India to Sell Only Electric Cars by 2030: Ambitious or Achievable?
Let’s just take a moment to reflect on that statement by Piyush Goyal. Not one petrol or diesel car to be sold in India by 2030. Really? That’s just 13 years away. Can India switch to all-electric transport by then? Or at least, can all passenger vehicles become electric?
Goyal’s statement seems to be inspired by countries such as Norway, The Netherlands and Germany. Norway and The Netherlands plan to phase out all petrol and diesel cars by 2025. Germany, where currently electric cars are a fraction of total car sales, wants to end sales of petrol and diesel cars by 2030. The Germans plan to put 1 million electric cars on the roads by 2020.
Can India do it? The passenger car market in India is more than 14 times the size of Norway’s passenger car market. Norway sold 200,317 cars in the 12 months till March 2017. India sold 3,046,727 passenger vehicles in 2016-2017. Imagine, if every one of those was electric.
Electric vehicle sales in India were not even 1% of the total sales. The previous year, only 22,000 electric vehicles were sold in India, of which four-wheeler sales was just 2,000.
Naysayers say that India does not have enough electricity for its towns and villages, and it’s planning to electrify all its cars. To the government’s credit, electrification of villages has been picking up pace. Finance Minister Arun Jaitley says that all villages in India would receive electricity by 2018. At present, only 4,141 villages remain which don’t have electricity, of the 640,867 villages in India.
However, an “electrified village” is defined as one where 10% of the village has electricity. And surveyors have shown that even villages where only electricity posts have been set up are counted as electrified.
Hurdles for Electric Cars in India
While the plan to have only electric cars by 2030 is all very well to reduce India’s dependence on fossil fuels, there are some key issues that must first be sorted out.
What happens to the 59,595 petrol pumps that currently exist? Will petrol stations become electric-vehicle charging points? There are hardly any charging stations for electric cars available in India right now. With only a handful of pure electric vehicles available in India, primarily two-wheelers, most charging is done from household outlets.
How will power be generated? If it’s not by clean power sources such as hydro or solar, India will still need to depend on non-renewable fossil fuels. Instead of it being burnt in internal combustion engines, the source of the pollution will now be concentrated only at the power-generating stations.
Charging times will have to reduce drastically. At present, even a Tesla Model S with a supercharger takes an hour for an 80% charge. It can go about 300 km on a full charge. Compare that with the five minutes needed to fill a petrol or diesel vehicle with enough fuel for the same range or even more.
Electric vehicles are seen as too expensive. Pricing of electric vehicles depends largely on the cost of the batteries driving them. At present, batteries are expensive. Lithium-ion batteries cost $600 per KWH to produce in 2011, but the cost has been dropping since. Battery prices currently hover at about $200 per KWH, with Tesla claiming it is producing batteries at $190 per KWH.
More incentives to buy electric cars needed. The government has said it is planning to hand-hold the electric vehicle industry for a few years till it stabilises. That means reintroducing the FAME (Faster Adoption and Manufacturing of hybrid and Electric vehicles) scheme, where a subsidy of Rs 1,800 to Rs 22,000 is offered on electric two-wheelers, Rs 11,000 to Rs 1.38 lakh for cars, and Rs 13,000 for hybrid cars. The government had set aside Rs 795 crore for these subsidies, but according to reports, only Rs 190 crore was used in 2016.
More manufacturers need to start looking at electric cars to have a portfolio ready by 2030. Now, only Mahindra makes two pure electric passenger cars in India – the E20 Plus and the E-Verito. Other manufacturers such as Tata have electric commercial vehicles that are niche products. Even electric two-wheelers from Hero, Lohia and Yo haven’t seen much sales volume.
What happens to regular petrol and diesel vehicles that are sold in 2028 or 2029? Will they be forced to be phased out by 2044, if the current 15-year rule on vehicle registrations are still in force? The government and the automotive industry need to sit down and come up with some solutions.