India has set an ambitious goal to become a leader in the electric vehicle market by 2030 with the government laying out a comprehensive roadmap to achieve this goal, which includes several initiatives and policies to accelerate the adoption of electric vehicles in the country.
One of the key initiatives is the Faster Adoption and Manufacturing of Hybrid and Electric vehicles (FAME) scheme, which provides subsidies to customers who purchase electric vehicles.
The government has also set a target to achieve 30% electric vehicle penetration in the country by 2030.
In this regard, the government is also taking steps for development of domestic manufacturing capabilities for electric vehicles and their components.
Key indicators: Bright Future
Electric vehicle adoption, including four, three, and two-wheelers, and buses, has seen a significant uptick in recent years.
Target of net-zero carbon emissions in the future will help promote the e-vehicle industry.
Push for electric mobility will reduce dependence on oil imports and free up foreign exchange reserves.
Last-mile mobility is a defining sector that will help carry this momentum, with partnerships with companies like Spoctech Green Ventures.
Decisive growth in the mass-market category of private vehicles in 2023, particularly in Tier II and III cities will promote demand.
Faster Adoption and Manufacturing of Hybrid and Electric vehicles (FAME) scheme extended until March 31, 2024 to provide subsidies will aid electric vehicle adoption.
Volumes, mass adoption, and large-scale component manufacturing will drive prices down.
Various initiatives to promote e-vehicles
About: In India, the government has implemented several schemes to promote the use of electric vehicles (EVs). These include:
FAME I & II: Faster Adoption and Manufacturing of Hybrid and Electric Vehicles is a government scheme, which provides incentives for the purchase of EVs and the installation of charging infrastructure.
NEMMP: National Electric Mobility Mission Plan was launched in 2020, which aims to have at least 30% of vehicles on Indian roads be electric by 2030.
Tax benefits: The Government has announced plans to provide an additional income tax deduction of INR 1.5 Lakh on the interest paid on loans taken to purchase electric vehicles.
PLI: The government has announced a Production Linked Incentive (PLI) scheme to boost domestic manufacturing and attract global companies to invest in the Indian market.
NTTM: The Government also plans to set up a National Technical Textiles Mission (NTTM) to promote the use of technical textiles in various sectors, including the EV industry.
Manufacturing plants: Setting up of battery manufacturing units in India to promote the use of electric vehicles.
Public transport: The Government has also announced plans to promote the use of electric vehicles in the public transportation sector, by providing financial assistance to states for the purchase of electric buses.E.g., E-buses in Delhi
Ensuring last-mile connectivity: The government has also identified last-mile mobility as a key sector to drive the adoption of electric vehicles E.g., deployment of a fleet of over 5,000 vehicles in Chennai.
Promoting e-vehicles in government: In an attempt to promote use of electric vehicles in the public sector, the government has plans to replace existing government vehicles with electric vehicles.
Phased Manufacturing Programme (PMP): Indigenous manufacturing of electric vehicles, their assemblies/sub-assemblies, and parts/sub-parts/inputs of the sub-assemblies to be promoted over time through a graded duty structure.
National Mission on Transformative Mobility and Storage: Government aims to drive strategies for transformative mobility and Phased Manufacturing Programmes for electric vehicles, electric vehicle Components and Batteries.
Advantages of EVs
Challenges of EVs
Lower operating costs: Electric vehicles have lower fuel costs and require less maintenance than traditional gasoline-powered vehicles.
Environmental benefits: EVs produce zero emissions and can significantly reduce air pollution and greenhouse gas emissions.
Energy independence: As more renewable energy sources are used to power EVs, it can reduce dependence on fossil fuels.
Improved performance: EVs have instant torque, which means they can accelerate quickly, and have a smoother and quieter ride.
Government incentives: Many countries and local governments offer tax credits, rebates, and other incentives to encourage the purchase of EVs.
Cost reduction: The cost of EVs is constantly reducing as the technology improves and economies of scale increase.
Convenience: Many electric vehicles have the ability to charge at home using a standard electrical outlet, eliminating the need to visit a gas station.
Energy security: EV’s use domestic electricity to power the car, reducing the need for oil imports.
High initial cost: The upfront cost of EVs is still higher than traditional gasoline-powered vehicles, making it difficult for many consumers to afford them.
Limited charging infrastructure: The lack of charging infrastructure makes it difficult for EV owners to travel long distances.
Battery technology: The current battery technology still has some limitations, such as limited driving range and long charging time.
Limited domestic manufacturing capabilities: India currently lacks the domestic manufacturing capabilities for electric vehicle components and batteries, making it dependent on imports.
