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Context: Battery electric vehicles (BEVs) are seen as a key solution to reduce greenhouse gas emissions and achieve net zero targets. Many countries, such as Norway and China, have adopted policies and incentives to promote the adoption of BEVs. However, India faces unique challenges that may limit the feasibility and effectiveness of BEVs in its context.

Details

• Mr Bean (real name Rowan Atkinson) is a famous comedian and a car enthusiast. He has written an article in “The Guardian”, where he criticises the electric vehicle (EV) industry and its environmental claims.
• He argues that EVs are not as green as they seem, because they have a high carbon footprint from their production and battery materials. He also accuses the European governments, car makers, and mining companies of colluding to promote EVs as a profitable business, rather than a sustainable solution.
• The article has sparked a heated debate between supporters and opponents of EVs. Some people agree with him that EVs are overhyped and have hidden costs and risks. Others disagree and say that EVs are still better than fossil fuel cars and that their technology and efficiency will improve over time.
• The debate is also relevant for India, which is planning to increase its EV adoption as part of its climate goals. However, India's EV policy is mainly focused on battery electric vehicles (BEVs), which use lithium-ion batteries. These are the same type of EVs that the article criticises.

Electric Vehicles

• Electric vehicles are vehicles that use one or more electric motors for propulsion.
• Electric vehicles have several advantages over gasoline-powered vehicles, such as lower emissions, lower maintenance costs, and higher energy efficiency. However, electric vehicles also face some challenges, such as limited range, long charging times, and high battery costs.
  • To overcome these barriers, electric vehicle manufacturers and researchers are developing new technologies and solutions, such as fast-charging stations, battery swapping, and wireless charging.
• Electric vehicles have the potential to transform the transportation sector and reduce its environmental impact, but they also require more investment and innovation to achieve mass adoption.
• There are different types of electric vehicles, depending on how they get their electricity and how much they rely on it.

Hybrid Electric Vehicles (HEVs)

• Hybrid Electric Vehicles are vehicles that combine an internal combustion engine with an electric motor and a battery. They can switch between the two power sources or use both at the same time, depending on the driving conditions.
• HEVs have better fuel efficiency and lower emissions than conventional vehicles, but they still need gasoline and produce some tailpipe emissions.

Battery Electric Vehicles (BEVs)

• Battery Electric Vehicles are vehicles that run solely on electricity stored in a large battery pack. They have no internal combustion engine, no tailpipe emissions, and no need for gasoline. They can be charged from an external power source, such as a wall outlet or a charging station.
• BEVs have lower operating and maintenance costs than conventional vehicles, but they have a limited driving range and longer charging time.

Plug-in Hybrid Electric Vehicles (PHEVs)

• Plug-in Hybrid Electric Vehicles are vehicles that combine an internal combustion engine with an electric motor and a large battery pack. They can run on electricity alone for a short distance, and then switch to gasoline when the battery is depleted. They can also be charged from an external power source, like BEVs.
• PHEVs have lower emissions and higher fuel efficiency than HEVs, but they still need gasoline and produce some tailpipe emissions. 

Fuel Cell Electric Vehicles (FCVs)

• Fuel Cell Electric Vehicles are vehicles that use a fuel cell to convert hydrogen gas into electricity, which then powers an electric motor. They have no internal combustion engine, no tailpipe emissions, and no need for gasoline. They only emit water vapour as a byproduct. They can be refuelled from a hydrogen station in a few minutes, like conventional vehicles.
• FCVs have a high driving range and low operating costs, but they face challenges such as high initial costs, limited hydrogen infrastructure, and safety concerns.

Battery Electric Vehicles (BEVs)

• Battery Electric Vehicles (BEVs) are a type of vehicle that uses electricity stored in batteries as their sole source of power. Unlike conventional vehicles that rely on internal combustion engines, BEVs do not produce any tailpipe emissions and have lower operating and maintenance costs.
• BEVs also have the potential to reduce greenhouse gas emissions and improve air quality, especially if they are charged with renewable energy sources. However, BEVs also face some challenges, such as limited driving range, high upfront costs, and a lack of charging infrastructure. Therefore, BEVs require further technological innovation and policy support to increase their market share and social acceptance.

Issues in Battery Electric Vehicles (BEVs) Push

High Tax Subsidy

• One of the key factors that drive the adoption of battery electric vehicles (BEVs) in different countries is the level of government support. For example, Norway has the highest penetration of BEVs in the world, due to a comprehensive package of incentives that includes tax exemptions, access to bus lanes, free toll roads, and free charging stations. These incentives make BEVs more attractive and affordable for consumers and also help to reduce greenhouse gas emissions and air pollution.
• However, such a generous subsidy scheme may not be feasible or desirable for developing countries like India, where most of the potential buyers of BEVs belong to the middle or upper middle classes. Offering tax breaks or other benefits to these segments of society may not be equitable or efficient, as it may divert public resources from other pressing needs.
  • It may not have a significant impact on the overall environmental performance of the transport sector, as BEVs still depend on electricity generated from fossil fuels in many regions.

