In a move that has pleased environmentalists, India has floated a plan to sell only electric vehicles in the country by 2030. The ambitious plan to switch to electric vehicles from vehicles based on fossil fuels managed to excite Elon Musk. The opportunity here for India is to avoid going through the same cycle as developed economies, and leapfrog into a more sustainable future. Potential methods for achieving this is outlined in the a report called "Transformative Mobility Solutions for All", based on studies conducted by NITI Aayog and the Rocky Mountain Institute.
One of the important steps in the plan is an actionable solution focused on two and three wheelers. Three wheelers contribute between six to twenty four percent to the total automotive particulate matter in the air (in simple words — pollution), although they represent only about five percent of the vehicle population. Two and three wheeler make up about 80 percent of local vehicle sales, and as such offer a huge market that is ripe for electrification.
The big idea here is using smart, swappable batteries. The proposition involves standardised batteries for 2 and 3 wheelers, that can be swapped out with fully charged batteries after they are drained. A network of swapping stations, similar to petrol pumps, will facilitate the swapping of batteries. An integrated payment and tracking system into the batteries could cut the sticker prices by as much as 70 percent. Payment models include leasing the batteries and paying per use. A subscription pricing model could also potentially be a viable option.
One of the biggest hurdles for the widespread adoption of electric vehicles is the high cost of the batteries. The government wanted to encourage the adoption of electric vehicles without offering any subsidies for the batteries. Ashok Jhunjhunwala, a professor on sabbatical from IIT-M came up with the solution of separating the batteries from the vehicles. By focussing on the efficiency of the vehicles, and allowing the batteries to be replaced, the cost per kilometer for electric vehicles comes down to about the same levels as fossil fuel based vehicles. "Suddenly the whole economics was working. And once the economics work, one can scale", Jhunjhunwala told Quartz.
The current laws in India make it costlier to buy batteries without the electric vehicles costlier than buying the batteries with the electric vehicles. The government can tweak the tax laws to encourage the sale of batteries independent of the electric vehicles. For a high level of transparency and accountability, a blockchain based cashless payment solution can be implemented. The vehicles, the batteries and the charging stations can all be a part of this system.
Another big idea to give a powerful incentive for the market segment is to exempt electric two and three wheelers from requiring vehicle permits.