Battery swapping is a mechanism that involves replacing drained batteries in electric vehicles (EVs) with fully charged ones. This method allows for the individual charging of batteries, keeping vehicles in action while minimizing downtime. It is particularly useful for smaller vehicles such as two-wheelers and three-wheelers, which have smaller, easier-to-swap batteries compared to larger vehicles.
The National Institution for Transforming India (NITI) Aayog recently released a draft battery swapping policy for EVs in the country. This policy targets improving the efficiency of the battery swapping ecosystem for electric scooters and three-wheeler electric rickshaws. The first phase of this policy will prioritize metropolitan cities with populations over 4 million for developing a battery swapping network.
Key Points of the Draft Policy
The draft policy positions battery swapping under the Battery-as-a-Service (BaaS) business model. It stipulates interoperability between EVs and batteries as crucial for the mainstream acceptance of battery swapping.
The policy provides for minimum technical and operational requirements to facilitate a reliable, safe, efficient and customer-friendly execution of battery swapping infrastructure. It also suggests financial support for Battery Providers and EV users, reduction in differential tax rates on Lithium-ion batteries and electric vehicle supply equipment, assigning unique identification number to swappable batteries, and the appointment of the Bureau of Energy Efficiency as the responsible agency for implementing battery swapping networks.
The Need for a Battery Swapping Policy
Traditional EV purchases come with “fixed” batteries that can only be charged within the vehicle. For widespread adoption of EVs, the presence of affordable and reliable charging networks is as necessary as fueling stations for conventional vehicles. India has been making efforts to enhance the availability of charging infrastructure, but the development process is time-consuming and faces space constraints in urban areas.
The Budget Speech for 2022-23 announced the introduction of a battery swapping policy with interoperability standards to enhance efficiency in the EV ecosystem.
The Importance of the New Policy
As India has committed to achieving a net-zero target by 2070 under the United Nations Framework Convention on Climate Change signed in 2021, the transition to clean mobility, led by EVs, is crucial for decarbonizing the transport sector. The Indian EV market, which was valued at USD 1,434.04 Billion in 2021, is projected to reach USD 15,397.19 Billion by 2027 at a CAGR of 47.09%.
Government’s Initiatives for EV Promotion
The government launched schemes like Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME) in 2015 and the Production Linked Incentive (PLI) scheme for manufacturing Advanced Chemistry Cell (ACC) batteries in 2021 to promote EVs and hybrid vehicles. Apart from these, another PLI Scheme that covers EV startups was also approved for the automotive sector with a set budgetary outlay.