Charging Network

• A World Bank analysis found that investing in charging infrastructure is 4-7 times more effective in EV adoption than providing upfront purchase subsidies. Norway and China have seen faster EV adoption through sustained efforts at expanding the public charging infrastructure, while also offering purchase subsidies. China, the leader in the number of publicly available chargers, accounts for 85% of global fast chargers and 55% of slow chargers.
• In India, the number of EVs had crossed 1 million by mid-2022, and will likely grow to 45-50 million by 2030. But only about 2,000 public charging stations are currently operational across the country.
• India’s charging infrastructure demands are unique because the vehicle mix is dominated by two- and three-wheelers. The charging network strategy has to be tweaked, given that the power requirement varies — 2Ws and 3Ws have small, low-voltage batteries for which normal AC power charging is adequate, while 4Ws have varied battery sizes and use different charging standards.
• Most e-2W and 3W models in India are suited to slow charging, and battery swapping is emerging as an alternative for cases where fast charging is required.

Electricity Sources

• One of the challenges of adopting electric vehicles (EVs) is the source of electricity that powers them. In some countries, such as Norway, EVs can run on clean energy from hydropower plants, which account for 99% of the electricity generation.
• In India, most of the electricity comes from coal-fired thermal plants, which are a major source of air pollution and greenhouse gas emissions. Therefore, switching to EVs in India would not necessarily reduce the environmental impact of transportation, unless the electricity generation mixes changes significantly. It would only shift the emissions from the tailpipe to the power plant.
• Thus, the adoption of EVs in India depends on several factors, such as the availability and cost of renewable energy sources, the infrastructure and policies for charging stations, and consumer preferences and behaviour.

Value Chain

• India faces a challenge in securing its lithium supply for the growing demand for electric vehicles (EVs) that rely on lithium-ion (Li-ion) batteries. According to projections, India will need more than 50,000 tonnes of lithium by 2030 to manufacture EV batteries, which will grow at a compound annual growth rate (CAGR) of over 30% by volume.
• India has limited domestic sources of lithium and will have to depend on imports from a few countries that dominate global lithium production. These include Chile, Argentina, and Bolivia in South America, as well as Australia and China in Asia-Pacific. Moreover, other critical materials for Li-ion batteries, such as cobalt and nickel, are also concentrated in a few regions, such as Congo and Indonesia.
  • This poses a risk to India's energy security and its ambitions to become a leader in the EV market. Therefore, India needs to diversify its battery portfolio and explore alternative technologies to Li-ion that is more viable and sustainable.
• China, on the other hand, has established a strong foothold in the entire lithium value chain, from mining to manufacturing. China's advantage in the lithium industry gives it a competitive edge over other countries in the global EV race.

Government Favour

• The government should not favour a specific technology over others when it comes to promoting electric vehicles (EVs). While lithium-ion (Li-ion) batteries have been successful for two-wheelers (2Ws) and three-wheelers (3Ws) in India, they are not the only option for four-wheelers (4Ws), which have more potential.
  • EVs include not only battery electric vehicles (BEVs), but also hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), and fuel cell vehicles (FCVs).
• Electrification is the future of mobility, but the best way to achieve it is still uncertain. Different countries have adopted different strategies to encourage EV adoption, such as regulations, tax incentives, and infrastructure development. According to McKinsey & Co, monetary incentives alone are not enough to drive EV penetration; other factors such as parking benefits and workplace charging facilities are also important.
• In India, the main goals are to reduce emissions and fuel imports. The government claims that it offers incentives for all types of EVs under the various schemes, but the vehicle manufacturers argue that a technology-neutral approach that sets clear emissions targets for them would be more beneficial.

Emerging Technologies

• New technologies in EVs are constantly emerging and evolving, offering a range of benefits and challenges for consumers and manufacturers alike. Indeed, there are a lot of technologies to choose from, such as battery types, charging systems, powertrain configurations, vehicle-to-grid integration, and autonomous driving features.

Hybrids Vehicles

• Hybrid vehicles are often considered a transitional solution to achieve the ultimate goal of full electrification. By combining an electric motor and a conventional engine, hybrids can reduce fuel consumption and emissions, while avoiding the need for charging stations that are essential for battery electric vehicles (BEVs).
  • Some manufacturers argue that producing hybrid vehicles can help develop the battery industry, which can then facilitate the transition to BEVs.
• However, hybrid vehicles are not without drawbacks. They still rely on lithium-ion batteries, which have environmental and social impacts. They also may not deliver the expected fuel efficiency benefits when the air conditioning system is frequently used, as is common in many regions of India throughout the year.

