Inoperational, vandalised & broken--India's raging EV charging infra crisis

Noida-based Rohit Sethi is an ardent electric vehicle user. The 33-year-old chartered accountant prefers his Tata Nexon EV over his ICE four-wheeler to travel across local routes. However, he is wary of taking the electric four-wheeler on routes that demand lengthy travel. Sethi had the bitter experience of being stranded across the Gurugram-Manesar highway in May last year as he couldn't find any operational electric charging station. With an emergency looming in, Sethi started from Noida at 8:00 pm with 8% charging that could cover at least 36 kilometres, assuming that the country's flamboyant public electric charging infrastructure would come to his rescue.

"Since it's a national highway, I assumed I would be able to locate the electric charging station on the app. But the two to three electric charging stations pointed out by the app on the entire stretch till Gurugram were inoperative," Sethi tells Fortune India.

Sethi, not only grappled with the double whammy of not finding an operational charging station but also suffered with 'range anxiety,' which is extremely common amongst electric vehicle users. He was later able to charge his electric four-wheeler in the parking lot of a Gurugram mall. The power outage, however, again stifled the complete charging of his electric vehicle. "I could only charge up to 40%. Had I not charged at the mall, I would not have been able to get home," says Sethi.

That overwhelming experience has made Sethi cautious about the dependency on public electric charging infrastructure. Just like Sethi, several other electric vehicle users that Fortune India spoke with face a similar dilemma. While the users enthusiastically want to drive electric vehicles, they are trapped with the dismal public electric charging infrastructure.

In order to gauge the present state of public electric charging infrastructure, Fortune India visited 10 charging stations across South Delhi. Of this only four charging stations near Safdarjung Enclave and Delhi Haat were operational. Electric charging stations located near Green Park, Lodhi Garden, IIT Delhi and Bhikaji Cama Palace was inoperable.

The government guidelines mandate the setting up of AC chargers (slow chargers) and DC chargers (fast chargers or public chargers) across residential complexes and public locations. AC chargers or slow chargers are usually installed at residential buildings and individual houses, whereas DC chargers are designed for installation across commercial and industrial places such as national highways, expressways and public places.

The installation of charging points depends upon the battery capacity of electric vehicles coupled with the accessibility of power supply and availability of land. The battery capacity of electric two-wheelers ranges from 2 kWh to 4.5 kWh, and electric passenger vehicles from 17 kWh to 120 kWh. Heavy-duty vehicles such as electric buses and trucks are above 150 kWh.

Low charging infrastructure

Abhay Chaurasia (name changed), another electric vehicle enthusiast faced a similar predicament as Sethi's while travelling from Gurgaon to Kanpur in the Mercedes EQS 580. He could only locate one charging station on Yamuna Expressway, near the Jewar Toll Plaza. "Even on the Lucknow-Agra Expressway, the only charger which was identified on apps was beyond our exit, and taking an exit further to our usual exit seemed too big a risk. So, we weren't able to charge at all," says Chaurasia, adding that since EQS 580 has a range of 600+ kilometres, he was able to travel the near-500 km journey.

India witnessed a shift in perception towards electric vehicles over the past few years. Earlier this year, EV sales across the country crossed the crucial one million mark. In CY23, a total of 10,00,243 electric vehicles have been sold, according to data on the VAHAAN portal of Ministry of Highways.

Government think tank NITI Aayog expects 30% of passenger vehicle EV penetration by 2030 with annual sales touching approximately one crore units. The Economic Survey 2022-23 states that the domestic EV market is expected to grow at a compound annual growth rate (CAGR) of 49% between 2022 and 2030.

However, with the consistent increase in EV sales in the past few quarters, the public charging infrastructure continues to remain dismal.

"Globally our observation is that for every four electric vehicles, one charger is being deployed. Now from that perspective, India is still quite way off," says Hemal Thakkar, Senior Practice Leader -Consulting, CRISIL Market Intelligence & Analytics.

