BEYOND NAGPUR: THE PROMISE OF ELECTRIC MOBILITY LESSONS FROM INDIA’S FIRST MULTIMODAL E-MOBILITY PROJECT A STUDY BY BEYOND NAGPUR: THE PROMISE OF ELECTRIC MOBILITY LESSONS FROM INDIA’S FIRST MULTIMODAL E-MOBILITY PROJECT A STUDY BY Ola Mobility Institute (OMI) is a policy research and social innovation think- tank of Ola that is focussed on developing knowledge frameworks at the intersection of mobility and public good. The Institute concerns itself with public research on the social and economic impact of mobility as a service, the climate footprint of mobility innovations, skill development and job creation, transportation-oriented urban planning, and the digitization of mobility. All research conducted at OMI is funded by ANI Technologies Pvt. Ltd. (the parent company of brand Ola). www.ola.institute [email protected] @olamobilityinst AUTHORS: Nitish Arora, Aishwarya Raman CONTRIBUTORS: Ola Electric Team, Paroma Bhat, Carson Dalton, Anand Shah DISCLAIMER This report takes into account data points from all aspects of EV operations spread over 18 months since inception, data points from primary research as well as established sources of secondary data. Whilst every effort has been taken to validate and verify correctness and accuracy of all material in this document, neither Ola, Ola Mobility Institute nor any other party associated with this report will we liable for any loss or damage incurred by the use of this report. © Ola Mobility Institute Copyright 2019 Ola Mobility Institute. This work is licensed under the Creative Commons Attribution 4.0 International License. To view a copy of this license, visit http://creativecommons.org/licenses/by/4.0/. CONTENTS EXECUTIVE SUMMARY 5 PROLOGUE 13 AN IDEA IN MOTION 14 The E-mobility Challenge The Pilot & The Study Leading the Change DRIVE LEARNINGS HOME 30 Pain Points & Resolutions Improvement Measures DESTINATION EV 34 TCO Economics Vehicle Segment Prioritisation Recommendations for Tomorrow CONCLUSION 51 REFERENCES 52 EXECUTIVE SUMMARY BEYOND NAGPUR: THE PROMISE OF ELECTRIC MOBILITY As one of the most populated countries in the world coming of age with one of the lowest vehicle penetration rates of a major economy, India has a unique opportunity to establish a sustainable transportation system. The Central Government flagged off radical policy changes since 2018 to encourage the Electric Vehicles (EV) ecosystem, helping India move closer to delivering on the promise of e-mobility. Ola Mobility Institute (OMI) believes e-mobility is the gateway to more affordable, reliable, cleaner, and efficient transportation – enabling India to become an example for other nations. THE STUDY The Institute studied India’s first With the key objective to determine to lower-cost conventional ICE multimodal*1 electric mobility project how to proliferate EVs, this study hatchback services. Driver-partners in Nagpur. attempts to gain an understanding of were provided free-of cost-charging operational issues that include vehicle in the first month, followed by 50% The pilot, inaugurated by Hon’ble performance, customer charging rebate*3 in subsequent months. To Chief Minister of Maharashtra, Shri behaviour, the impact of temperature address concerns of driver-partners Devendra Fadnavis, and Hon’ble on charging and battery life, and regarding their income, time taken Union Minister, Shri Nitin Gadkari of integrating renewables at the for charging, and dry run, the in May 2017, excited industry and charging station, etc. initial lease for vehicles was just government stakeholders to execute 10% of what was being charged and understand the potential for The study found that the pilot on conventional ICE vehicles. To electrification of transport. The pilot required a broad set of actions. increase effective on-road hours, built battery charging and swapping To start with, the Nagpur fleet Ola deployed multiple fast charging infrastructure and deployed a comprised of electric cabs and stations in Nagpur. It also installed multimodal EV fleet in a brief span. electric rickshaws from the slow charging points at driver- At the time of conducting this study manufacturers, Mahindra and Kinetic. partners’ residences. This provided the electric fleet by Ola in Nagpur - Ola’s vehicle leasing arm, Ola Fleet driver-partners the technical a combination of e-rickshaws and Technologies, procured all EVs and know-how of charging their EVs, e-cabs - had served over 3,50,000 offered them on daily lease to driver- and pioneered the home charging customers, clocked over 7.5 million partners, as a key component of Ola’s infrastructure for the ecosystem clean km, saved over 5.7 lakh litres e-mobility strategy. Ola designed in Nagpur. Thus, the pilot focused of import-dependent fossil fuel, and lucrative value propositions for a primarily on ensuring usage of EVs reduced CO2 emission by over 1,230 seamless transition to e-mobility. - or simply put, clean kilometres tons since its inception. For e-cabs, riders were offered Ola travelled – to test the viability of Play*2 sedan services at fares equal EVs on economic