Electric Vehicle Battery Swapping : Daily Current Affairs

Relevance: GS-3: Science and Technology- Developments and their applications and effects in everyday life.

Key Phrases: Battery Swapping, Niti Aayog’s Draft Battery Swapping Policy, Unique identification number, Battery charging stations, Standardisation, Innovation, Interoperability, Electric Vehicle (EV).

Why in News?

It is expected that the Electric Vehicle (EV) will contribute to improving the overall energy security situation as the country imports around 85% of its overall crude oil requirements.

What is Electric Vehicle (EV)?

An EV is one that operates on an electric motor, instead of an Internal Combustion Engines (ICE) that generates power by burning a mix of fuel and gases. It includes road and rail vehicles, surface and underwater vessels, electric aircraft and electric spacecraft.

Advantages of Electric Vehicles

Environmental Advantages
- Reduce dependence on petroleum: Electric Vehicle (EV) will contribute to improving the overall energy security situation as the country imports around 85% of its overall crude oil requirements.
- They have the potential to reduce greenhouse gas emissions and reduce health effects from air pollution
Low maintenance cost
- Electric vehicles have very low maintenance costs because they don’t have as many moving parts as an internal combustion vehicle. The servicing requirements for electric vehicles are lesser than the conventional petrol or diesel vehicles. Therefore, the yearly cost of running an electric vehicle is significantly low.
Electric Vehicles are easy to drive and quiet
- Electric vehicles don’t have gears and are very convenient to drive. There are no complicated controls, just accelerate, brake, and steer.
- Electric vehicles are also quiet, so they reduce noise pollution that traditional vehicles contribute to.
Better Energy Efficiency
- Internal Combustion engines consume fuel even when the vehicle is stationary, whereas stationary electrical vehicles do not consume energy.
- Electrical Vehicles ‘tank-to-wheels’ efficiency is about a factor of 3 higher than internal combustion engine vehicles
Tax and financial benefits
- Registration fees and road tax on purchasing electric vehicles are lesser than petrol or diesel vehicles.
- There are multiple policies and incentives offered by the government.

Challenges with adoption of Electric Vehicles in India:

Consumer perception: The range anxiety, lack of charging infrastructure, a wide gap between EV and Internal Combustion Engine. (ICE) vehicle prices, lack of assurance about satisfactory resale value show a weak consumer perception.
High price: There is no price parity between electric vehicles and ICE vehicles in India. For example, the Tata Nexon price starts from ₹7.19 lakh, while the Tata Nexon EV price starts from ₹13.99 lakh.
Scarce battery technology: India doesn't produce lithium and li-ion batteries either, a key EV technology. India relies on import for EV batteries which are quite expensive.
Majority of EVs are not covered under FAME scheme: The Indian Government has tried to promote electric mobility in the country via incentivising and discounts for EVs through FAME. The terms and conditions of FAME scheme don’t support a majority of the electric vehicles with low-speed electric two-wheelers, lead-acid battery powered EVs are not covered under FAME.
Lack of charging Infrastructure: The target of setting up a sufficient number of public charging stations in India is well below the mark,a discouraging factor in adoption.

What is Battery Swapping?

Battery swapping is an alternative that involves exchanging discharged batteries for charged ones.
Battery swapping de-links the vehicle and fuel (in this case, the battery) and thereby leads to a reduction in the upfront cost of the vehicles.
Battery swapping is popularly used for smaller vehicles, such as two- and three-wheelers, which have smaller batteries that are easier to swap compared to other automotive segments where the same can be implemented mechanically.
Battery swapping offers three key advantages relative to charging—time-saving, space-efficient, and cost-effective—provided each swappable battery is actively used.
Further, Battery swapping provides a level playing field to innovative and sustainable business models, such as ‘Battery as a Service’.

How does Battery Swapping work for EVs?

The customers will be able to visit the outlet of the energy operator, lease the charged batteries and pay for the energy consumed.
The concept is similar to the use of LPG cylinders by consumers.
These operators will purchase the batteries in bulk and set up stations similar to petrol pumps to help EV owners swap their drained batteries.
However, while Internal Combustion Engines (ICE) vehicles can be refilled at any petrol pump, the EV owners will have to ink an agreement with energy operators to swap batteries.

Do you know?