According to the Bureau of Energy Efficiency under the Ministry of Power, as many as 10,183 operable public charging stations have been installed in India across 77 charge point operators at present. Of this, the highest number of public electric charging stations has been installed in Maharashtra (2716), Delhi (1815), Karnataka (813), Uttar Pradesh (486), Tamil Nadu (465) and Rajasthan (400). In comparison to this, more than 2.8 million electric charging connectors have been installed globally.

"In developed markets, the penetration of EVs and charging infrastructure are directly co-related. Charging infrastructure in India is at a nascent stage. Lack of adequate charging infrastructure is a key deterrent for EV penetration in India, although it has gradually been improving," says Vinutaa S, Vice President and Sector Head, ICRA

The Confederation of Indian Industry estimates a requirement of 13 lakh charging stations by 2030 to support aggressive EV uptake. "By the year 2030, even in a business-as-usual (BAU) scenario of 40% year-on-year growth, we will see about 1.6 crore EVs being sold every year. To achieve a 1:40 ratio of charging infrastructure to EVs, a ratio that would be imperative to support the increased fleet of EVs, we would need to install more than 4 lakh chargers annually with a total of 13.20 lakh chargers till 2030 across the country," says CII.

According to CII estimates, with 22 lakh EVs, the ratio of public chargers to EVs in India is very low (around 1:223). India will need 13 lakh public chargers by 2030, it says. "By 2030, even in a business-as-usual scenario of 40% YoY growth, we would need to install more than four lakh chargers annually till 2030," it says.

Vandalised, broken, and beyond

Electric charging infrastructure, which requires collaboration between charge point operators, land owners, and central and state government agencies,  is plagued with lack of coordination, thus stifling the faster proliferation of the ecosystem.

While inoperable electric charging stations often torment consumers, it is a double-edged sword for the industry as well. Industry leaders attribute the lack of safety protocols in public charging stations to be the primary reason behind this burgeoning crisis.

Technical glitches such as lack of synchronisation between the software, lack of compatibility between the connector and the gun and central management connectivity issues are among the secondary reasons constraining the inoperability of electric charging stations.

"It is estimated that between 10-40% of chargers deployed in India are not in working conditions. Either they have been vandalised or the IT system which they are hooked on is inoperational, or customers are not able to authenticate or pay/charge. And that's a cause for worry because OEMs (original equipment manufacturers) or CPOs (charge point operators) have invested multiple lakhs for the installation of chargers, and that's why the industry needs to make sure that it works seamlessly all the time," says Anant Nahata, Managing Director, Exicom Telesystems. The Gurugram-based company has so far deployed more than 5,000 EV charging stations—3,600 AC chargers and 1,400 DC chargers-- across 200 cities in India. The company uses CCS2, Chademo and GB/T as the charging standards for installation of AC and DC chargers. 

Queries sent to the Ministry of Heavy Industries regarding the number of vandalised or inoperative electric charging stations across India remained unanswered at the time of publishing.

As a consumer, Sethi says that there is an urgent need for a solution through which customers can locate operable electric charging stations. As per industry estimates, there are 15-20 apps at present that help to locate public electric charging stations.

Nahata, however, attributes multiple apps to be the reason behind the hindrance in locating functional electric charging stations. With a single app for locating electric chargers under work by the government, industry leaders say the entire ecosystem will have to align with that.

"This issue can be resolved by what we call 'roaming' where customers can see multiple charging stations using one app. Roaming is a big industry. It is present in the US. I believe 'roaming' has to be present even in India, for effective utilisation of all chargers," Nahata says.

Rectifying Power Outages

While inoperability is just one aspect of the adversity faced by the EV charging ecosystem, power downtimes or ineffective power supply adds to the many woes faced by the industry. EV charging stations are interlinked with the availability of power. An effective power supply would mean efficient electric charging stations. However, power downtimes and low quality of power grids impede the performance of electric charging stations.

