World EV Day: 4 Ways India Can Achieve 100% EV Adoption The Indian government wants 100% electric vehicle adoption by 2030, but some challenges persist, which need to be addressed

When the idea of electric vehicles (EVs) first came about as a solution to tackle climate change and dependence on oil imports, a complete transition to EVs looked like an impossible goal to chase. However, today, EVs are a big part of our lives. The steeper growth trajectory seen in the adoption of electric two-wheelers (E2Ws) and electric three-wheelers (E3Ws), in particular, is a positive sign on our road to EV success.

According to a report, EV sales across segments (2W, 3W, 4W and e-buses) grew by 110 per cent in FY22 compared to the previous year. Around 5.2 lakh units were sold across segments in FY 22. Further, the EV value chain revenue pool is expected to reach between $76 billion and $100 billion by 2030, potentially translating to an $8 billion–$11 billion profit pool, as per a report from Bain & Company.

However, there are still some challenges that need to be addressed to achieve 100% transition.

As we celebrate World EV Day tomorrow, with an aim to increase public awareness around EVs, here is a look at four ways we can ensure 100% EV adoption.

Focus on charging infrastructure

The lack of adequate charging infrastructure and the resulting range anxiety has been the most significant barrier to widespread EV adoption in India. "For India to truly embrace EVs, we must catalyze a nationwide "charging revolution". It's not merely about rolling out electric cars; it's the backbone of power behind them that truly counts. The heart of our modern mobility lies in every strategically placed charging station and every innovative solution we bring to the table. We envision a landscape wherein electric chargers are as commonplace as our current petrol pumps, seamlessly integrated into the rhythm of daily life. It's a dance of technology and infrastructure, harmony between innovation and tradition. An electrified road is no longer a distant dream, but a reality we must confront. This is the future India not only needs but rightfully deserves," said Sandiip Bhammer, founder and co-managing partner, Green Frontier Capital, a climate tech VC firm.

Extracting and recycling Lithium

Lithium-ion batteries will be key to India's EV success. Along with focusing on ways to extract Lithium and using them with 100% safety in mind, recycling can also go a long way in replacing petrol or diesel with lithium-powered batteries as the source of power in vehicles.

This is because as the demand and market for EVs increased, the dependency on Lithium has also increased over the years. According to an analysis by The Energy and Resources Institute (TERI), India's lithium imports increased by about 6.5 times between 2010 to 2017. India imported 450 million units of lithium batteries valued at INR 6,600 crore ($929.26 million) in 2019-'20, said Harsh Vardhan, Union Minister of Science and Technology and Earth Sciences, during his Lok Sabha speech on February 7, 2020.

While the EV industry and other industries that use Lithium have found discoveries of Lithium in India as a positive step toward building a greener and self-reliant India, they also feel that the mere discovery of Lithium reserves isn't automatically going to change everything and we need to build processing infrastructure and expertise.

EV financing

EV financing is gaining momentum due to which access to credit is becoming much easier, pushing more and more people towards EVs, particularly E-2Ws. In addition to that, tax exemptions and subsidies from the government under FAME II (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles) are also expected to continue encouraging consumers towards E2Ws. However, more needs to be done.

"To achieve a 100% transition to EVs in India, the primary focus should be on revolutionizing EV financing. Simplifying access to affordable financing options will empower individuals and businesses to embrace cleaner mobility, accelerating the EV adoption curve and contributing to a sustainable future for our country. Furthermore, offering customized and innovative financing solutions, such as daily and weekly EMI options, as well as rent/lease choices, can cater to diverse needs without promoting any specific product or service, ensuring a flexible and inclusive approach to EV adoption," said Sameer Aggarwal, CEO and founder at Revfin.

Improving E4W adoption

The upfront investment in an E4W is less financially appealing for consumers, particularly in price-sensitive markets, as of today. Thus, in the 4W space, the price parity between an electric and ICE engine is enormous, significantly increasing the total cost of ownership (TCO) of a 4W EV. Generally, EVs for four-wheelers are sold at a premium of up to 50% more than their internal combustion (IC) counterparts, making them less affordable for consumers.

In order to bring the TCO down, the cost of battery packs needs to be significantly low, for, they constitute a significant portion of the vehicle's price. To resolve this, EV technology needs to evolve. Experts say that the more the automakers innovate, the faster the disparity between EV adoption in 4Ws and the success seen in the 3W and 2W sectors will diminish.