In the automotive industry, electric vehicles (EVs) are the buzzword. While the big OEMs are developing new EVs there are quite a lot of start-ups are also entering the space. The transition to electric mobility is a promising global strategy for decarbonizing the transport sector. India is among a handful of countries that support the global EV30@30 campaign, which targets to have at least 30% of new vehicle sales be electric by 2030.
The recent announcement of the FAME II policy, aimed at promoting faster adoption and manufacturing of electric vehicles in India, is visionary and has led to a phenomenal start to the shift towards a more environmentally friendly automobile market. But there are still some tweaks needed if we are to move forward and keep the momentum going. The demand for electric vehicles is increasing every day. As many as 236,802 electric cars and 25,735 electric two-wheelers were sold in FY21 as per the Society of Manufacturers of Electric Vehicles (SMEV).
Without a doubt, EVs are environmentally friendly compared to fossil fuels but if a customer buys a petrol or diesel vehicle there are around 70,000 fuel stations across the country and refilling is quite easy. But what about charging stations? There are only a few numbers available in the country, so installing a charging infrastructure is the priority for the government and private players. In order to reach the goal of EVs reaching 30% market penetration by 2030, India needs to work on a robust network of electric vehicle (EV) charging infrastructure.
EV charging requirements depend on the specifications of EV batteries, as power must be supplied to the battery at the right voltage and current levels to permit charging. The typical capacity and voltage of EV batteries vary among the different EV segments. EV charging involves the supply of direct current (DC) to the battery pack. As electricity distribution systems supply alternate current (AC) power, a converter is required to provide DC power to the battery. In the case of an AC EVSE, the AC power is delivered to the onboard charger of the EV, which converts it to DC. A DC EVSE converts the power externally and supplies DC power directly to the battery, bypassing the onboard charger.
EV chargers are defined by the amount of energy delivered to the vehicle’s battery per unit of time. Starting from 1KW to 120KW chargers are available. The 1KW being the lowest to 120KW will be the fastest to charge the battery. Capex for a charger consists of the charging equipment itself (similar to a gas pump) plus any required upgrades to the local electricity grid, land, civil works, etc. Most capital cost comprises the charging hardware itself. There are some economies of scale, but these peak as the station reaches four to six chargers, with capital cost per charger declining slowly as the overall size and capacity of the station increases. While Level 2 chargers are relatively less costly to build (with only a 5 KW capacity) on a per-KW basis, they’re actually more expensive than Level 3 and 4 chargers.
Many entrepreneurs wish to set up charging stations in both cities and highways, but considering the current volume setting up charging stations does not provide enough returns or profit. On the other hand, the vehicle manufacturers see the lack of such stations as a dampener for the sale of these low-emission automobiles.
Private companies are building charging capacity in advance of demand, absorbing losses and counting on the eventual rise in EV adoption. These players often seek to play in numerous EV-charging use cases such as installing home chargers (not unlike installing a home appliance) and at-work charging networks, setting up charging points at commercial locations (such as parking lots at hotels or retail centres) and building roadside, fast-charging stations.
ஒட்டுமொத்த விகடனுக்கும் ஒரே ஷார்ட்கட்!
Though the state and city governments have made provisions of charging points mandatory in new buildings, it is currently only public sector companies, such as the NTPC and Energy Efficiency Services (EESL), and those running EV service that have put up charging infrastructure.
Capex for a charger consists of the charging equipment itself (similar to a gas pump) plus any required upgrades to the local electricity grid, land, civil works, etc. Most capital cost comprises the charging hardware itself. There are some economies of scale, but these peak as the station reaches four to six chargers, with capital cost per charger declining slowly as the overall size and capacity of the station increases. While Level 2 chargers are relatively less costly to build (with only a 5 KW capacity) on a per-KW basis, they’re actually more expensive than Level 3 and 4 chargers.
Indian electric vehicle market is projected to grow at a CAGR of over 37%, during FY2022-FY2027. Robust market growth is anticipated on account of rising number of government initiatives such as incentive schemes to encourage adoption of environment-friendly electric vehicles, growing consumer inclination towards electric vehicles, increasing concerns over harmful effects of air pollution, and huge investments by various OEMs for developing more affordable and premium electric vehicles in the coming years.
The EV charging infrastructure in India is growing, as the number of electric vehicles on the road is increasing day by day. Various government initiatives to curb pollution will be a major factor behind the increasing number of electric vehicles on the road, this will further bolster the growth of the electric vehicle charging infrastructure market. If all the gaps are addressed immediately, the charging infrastructure in the country will witness a massive boom, creating huge opportunities for potential investors too.