Lack of awareness: There is still a lack of awareness about the benefits of EVs among the general public in India.
Limited Government initiatives: The Indian Government has set ambitious goals for the adoption of electric vehicles, but the lack of concrete action plans and initiatives has been a hindrance.
Lack of standardization: The lack of standardization in charging infrastructure and lack of uniformity in regulations across states and union territories is a challenge.
Power Grid infrastructure: India’s power grid infrastructure is not fully developed and is not capable of handling the high-power demand of EV charging stations.
What more can be done?
Government can devise strategies for transformative mobility for electric vehicles, electric vehicle Components and Batteries
Creating a Phased Manufacturing Program (PMP) to localize production across the entire electric vehicle value chain.
Coordination with key stakeholders in Ministries/ Departments/states to integrate various initiatives to transform mobility in India.
Ensuring holistic and comprehensive growth of the battery manufacturing industry in India with initial focus on large-scale module and assembly plants on Gigascale manufacturing in future.
Preparing roadmap for enabling India to leverage its size and scale to produce innovative, competitive multi-modal mobility solutions that can be deployed globally in diverse contexts
Electric Vehicles (EVs) are seen as key to decarbonise mobility, but there are challenges in recycling lithium-ion batteries from electric vehicles.
How the battery waste is managed in India?
Battery Waste Management Rules 2022
Nodal agency
Ministry of Environment, Forest and Climate Change (MoEFCC)
Coverage
All types of batteries - EV batteries, automotive batteries, industrial batteries and portable batteries
Extended Producer Responsibility (EPR)
Producers (including importers) of batteries are mandated to collect and recycle/refurbish waste batteries
Online portal
Provides for exchange of EPR certificates between producers and recyclers/refurbishers
Recovery
Minimum percentage of recovery of materials from waste batteries is mandated
Polluter pay principle
Environmental compensation will be imposed for non-fulfilment of EPR targets and obligations set out in the rules
What are the concerns with the Battery Waste Management Rules?
Labelling requirements- The labels on batteries in India does not carry an icon (a crossed bin) which indicates that the batteries cannot be disposed of in regular bins.
Design constraints- There is an absence of eco-design during assembly for recycling to employ corrective methods.
Lack of traceability- The rules do not provide tracking of material used in the batteries, which is critical to reduce the carbon and environmental footprint of the batteries.
Absence of harmonisation- The rules do not establish regulatory standards for testing and classifying used batteries that have a second life.
Counterfeit documents- - Recyclers or dismantlers are falsifying documents and moving the same shipments repeatedly to meet their targets.
Financial crunch- Recycling plants are capital intensive and will be operating at low capacity as the volume of end-of-life batteries are still very low.
The rules do not provide incentives for recycling capacity and facilities.
Global Climate Friendly Initiatives for Battery Recycling
Inflation Reduction Act, 2022- It is a US law that allows recycled battery materials to qualify for significant tax credits.
End of Life Vehicles Directive- It is a European Union initiative that mandates automakers to take back vehicle owners’ end-of-life batteries.
Fit for 55- It is a European Union package that requires the publication of battery carbon footprints by setting collection and recycling targets including minimum recycled content requirements for newly built batteries.
Battery passport- It is a digital tool introduced by European Commission that seeks a carbon footprint declaration for batteries sold in Europe starting 2024.
China- It’s regulations encourage standardisation of battery design, production and verification to improve assembly and dismantling of used batteries.
Why there is a need for battery recycling and reuse?
Limited resource availability- Recycling of batteries can generate a source for rare metals.
Using recycling technologies, 95% of metals can be recycled for use in manufacturing new batteries.
Environmental hazards- If not handled well, it could reach in landfill thus contaminating soil and groundwater.
The environmental impact of metal recycling from lithium ion batterieswaste is significantly less than from metal extraction from the mines.
Import dependency- It is important for India to establish recycling ecosystem to save forex.India’s major import is from China which holds 51% of global cell manufacturing capacity.
Supply chain disruption- COVID 19 pandemic has exposed business risks as a result of disruptions in the global supply chain, resulting in a long lead time for raw material deliveries.
Recent Russia-Ukraine war has also affected the supply chain of key battery metals like nickel and aluminium, along with crude oil.
Price discovery- Creating a well-established recycle ecosystem can help discover the resale value of batteries for reuse/ recycle applications.
Telangana model- Electric Vehicle Policy provides incentives to recycling businesses for ultra-processing.
Punjab model- Punjab is creating an e-marketplace to encourage resale of used batteries along with incentives to promote resale.
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