Now if our government keeps up this promise, this would be great news for the EV industry. Around the world the EV industry is supported by the government in the form of subsidies for consumers, EV infrastructure development and breaks for EV manufacturers. But sadly we have nothing here in our country for EV manufacturers or consumers. Its about time, that this situation is reversed.
India is a perfect country, where EV's would thrive. With more than a billion people, we have several of the world's most congested and polluted cities as well as a low cost of manufacturing labor and educated engineers.
Electric Vehicles are perfect for India due to the following reasons.
- Electric power-trains operate at much higher efficiency at low Indian driving speeds than an Internal Combustion Engine (ICE), thus saving huge amounts of money spent on purchasing oil by the government.
- Due to the start and stop nature of traffic in Indian cities, A higher share of energy per trip is lost in braking, which is almost wholly recovered in an EV.
- EV's use no fuel during idling and the share of idling time in traffic is much higher in India (than the US or Europe).
- The average range traveled in India is much smaller than in the US, making EVs much more feasible and range anxiety less of an issue.
The reality is that, the sight of an EV is as rare a sight, as seeing a camel or an elephant on the road!
Why is this?
- Very less choices
Only one domestic electric car, the Mahnidra e20, is currently on sale, and international companies have ignored the Indian market due to the many challenges facing Plugin EVs in the country. When it comes to e-bikes, there are no alternatives to the dreaded, lead-acid battery.
Lack of public charging infrastructure
Charging infrastructure is not mandatory as every Indian home has an electric socket. But DC Quick charging infrastructure is a requirement that would drive the sales of EV's as illustrated in my other blog.
- Lack of Awareness
We know that Indians are cost conscious, but we are also not risk takers. Most people don't want to take a chance on a vehicle that uses new technology. Also people are also scared about the cost of the replacement battery and have other fears.
Even if there were more EV's to choose from, demand would likely be minimal due to the higher cost of these vehicles as compared to petrol based alternatives.
All these barriers can be solved by government foresight and vision.
The Central Government, through the Ministry of New and Renewable Energy, earlier provided a subsidy of 20% on the ex-factory price or ₹100,000, whichever is less, typically amounting to ₹75,000 – ₹93,000 for people buying an electric car. This subsidy ended on 31 March 2012.
And since then the EV industry is handicapped, due to falling sales and less customer demand.
With an aim to have seven million electric vehicles on the road by 2020, the National Electric Mobility Mission Plan 2020, if successfully implemented can truly transform the Indian auto scene by the end of the decade.
Here are some of the government polices that are driving the EV industry forward in many countries
- The Federal government of America uses an incentive program. If you live in the USA and buy a battery electric vehicle, you qualify for an income tax credit of $2500 to $7500 knocked right off your liability.
- California state has some of the most aggressive legislation. California Air Resources Board are already requiring a certain number of ZERO Emission vehicles to be sold in California. This law ensures that major auto manufacturers will comply by selling EVs and offer more choices to consumers.
- In many countries, you can use a Car Pool lane if u drive an EV
- You dont have to pay congestion Tax in cities like London.
- The UK government launched the Plug-in Car Grant, which was started on 1 January 2011 and is available across the UK. The programme reduces the up-front cost of eligible cars by providing a 25% grant towards the cost of new plug-in cars capped at GB£5,000 (US$7,800). Both private and business fleet buyers are eligible for this grant which is received at the point of purchase.
- The Chinese government has introduced, an exemption from annual taxes for pure electric, fuel-cell, and plug-in hybrid vehicles. There is also a cash subsidy. The subsidies are part of the government's efforts to address China's problematic air pollution.
- Norway, where the top selling car is an electric car, promote something known as negative incentives. Taxes on petrol, diesel or natural gas powered vehicles are pretty significant in Norway, more so than perhaps any other country. These negative incentives push people away from dirty vehicle options and push them towards electric vehicles much faster.
Also Norway actually doesn't have rebates or tax credits for EVs. However, EVs are exempt from Norway’s rather hefty VAT and sales taxes. Apart from that EV drivers in Norway enjoy - free access to toll roads, access to bus lanes, free parking, free charging, free ferry incentives and low annual road fee.
The EV industry in India is at a critical juncture. The current situation is not looking good, although the future has lots of promise. We need leaders with vision, governments that act swiftly and decisively on policies for the EV industry.
If subsidies materialize from April 2014, it would make a huge difference to the industry. We would see more number of innovative start-ups and established companies enter the EV market. Global players like Nissan, Mitsubishi, BMW and other auto companies could flood the Indian market with EV's. Big Indian companies like Tata, Maruti, Hero, Bajaj, TVS could also jump into the EV bandwagon.
This will lead to more choices to the consumer, more work on DC quick charging and gradual reduction in prices due to economies of scale.
YEAR 2014 is an important and crucial year for the EV industry. Lets hope that someday in the future when all of us breathe clean air in our cities, we will remember this year.