Does draft battery-swapping policy address all concerns of the industry?

Just as public trust in electric vehicles was taking a hit amid a spate of fire incidents involving e-scooters, government think-tank NITI Aayog came out with the much-awaited draft policy on battery swapping last week.

Targeted at electric two and three-wheelers, the policy aims to drive large-scale adoption of EVs by promoting the use of the nascent but rapidly growing battery swapping technology and encouraging collaboration among the stakeholders.

Battery swapping falls under the broader umbrella of Battery-as-a-Service (BaaS) business model where users purchase an EV without the battery, which significantly lowers upfront costs. They pay a regular subscription fee to service providers for battery services throughout the vehicle's lifetime.

To bring battery swapping into the mainstream, the draft policy promotes open architecture and aims to create a framework for greater interoperability between EVs and batteries. The batteries will have to be compatible with different EV models and with different battery-charging stations. 

NITI Aayog also said the policy will not mandate a rigid set of technical and operational requirements to foster interoperability, leaving room for innovation.

When it comes to safety, a rigorous testing protocol has been proposed to avoid any unwanted temperature rise at the electrical interface. 

Batteries are required to be enabled with Battery Management System or BMS, for efficient battery monitoring, data analysis, and safety.

The BMS must be self-certified and open for testing to check its compatibility with various systems, and capability to meet safety requirements. 
 

Swappable batteries will have to be equipped with advanced features like IoT-based battery monitoring systems, remote monitoring and immobilisation capabilities.

Apart from asking the GST Council to consider reducing the tax on lithium-ion batteries to 5%, NITI Aayog suggested that incentives for vehicles with fixed batteries be extended to swappable-battery vehicles.

Pulkit Khurana, the Co-founder of Battery Smart, which operates a network of over 200 swap stations in 10 cities, says that NITI Aayog has incorporated most of the feedback raised by his startup as well as other companies during stakeholder discussions with the government last month. 

The draft policy goes above and beyond industry demands and encourages multiple interoperable ecosystems to come up, says Khurana. Specifications for batteries and chargers will help in safety, he says. 

The policy provides clarity for EV buyers on who to approach for grievance redressal. The Battery Providers are designated as the Point of Contact and will be responsible, in coordination with other ecosystem players, for handling any type of complaint.

Draft says that they will also be responsible for channelling monetary compensation to the EV owners, if necessary.

Depending on the particulars of the case, a battery provider may recover these costs from other ecosystem players too, for instance, the vehicle manufacturer.

Arun Sreyas, co-founder of RACEnergy which manufactures swap stations and swappable batteries, questioned the policy push towards interoperability. He said there could be practical challenges in implementing that and could pose a safety risk.

While the industry seems split on the issue of interoperability, the draft policy by and large promises leeway for innovation. By touching upon the aspects of incentives, GST, safety, interoperability and accountability, the comprehensive set of policy recommendations can establish the battery-as-a-service model as an alternative to the fixed battery and traditional internal combustion engine vehicles.