Battery Swapping Policy
Context: Government think-tank Niti Aayog has prepared a draft battery swapping policy and has put up for public consultation.
What is battery swapping?
- Battery swapping is a mechanism that involves exchanging discharged batteries for charged ones.
- This provides the flexibility to charge these batteries separately by de-linking charging and battery usage, and keeps the vehicle in operational mode with negligible downtime.
- Battery swapping is generally used for smaller vehicles such as two-wheelers and three-wheelers with smaller batteries that are easier to swap, compared to four-wheelers and e-buses, although solutions are emerging for these larger segments as well.
What are some of the key proposals?
- Tax Cuts: The draft policy has suggested that the GST Council consider reducing the differential across the tax rates on Lithium-ion batteries (18%) and electric vehicle supply equipment (5%).
- Equal Treatment: The policy also proposes to offer the same incentives available to electric vehicles with a fixed battery to electric vehicles with swappable batteries.
- Subsidy: An appropriate subsidy can be allocated to battery providers operating in battery swapping ecosystems.
- Ease of registration: Transport Departments and State Transport Authorities will be responsible for easing registration processes for vehicles sold without batteries or for vehicles with battery swapping functionality.
- Unique Identification: The policy also proposes to assign a unique identification number (UIN) to swappable batteries at the manufacturing stage to help track and monitor them. Similarly, a UIN number will be assigned to each battery swapping station.
- Charging Infrastructure: The policy also requires state governments to ensure public battery charging stations are eligible for EV power connections with concessional tariffs especially during off-peak periods. Municipal corporations will be responsible for planning, zoning permissions and land allocation for battery swapping stations. It also proposes to install battery swapping stations at several locations like retail fuel outlets, public parking areas, malls, kirana shops and general stores etc
- Battery-as-a-service (BaaS) Model for Interoperability: Battery swapping will fall under BaaS business model, and such models would have to ensure interoperability between EVs and batteries for a successful mainstreaming of battery swapping as an alternative.
- Data Sharing to enable peer-to-peer networks: Major battery providers will be encouraged to sign data-sharing agreements to provide information on battery health and performance, and to enable more flexibility to consumers through peer-to-peer roaming networks.
- Battery Safety: To ensure a high level of protection at the electrical interface, a rigorous testing protocol will be adopted to avoid any unwanted temperature rise at the electrical interface.
- Advanced Technologies: Additionally, for better protection of assets, swappable batteries will have to be equipped with advanced features like IoT-based battery monitoring systems, remote monitoring and immobilisation capabilities.
- Phased Implementation: All metropolitan cities with a population of more than 40 lakh will be prioritised for the development of battery swapping networks under the first phase, which is within 1-2 years of the draft policy getting finalised.
What are the advantages of having such a policy?
- It reduces upfront costs of purchasing EVs.
- The policy is targeted at supporting the adoption of battery-swapping, primarily for battery swapping systems used in electric scooters and three-wheeler electric rickshaws.
- It drives adoption of EV among buyers.
- It was also required amid several instances of EVs erupting into flames, raising concerns about their safety.