-crore (USD 1.43 billion) company by 2020. EESL is expanding this business model of bulk procurement and demand aggregation to other energy efficiency solutions such as smart meters, Buildings Energy Efficient Program to name a few.
Our e-mobility vision entails procuring and deploying electric vehicles in government offices across India. It is estimated that replacing 5,00,000 cars in government offices with EVs over three to four years will lead to fuel savings of about 83.2 crore (832 million) liters and 22.3 lakh (2.23 million) tonnes of CO2 reduction annually.
EESL has signed a Memorandum of Understanding with The Climate Group to promote e-mobility in India through case-studies, speaking forums and EV100 involvement. Besides this, we are also exploring synergies with various urban local bodies to develop a robust public charging infrastructure for EVs, so that customers don’t have to commute long distances for their next car battery fuel-up.
We have joined hands with various municipal bodies such as Ahmedabad, Jaipur and Chennai to set up public charging infrastructure, deploy EVs on contract basis and facilitate their e-mobility transition. It is heartening to note that various innovative models are also coming up domestically and such innovation must be explored further. For instance, recently a first-of-its-kind all electric mobility service offering was launched in New Delhi. It bundles services like ride hailing, car-sharing and shared charging.
Another way to stimulate the electric transition is public transport. Public transport has a massive demand in India, and this can be leveraged for the EV success story. An electric public transport system will also enable every citizen, not just car owners, to benefit from electric mobility. The FAME 2 includes many incentives for shared electric mobility. States such as Tamil Nadu have already started working towards an electric public transport system.
Cab aggregators, some of whom have already started EV pilots, can also be brought on board to accelerate the uptake of EVs. Their cabs are on the road for a longer time than personal vehicles and their electric transition will have a significant impact on not only the e-mobility ecosystem but also air pollution levels. Consumer experience of these cabs can also be the experiential trigger for people to try out EVs for themselves. Many consumers, in fact, prefer cabs because the cost of fuel, which is a major component in private ownership, and severe traffic congestion, make navigating cars around the city uncomfortable and inconvenient. The promise of travelling around the city at a low cost and lower carbon footprint may further increase demand.
Battery storage is key to ensuring a smooth transition to e-mobility. However, battery prices could be a deterrent to making EVs an attractive option. Interestingly, globally the demand for EVs is on the rise and the prices of batteries are coming down. This trend is likely to continue.
Also, under the National Mission on Transformative Mobility and Battery Storage, which encourages setting up large-scale, export-competitive integrated batteries and cell-manufacturing giga-plants, India has expressed its intent to create a robust domestic manufacturing infrastructure.
In conclusion, the intersection of proactive policy, an agile mobility ecosystem, and compelling consumer use cases will be the driver of India’s EV success story.