By Rahul Thakur
Marketing Head Matter.in | Summa Cum Laude | Marketing Leader 2018-19 World Marketing Congress | United Nations Climate Ambition Asst. Attaché
Global climate commitments, energy security, and an ambitious renewable target by 2030 are the defining factors that map India’s transition towards an electric future. The country has made significant advancements so far and by pushing e-mobility under the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles Phase II or FAME-II scheme and by setting an ambitious target of generating 175 gigawatts of power from renewable energy by 2022, it has made its stand and intention clear on reducing carbon footprints for a sustainable future.
At present, the transport sector contributes an estimated 142 million tonnes of CO2 annually, of which 123 million tonnes are from the road transport segment alone. To reduce vehicular emissions, the government has set a target to ensure that at least 15% of the country’s vehicles go electric by 2030. The energy supplies required for conventional modes of transport further remain an economic burden due to dependence on crude oil imports. According to a report by the Delhi-based Council on Energy, Environment and Water, the increased awareness towards clean energy can result in 30% of vehicle sales being electric in India by 2030 which apart from environmental gains can save up to save crude oil imports worth Rs 1 lakh crore annually.
To achieve these eco-friendly targets, multiple doors of investments have to be opened up to fast-pace India’s mobility transition and also for financing OEMs, battery manufacturers, charging stations, etc. Various tried and tested methods including investments in research and development for battery manufacturing; focus on public transport including electric trains, electric buses; use of energy-efficiency systems; a robust framework for EV venture capital fund while providing tax exemptions for manufacturing and land subsidies; allocating parking spaces for EV in commercial spaces; targeted and systemic policy support for end-users, shifts in market design; conducive business models; plans for setting up EV manufacturing hubs and easy financial structuring, among others can be a part of the long-term vision to efficiently lead to a smoother transformation.
The government should also come out with incentives to scale the production of lithium-ion batteries by giving exemptions in custom duties to bring down their cost. Batteries should be treated as valuable resources and its wastage should be prevented at any cost through incentives or recycling. Currently, India’s progress towards an electric ecosystem also has many hurdles. At present, electric vehicles are comparatively costlier than conventional vehicles which pushes away many price-conscious buyers from switching to clean energy. Furthermore, these electric cars have a short driving range and the paucity of charging points remains an issue for vehicle owners who wish to travel long distances on a single charge and hassle-free access to charging stations along their travel routes which is also a major deterrent. In addition, conventional cars take few minutes to refuel as compared to electric alternatives which take hours to charge and this is also influencing a buyer’s decision. Reselling of cars is a common phenomenon in the Indian market and many first-buyers often find it difficult to convince others to sell the vehicle at a reasonable fair price which is not a major hassle in conventional vehicles. These factors have caused reservations in Indian buyers on EVs and should be resolved.
The EV segment requires different skill sets and jobs in this area will demand a specially trained workforce that is capable of handling new skills. This upskilling has to pace up in India for greater automation. Furthermore, participation and involvement of all levels— primary, secondary, and tertiary– are required to help India achieve its electric mobility goals. A paradigm shift in transportation will give this trajectory an upward trend and will cut the clutter in overcrowded cities that are already battling stress on infrastructure and unsustainable pollution levels, majorly air pollution. An evaluated and well-thought strategy is also required to place the correct number of charging stations for max utilisation of the facilities and to ensure ease of access to customers.
The urban bodies will have to ensure that they perform their roles in the transformation at the grassroots level to quickly move to environmentally sustainable and economically beneficial transport systems for achieving sustainable goals. In addition, emphasis on public transport and reduction of carbon footprint will significantly uplift the city’s environment and liveability index. A clear roadmap, research-backed plan, and solutions of pre-existing hurdles including traffic, power supplies, higher operational cost, among others have to be discussed briefly to accommodate the electric future. The transition will undoubtedly see large upfront investments and all channels of recommendations including policy priority from the government will play key roles to get the best outcomes from all the stakeholders involved in this transformation from conventional to clean energy.