[Answered] The draft battery-swapping policy of NITI Aayog addresses some key concerns within the electric vehicle (EV) ecosystem. Elaborate

Recently, Niti Aayog has prepared a draft battery swapping policy to offer incentives to electric vehicles (EVs) with swappable batteries, subsidies to companies manufacturing swappable batteries, a new battery-as-a-service business model and standards for interoperable batteries. Battery swapping is replacing a depleted battery with a fully charged one at a battery swapping station (BSS). It reduces infrastructure cost and is a more efficient charging arrangement for vehicles.

Concerns:

• Safety concerns: Multiple recent incidents where e-vehicles have caught fire and exploded have created an attitude of risk aversion. Short-circuits within the battery are the usual cause. Battery swapping stations would be able to handle these batteries safely.
• Supply chain constraints: Unregulated mining practices for input materials that go into battery manufacturing are putting a greater strain on a limited pool of natural resources. Battery swapping will require less production of new batteries.
• Lower cost: Battery swapping falls under the broader umbrella of Battery as a Service (BaaS) business models. BaaS involves users purchasing an EV without the battery, which significantly lowers upfront costs, and paying a regular subscription fee (daily, weekly, monthly, etc.) to service providers for battery services throughout the vehicle lifetime
• Space constraints: Charging stations require more space, since vehicles need to be parked next to the chargers during the charging process. Battery swapping stations can stack multiple batteries on top of each other.
• At present, the GST on a separate battery is at 18 percent as opposed to on a battery sold with an EV, which attracts only 5 percent GST. While this will take out a significant cost from the vehicle and discourage to do business in the space of Battery as a Service (BAAS).
• With existing technologies for e-2Ws and e-3Ws, regular charging takes at least 3 to 4 hours, adding to inconvenience and creating range anxiety. Battery swapping is done in minutes, as the batteries are pre-charged in swapping stations.

Way forward:

• The private sector should be encouraged to develop business models for ‘battery or energy as a service’.
• There should be uniform specifications of the batteries across various vehicles to operate electric vehicles with ease.
• The next step can be to harmonize authentication and payments at charging stations.