The government of India kicked off the second phase of FAME (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles) scheme from April this year. The plan is to set up 2700 charging stations at an outlay of Rs 10,000 crore. It includes the installation of public charging stations in grids of three square kilometers.
The FAME India program was introduced in fulfillment of pledges made at the 2015 Paris Agreement on Climate Change. The idea is to encourage electric and hybrid vehicle manufacturing.
The extension of FAME is a key next step in fulfilling the commitment to create and promote sustainable ecosystem for electric mobility.
The political commitments made at Paris COP21 include ambitious growth targets in electro-mobility and further rollout of electric vehicles. Substantial resources have already been committed towards the deployment of green technology for urban mobility. Investments in research and development, manufacturing, and the development of alternative ecosystems are expected to make an impact on mitigating climate change.
Many of us who are actively involved in the commerce of electric mobility are convinced of the need for an anthropological approach. The idea is to take the advanced concepts of the FAME program to a different level of urban mobility.
Looking beyond automobiles
We need to look beyond automobiles to more inclusive modes of transport such as rickshaws, motorcycles and scooters.
Of the three modes, the three-wheeled rickshaw is the most suited as a low-cost mass transport option. It can be divided into two prime categories: the L3 or E rickshaws, and the L5 or the traditional auto rickshaws. Both of these will have separate needs for charging and business models.
E rickshaws have gained huge volumes in the Indian market without any support from the Government. In 2018, there were about 1.5 million battery powered rickshaws in use plus 11,000 new vehicles are added to the fleet each month.
To gauge the dimensions of E rickshaws market, consider that it is valued at US$ 1.5 billion. This has been possible because they comprise an ideal solution to the last mile connectivity problem, both for passengers and recently for last mile logistics as well.
That said, it is equally important to understand the market may not have achieved its expected size. This is largely because of the lack of specific infrastructure that caters to this new mode of urban mobility.
For example, at the end of 2017, there were only 450 charging stations. The take-off stage for this segment will come in three years, when the number of charging stations will increase six fold.
Today, the market is at a nascent stage not only in size but also in the adoption of technology. It is dominated by lead-acid batteries, which have their own inherent problems of long charging times, shorter life span, and maintenance.
Lithium ion batteries can be the solution. However, these are far more expensive than the traditional lead acid batteries. As such, they will remain out of reach for the rickshaw owners; plus, little or no financing is available.
Opportunities in E rickshaw segment
Given the present ecosystem, battery swapping is the right solution for E rickshaw vehicles. This basically means that an E rickshaw owner can get his discharged battery replaced with a new, fully charged battery in under one minute from a charging station and be back on the go, without sacrificing income.
Battery swapping is a great opportunity where we will see a lot of entrepreneurs who can come in as “Energy as a service provider”. For the vehicle owners, this is a win-win situation as they can now enhance their revenue without having to make a capital outlay for lithium batteries.
We could also see micro entrepreneurship opportunities in this space. This basically means that there will be no need to set up individual charging points for E rickshaw, thus saving time, money and cost while enhancing efficiency of operation.
For this to succeed, it is however imperative that the battery technology used is robust, safe and engineered for swapping. In India, very few companies have engineered products and primarily use low-grade products for this market, which can be detrimental to the battery swapping model.
In the L 5 category, the initial adoption will be for cargo and load carrying operations in last mile delivery. In this case, energy requirements can be met only by using well engineered lithium batteries. These cargo loaders will primarily be managed by fleet operators, who will manage the entire operations including providing drivers and vehicles for individual customers.
Therefore there is a very good opportunity for entrepreneurs who can provide such fleet management services to customers, freeing especially commercial customers from having to manage them on their own.
There will be a requirement of charging points for such L 5 vehicles. However, because these will be managed mainly by fleet managers, there will be no need for public charging infrastructure. Rather, the charging infrastructure will be available at local hubs where these vehicles park overnight.
To sum up
There will be plenty of opportunity for electric three-wheeler penetration in the Indian market through the model of battery swapping as well as local charging points available at delivery hubs.
Electric mobility is set to penetrate the urban transport mass market where rickshaws have traditionally operated. Adoption of such climate friendly options will strengthen the market for electric mobility, battery design, and charging technology at the very grass roots.
Such innovative alternatives will not just help in urban transport but also promote sensible use of energy and the curbing of pollution. Beyond that, these will help India establish its leadership in climate change technologies.
GreenFuel specialises in energy solutions for sustainable mobility in the Indian market. Aiming to become a leading player in the electric two- and three-wheeler space in the country, the company has been working on the plan for two years now, and claims to have been able to develop the lithium-ion battery pack that’s well-suited to Indian climatic conditions.
The views and opinions expressed in this article are the author’s own, and do not necessarily reflect those held by pv magazine.