The country appears to be finally ready to adopt electric mobility as a mainstream mode of transportation, said Mahua Acharya, MD and CEO of Converge Energy Solutions Services Ltd (CESL). The fact that electric mobility has entered mainstream conversation is important as it helps push forward the mandate towards achieving clean energy goals set by state-owned EESL - an agency entrusted with aggregating demand for electric vehicles for and within the government.
CESL, Acharya explains, is an energy transition company, launched under the aegis of EESL, with a wide focus on achieving clean energy and climate goals and electric mobility is a big part of it.
EESL set into this space as an early mover and as a leader in the business two years ago. They issued a tender for 10,000 vehicles but only approximately 1,600 vehicles (four-wheelers) are on the road now, according to Acharya.
“The uptake for electric four-wheelers is limited. At least, the uptake in the current business model - which is government to government - is extremely limited. Some more work needs to be done before we generate the large-scale demand/ deployment that people hope for,” said Acharya.
Acharya, therefore, has several learnings as she takes on this role. Not encouraging producers to cut costs at the expense of quality, for example.
CESL is addressing this by holding huge bids - think 300,000 electric three-wheelers in a few years - and focusing on two- and three-wheelers rather than relying on public funds. Four-wheelers may cost up to Rs 2.5 million, and ample financial engineering at the backend can ensure that the financial burden of these large tenders does not fall entirely on either EESL or the taxpayer.
When asked what is the direction of the work that now needs to be done and whether any policy has helped the work that was being attempted when these tenders were issued, Acharya said that today the objective of the mobility business at CESL is to deploy at scale - affordably, excessively, and naturally clean.
So the electric part takes care of some of the clean story. There will come a time in India where we will charge through renewable energy and that will be clean energy. There will also come a time where we will know or have a market on what to do with used batteries and that will be clean as well because we will have a circular economy, she said.
“We are not a manufacturer, we work with as many manufacturers that are out there in the market, but we figured out a way to financially deploy them at scale. So, we do a fair bit of financial engineering at the backend, we use concessional capital wherever possible, and we use carbon credits wherever possible. We structure to allow consumers to use two-wheelers, three-wheelers, four-wheelers as well, and buses at a price point that they can afford, and the proxy for what they can afford, will be and should be either cheaper than what their fossil fuel equivalent is, or the same,” Acharya said.
Acharya said they are expected to get three lakh three-wheelers on the road in the next three to four years, when asked what the plan now is and how many more vehicles are they looking to procure.
“That is the expectation. A big function of that is the quality and functional performance of the vehicles themselves. The next big function is the financial package. Is it affordable? Can people take it? In the two-wheeler business, I'm happy to report that at the beginning of this fiscal year, we had our internal target and we have overshot the target five times in the two-wheeler business,” said Acharya
For the full interview, watch the video