‘The rising cost of lithium and raw material are not the only challenges for EV industry’: Randheer Singh

As a thought leader and key policy maker for the industry what is your outlook for the domestic EV industry for FY 23-24 to reach the target of 1 million EVs?
In Nov’22, we saw 9 E2W launches, one E 3W launch, and three electric car launches in India. The number of electric vehicles registered during the month of Nov 22 equals 119,949 vs. 42,055 vehicles on Nov 21.

Further, the interesting part is that almost all the electric vehicle manufacturers are expanding their manufacturing capacities as the order backlog runs in months. Also, already, we have crossed the 70-75 percent mark of 1 million EVs on the road. Therefore, reaching theone million EVs target is also not far. We think this will be led by e2w in India.

Can you share some of your key achievements that have created a measurable impact for the industry? Also, could you hint at the broad areas of industry that can expect further intervention from your policy making in the coming years?
I can share quite a few — FAME II Remodelling, ACC PLI, Charging infrastructure standards, Industry analysis for EV Penetration (bottom-up modelling), Reuse and recycling project (Ongoing, 1 report already out), EV Policy for Indian Railways, EV Policies of the states (under EV Accelerator program), Handbook for EV Charging infra, Shoonya Campaign and many more are already in the public domain.

In addition to these, a few things which are in the pipeline include Niche ACC, Battery Swapping, BaaS business models, Open source BMS, EV charging payment system integration with National Common mobility card, etc. All of these are some of the works in addition to many which will be made public as and when they get approved/formulated.

What are opportunities in the EV sector do you think the domestic industry must tap as we move towards FY23-24?
I can think of three. First is EV financing as this is required not only to improve the EV uptake but also to shift the traditional ICE manufacturers to shift to EVs. Affordability will increase, as also consumer confidence, with the entry of financers andbanks in this domain. Currently, the interest rates are high and the primary market is not appropriately sensitised (especially for 2- and 3-wheelers). Second is repurposing and recycling of EV batteries.

This is very critical from the perspective of raw material recovery. We are eyeing GWh level of Lithium cathode-based batteries coming out in the next 1-2 years in India. Not only do we need the recycling of these but the effective recovery of critical minerals. Therefore industry needs to focus on this part too.

Thirdly, capacity building as this is required at various levels right from futureready automobile workforce, upskilling and reskilling of existing ones, capacity building of testing labs, and finally, customer service through organised and unorganised sectors.

Which are the areas you see growth picking up the fastest?
Cell manufacturing, e2w and e3w manufacturing and indigenisation, battery swapping, and retail financing are some of the areas.

What steps should EV makers take to wholeheartedly embrace the new regulations from April 2023?
They should comply with AIS 156, AIS 038 ver 2 requirements. Ensure testing of individual cells, upgradation of Battery Management Systems are among some of the critical ones which are required to be embraced fully. This aspect is important for e2w and e3w manufacturers and battery OEMs.

What role do you think ICAT and ARAI can play to hand-hold start-ups that are under pressure from multiple regulations?
These organisations are already providing full support through various validation programmes and supporting them technically. I am sure they will also streamline several of their processes (accelerated homologation included) to deal with a sudden surge in EV (and related components) testing.

Do you plan to recommend PLI schemes for other EV segments to help accelerate EV adoption?
See, you cannot have PLIs for each and everything. We need to understand that with the current schemes, the entire EV value chain, including adoption is facilitated at federal and state levels. Having said that, I am sure appropriate actions will be taken on a need basis to make the sector competitive and take the lead seat.

What is your view on the integration of EV charging/ swapping along with solar generating systems to increase charging footprint in electricity deficit semi-urban and rural areas?
This is definitely needed. Let’s take an example of batteryswap-cum-charging stations in rural areas. There space is available, and these batteries can be charged using solar powered systems and the batteries can be used as a power supply for houses and also feed to the grid when the utilisation at the vehicle level is less. This solves the bigger issue of asset utilisation as well as clean power availability.

Automotive industry been clamouring for subsidy support for hybrid vehicles? Do you see a policy change in the making?
If you see the statistics of last few years, BEVs were 71 percent of H1 2022 global EV sales, up from 66 percent in H1 2021, and 70 percent in all of 2021. PHEVs were 29 percent in H1 2022, down from 34 percent in H1 2021, and 30 percent in all of 2021. These figures clearly outline where the global market is moving. Finally, it’s the market dynamics that shape up the acceptability and adoption.

Despite having a PLI in Cell manufacturing, our sources say not much of the PLI would have been utilised. Your comments?
Advanced Chemistry Cells (ACC) PLI was oversubscribed with bids received for 128 GWh vs 50 GWh on offer. Automotive PLI was also oversubscribed with more than 90+ Auto OEMs and Component OEMs quoted. With these statistics (in the Public domain), I am sure you get the idea about the success of the programmes.

Do you think PLI for cell material Mining is the need of the hour as much as for cell manufacturing?
Of course, this is a much-needed step as you know 35-45 percent of the vehicle cost is a battery, and more than 70 percent of the battery cost is a cell. Therefore, to take a prime seat in automobile manufacturing and reduce dependence on imports (of cells and Oil), cell manufacturing with localisation targets is a must.

In the last-mile mile mobility, do you have plans to increase the scope of subsidies to even quadricycles as they take lesser space on the road and the cost is even lower?
I agree they are cheaper and take less space, but the transition to cleaner mobility simply means that we need to shift the adoption, not increase the vehicle population or congestion on roads. Further, safety is also one aspect we need to see when the vehicle comes on the road. I personally feel that with current battery prices and demand, Total Cost of Ownership (TOC) or them should already be either lower or at least on at par with ICE.

What role does the government have to play even as 60 percent of the stakeholders wanted better incentives for recycling?
The scrappage policy and battery management rules released in 2022 have made several things clear in terms of incentives etc. Further, several states have also included this in their EV policies.

India’s bus industry seems to be replacing CNG and diesels with electric buses for fleet modernisation as assets that over 10 years old are being pulled out of service. Can we have your observations on this subject?
Yes, public transport is the first priority from the transition to a clean mobility perspective. This not only targets the majority of the passenger-km travelled but also upgraded the current public mobility infrastructure. Recently, concluded 5,500+ e bus units tender as wet lease format has seen the competitive rates which are either equal or lower than ICE counterparts. This shows that transition is not forced but natural in the bus segment.

This interview was first published in Autocar Professional’s December 15, 2022 issue.