Budget 2022: India to introduce new battery swapping policy in EV push

Finance Minister Nirmala Sitharaman announced introducing a new battery swapping policy and setting up interoperability standards, considering space constraints in the urban areas for setting up charging stations at scale. She also said the private sector would be encouraged to develop sustainable business models for the 'battery as a service' or 'energy service as a service' model, amid a broader push to meet decarbonisation goals.

The government has been trying to cut India’s total projected carbon emission by 1 billion tonnes by 2030.  To achieve these targets, the government wants to push the adoption of EVs in the country. However, rising input costs for batteries and insufficient charging structures are major roadblocks for the industry.

"Considering the constraint of space in urban areas for setting up charging stations at scale, a battery swapping policy will be brought out and interoperability standards will be formulated," Sitharaman said.

Battery swapping allows drivers to replace their discharged batteries with freshly charged ones at swap stations. This method of recharging batteries is faster than charging the EV.

She further said the government will promote a shift to use public transport in urban areas. "This will be complemented by clean-tech and governance solutions, special mobility zones with zero fossil-fuel policy, and EV vehicles," Sitharaman added.

She also spoke about including data centres and energy storage systems, including dense charging infrastructure and grid-scale battery systems to the harmonised list of infrastructure. "This will facilitate credit availability for digital infrastructure and clean energy storage," she added.

Experts believe this inclusion of gird storage and dense charging into the harmonised list "will help mobility start-ups and IPPs to explore low-cost financing," Sumant Sinha, Chairman and CEO of ReNew Power said.