Charging stations & battery storage: Cornerstones of electric mobility

Updated : February 28, 2021 12:15 PM IST

The central as well as the state governments have been taking various steps and policy decisions to encourage the adoption of EVs.

While the Charging Station Guidelines are a step in the right direction, various interpretation and implementation issues persist.

India is witnessing a conscious shift towards green mobility.

The role of electric mobility to reduce dependency on fossil-fuels is witnessing global popularity. The driving factors influencing the growth of the electric vehicle sector include an increased focus on climate change, advances in renewable energy, rapid urbanization, advancement in battery technology and a need to ensure energy security. India is also witnessing a conscious shift towards green mobility to achieve its commitments under the Paris Agreement.

In India, the EV sector is steadily gaining traction. The central as well as the state governments have been taking various steps and policy decisions to encourage the adoption of EVs. Regulatory support for EVs in India includes the National Electric Mobility Mission Plan, 2020 for the faster adoption of EVs, with the aim to enhance national fuel security and provide affordable transportation, the Faster Adoption and Manufacturing of Electric Vehicles in India (FAME) Schemes I and II, that set out various incentives to enhance demand for EVs, and various state-specific policies for EVs.

To boost consumer confidence in the sector and address issues of ‘range anxiety’, the ‘Charging Infrastructure for Electric Vehicles – Guidelines and Standards’ (Charging Station Guidelines) was issued by the Ministry of Power, Government of India (MoP) on December 14, 2018, and subsequently revised on October 1, 2019. Further, on June 8, 2020, the Charging Station Guidelines were amended.

The Charging Station Guidelines allow the setting-up of private charging stations as well as public charging stations (PCS). Under the Charging Station Guidelines, setting-up of PCS is a de-licensed activity since it is deemed to be a service. The amendment to the Charging Station Guidelines incorporates several new concepts such as captive charging station and battery swapping stations. More importantly, while the tariff for supply of electricity to PCS is to be determined by the appropriate regulatory commissions as per the Tariff Policy issued in terms of the Electricity Act, 2003, the amendment caps the tariff at cost of supply plus 15%, unless the Tariff Policy specifies otherwise.

While the Charging Station Guidelines are a step in the right direction, various interpretation and implementation issues persist. For example, although there is a requirement as to the minimum number of charging stations for a 3 km radius, the Charging Station Guidelines do not specify a maximum number, which could lead to long term demand and competition issues. Another issue is that there are no minimum infrastructure requirements on private charging stations, and this could potentially be exploited by PCS players to set-up single-point charging stations directly in the consumer’s name.

Further, energy storage is vital to achieving India’s sustainability and climate goals. Currently, India is heavily dependent on imports to meet its battery storage requirements and local manufacturing is limited. EV batteries can take significant time to charge and this inhibiting factor can be effectively tackled by developing an ecosystem of fast-charging or swapping of batteries. While there have been various government initiatives such as the National Mission on Transformative Mobility and Battery Storage, 2019, the battery storage sector is still at its nascent stage. The mission aims at a phased manufacturing program to localise production across the entire EV value chain. Measures to strengthen the supply chain of raw materials (primarily used in lithium-ion batteries), local manufacturing capability for battery storage solutions along with a focus on research and development, will contribute to the growth of the sector. Additional factors such as norms for adequate battery disposal facilities, recycling of old batteries should also be considered. Presently, India lacks a regulatory framework for energy storage systems, which is also the need of the hour to encourage battery storage solutions.

Notably, the uninterrupted supply of electricity to charging stations underpins the success of e-mobility in India and the State DISCOMs would play a crucial role in ensuring this. Newer business models would shift focus from state-owned utilities, which are currently setting-up charging stations, to more private sector participation.

A robust ecosystem for battery storage and public and private charging stations will boost confidence and drive India’s mission to achieve 100% electric vehicle (EV) sales by 2030. By developing local manufacturing expertise and scaling domestic production capacity, India can have a significant economic advantage in this vital sector. A predictable legal and regulatory landscape will help incubate new platforms for growth and innovation, which will help to achieve India’s climate change ambitions.

-by Vishnu Sudarsan & Megha Arora

(Vishnu Sudarsan & Megha Arora are partners at J Sagar Associates. The views expressed are personal.)

Published : February 28, 2021 12:15 PM IST

Charging stations & battery storage: Cornerstones of electric mobility

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