Picking up the pace – India Inc. accelerates the electric mobility transition

Atul Mudaliar (The Climate Group) & Jasmeet Khurana (WBCSD)
Reading time: 5 minutes
10 July 2019

Electric mobility has attracted the attention of Indian leaders, policy makers and vehicle manufacturers as an opportunity to accelerate a low-carbon transition for transport in the country.  Electric powered vehicles got another push from the recent Union budget of India, which announced a slew of incentives to make them more affordable - tax rebates of up to ₹1.5 lakh (US$ 2,188) on interest paid on loans to buy electric vehicles (EVs), duty exemptions on lithium ion batteries, and lower Goods and Services Tax rates from the current 12 percent to 5 percent.

This is in addition to the outlay of ₹10,000 crore (US$ 1.43 billion) that was earmarked earlier this year for phase 2 of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (or FAME 2) scheme, fee waivers on vehicle registration and renewal, and ending fossil-fuel powered 2-wheeler and 3-wheeled vehicles by 2025 as part of upcoming policies.

The acceleration of EVs adoption during the next decade is of utmost importance in order to catch-up with the demographic growth in India; - a slow transition could mean tens of millions of additional internal combustion engines on Indian roads. As such, it is imperative that our work today influences and catalyzes a rapid adoption in the beginning of the next decade.

What many people don’t know is that Indian companies are already driving forwards the EV market. Original Equipment Manufacturers (OEMs), utilities and fleet owners are building the architecture of the Indian EV market – by bringing in investment, accelerating demand and catalyzing innovation, leading to a faster roll-out of EVs on Indian roads.

Driving demand

Wipro and State Bank of India, owners of large vehicle fleets in cities across India, are already stepping up the pace for EVs to hit Indian roads by committing to transition their vehicle fleets to electric by 2030 as part of The Climate Group’s EV100 initiative. EV100 now brings together more than 45 global companies accelerating the shift to clean transport by committing to electrify their fleets and install charging points for their staff and customers to use.  

Shuttl, a leading office transport services company and BSES Rajdhani Power Ltd (BRPL), a private power utility company, recently joined EV100 and have also pledged to switch their fleets to electric and install charging infrastructure where they have operations – accelerating the electric mobility transition in India. EV100 member BSES Yamuna Power Limited, a Delhi-based utility is currently running pilots on how renewable electricity can move to charging points in various parts of the city.

Like Wipro, State Bank of India, Shuttl, BRPL and BSES Yamuna Power Limited, all major Indian companies with large commercial fleets can make a strong contribution to accelerating the Indian EV market, scaling demand and introducing innovation for a model transport ecosystem in the country. 

Driving adoption

EVs already make business sense for high-usage vehicles, depending on vehicle type and the cost of electricity. This makes commercial fleets the primary target for initial adoption of EVs in India, expected to form a significant share of overall EV roll-out in India until 2023-24, which is when mass adoption is likely to begin. By rolling out EVs in their own fleets, companies can also help grow the EV market and bring down prices further, getting us to the tipping point for consumers even faster.

Companies representing over 4 billion kilometres in annual mobility demand and major players from the EV value chain collaborate through the REmobility initiative of World Business Council for Sustainable Development (WBCSD), and are working to accelerate corporate EV adoption in India through a focus on creating business solutions. The initiative is focused on the role of employee transport, ride-hailing, and deliveries as the most scalable use cases for early EV adoption in Indian commercial and fleet operations.

Companies such as TESCO, Accenture, Wipro, Adobe and E&Y are known to have deployed electric vehicles for their employee transport requirements across major Indian cities. This in turn is supporting the creation of an independent electric mobility ecosystem with new start-ups and businesses, charging infrastructure and financing models. Mobility solution providers such as Lithium Urban, Ryds (Bhagirathi) and EEE-Taxi are leading the change, with Lithium Urban already claiming to be the largest EV fleet operator outside of China.

Similarly, shared mobility and ride-hailing services hold immense potential to transform India’s mobility landscape, and EVs can play an important role by making this transformation clean and affordable. Ola’s (an Indian taxi aggregator company) experiment in Nagpur and its creation of a dedicated research unit to lead the change on shared mobility is telling of their commitment to drive electric mobility. Similarly, Uber has recently deployed 50 EVs in Hyderabad and is keen to expand adoption across India.

Another important use case for EV adoption is in urban freight distribution and in e-commerce/food deliveries. Several companies and delivery platforms have initiated trials with EV-based deliveries. For instance, EV100 member IKEA aims to run 60% of its home delivery fleet on electric within 3 years of operation and Swiggy, a food delivery company, is piloting the use of EVs in 10 cities in India.

The REmobility initiative is creating knowledge products to benefit the industry such as a ‘Business EV adoption guide’, developing pilots for scale demonstration, and convening progressive manufacturers, large corporates and fleet operators with a mission to support India’s goal on electric mobility through incentives that can have a long-term impact. 

The Road Ahead

For India to join in the global momentum on EVs, a demand side push is vital. Indian companies have a big advantage in driving forward this shift for several reasons.

Firstly, EV integration in company operations can dramatically reduce running costs of fleets. With rising petrol prices, newer and more affordable EV models coming into the market and falling battery pack costs, the EV transition is already making business sense.  

Secondly, it makes environmental sense to shift to EVs. With 14 of the 15 most polluted cities being in India, companies can accelerate the reduction of energy-related greenhouse gas (GHG) emissions where they operate by offering a major solution in cutting millions of tons of emissions per year, as well as curbing transport related air and noise pollution.

Finally, it connects companies to the welfare of its customers. Accelerating the uptake of EVs among staff, as well as contributing to public infrastructure development, allows companies to engage with their employees and customers in new ways - demonstrating their commitment to creating in a future that nurtures clean and quality lifestyles for all.

 

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