India EV charging guidelines need closer collaboration among stakeholders • EVreporter

The Ministry of Power issued the latest guidelines for EV Charging Infrastructure on Sep 17, 2024. The new guidelines received a mixed reception from Charge Point Operators (CPOs). On the positive side, the government has acknowledged various challenges repeatedly raised by industry. However, despite these improvements, there are still gaps in the guidelines that must be addressed to create a fair and competitive environment for private CPOs and establish a thriving ecosystem.

The Indian Charge Point Operators Association — comprising seven members, Jio BP, ChargeZone, Zeon, EVRE, GLIDA, and two manufacturers, Ador and Mindra — has been sharing its recommendations with the Ministry of Power and the Bureau of Energy Efficiency to present the industry perspective while the guidelines were being prepared.

Mr Awadhesh Jha from GLIDA, who is also Chairman of the Indian Charge Point Operators Association (ICPOA), shares the association’s feedback on the published guidelines from the perspective of public charging infrastructure for electric cars.

The latest guidelines released by the Ministry of Power are a step in the right direction as they aim to establish the infrastructure necessary for widespread electric vehicle adoption. While these new guidelines have made some directional improvements, they also add significant implementation challenges on the ground.

LT Capacity

One positive aspect of the recent guidelines is the recommendation to increase the LT (Low Tension) threshold across the country to 150 kilowatts. It is a favourable move for developing public charging infrastructure; however, how this will be implemented remains uncertain, as this decision lies with individual regulators. The feasibility of changing the entire electrical infrastructure across the country to accommodate this increase would be challenging, but as CPOs, we view the 150-kilowatt recommendation positively, as it can support 2 to 3 fast chargers at one location, which would ease charging by end users.

Charging Locations

State PSUs, Central PSUs, or state agencies can acquire locations from municipal corporations or other landowning govt agencies at a flat ₹1 per kWh revenue share without going through a tender process. The guidelines for private operators mandate that such public locations can be made available to private CPOs through competitive bidding where ₹1 per kWh is a floor price for revenue share and the highest bidding CPO would get access to these locations. As an association, we are fine with these modalities, as we fully understand that government resources cannot be allocated to private entities without a fair and competitive bidding process.

However, why treat state agencies preferably for securing locations that are critical for developing widespread public charging? We observe that many of the agencies who get access to such public spaces on a preferential basis do not invest in developing the charging stations themselves; rather, they further tender out to “offer right to use” such locations by asking for additional revenue to be shared with them. This distorts the entire ecosystem without adding any value to end users.

We suggest bidding should be mandatory for all, including central government agencies, to create a level playing field.

Electricity Connections

The new guidelines specify timelines—3 days, 7 days, 15 days—for providing connections.

For effective implementation of these timelines, the Ministry of Power should facilitate discussions between CPOs and the Forum of Regulators. This forum includes all state regulators and the Central Electricity Regulatory Commission (CERC), and they collaborate to develop a common regulatory framework. Without such coordination, states may continue to have varying guidelines and policies, as electricity is a concurrent subject.

The Forum of Regulators should engage with CPOs directly. There should be an open and free-flowing discussion between CPOs and the Forum of Regulators because CPOs are the recipients of the services, while they are the custodians of offering these services through distribution companies. More engagement between the CPOs and the Forum of Regulators would bring in perspectives that regulators might be missing.

Charges and Service Fee Cap

We do not support regulating the service fee cap. It should be left to the market, which would take care of the price. The government’s involvement in capping service fees may not be necessary, as the market is already functioning with a reasonable range of prices, from ₹6 to ₹20 per kWh, based on location and service quality. There’s no need for regulatory interference, as customers naturally gravitate towards services that meet their needs.

Further, the new guidelines have three elements: a Service fee cap for recovering capital costs, Electricity as a pass-through, and land cost as a pass-through. Even though the intent is positive, this introduces unnecessary complications. The guidelines do not clarify how to standardise land costs across different locations with varying utilization rates, leading to a per-kWh rate that changes based on site-specific factors. Additionally, every state might interpret these guidelines differently, creating inconsistencies that charge point operators (CPOs) will have to navigate.

For example, how will the land cost be converted into a per-kWh charge and passed on to the customer? Different locations will have varying utilisation levels, which are known only after the designated period. Not only will the per-kWh rate differ based on how much a location is used, but it is difficult to recover from the end user as the market has moved to a pre-paid model.

Another challenge arises in administering the fixed demand charges of electricity. For instance, if a CPO in Bangalore has a 100-kilowatt connection and pays a monthly fixed fee, how will this cost be passed to customers when usage fluctuates monthly? Unlike variable energy costs, fixed costs are harder to recover. A reconciliation at the end of the year isn’t practical, as customers charge and leave, making it difficult to recoup these expenses. This needs deeper engagement among Discom, CPOs, and regulators to arrive at the right modalities.

Furthermore, the service fee cap, set at ₹11 and ₹13 for solar and non-solar setups, lacks clarity on its applicability. A high-end charger capable of dispensing 25 to 160 kW costs more, but the fee is capped at ₹11 or ₹13; the CPO has no incentive to deploy advanced technology or set up infrastructure in remote areas.

Overall, capping the service fee is neither practicable nor desirable in developing a robust charging infrastructure.

DISCOMs as Nodal Agencies

The guidelines mention that DISCOMs could be nodal agencies, which raises a conflict of interest. In some states, DISCOMs are also CPOs, which not only provide electricity connections but also set up charging infrastructure. Allowing a DISCOM to act as a CPO and a nodal agency within its jurisdiction creates an unfair advantage, as they control the connections and locations. We believe DISCOMs should not operate as CPOs within their licensing areas.

Open Access and Renewable Energy

Open access regulations, though useful, pose issues for public charging stations. Predicting energy usage for the next day in 15-minute blocks is nearly impossible due to the unpredictability of vehicles. Predicting the number of vehicles and the capacity getting utilised on a day-ahead basis would be challenging for public charging stations. Consequently, open access with a scheduling requirement is not feasible. A significant penalty is incurred under the Demand Settlement Mechanism (DSM) if a schedule is submitted and unmet.

The current open access framework allows a one-month banking period. Extending this banking period to one year for EV charging could provide considerable benefits. While we have not conducted a detailed analysis on the impact of a one-year banking period, we are confident that, given the increasing adoption of vehicles, a CPO could minimise the effects of the DSM within that time frame. If this change is implemented, open access could become highly beneficial.

However, without such a change, there are still opportunities to enhance the charging experience. For example, many DISCOMs have introduced the green tariff concept, allowing regular EV connections to be converted to green tariffs. Although this may involve a slightly higher fee, it enables users to claim that they are using completely green energy, positively influencing their driving experience. This initiative also aids discounts in procuring more renewable energy, even without specific obligations, thus helping to build a consumer base.

Summary

To implement these guidelines effectively, the Ministry of Power, the Bureau of Energy Efficiency, or any DISCOMs could facilitate interactions between CPOs and regulators. This would be a significant step forward, ensuring that these guidelines do not remain merely theoretical.

Also read: What is meant by EV charging conformance?