The electric vehicle (EV) market in India, which is in its infancy now, is likely to touch $150 billion by 2030, growing at a compounded annual growth rate (CAGR) of 90 percent in this decade, a report by consulting firm RBSA Advisors said in December last year.

In 2020-21, EV sales accounted for only 1.3 percent of the total vehicle sales in India, Business Today reported.

According to the Society of Manufacturers of Electric Vehicles, this year alone the total sales of EVs is likely to be around 10 lakh units, which is equal to the cumulative sales of EVs in the last 15 years.

"In the last 15 years, we collectively sold around 1 million electric two-wheelers, e-three wheelers, e-cars, and e-buses, and we will most likely sell the same 1 million units in just one year beginning January 2022," PTI quoted SMEV director-general Sohinder Gill as saying.

Battery capacity required

An earlier study by CEEW Centre for Energy Finance (CEF) had indicated that to realise India's EV ambition, the automotive industry would require an estimated annual battery capacity of 158 GWh by FY30. So, is India’s EV battery ecosystem ready for the massive influx of customers?

India heavily depends on the international market for its EV component needs, especially battery cells. In order to change this, government think tank NITI Aayog initiated the National Programme on Advance Chemistry Cell (ACC) Battery Storage, which would support the domestic manufacturing of 50 Gigawatt hours (GWh) of ACCs. ACCs are battery cells which can store electric energy as chemical energy and convert it back to electric energy when required.

In October last year, the government had approved the production-linked incentive (PLI) scheme for the National Programme on Advanced Chemistry Cell Battery Storage with the aim of enhancing India’s ACC manufacturing capabilities with a budgetary outlay of Rs 18,100 crore. A total of 10 companies submitted bids under the scheme.

Companies step up efforts

A clutch of leading central public sector enterprises (CPSEs) and private companies have stepped up efforts to set up EV charging facilities across the country. At the forefront of the move are private players like Tata Power and Reliance Industries and state-run energy firms IOCL, HPCL and NTPC.

Indian Oil Corporation or IOCL will install EV charging facilities at its 10,000 retail outlets in the next three years.

Tata Power, which has 878 public EV charging points at present, aims to set up over 1 lakh such charging points by end of FY25.

Under the second phase of Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) in India scheme, the Ministry of Heavy Industries has sanctioned 2,877 charging stations in 68 cities across the country, ANI reported.

Around 1,576 EV charging stations will be installed across 16 highways and nine expressways, the report said. Highways will have one charging station every 25 km on both sides. Further, both sides of highways will have one charging station for heavy duty EVs every 100 km. Single charging stations will be set up in cities in a grid of 3kmx3km.

Inking deals

Earlier this month, Reliance Industries Ltd (RIL) announced that it had acquired assets of cobalt-free lithium battery technology company Lithium Werks for $61 million.

The acquisition will help RIL establish an end-to-end battery ecosystem for manufacturing key supply chain materials such as cathode, anode and electrolyte at large scale. The company will thereby have the flexibility to produce batteries and battery module systems across energy storage and mobility sectors.

Last year, RIL subsidiary Reliance New Energy Solar Ltd inked a deal to acquire leading sodium-ion battery technology company Faradion Limited. The deal, worth GBP 100 million, will give RNESL access to high density, sustainable and competitive cost battery technology. RNESL will use the technology at its upcoming fully integrated energy storage giga-factory at Dhirubhai Ambani Green Energy Giga Complex project in Jamnagar.

The Mahindra Group has also entered an agreement with Jio-BP — a joint venture of BP of the UK and Reliance Industries — to explore technology options like battery swapping for electric 3-wheelers.

"We will eventually look to the four-wheeler and other categories," Anish Shah MD of Mahindra Group told CNBC-TV18 in an exclusive interview in December.

Battery swapping

Stressing on the importance of battery swapping or the battery-as-a-service (BaaS) model for faster adoption of EV, Finance Minister Nirmala Sitharaman announced that the government would introduce a battery swapping policy and inter-operability standards and encourage private companies to develop sustainable and innovative business models for this service.

“This will improve efficiency in the EV ecosystem,” the finance minister said while presenting the Union Budget 2022-23.

Battery swapping is a service that will allow EV owners to replace the discharged batteries with fully charged ones at the swap stations. Not only will this system address the problem of setting up charging stations, but it will also save EV owners the cost of buying a battery.

The Centre is working on finalising the incentives under the battery swapping policy announced in the budget and is likely to announce it by April, Reuters had reported. Initially, the policy will focus on battery swap services for three- and two-wheelers.

Also Read | Electric vehicles' cost to be at par with petrol-run cars in 2 years: Nitin Gadkari

(Edited by : Thomas Abraham)

First Published:Mar 29, 2022 1:38 PM IST