As per the guidelines by the Ministry of Power, public charging stations can only be operational after inspection and clearance by DISCOMs. However, this is far from reality as India continues to face telecom challenges such as lower grid quality despite government efforts.

Industry leaders point to frequent breakage in the telecom connection as well as the installation of electric chargers without consideration of the effective electricity supply in residential complexes and public location becomes a woe for customers.

"Most residential buildings don't have the load capacity to support the charging requirements. In such cases, the customers have to go to the local municipal body in order to locate the required load capacity. So this becomes cost-intensive as well as a complex process," says Ravneet Pokhela, chief business officer, Ather Energy. Backed by Hero MotoCorp, the Bengaluru-based electric two-wheeler manufacturer has so far installed more than 1,000 chargers for electric two-wheelers with CCS-II standard across Ather Energy's Grid Charging Points in 80 cities.

The data by the Central Electricity Authority points out that in the April to June quarter in FY24, power consumption stood at 4,07,762 units, declining by 2% as against 4,00,448 units in the same period last financial year, mainly on account of unseasonal rainfall.

"Currently most states have LT connections. More HT lines are required for faster charging. Further, the duration for obtaining an electricity connection is relatively long. While many state electricity regulators have notified separate tariffs for EVs, the fixed demand chargers increase operating costs. This is a challenge for operators, given the low EV base currently," says ICRA's Vinutaa.

Rating agency ICRA expects the thermal PLF (plant load factor or capacity utilisation) level to improve from 58.9% in FY22 to 64% in FY23 and further to 65.5% in FY25 led by healthy demand growth and limited thermal capacity addition. The demand growth for FY23 is estimated to be at 9.5-10%, which is likely to moderate in FY24.

As a temporary solution to power outages, the industry is deploying solar modules as power backup. "Today the electricity consumed by electric vehicles could be coming from conventional sources like coal but if the EV charging stations are using solar-based electricity to charge the electric vehicles, then this will help in solving the issue of power cuts as well as support the green mission," says Niranjan Nayak, MD, Delta Electronics India. The Bengaluru-based company, which is a subsidiary of Taiwan-based Delta Electronics, has been one of the earliest entrants in the electric vehicle charging infrastructure space. With a market share of 20%, the company has so far deployed more than 8,000 AC (45%) and DC chargers (55%) of CCS-II standard across the country.

The shortage in power supply also indicates another mushrooming crisis of slow charging across public charging stations. "Several factors contribute to this issue. One of the key reasons is infrastructure limitations, where charging stations may not be optimised to handle high demand, resulting in slower charging speeds. Additionally, power grid constraints can influence charging rates, especially in areas with insufficient power supply," says Nayak.

Promised land

Non-availability of land is another ballooning concern raised by industry leaders hobbling the maturation of the electric charging ecosystem. Most EV charge point operators either rent the land or avail it in the revenue-sharing model. The location for the installation of a public electric charging station is a joint decision between the charging point operators and the land owing agency.

Industry leaders say that though this challenge is measurable, it continues to thwart the growth of the sector.

"One of the challenges that the industry is facing is to get a good location for setting up charge points as EV fast-charging requires 30 to 40 minutes. For the installation of EVs, the charge point operators need sufficient or basic amenities to begin with, since EV charging is a time-consuming process," says Kartikey Hariyani, founder and CEO, CHARGE+ZONE. The Ahmedabad-based energy-as-a-solution company has installed 1,600 charging stations across the network. Of this, 20% are CCS-II AC chargers, whereas 80% are DC chargers.

According to industry leaders, non-availability of land infrastructure also hinders effective last-mile electric connectivity. The Ministry of Power stipulates the land-owning agency to provide assistance to charge point operators in obtaining consent, clearance and permits for installation of EV charging stations as well as for obtaining separate power connections and enhancing the power supply at each location.

