Mint Sustainability Summit: EV adoption in India faces inadequate charging facilities, emergence of alternative fuels

New Delhi: The slow adoption of electric vehicles (EVs) in India stems from the incessant need to find alternative fuels and the lack of adequate charging infrastructure in the country, according to industry leaders who spoke at the Mint Sustainability Summit 2024 on Tuesday.

According to Harsh Kapoor, a partner at Monitor Deloitte, the adoption of EVs has been complicated by the lobbying for various alternative fuels such as hydrogen even as LNG is being considered a strong alternative transition fuel. However, he said EVs are not the only category to be affected by slowing sales.

“Car sales globally are on a decline, so it is not just EV sales that are under pressure,” Kapoor said.

Although the sale of electric vehicles in India has been growing, it is dominated by two-wheelers and three-wheelers. In FY24, the number of EVs sold in the country rose to 1.67 million from 1.17 million in FY23, according to data on the Society of Manufacturers of Electric Vehicles (SMEV) website. Sales of electric four-wheelers rose to 90,432 from 47,499 units.

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The challenges faced by the EV industry include inadequate charging infrastructure, lack of standardised charging norms, evolving battery technologies and high initial costs. 

Anand Mimani, CEO of Greenline Mobility Solutions, said financing remains a huge concern for alternative fuel vehicles in the country.

“No bank, nobody wants to finance it very easily. If the government gives a small push there, adoption can happen much faster,” he said.

Subsidies not the answer

However, Aanchal Jain, CEO of PMI Electro Mobility Solutions, a global technology company specialising in advanced electric bus manufacturing, said subsidies are never a long-lasting and sustainable solution. India has reached a stage where subsidies for intra-city buses are not needed anymore, she added.

"The prices that have been discovered for EV bus tenders without subsidies have been lower than those discovered with subsidies earlier. This is due to economies of scale. Our production is not linked to subsidies anymore,” she said. “Subsidies are not needed for intra-city electric buses anymore. However, for other new sectors like school buses and inter-city bus subsidies might be needed to get the demand going.”

Electric bus sales climbed to 3,693 in FY24 from 1,984 in the previous year. As of August 20 in the current fiscal, 1,251 electric buses had been sold, according to information on the SMEV website.

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According to Kapoor, there are additional challenges hindering the adoption of new vehicle technologies such as the total cost of ownership, including resale value, and price stability for fuels such as LNG.

“Technology is not the only constraint for the adoption of new vehicle technologies,” he said.

Anmol Jaggi, CEO of BluSmart, an all-electric cab service, expressed disappointment with the lack of new EV models and said the growth of charging infrastructure remains a challenge.

“Slightly disappointed with no new real EV models coming into the market. I would like to see at least 25 models out there,” Jaggi said. “When we started in 2019, EV charging was the single biggest problem. Even in 2024 charging is the single biggest problem despite installing thousands and thousands of chargers.”

Jaggi said the two main factors affecting charging infrastructure are land and load. A lot of investment is required to beef up the distribution and transmission infrastructure, he added.

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“The current network cannot take the load of so many EVs joining the grid,” he said.

Jaggi said given the current market situation, reaching a 10% market share for electric four-wheelers by 2030 might be difficult. EVs accounted for 6.5% of total vehicle sales in 2023, according to JMK Research & Analytics Private Ltd, a specialist research and consulting firm.

India wants EVs to have a 30% share of all vehicle sales in the country by 2030.