EVConnect Journey: Five insights on e-vehicle adoption in India

In August 2018, WRI India launched its first edition of a monthly newsletter on electric mobility, ‘EVConnect’. It was clear that although electric vehicles’ sales and growth in charging infrastructure was embryonic and sporadic, its ecosystem had the potential to benefit Indian cities and states, which warranted further exploration. Electric vehicles provide a host of benefits such as curbing tailpipe emissions from vehicles, the ability to store renewable energy in vehicle batteries and reduced foreign oil imports, to name a few. Actualising these benefits requires substantial collaboration between the transport and electricity sectors – two domains that, at least in India, are only modestly aware of each other’s workings. New knowledge is needed to realise the potential for collaboration between both sides.

Therefore, the goals of EVConnect are: 1) to track the developments in markets, technology and the policy landscape of electric vehicles in India and in other nations; 2) to draw takeaways that fit India’s unique needs and curate this information in one place; 3) to build the capacity of actual doers on-ground in city and state governments, i.e. those who will need a basic understanding of the vehicle, battery and charging technologies to begin implementing targeted and cost-effective projects. Specifically, every edition includes key summaries of emerging trends and updates in global and national news, as well as a focused interview with a thought leader in the electric vehicles landscape.

We revisited the past 15 issues of EVConnect and found five learnings for policymakers and businesses going forward:

1. The need for policy coordination

Eight states in India have approved electric vehicle policy drafts, namely, Andhra Pradesh, Delhi, Karnataka, Kerala, Maharashtra, Telangana, Uttar Pradesh and Uttarakhand. While this is a step in the right direction, the drafts do not mention the joint effort required by several departments to ensure that electric vehicles are deployed or to set up charging and swapping infrastructure on the ground. Most notably, the transport and power departments would need to work closely, with active support from departments like industrial development, finance and land authority. Electric vehicles are a new technology and obstacles will emerge along the way when projects are implemented. However, a multi-departmental effort will improve problem solving at the ground level and also send a clear signal to consumers, building their trust with regard to adopting electric vehicles.

2. Urgency behind securing battery raw materials

Electric vehicles draw power stored in battery packs that are made out of minerals available in limited quantity and acquired mainly from overseas locations in China, Australia and the South Americas. With the sale of EVs picking up, the demand for these minerals is rising steadily. As a result, many governments and vehicle manufacturers are making advanced purchases for future manufacturing requirements. Two approaches can be explored for the Indian context. Firstly, pacts can be signed with foreign businesses that own mineral reserves to secure raw materials. However, this option needs to be pursued with careful geopolitical analysis. The second and a more self-sufficient option is to create a market for recycling waste batteries and mine raw materials. The battery recycling industry is estimated at a potential of USD 1000 million, with 22-23 GWh of waste batteries ready to be recycled by 2030. This is an untapped business opportunity which needs policy and financial support in the early days, supported by extensive research, development and entrepreneurship. A hybrid approach that makes use of both foreign partnerships and local recycling methods could be a suitable option.

3. India’s auto export destinations are growing local EV markets

India’s auto industry has been a leading exporter in the Internal Combustion Engine (ICE) based two and three-wheeled vehicles in South East Asian countries such as Indonesia and Thailand. These countries have a sparse auto industry to make Internal Combustion Engines (ICE) vehicles. However, they are now planning to create a local industry for electric vehicles by inviting foreign players and ambitiously overhauling their auto regulations in favour of electric vehicles.

India’s auto industry and policy makers need to rapidly assess the market scenario in EV export markets and double-down on making innovative products or else they will lose out to their indigenous industries. Auto markets that didn’t have an ICE vehicle industry will find it more convenient when developing a local electric vehicle industry. With ICE technology gradually fading away, EVs are a new industrial opportunity for them at lower transition costs from the conventional vehicle industry.

4. Greater opportunities for women to join the EV workforce

The manufacturing and delivery of electric vehicles will require far lesser mechanical tasks that are perceived to be heavy-duty. Instead, digital and IT related skills that are more cerebral and ‘strength neutral’ will be needed. This opens the possibility of expanding the participation of women in the auto industry workforce, which has historically been lopsided. Some vehicle manufacturers in India have set-up women only shop floors, but mainstreaming and systematic efforts are needed.

The share of women working in the auto industry worldwide has barely been at par with their male counterparts. Studies show that gender parity improves problem-solving, leading to increased profits. This is unlikely to become a reality for India without concrete actions, which may include: (i) stronger marketing of skilling courses for women; (ii) incentivising industry players who maintain gender balance in diverse roles across the sector; (iii) establishing labour and on-the-job welfare systems for equal benefits, job growth and safety for women working in the transport industry.

5. Battery storage can strengthen linkages between transportation and renewables

The use of battery storage has the potential to affect a big change in transportation. Not only will vehicles be able to run on fossil-free energy, but this energy can also be supplied back to the grid. It will thereby help to expand the share of clean energy in the total energy mix. Vehicles that sit idle for prolonged periods would be perfect for consideration in this regard. Technologically, the vehicle to grid connection is feasible but to actualise such technologies, the right set of commercial compensation for EV owners to participate in ‘vehicle to grid’ programs need to be defined. In addition, the infrastructure needs of the grid have to be studied further.

Conclusion

The latest developments from a local and global perspective, combined with a detailed review of the lessons learned by thought leaders (as shared every month for EVConnect), have made it clear that electric mobility could be the gateway for India to create fossil-fuel free societies. There are many challenges that must be addressed to fast-track the growth of this new technology. Moreover, a shift from the conventional ‘departmental’ ways of implementing policies is needed as clean mobility undergoes tremendous changes in the years ahead. The first step in the transition to electric vehicles involves setting aside disciplinary boundaries and political differences to work towards a common goal.