2023 LOOKS PROMISING FOR INDIA’S EV MARKET

NAIR

RESEARCH ANALYST, COUNCIL ON ENERGY, ENVIRONMENT AND WATER (CEEW)

In India, over one million electric vehicles (EVs) were sold in 2022 The EV transition has been swift, marked by an 8X growth in unit sales from two years ago in 2020 And with this, the world's third-largest automobile market has become a major contributor to the transition, with 12 per cent share of EV sales recorded worldwide A market with much space for increasing vehicle penetration and a national commitment towards cleaner transportation now shines brighter than ever If 2022 was proof that the Indian auto market was ready to electrify, 2023 is the year to solidify commitments and grow this space

As seen over the years, the Council on Energy, Environment and Water (CEEW) expects electric two-wheelers (e-2W), a category that dominates traditional auto sales, to continue to lead the sales chart in 2023 And while it sees the presence of nearly 100 manufacturers, the segment frequently reports instances of overbooking and delayed delivery of products A growing segment that is expected only to grow faster and bigger must hold onto consumers’ excitement by accounting for projected growth volumes Increased manufacturing capacity to ramp up EV production along with a conscious strategy to account for supply chain interruptions will avoid a demand-supply mismatch and help retain the consumer's enthusiasm

And while electric three-wheelers (e-3W), primarily led by e-rickshaws, are the second-most successful category within EVs, electric fourwheelers may be the category to watch out for This segment has shown a 10X growth over the last two years, with all major players such as Tata, Hyundai, Kia, and MG and even newer ones such as BYD committing to an exciting range of new products at the 2022 Indian Auto Expo held in Delhi. The promise of a larger range of products and the introduction of sub-segments such as electric SUVs, infuses much promise into it However, the market may need an affordable electric car that mirrors the utility of the now-retired Mahindra Rewa to grow this segment over the next few months

With Man expe state policies providing EV buyers subsidies The year 2022 saw six states and UTs – Haryana, Rajasthan, Chhattisgarh, Ladakh, Chandigarh and Uttar Pradesh – launch EV policies that provided this This year may see more states launch or extend their EV subsidy limits Second, affordable consumer financing for personal and commercial EVs is critical for broader adoption, whether through policies like interest subventions or others Third, and perhaps most importantly, the sector will be seen turning inwards to domesticate its supply chain over the next few years. The same may lead to short-term headwinds for some players and, in turn, may lead to a change of market order

The continued success of electric vehicles in 2023 depends mainly on the gaps it manages to fill Increased international prominence may also inject a much-needed new finance stream and experience in 2023. With the right policies to support EVs and disincentivise traditional vehicles, the mainstreaming of this emerging segment may no longer be a distant dream.

As per vision 2030 identified by NITI Aayog & Rocky Mountain Institute 2019, 70% of all commercial cars, 30% of private cars, 40% of buses & 80% of 2W & 3W sales to be electrified by 2030 Out of these different categories of EV 2W & 3W EV will majorly adopt captive slow charging mode followed by commercial EV (aggregated cab, L5 vehicles) with mixture of captive slow charging & fast/slow public charging mode For intrastate travel of all commercial EV PCS (public charging station) with fast/ slow charging mode must In case of e-buses for intrastate travel, fast DC charging PCS in different bus depots is a must & for Interstate travel PCS beside highway & expressways is must Thus to achieve the vision 2030 of NITI Aayog, it is important to have a balancing act in PCS (Public charging system) infrastructure implementation to support rapid EV adoption across the country

Keeping in mind the above insight, the Department of Heavy Industries had invited EOI dated 28th Aug 2019 from public & private entities for setting up EV public charging stations within cities After evaluation of proposals received, the government sanctioned 2877 EV charging stations to 22 public entities besides different Highways/ Expressways

Recently, the Ministry of Power clarified that charging EVs can be considered a utility, meaning that licenses are not needed to operate EV chargers. It has also adopted a policy for charging infrastructure to encourage EV adoption In January, 2022 saw the promulgation of revised Guidelines & Standards for Charging Infrastructure for EVs These guidelines cover both individuals who own EVs and infrastructure for public charging stations (PCS) It addresses issues such as land use and access and power tariffs The state and central government are also included. There are timelines for installing PCS connectivity In November 2022, The Power Ministry changed the consolidated guideline: Public charging stations will be equipped with the following features: Prepaid collection of service charges, time of day rates, and solar discount A Committee under Central Electricity Authority will recommend to the State Government the maximum limit for service fees to be levied This Committee will also recommend a "time of the morning rate" for service costs and a discount for charging solar hours.