Catalysing EV Adoption: Draft policy seeks to create a robust battery swapping ecosystem

Draft policy seeks to create a robust battery swapping ecosystem

Electric mobility is leading the decarbonisation of India’s transport sector. The country’s EV revolution is expec­ted to be driven by the two-wheeler and three-wheeler segments. Of all private vehicles, over 70-80 per cent are two-wh­ee­lers. Meanwhile, three-wheelers are crucial for public transport, last-mile connectivity and freight, and are witnessing a mass migration to electric. Till now, EV ad­option has met with certain challenges such as lack of charging infrastructure, high costs and long refuelling times. The­se challenges can be resolved to some ex­tent with battery sw­a­pping, which allows the de-linking of EV charging and batteries. Simply put, di­scharged batteries can be quickly ex­ch­an­ged at battery swapping facilities for charged batteries.

Innovative models such as battery-as-a-se­rvice (BaaS) allow consumers to purch­ase an EV with or without the battery, thus helping address some of the concerns associated with EV uptake. During the Union Bu­d­get 2022-23, the government annou­nced its intent to launch a ba­­ttery swa­pping policy. Subsequently, NITI Aa­yog drafted a battery swapping policy which is open for in­puts from until June 5, 2022.

Objectives, incentives and features

The draft policy aims to boost large-scale adoption of EVs by creating a battery sw­apping ecosystem that ensures minimal EV downtime while lowering costs and sp­a­ce requirements. As per the policy, ba­ttery swapping would fall under the BaaS mo­del, wherein customers can pay a regular subscription fee at fixed intervals to service providers for battery services th­roughout the vehicle lifetime. Only batteries using ad­­­vanced chemistry cells, with perform­a­nce that is equivalent or superior to EV ba­t­t­eries supported under the FAME-II sc­h­e­me, would be considered under the policy. The policy also seeks to provide incenti­ves for greater adoption of swappable batteries in EVs. It has recommended that the GST Co­uncil consider reducing the differential across the tax rates on lithium-ion batteries and EV supply equipment. At pr­e­sent, the tax rate is 18 per cent on the fo­r­mer, and 5 per cent on the latter. The sa­me incentives available to EVs that come pre-equipped with fixed batteries will also be available to EVs with swappable batteries. The state governments are also required to ensure that public battery charging stations are eligible for EV power connectio­ns with concessional tariffs. Such stations are propo­sed to be brought under existing or future time-of-day tariff regimes, to all­ow swappable batteries to be ch­arged during off-peak periods when electricity tariffs are low.

As data sharing will play a crucial role in ensuring interoperability, major battery providers will be encouraged to sign data-sharing agreements to provide informati­on on battery health and performance, and to enable more flexibility for consu­mers th­rough peer-to-peer roaming net­wor­ks. Fur­thermore, to ensure seamless and streamlined tracking and monitoring of swappable batteries throughout their lifecycles, the policy proposes to as­sign a unique identification number (UIN) to each battery at the manufacturing sta­ge. A UIN number will also be assigned to each battery swapping station. Battery sw­apping stations are proposed to be set up at multiple, diverse lo­ca­tions such as malls, retail fuel outlets, public parking ar­eas and local general st­ores. Moreover, to ensure battery safety, sw­app­able batteries will be equipped with ad­vanced features such as internet of thin­gs-based battery monitoring systems and re­­m­o­te monitoring and immobilisation ca­pabilities. A rigorous testing protocol will also be ad­opted to avoid any un­wanted te­mperature rise at the electrical interface. Further, the policy covers steps for recycling of batteries at the end of their life cycles. Once finalised, the policy will be impleme­nted for the development of battery sw­a­pping networks in all metropolitan cities with a population of more than 4 million un­der the first phase, and major cities, such as state capitals, with a of population more than 0.5 million under the second phase.


Promoting battery swapping for EVs is a welcome step in India’s journey to net zero emissions. Battery swapping offers key ad­vantages over traditional batteries: it is time efficient and costs less. Yet, as the industry is still at the nascent stage, several challenges lie ahead. As the demand for EVs is rising, different business models and battery designs are being explored. Therefore, achieving standardisation may be a time-consuming process and a “one size fits all” approach may not be fruitful. Also, as the demand for EVs is not yet fully established in the market, the initial cost of investment in battery swapping technology and stations may be very high. Without adequate and appropriate financial and regulatory incentives, private players may not be willing to take the initial risk involved.

Nevertheless, with the right implementation of the draft policy, there is immense po­te­n­tial for establishing a full-fledged ba­ttery swapping ecosystem in India, especially gi­ven the rising penetration of electric th­ree-wheelers across metropolitan cities.

By Kasvi Singh