According to recent research by Accelerated e-Mobility Revolution for India’s Transportation (e-Amrit) portal in India, only 7,96,000 Electric vehicles have been registered till December 2021, and the installation of 1,800 charging stations on public places.
The sales of EV vehicle have seen a growth of 133% from FY 2015 to FY 2020.
According to NITI Aayog, EVs should account for sales of 80 per cent of two and three wheelers, 50 per cent of four wheelers and 40 per cent of buses by 2030 — must be accompanied by a rapid improvement in charging infrastructure.
Range anxiety is the electric vehicle owner's fear that an EV's battery does not have sufficient enough charge for the vehicle to reach its final destination or that a charge point won't be available for charging “on the road.”

Key Proposals in Draft Battery Swapping Policy2022:

The draft policy proposes that demand-side incentives offered under existing or new schemes for EV purchase can be made available to EVs with swappable batteries eligible under this policy.
Reduce the difference between tax rates on lithium ion batteries and electric vehicle supply equipment. Currently, batteries attract GST at 18%, while EV supply equipment attract GST at 5%.
Require State governments to ensure that public battery charging stations are eligible for power tariffs at concessional rates.
Ease the registration process for EVs sold without batteries or those with swappable batteries.
Assign a unique identification number to swappable batteries and battery charging stations.
Vehicles with swappable batteries will be sold without a battery, providing the benefit of lower purchase costs to potential EV owners.
Any individual or entity is free to set up a battery swapping station at any location, provided that the specified technical, safety and performance standards are adhered to.
Set up battery swapping stations at locations like retail fuel stations, public parking areas, Malls, etc.

What is the Battery-as-a-service Business Model?

The battery-as-a-service business model is one in which companies set up dedicated battery swapping stations.
These stations maintain stocks of replaceable batteries which are charged and kept in the stations.
Customers who have compatible EVs can then come in and swap out their discharged batteries and have it replaced with the charged ones at these stations, for a subscription or a pay–as-you-go model.
Battery swapping allows EV owners to quickly get a boost without worrying about having a charger installed, or wait for the vehicle to charge up.

What changes are needed in policy framework?

The country’s final policy should consider the following key aspects.

Policy measures should facilitate the phased development of a swapping ecosystem that is linked to the EV market’s stage of maturity.
It must take a targeted approach, identifying priority vehicle segments and enabling an accelerated adoption of swapping solutions in those segments where battery swapping could have the most value.
It must find a balance between standardisation and encouraging innovation.
It should provide equitable growth opportunities for multiple technologies, solutions and business models, and let the market pick the winner among these.
Policy must offer flexibility to various stakeholders, including State governments, to devise battery-swapping ecosystem development strategies that are best suited to their needs.

Do you know?

India is among a handful of countries that support the global EV30@30 campaign, which aims for at least 30% new vehicle sales to be electric by 2030.
India aims to achieve EV sales accounting for 30% of private cars, 70% of commercial vehicles, and 80% of two and three-wheelers by the year 2030.
The government of India has taken various measures to develop and promote the EV ecosystem in the country such as:
- The remodeled Faster Adoption and Manufacturing of Electric Vehicles (FAME II) scheme.
  - Phase I lasted from 2015 to 2019 and Phase II of FAME was launched in 2019 and is expected to be completed by 2022.
  - FICCI has asked for the continuation of FAME II till 2025, along with short-term booster incentives to enhance demand.
  - FAME Phase II scheme has an outlay of US$1.36 billion to be used for upfront incentives on the purchase of EVs as well as supporting the development of charging infrastructure.
- Production-Linked Incentive (PLI) scheme for Advanced Chemistry Cell (ACC) for the supplier side.
- PLI scheme for Auto and Automotive Components for manufacturers of electric vehicles.

Way forward:

In India, battery swapping can evolve as a fit use case for two- and three-wheelers, which together comprise more than 80% of all automobiles in the country. Therefore, an enabling battery-swapping policy will be critical for us to accelerate India’s e-mobility transition. At the same time, the policy that we adopt should be mindful of the nascency of the battery-swapping ecosystem in India and therefore avoid constraining various aspects of the swapping value chain into watertight standards.

Source: Live-Mint

Mains Question:

Q. The new draft battery swapping policy will foster India’s Electric Vehicle (EV) ecosystem. Discuss. (250 words).