Government to come up with ‘Incentives’ for Battery Swap in Two Months

The run for renewables and decrease the carbon footprint looks quite robust as too much is happening this week. Just as Finance Minister had declared a battery swapping scheme in the Union Budget to promote faster adoption of electric vehicles (EV), government sources are saying that the concerned department is about to finalise the incentives under the said scheme.

It has been learnt that in about two months the incentive policy will be ready. The scheme and the incentives are necessary for a broader clean mobility push to meet India’s decarbonisation goals.

The policy is evolutionary in nature. The government sources say that the policy will initially focus on battery swap services for electric scooters, motorcycles and three-wheeled auto rickshaws. This is expected to provide a boost for sectors like last-mile delivery and ride-sharing.

It has been learnt from the source that the government is likely to offer electric vehicles owners an incentive of up to 20% of the total ‘subscription or lease cost’ of the battery. It is also being said that this will be in addition to what consumers already get for buying electric vehicles.

Under the newly declared battery swapping scheme, electric vehicle drivers will be able to replace depleted battery blocks for freshly charged ones at swap stations. This system will be way faster than charging the vehicle and reduces range anxiety for drivers. This will not let have any negative impact on their livelihood.

A battery is the most expensive part in an electric vehicle and swapping allows companies to offer it as a service through lease or subscription models, bringing down the cost of owning and operating the vehicle.

India’s drive towards EV began in 2019 when the government had set aside 100 billion rupees ($1.3 billion) to promote electric vehicles by giving incentives directly to buyers. But the travesty is that only 10% of this allocation has been used. Now the sources say that incentives for battery swapping is likely to be given from the same fund. It is also said that the government will also define battery design and charging standards for companies that want to set up swap stations.

This is necessary as this will ensure that the batteries can be used across electric vehicle models of different automakers.

The Reliance Industries has recently formed a joint venture with Britain’s BP Plc to offer battery swapping in India. Similarly, motorbike maker Hero MotoCorp and Taiwan’s Gogoro have also partnered to set up swap stations.