Zero Emission Vehicles (ZEVs): Policy Framework – NITI Aayog

Highlights

Combined with the development of motors with higher rating and reliability, these improvements in battery chemistry have reduced costs and improved the performance and efficiency of electric vehicles. While vehicle growth in India is rapid, ownership per 1000 population has increased from 53 in 2001 to 167 in 2015, a key difference between India and other countries and the types of vehicles being used.

The prevalence in India of small vehicles such as two-wheelers, three-wheelers, economy four-wheelers and small goods vehicles is unique among large countries. The general strategy should address two key variables affecting the costs of EVs: battery costs and any fiscal policies that either increase the costs of an ICE vehicle or decrease the costs of an EV. Broadly speaking, approaches exist to reduce battery costs – reducing the number of batteries that an electric vehicle needs and making batteries cheaper on a per kilowatt-hour basis. A smaller battery will lower costs by reducing the total weight of the vehicle, resulting in higher energy-efficiency and improved ability to upgrade as the technology evolves.

Increasing efficiency of vehicles: Incentivizing developments to increase vehicle efficiency, thereby reducing energy consumption, can enable to a vehicle to travel the same distance on a smaller battery pack. For the second approach, reducing the unit costs of each battery, India can explore several pathways: a. Selecting appropriate battery chemistries: As batteries dominate costs of electric vehicles, the strategy would be to use battery chemistry with optimized cost and performance at Indian temperatures.

GST should favor commercial vehicles that have higher utilization and drive more KMs, to maximize electric Vehicle Kilometer. EV charging and battery swapping are two means for providing energy to a vehicle. India would recognize battery swapping and battery charging as addressing different segments of vehicles and two equally valid options that industry may choose to use. Swappable vehicle batteries and vehicles without batteries should also be treated the same under GST. Further, installation of chargers would be allowed on street parking, parking lots and any public charging space.

An EV uses electricity as fuel which is stored in a battery in the vehicle. To incentivize longer life batteries to be developed and produced, India would enable battery systems, both within vehicles and in “Second life” to avail potential revenue in supporting load balancing, time-of-day charging, energy banking and other uses after their useful life in the automobile is exhausted. One study has estimated that driving the shift to electric vehicles would lead to a 1% increase in EU GDP. In another study, net private and social benefits are estimated between $300 and $400 per EV. Coupled with generation of renewable power, the battery manufacturing industry in India can become bigger than the total amount spent on import of crude oil.

Early conversion of these vehicles to electric vehicles using Lithium-ion batteries will provide clean transport to a large number of people. If we assume that each of these vehicles uses a little more than half a liter of petrol per day or about 200 liters per year, the total amount of petrol used by such vehicles is about 34 billion liters. Used only in specialized vehicles, where smaller batteries are used with charging and discharging very frequently.

Other major concerns are weight of the battery in the vehicle, range that the battery provides and the costs of the battery. Some key attributes in selecting appropriate drive trains include: Vehicle weight and use patterns: The power requirement of the motor depends upon the weight of the vehicle along with its payload, the speed-range at which the vehicle has to be driven, grade ability that it has to handle and the acceleration that the vehicle needs.

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