India was placed 7th in 2023 Climate Change Performance Index (CCPI). However, the country improved by only one rank from the previous one, remaining among the highest climate performers.
She has maintained her position among the top 10 for the fifth year in a row. This has been achieved by a variety of actions in GHG emitting sectors; the two highest emitting sectors being power (8.2 Gt Co2) and transport (4.7 Gt.CO2).
The breakup of power generation as on June 12, 2023 is given below:
The Government of India (GoI) has planned to increase non-fossil fuel energy capacity from present 173,010 MW to 500,000 MW by the year 2030. This will fulfill about half of her energy requirements through renewable energy.
The increase in the use of renewable energy will reduce CO2 emissions by 1 billion tons, thus carbon intensity by 2030 will come down below 45%. The Net-Zero emission target will still be far from what is planned to be achieved by 2070.
To achieve Net-Zero emission targets in the transport sector, one of the actions taken by GoI is the promotion of Electric Vehicles. No doubt, electric vehicle will reduce air pollution by restricting exhaust emission. However, it should be clearly understood that EVs only transfer the GHG from the fuel tank to the power generating station. It contributes to GHG reduction only if it consumes the grid power that has been generated by renewable sources of energy e.g. Hydropower, Solar Power, Wind Power etc.
In India, the 2023 power generation scenario reveals 56.9 % power to have been generated by using fossil fuels. Thus, using 100% Electric Vehicles in road transport, in an average scenario, will reduce only 43.1 % of GHG emission. Conversion of 100% road mobility into electric systems is not presently feasible as adequate numbers of charging stations at appropriate locations are not available.
In addition, electric vehicle charging has a big disadvantage of creating grid imbalance as the charging is done by plugging in a single phase power point.
No doubt the government is promoting the use of electric vehicle by providing subsidies in various sections of automobile like two wheelers, three wheelers, and four wheelers, but the key barrier in the propagation of EV in India at a large scale is the absence of public charging infrastructure at a required level.
Such a problem is being faced not only in India but all over the world. Even in a developed country like the USA, 95% of the charging points are private. The public charging stations are located only on highways.
In India, the charging stations are provided by power utility, charging infrastructure, manufacturer, charging station operators, vehicle manufacturers/fleet operators, location owners/real estate and public authorities. Some vehicle owners have their own private charging station.
The electric vehicle has created an opportunity for charging business, thus giving a boost to the economy and employment. International experience as well as Indian experience suggest that various institutions/stakeholders are engaged in planning and development of charging infrastructure for electric vehicles.
ABB India, Delta Electronics, Mass Tech, RRT, Okaya and Exicom are some of the charging infrastructure manufacturers. Of late, the ministry of power has defined electric vehicle charging as service. This has facilitated the establishment of new charging stations by various entrepreneurs and operators. The charging operators do not require any license under electricity act 2003 to establish and operate their charging stations.
Electric vehicle infra hardware solutions can be provided in two different ways. Standalone delivery – to install at home, workplace, or for public charging is one way. The other way is to provide a solution through partnership with vehicle manufacturers by offering the hardware as a part of the vehicle.
This way, one will essentially be providing a complete charging point
solution for public and private charging including the hardware and software installation. Further, services such as maintenance of the hardware as well as additional support services can also be provided, thus more employment can be created.
The Charging Point Operation (CPO) by itself will become a business complementary to EVs. These operators can operate a single charging station providing multiple charging points or can scale up to operating a network of charging stations.
Electric vehicle charging, customer support, network solution (standalone or in partnership with a Network Service Provider), etc. could be the services that these operators could provide Time-based fees, Energy-based fees, fixed fees, Membership fees, etc., could be different pricing mechanisms that could be offered to electric vehicle users.
Recently, an amendment has been made in the Electricity Act 2003 by the Ministry of Power which has made electric vehicle charging a “service.” Thus, no licensing is required under the act to operate a charging station. Some of the companies that have taken advantage of this provision are Tata Power, EESL, Fortum India, Magenta Charge Zone, and Group Volttic.
Presently, lithium-ion batteries are most commonly used in EVs. These batteries consist of rare elements such as Lithium, Nickel, and Cobalt. Use of these rare elements is expected to increase as the electric vehicle industry grows. The supply chain for these materials is restricted and fragile; only a few countries have deposits of these materials.
Recently, big deposits of lithium have been discovered in India. Battery constitutes the biggest cost in electric vehicles. Recycling of batteries will reduce the cost of EV operation and also reduce negative environmental impact. Thus, there is an opportunity to create a sustainable business of battery recycling.
Be that as it may, the attainment of net zero in road transport is difficult with transition to EV alone. It will also require power generation to be completely switched over to renewable sources. While reforms in the energy sector will contribute to lesser secondary GHG emission from electric road transport vehicles, the transition to hydrogen powered vehicles will result in faster attainment of Net Zero.
(The author is a Professor of Strategy and Entrepreneurship & Dean (Research), Birla Institute of Management Technology; Views are personal)