Ethanol & Flex Fuel

• A flex fuel, or flexible fuel, vehicle has an internal combustion engine, but unlike a regular petrol or diesel vehicle, it can run on more than one type of fuel or even a mixture of fuels such as petrol and ethanol. A nationwide pilot that is currently underway aims to replicate the commercial deployment of this technology in other markets such as Brazil, Canada, and the US.
• Ethanol is a renewable fuel that can be produced from various sources of biomass, such as corn, sugarcane, or switchgrass. It has lower carbon intensity than petrol, meaning it emits less greenhouse gases per unit of energy.
• Ethanol can also improve engine performance and reduce air pollution. Flex fuel vehicles can use ethanol blends ranging from E10 (10% ethanol and 90% petrol) to E85 (85% ethanol and 15% petrol), depending on the availability and price of the fuels.

Hydrogen fuel cell electric vehicles (FCEVs) & Hydrogen ICE

• Hydrogen is a promising alternative fuel for vehicles, as it can reduce greenhouse gas emissions and improve air quality. However, there are two different ways to use hydrogen in vehicles: fuel cell electric vehicles (FCEVs) and hydrogen internal combustion engine (ICE) vehicles.
• FCEVs use hydrogen to produce electricity in a fuel cell, which powers an electric motor. FCEVs have no tailpipe emissions, except for water vapour. They can also refuel quickly and have a long driving range.
  • However, FCEVs face challenges such as high costs, low durability, and limited availability of hydrogen fuelling stations. Moreover, hydrogen is highly flammable and must be stored in pressurised and cooled tanks, which poses safety risks.
• Hydrogen ICE vehicles are similar to conventional ICE vehicles, but they run on hydrogen instead of gasoline or diesel. Hydrogen ICE vehicles have lower emissions than conventional ICE vehicles, but they are not zero-emission like FCEVs. They also have lower efficiency and performance than FCEVs, as they lose energy in the combustion process.
• Both FCEVs and hydrogen ICE vehicles have advantages and disadvantages, and they are still under development and testing. The choice between them depends on various factors, such as the availability of hydrogen, the cost of the vehicles, the environmental impact, and consumer preference.

Indian government has taken several steps to promote the adoption of electric vehicles (EVs) 

• The National Mission on Transformative Mobility and Battery Storage focuses on creating a conducive ecosystem for EVs, including setting up battery manufacturing plants, charging infrastructure, and policy framework.
• The Green Highways Policy mandates that at least 1% of the total project cost of highway construction should be earmarked for developing green corridors with EV charging stations.
• The Income Tax deduction, which allows individuals to claim a deduction of up to Rs. 1.5 lakh on the interest paid on loans taken to purchase EVs.
• Reducing the Goods and Services Tax (GST) on EVs from 12% to 5% and on chargers or charging stations from 18% to 5%, making EVs more affordable compared to conventional vehicles.
• Exempting EVs from registration fees and road tax, and issuing green license plates for easy identification.
• Allowing the sale of electricity as a service for EV charging, and amending the building bylaws to facilitate the installation of charging stations in private and commercial premises.
• Transferring the indigenously developed lithium-ion battery technology by the Indian Space Research Organisation (ISRO) to companies, to boost local manufacturing and reduce ownership costs.
• Implementing the Faster Adoption and Manufacturing of Electric and hybrid vehicles (FAME) scheme to provide subsidies and incentives for EV buyers and manufacturers, as well as support for creating charging infrastructure.
• Introducing electric buses in various cities under the public-private partnership (PPP) mode, to promote eco-friendly public transportation.
• Launching the Production Linked Incentive (PLI) scheme offers incentives for the domestic production of advanced chemistry cell (ACC) batteries, a key component of EVs.

These steps are expected to boost the demand and supply of EVs in India and reduce the dependence on fossil fuels, thereby contributing to environmental sustainability and economic growth.

Must-Read Articles:

Electric Vehicles: https://www.iasgyan.in/blogs/electric-vehicles-22

ELECTRIC VEHICLES: https://www.iasgyan.in/daily-current-affairs/electric-vehicles-28

PRACTICE QUESTION Q. Electric vehicles (EVs) are becoming more popular and affordable, but they also pose some challenges and questions for consumers and policymakers. How can we ensure that EVs are accessible and convenient for everyone? What are the benefits of switching to EVs for the environment and the economy? What are the main barriers and risks that prevent or discourage people from adopting EVs?

https://indianexpress.com/article/explained/explained-economics/the-problem-with-battery-electric-vehicles-8822335/