Across the globe, momentum is building to increase the adoption of electric vehicles (EVs), and India is no exception. The transport sector is the third largest emitter of CO2 in India and directly tied to India’s socio-economic development. Air pollution and emissions from transport pose grave health risks with to the population, and the need for cleaner transport options has never been greater.
The adoption of EVs can help curtail India’s dependence on oil imports, boost energy security and economic opportunities and help realise India’s net zero goals. Motivated by these advantages, India is promoting EVs for both public and private transport to achieve a high level of EV use by 2030. India is also focusing on electrifying freight transportation, which is a critical backbone of India’s transport sector and growing economy. Due to the rising demand for goods and services, the demand for freight transport in India is expected to grow fivefold over the next three decades. In addition, transport is a significant consumer of fossil fuels in India, a country with over 80 per cent dependence on crude oil imports.
The last few years have seen the momentum for EVs pick up. This is the result of a confluence of several important factors. Favourable central policies such as the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) and the Production Linked Incentive Scheme (PLI) have encouraged Original Equipment Manufacturers (OEMs) to invest in Made-in-India manufacturing facilities.
Several Indian states have drafted EV policies that incentivise EV manufacturing and adoption. Electrification is rising in the 2-and 3-wheeler categories. Falling battery prices too have helped EVs become more cost-competitive with mainstream ICE vehicles. India’s battery swapping policy with interoperability standards is further expected to boost the EV market.
While the momentum for EVs is growing, it may be a while before sales take off in large numbers. EVs are more costly than ICEs and have a much larger initial investment. This makes them a less appealing alternative for the ordinary Indian buyer. The lack of significant charging infrastructure leads potential electric vehicle purchasers to experience “range anxiety.”
The adoption of EVs will require substantial changes in how we regulate and operate the grid, including metering, pricing and expanded grid-scale electricity storage. We still have a while to go before the electricity grid becomes fully capable of meeting the demands of charging multiple EVs at the same time.
To make EVs more affordable, manufacturing must be increased. EV battery manufacturing in India is still largely dependent on imports due to the lack of lithium. Scaling up domestic manufacturing will help develop local capacity to produce electric batteries and their components. With the demand for battery recycling expected to grow, India will need to strengthen its battery recycling ecosystem, which as of now is extremely nascent.
The electric mobility transition is promising, and if such critical challenges can be tackled, it would help capture the immense benefits of EVs on India’s climate and economy.
Given the connections between the transport sector and air quality, jobs and climate change, the case electric mobility is compelling. Shakti Sustainable Energy Foundation houses the Electric Mobility Initiative (EMI), a multi-funder effort that supports national and state level efforts towards accelerating electric mobility in India.
Through this initiative, we work with policy makers, Industry, State Transport Undertakings (STUs) and fleet operators to boost the EV manufacturing ecosystem, and with discoms to support the development of charging infrastructure. In addition, we aim to find solutions for hard to electrify segments such as heavy-duty vehicles (HDVs) as well as promote circular economy solutions for the recycling of batteries. Our work also focuses on generateing awareness among consumers to drive faster EV adoption.