Viz-A-Viz with Harsh Thacker, Sr Analyst- MOVE (Moving Onwards Vehicle Electrification)

Q. With all automobile companies helming towards Electric Vehicles, demand for energy and suitable ecosystem is the initial glitch, how is IESA working to outpace these snags? Š

Harsh Thacker

Harsh Thacker, Sr Analyst- MOVE (Moving Onwards Vehicle Electrification)

India has a significant market potential for batteries and electric vehicles. Our analysis projects the EV market potential for India would be around 77 million between now and 2030 which translates to cumulative demand of 800 GWh over the next 12 years for advanced energy storage systems.

For this growth to take place it is essential that appropriate charging infrastructure gets built to provide confidence for consumers to switch to electric vehicles. To support this transition, IESA has launched a new initiative called MOVE: Moving Onward to Vehicle Electrification with a goal of developing sustainable ecosystem for charging infrastructure and services. IESA is also working towards making India a global hub for R&D and manufacturing of advanced energy storage systems, so that we are not dependent on imports to meet this growing demand. Š

As part of IESA activities, we have established three working groups i.e. Policy, Business and Technology for exchange of ideas between the various stakeholders. On the technological front, IESA is leading efforts for knowledge transfer in the area of energy storage recycling, standards and testing. Applications Vs Technology, Technology Performance, Safety Evaluation and standards Protocol and Innovations and Advanced Technological Development are few critical aspects which will be covered under the Technology group.

Q. How is IESA currently posing to drive the EV ecosystem in India? Š

IESA has also launched an initiative, MOVE, to focus on creation of robust EV and charging infrastructure in India. To accelerate EV adoption we require policy support from the government. Over past 2 years, we have been working with Department of Heavy Industries, Department of Science & Technology as well as NITI Aayog to provide inputs on the electric vehicles and associated e c o s y s t e m . M i n i s t r y o f N e w a n d Renewable Energy (MNRE) has recently constituted expert committee to draft the National Energy Storage Mission and IESA is part of the expert committee.

The mission will cover aspects related to the charging infrastructure as well as battery requirements for EVs. Once this mission document is in place it will act like a guiding document. Š

IESA along with International Centre for Automotive Technology (iCAT) had organized the 1st Electric Vehicle Conclave at the iCAT campus in May 2017. This conclave brought together various stakeholders across the Indian EV Industry, from battery manufacturers to EV Manufacturers to policy makers, making it an exclusive event to explore EV business opportunities. This year the 2nd Electric Vehicle Conclave will be held on 17th and 18th May 2018.

Q. Setting up a charging infrastructure is an attractive prospect, given the lucrative market potential projected to be around 90 billion units (BU) of electricity. Though figures are old but when compared; India generated 1,107 BU in 2015-16 evidently slating the potential of this sector in 2018? What strategies has the association enveloped to pave the long-run goals of this nascent industry? Š

Traditionally one of the challenges for building electric charging infrastructure was that it had to be done by licensed distribution companies /utilities. Currently, most of the charging stations are owned by Government utilities and PSUs on pilot mode in India or provided as a free service by auto companies. Apart from these pilot projects Energy Efficiency Services Limited (EESL) and State Distribution companies have floated a few tenders to install charging stations across India mainly for the 20,000 EVs they are purchasing for various government departments. Š

As part of the anticipated EV policy, charging infrastructure is anticipated to be allowed to be built on a service model as well. This can attract number of new players to the field and also open up new business models for accelerating adoption of EVs. Š

NITI Aayog had invited comments and suggestions on its plan for ‘Zero Emission’ mobility from all stakeholders earlier in January. India Energy Storage Alliance (IESA) was invited for the consultation. We also shared our comments in consultation from our members on the National Auto Policy (Draft) by the Ministry of Heavy Industry and Public Enterprise

Q. What key challenges do you purview in the current EV market? Š

A key drawback under the government’s current EV initiatives is the lack of a single point nodal agency for all the programmes and policies. Considering the EV landscape is evolving in India, it is acceptable that various policies and schemes are mooted by different government ministries and agencies.

However, going forward it would be ideal to have a single ministry/nodal agency responsible for all EV related policies and projects. An example would be UK’s Office for Low Emission Vehicles which is an exclusive agency working on electrification of transport while being part of Department of Transport and Department for Business, Energy and Industrial Strategy. Š

Indian companies have successful built electric cars in recent past and are lining up Electric Buses to be provided to state transportation. Batteries are critical component for EVs and there is a big gap as currently there is no li-ion cell manufacturing taking place in India. Numbers of IITs and national research labs have been working on research in area of li-ion batteries. At the same time, there is a big gap in commercialization of this innovation as well as linking R&D to needs and timelines required by industry.

Hence, most of the local manufacturing companies if interested in setting up li-ion cell manufacturing plant in India may need to license technologies from counties like Korea, Japan, China, Germany, the US, Canada, the UK or Australia.

