EVs may hit the road but high costs, low use may slacken demand for public charging stations

The electric vehicle (EV) industry may fall well short of its target of setting up sufficient number of public charging stations in India this year, and thus dampen the excitement over EV adoption in the country.

India would need four lakh public charging stations to cater to an estimated total of two million EVs plying on the roads by 2026, according to a June 2021 report by Grant Thornton-Bharat and the Federation of Indian Chambers of Commerce and Industry (Ficci). 

However, on December 16, 2021, data disclosed in the Parliament by Raj Kumar Singh, union minister of power and new and renewable energy, reveals that India currently has only 1,028 public EV charging stations — almost 30 percent of which are in Delhi alone.

This implies that government bodies and private startups have their work cut out, say industry experts.

To be sure, Indian cab aggregator and mobility company Ola said last month it will be setting up a total of 4,000 public EV charging facilities by 2022 in a bid to market its new S1 electric scooter portfolio. Besides, as part of government mandates, oil sector companies have also vouched to set up EV charging facilities.

In November last year, Petroleum and Natural Gas Minister Hardeep Singh Puri said the Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum have set targets of 4,000 total EV charging stations by the end of 2022. Distribution companies such as Tata Power, too, have set estimates, targeting 2,000 EV charging stations in 2022, Praveer Sinha, chief executive office and MD of Tata Power said in October last year.

Moreover, in October 2021, the National Highways Authority of India (NHAI) announced plans to cover 40,000 kilometres of highways in the country with an EV charging facility spread every 40 to 60 kilometres apart. “We have bid out 100 wayside amenities and got a tremendous response. Each wayside amenity has received at least six-seven bids. Once the bids are awarded, it will take six months to complete,” said Giridhar Aramane, NHAI chairman in an interview with ThePrint at the time.

Industry experts, however, remain skeptical. Rajesh Singh, founder and chief executive of eChargeBays, a Delhi-based startup that offers setup and installation of private charging infrastructure, believes that many targets in the public charging infrastructure space could be inflated. “If you look at the past two years, less than 1,000 public chargers compatible with all EVs have been installed. If you look at high-voltage chargers of 50kW and above for passenger EVs in the public space, it wouldn't have crossed 200 in the past two years.”

“The key point about EV charging stations is that they don't make money. Setting up a charging facility for an apartment complex or a commercial centre does not make any business sense. As a result, while there is a need for charging station operators, it's hard to organically build that demand,” corroborated Arun Vinayak, co-founder of Exponent Energy.

There are other challenges too. Experts point out that instead of setting up public charging facility targets, the key could be to adopt facilities specific to the Indian market.

According to Vinayak, “94% of passenger vehicles are charged at home (in India), so they don't really need a public charging station right now.” He added that the lack of organised parking spaces in India is also a big hindrance to setting up public chargers. "This is a big difference between India and a market like the USA, where prices of cars are almost 4-5x as here. As a result, one thing that is required in order to boost public EV charging infrastructure in India, and help make it a viable business for the involved parties, is to come up with solutions custom to our market. Many users also do not have the facilities of charging at home, which is why we need public charging. But, for the latter, a person cannot take 2-3 hours to charge their car, so we need faster charging. To make public charging profitable would also be a task. India cannot simply adopt an international model — we will need our own set of regulations to suit the market,” Vinayak explained.

eChargeBays’ Singh agreed. “The biggest challenge of setting up public chargers is viability — the cost of setting up is very high, and use is very low. Companies in this sector either follow or are only slightly ahead of EV launches by automakers. For example, if Maruti Suzuki or Hyundai talk about launching their first EVs in India, charging infra companies will likely follow suit as the latter would have good potential in viability. But, if companies talk about launching cars in the later years, then despite the initial mission statements of public charging goals, the timelines will keep getting pushed back,” he explained.

It is this lack of viability that could be pegging back 2022’s initial estimates — despite tall projections from many. Vinayak concluded, “A lot of companies right now look at charging stations as a marketing initiative, which serves a branding cause. But, are companies right now lining up to become charging station operators yet? Not quite.”