"Specific spaces should be earmarked for public charging stations, to ensure adequate density. Further, to manage costs, the land leases should be on a long-term basis," says Vinutaa of ICRA.

As per industry estimates, the installation of public DC charging points requires an investment of a whopping ₹30 lakh to ₹40 lakh per charger. This is much more expensive than setting up AC electric charging points which require investments between ₹65,000 to ₹1.2 lakh. Any public and private player can install charging stations after mandatory approvals by the government. Analysts say that most charge point operators are startups that have limited capacity in terms of deployment of funds, and unlike legacy players, they are apprehensive about going aggressive in this space.

CRISIL's Thakkar believes the price for installation of DC chargers will get stabilised once the industry starts localisation and scales up. "But then also, the industry won't see a major rationalisation of prices. The industry will see the adoption of EV charging infrastructure, but from that perspective, slow chargers or AC chargers will always be available at more affordable prices with respect to fast chargers," says Thakkar.

Asset Utilization

Despite the government's push towards electric vehicle adoption, asset utilisation continues to distress the electric charging ecosystem.

"Given the relatively high capital and operating costs, asset utilisation becomes critical. ICRA estimates that it would take at least five years for an EV charging station to break even based on current expectations of EV penetration and commensurate asset utilisation, not accounting for any subsidy," says Vinutaa.

As per ICRA's estimates, installation of 45,000-50,000 electric chargers by CY2025 would require an investment of over ₹30 lakh per charging station with an incremental capex of ₹10-12,000 crore from CY23-CY25.

The Ministry Of Heavy Industries (MHI) has sanctioned ₹800 crore under the FAME-II (Faster Adoption and Manufacturing of Electric Vehicles) scheme to oil PSUs — Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum — for setting up 7,432 public fast charging stations across the country by March 2024. MHI has also approved financial assistance of up to 80% for setting up upstream infrastructure at charging stations to reduce upfront costs.

Pokhela of Ather Energy feels that the standardisation of norms regarding EV charging infrastructure would help ease the concerns regarding asset utilisation. "If every OEM has their own standards of charging then those, then the assets of charging infrastructure will not get utilised adequately. If every brand has the same connectors, then the utilisation of the charging infrastructure becomes a lot more," says Pokhela.

The Way Forward

Despite the burgeoning challenges in the electric charging infrastructure, industry leaders say that the ecosystem will consistently grow in the next three to four years.

"As an industry, we have reached a stage where we will see the take-off quite exponentially. Because there are enough vehicles on the road now to justify this as a standalone business. Given the increase in the number of electric two-wheelers, I think it is time that charge point operators at least have a line of sight to be profitable over the next few years. So, it is no longer a business that can pay off in 10 to 15 years, but it has become a business that will pay off in three years or four years. So there is a scope of growth for a lot of charge point operators, especially in the two-wheeler space," says Pokhela.

Maxson Lewis, Founder, Magenta Mobility feels that charging infrastructure will be amongst the biggest consumers of electricity and hence require the presence of green energy. The Bengaluru-based company deploys electric charging points for three-wheelers. The HPCL-backed company has so far deployed AC charging stations in more than 37 oil depots in Bengaluru, Mumbai, Hyderabad and Delhi-NCR. It claims to have deployed 1,000 stations in partnership with HPCL and Jio BP.

CRISIL Ratings estimates that in order to achieve the country's dream of electrification, India will require approximately a million charging stations. "If by 2030 passenger vehicle sales are going to be 6-6.5 million, 20% of those sales will be coming from electric vehicles. That'd be, as per estimates, close to 1.2 million electric vehicles. But the overall number of electric vehicles would be around 3 million. From this perspective, our estimation is India would require close to 6,00,000 chargers only for passenger vehicles," says Thakkar. 

That sure is an ambitious target. But whether India makes it in EVs or not will depend upon how it tackles its raging charging infrastructure problems.