This has been also the case in the lead acid industry, where leading lead acid providers have traditionally licensed intellectual property from US, Japanese or Chinese companies. R&D in some of key areas for electric vehicles including battery performance, power electronics devices, advanced e-vehicles testing, battery testing etc., should be encouraged. Š

Similarly, for charging or swapping stations, we need various components which are currently being imported. Here is a huge opportunity for local tool and component makers to design and manufacture in India. Local component suppliers currently engaged in supplying component to the auto industry have an opportunity to diversify to manufacture components for EVs. India Energy Storage Alliance (IESA) is closely working with India Electrical and Electronic Manufacturers Association (IEEMA) to prepare capacity building amongst Indian industry for this opportunity.

Q. How ambitious do you think is the 2030 EV target for India? Your comments? Š

Government of India has clearly decided to prioritize electric vehicles with a goal of having 100% EVs by 2030. Although in past couple of months there seem to be some confusion on the exact details of this goal, with some departments suggesting relaxing the target to 30% by 2030. So currently there is a significant uncertainty in the extent of the target.

But even 30% EV penetration by 2030 would be a huge achievement for the industry. Most of the developed countries have taken more than a decade to even get to 10% EV penetration. At the same time, in next 5 years, it is anticipated that with the continued drop in price of key components, EVs would become cost competitive to ICE vehicles even on the upfront capital cost. So, it is highly desirable that Indian policy makers set an ambitious target for EVs.

ŠDepending on how the charging infrastructure is created and associated policies are developed, this may or may not require substantial new generation capacity. E.g. with 100 GW of anticipated solar capacity added by 2022, India is expected to have a net load curve which has sufficient capacity for taking additional load during afternoon. If we can have sufficient public charging facilities which can be used for charging EVs during the day, then this can actually solve a problem of low net loads during the times when maximum solar energy is being produced. Š

Energy Storage is a key component of this and there are number of ways in which EV adoption could be transformative for the grid. With better tariff structures and use of right storage technologies in EVs, we could also use EVs as distributed storage and provide grid balancing services. This transformation will not only help in greening the transportation fleet by reducing diesel / petrol consumption and associated emissions, but will also help in greening the grid if EVs are used for better integration of renewable resources in grid.

Q. What will be prospected picture of a holistic EV ecosystem in India in 2018 and maybe a year after? Š

We anticipate that with global scale up in manufacturing, the advanced energy storage prices will continue to drop by over 10% in 2018. With introduction of various EVs (across 2W, 3W, 4W and commercial vehicles), India will start witnessing adoption of EVs in 2018, fueled by central procurement led by EESL and various state agencies. 2018 should also witness pickup of EV charging infrastructure deployment in various metro cities. Š

If we start deploying energy storage projects in a systematic manner this can create a huge interest for local manufacturing and system integration capabilities. By mid-2018, India will have over 1 GWh of li-ion battery pack manufacturing capacity. We also anticipate that in 2018 at least two li-ion cell manufacturing plants with capacity of 1 GWh or more will start construction in India with anticipated completion for early 2020, bringing India on the global map of Giga Factories.

Q. Lastly, do you think how swiftly India can adapt the EV revolution? To add, do we have the suitable resources, talent pool and Govt. amendments in place for the EV future? Š

The EV market is slated to be driven by both incentives and also other market dynamics that will bring down the cost of Electric Vehicles (EVs) comparable to gasoline powered vehicles. Similarly the growth in the manufacturing sector with added incentives like export credit can help India turn into an export market for EVs. NITI Aayog has already evaluated the policy option of providing feebates to promote adoption of EV. Š

The key to having an efficient charging infrastructure begins with a comprehensive planning. NITI Aayog has already proposed a consultation for EV charging. Similarly standardization and interoperability is key to developing a pan-India charging infrastructure. The DHI Bharat charger standards already propose a common standard for both charging and payment mechanism.

To ensure interoperability, standardization can be adopted in range of battery size, plug technology, payment standards etc. without hampering the existing systems. If global trends are an indication, software will play a major role for convenient charging, last mile connectivity and promote people to opt for plans that are compatible with multiple service providers. It will help utilities and service providers to map the supply-demand from EVs and provide suitable incentives. Š

India has a talent pool but lack on the R&D facilities for battery and cell manufacturing. There is a need for supply chain strategy. In the past 3 years India has witnessed creation of 100s of Accelerators / Incubators that are focusing on information technology / healthcare area.

There is a need for a special incubator to nurture early stage electric vehicles and energy storage technology startups and provide them suitable facilities for accelerating their progress from lab to commercialization. IESA has been working on creation of such Incubator for energy storage sector in line with Atal Innovation Mission (AIM). IESA is also working with Skill India initiative and various academic partners to identify skill and training gaps in this area.

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