metrics. *1 More than one mode of commute. The project in Nagpur, for instance, had e-cabs and e-rickshaws. *2 Ola Play, the world’s first connected car platform, aims to transform the in-cab experience by bringing advance car controls, choice of personalised content and a fully connected 6 interactive experience, to the backseat of the cab, creating a perfect ambience for oneself. *3 The driver partners were charged only for 50% of electricity units consumed. LESSONS FROM INDIA’S FIRST MULTIMODAL E-MOBILITY PROJECT KEY LEARNINGS AND RECOMMENDATIONS With evidence from the Nagpur first or the charging infrastructure. rationally consider the TCO profile pilot, OMI has the following key of an EV and compare it with ICE recommendations to accelerate EV Vehicle segment prioritisation, with vehicles, while making their purchase adoption in India. an eye on TCO viability, is at the decisions. They weigh savings from heart of the EV adoption drive across EVs on account of lower operational The success of e-mobility is hinged the country. and maintenance costs against on leveraging shared mobility. high upfront purchase prices. TCO, Unlike Western models, India may therefore, is a useful calculation to On the one hand, high upfront costs, not easily kick start its electric assess the direct and indirect costs lack of charging infrastructure and journey by deploying premium associated with a purchase. uncertain performance of a battery- electric cars. Instead, it makes sense powered vehicle may hold back rapid to focus on electrifying vehicles with The OMI study found that since TCO adoption of e-mobility for private the highest demand and utility in parity for four-wheelers (4W) will not users; on the other, fleet operators the Indian context: two-wheelers be occurring before 2026, vehicle are potential early adopters due to and three-wheelers. The rickshaw segments must be prioritised for business sensitivity to operating is already proliferating in electric electrification. This will help better costs. Due to the low operating cost variants, suggesting it is both viable expend resources on supporting of an EV, commercial and public and practical. Thus, appropriate segments where the TCO differential utility vehicles have more compelling prioritisation of vehicle segments with ICE counterparts is minimal – as economics when compared with for electrification may prove to be is the case of electric two-wheelers private / passenger-owned vehicles. critical to the adoption of e-mobility. (2W) and three-wheelers (3W). This Ergo, shared mobility actors, such would also make fleet operators less as fleet operators / app-based This study carried out extensive TCO dependent on the government for aggregators, can lead and accelerate analyses - comparative analyses subsidising the upfront cost of the the EV penetration because they between EV and ICE (Internal EV and battery. Third, given the price generate more km on their vehicles. Combustion Engine) categories of sensitivity of the Indian consumer They can amortize the high upfront various segments of vehicles. (Refer market, leveraging fleet operators to costs over more travel in a shorter pages 34 to 40 for detailed TCO drive down costs for the market may payback time frame, despite a higher analysis for all vehicle segments.) prove to be a significant catalyst. TCO*1 (Total Cost of Ownership) per Public transit agencies, new age app km (Arora. N and Raman. A, 2019). aggregators of bikes, auto-rickshaws, Further, currently, over 80% of For instance at current crude prices and cabs, and fleets managed by vehicles plying on Indian roads are and electricity tariffs, when an government agencies put in more km 2W and 3W, contributing to 35% electric four-wheeler is compared on their vehicle each year compared of pollution (NITI Aayog and World to an ICE powered 4W - it provides to personal vehicles*2. Such high Energy Council, 2018). Any attempt operational savings of Rs 3.07/km asset utilisation allows these fleet at electrification of the country’s and Rs 4.57/km to fleet operators and operators to spread the cost recovery vehicle fleet must include emphasis private owners respectively. The high of buying, maintaining and operating on these segments. In addition, the upfront costs get recovered in five the vehicle, thereby making electric highest proportions of passenger- years for a fleet operator, which takes mobility service a more viable km traveled are by public and almost 11.5 years when driven for prospect. This consideration, referred shared transport vehicles (bike- private use. Fleet operators provide to as Total Cost of Ownership (TCO), taxis, auto-rickshaws, taxi-cabs, the necessary scale and ability to is critical to the financial viability of and buses) (Roychowdhury. A and manage with limited infrastructure: market-based e-mobility initiatives in Dubey. G, 2018). resolving the classic question of EV India. In other words, fleet operators *1 Total Cost of Ownership - TCO - uncovers hidden costs over the lifecycle of an asset, incorporating direct and indirect expenses.