India is already shifting gears and marching ahead into, what the author calls, a "stupendous transformation". India's ambition to move towards a completely electrical vehicle (EV) market is driven to a large extent by necessity: pollution (to which vehicles are key contributors), reliance on oil imports and international impetus (India is a signatory to the Paris climate agreement). These concerns are shared by other nations around the globe, including the UK where in July 2017 ministers announced plans to ban diesel and petrol cars and bans from 2040.
Like the UK, the Indian government has two key issues to tackle if the EV revolution is to materialise:
(a) Battery cost – even though the cost of batteries has fallen dramatically in the past couple of years, there are still calls for the Indian government to "subsidise battery and lithium imports" in order to encourage more businesses to set up in India (Yaquta Mandviwala, partner at Bain & Company). Recognising this challenge, the government is considering providing incentives for domestic car manufactures who invest into lithium-iron battery manufacturing plants in the country (the announcement was made in May 2017 by government minister Anat Geete);
(b) Infrastructure - according to the author there are currently only "100 – odd charging stations across India" and this makes using EV for long distance travel quite challenging. Contrast this with the UK, where according to ZapMap there are currently 7408 charging points in 4820 locations. And yet, according to a recent BBC article ("Why switching to fully electric cars will take time", 19 September 2017, BBC) this is not enough especially if we are to see a huge rise in the number of EV in the near future.
Yet there is another, less talked about, issue – security of supply (mainly cobalt and lithium) required to manufacture the batteries that power EVs. Writing for the Observer, Karl West ("Carmaker's electric dreams depend on supplies of rare minerals") highlighted the key issues facing the EV industry; the key supplier of cobalt is the Democratic Republic of Congo, a country that has often been faced with political upheaval. Demand for graphite and lithium carbonate has also pushed prices up, forcing a number of battery pioneers to trial alternative materials (including zinc and nickel) in an attempt to stay ahead of the market.
We will be attending the Solar & Storage conference in Birmingham in October and we cannot wait to discuss further the challenges faced by the EV sector. The EV revolution is upon us and there is plenty of opportunity for players to get involved and innovate.
In 2015, India had launched a scheme, the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME), to promote clean fuel technology cars. But it failed to take off. Now the Modi government is set to roll out a national policy for EVs by December this year. It will set the standards and specifications for the vehicles and provide guidelines to incentivise their use. It is also expected to provide clarity on the rules regarding the manufacturing of and subsidies for their batteries. As a precursor, India’s new and renewable energy ministry has been appointed the nodal agency to help procure some 10,000 electric cars this year to replace existing government vehicles. Various state governments are making their own plans in this regard.