| In the aftermath of the FAME II Policy’s release, Electronic Vehicles’ (EV) adoption in India has further increased due to the Battery Swapping Technology.
Kaushik Burman,
General Manager,
Gogoro India
India, one of the world’s largest automobile markets, has accelerated its journey toward net-zero carbon emissions and embraced the clean energy transition with remarkable resilience, reaching an inflection point. The Government of India, along with its key ministries of Heavy Industries, Consumer Affairs and Finance, aided by National think tanks, has collectively laid impetus to the decarbonisation goals with gusto, creating a manifest in the success of the FAME-II policy towards EV adoption, and has reached the 1 million mark concerning electric two-wheelers.
Indeed, the ambitious goal to reach 100% electrification in our transportation sector has seen a great onset. This ambition has the potential of not only reducing the fiscal burden of expensive fossil fuel imports but also creating an ecosystem of upstream manufacturing and downstream infrastructure players, creating millions of jobs in the process.
An opportunity in the grabs
Two-wheelers are an integral part of India’s mobility ecosystem, especially in dense urban cities. Currently, the country stocks ~240 million units of internal combustion engine-powered two-wheelers, which increase by 18–20 million units per year. Based on the statistic, the total stock of two-wheelers in the country may reach the 300 million range by the end of this decade. Out of these, India has ~1.5–2 million units of EV two-wheelers, which amounts to less than 1% market penetration.
Relevance of battery swapping
Kaushik Burman, General Manager, Gogoro India
Building an EV charging infrastructure that not only parallels that of a gasoline refuelling network but also converts the entire stock of Internal Combustion Engine (ICE) two-wheelers into EV implies setting up anywhere between 6–8 million DC fast-charging points, and approximately 5 times the number of AC slow-charging points. The adoption rates in the two-wheeler and three-wheeler segments can be significantly accelerated in densely populated metropolitan areas and tier 1 and 2 cities, where real estate is scarce and expensive.
Cost benefits
While conventional batteries have larger sizes (kWh), the battery-swapping technology allows for smaller, swappable batteries that reduce overall costs. Since batteries account for a significant portion (4%–50%) of the total vehicle cost, the battery expenditure is borne by the Battery Swapping Station (BSS) rather than the vehicle owner, resulting in cost savings.
For commercial fleet owners, battery swapping provides a quick refuelling solution that offers a means of reducing capital expenses while enabling them to utilise their assets more efficiently. A well-established network of swapping centres could prove to be a critical enabler for the mass adoption of EVs within India’s public transport system.
Reduced operational downtime
Charging electric vehicles with existing technologies can take several hours, causing inconvenience and range anxiety for drivers. However, with battery swapping, pre-charged batteries are readily available at swapping stations, allowing for a quick battery swap that takes only minutes. This drastically reduces charging time and provides a more convenient, hassle-free experience for drivers. Gogoro’s 6-second Swap & Go solution is a near-zero downtime for customers, which creates higher revenues using higher operational uptimes.
Increased battery range
A dense network of battery-swapping stations allows drivers to extend the range of their electric vehicles without lengthy charging stops. By swapping out depleted batteries for fully charged ones, drivers can continue long journeys without worrying about running out of power, thus eliminating range anxiety. Consequently, this provides a more enjoyable and seamless driving experience.
Job creation
Battery-swapping stations can create new job opportunities in India, especially in rural parts, where traditional charging infrastructure may not be feasible. Staff and maintenance requirements at these stations provide employment opportunities, contributing to the local economy.
Use cases of higher asset utilisation
Gogoro has demonstrated multiple use cases in deploying battery-swapping infrastructure in generating additional revenue streams from the network, which is a value add for network partners, whilst also leading to higher infrastructure utilisation. Services such as demand response help balance the grid demand and supply during peak and off-peak hours.
Necessity for infrastructure incentives
Battery-swapping infrastructure creation requires similar treatment of incentivisation as received by the direct charging solution providers under the FAME-II policy. While the Finance Minister of India, Nirmala Sitharaman, has laid strong emphasis on green growth in the Union Budget 2024, she has also announced that an EV battery-swapping policy is being framed in the Union Budget for FY2023. However, the much-awaited battery-swapping incentivisation policy is yet to be published, which has a huge potential to invite FDI into the battery-swapping network infrastructure creation.
Thus, there is a pressing need for the government to incorporate the inputs received through numerous industry–policy-maker consultations and announce the battery-swapping incentive policy. In this regard, the industry applauds the Ministry of Consumer Affairs’ decision to defer interoperability standards and hopes that the policy will reiterate this and not foist any standards, keeping in line with the recent developments.
Providing a level playing field in terms of FAME-II incentives and equal GST rates will help the nascent nature of this industry. Present-day incentives are provided to vehicles powered by direct charging, but not to vehicles enabled by battery swapping, invariably resulting in a skewed market. As the creation of the enabling battery swapping infrastructure is capex-heavy, suitable incentives will catalyse the EV adoption rates. This makes the level playing field even more pertinent.
This year is India’s moment of reckoning, as the country heralds its rise globally through its G20 presidency. Electrification of the transportation sector, with emphasis on Smart Mobility, innovative driving technologies and business models is quintessential to India’s sustained leadership in achieving net-zero goals.
