How EV Charging Stations could be Viable Business Opportunities in Tier II and Tier III Towns

Apart from monetary value, there are several business advantages to establishing charging stations for individuals and self-help groups in Tier II and III towns.

March 21, 2023. By News Bureau

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EV charging stations are also known as “EV charge points” or “electric vehicle supply equipment.” These stations provide electric power to plug-in electric vehicles for charging. Charging stations are classified into two types: those for batteries that require direct current (DC) and those for alternating current (AC). Now-a-days, a built-in AC-toDC converter, commonly known as the “onboard charger,” is present in most electric vehicles. In accordance with the IMARC Group report titled “India Electric Vehicle Charging Station Market: Industry Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027, provides an analysis of the EV industry that provides insights on the size of the market for EV charging stations in India. It is expected that the Indian EV charging station market will exhibit a CAGR of 8.90 per cent during 2022–2027. The adoption of 3-wheeler electric vehicles has witnessed a remarkable growth of around 120 per cent in terms of sales in the year 2022, especially in Tier II & III towns

Now let’s get to know more about these EV charging stations.

The kind of investment and infrastructure that is required to establish a charging station in terms of capital, required area, electricity, approvals, and so on, depends on the chargers installed. An EV charging station may cost anywhere between Rs 1 lakh and Rs 40 lakh. Depending on their capacity, AC slow chargers are less expensive than DC fast chargers, which are more expensive. A DC charger may cost anywhere between Rs 1 lakh and Rs 15 lakh, while an AC charger is priced between Rs 20,000 and Rs 70,000. To charge fluid-cooled batteries when using a fast charger, the PCS must also have liquid-cooled wires.

The Ministry of Power (MoP) set the basic specification for a Public Charging Infrastructure in 2018 include “an exclusive transformer with all related substation equipment,” which includes plug-in nozzles, 33/11 KV cables (for metering and termination purposes), and circuit breakers as safety gear. Each public charging station must feature at least one electric kiosk with numerous charging stations. In addition to the absolute minimum requirement, the installation of numerous kiosks and charging stations is an option. No permit is necessary for the charging station. According to these new regulations, anybody or any organisation may now build public charging stations without a permit. All that is needed to address this are the technical, security, and performance standards and protocols.

There are mainly two types of vehicles that are eligible for charging -Battery Electric Vehicles (BEVs) and Plug-in Hybrid Electric Vehicles (PHEVs). The Battery Electric Vehicles (BEVs) are the ones without components of a gas engine; they are only powered by an electric battery. The majority of BEVs are capable of rapid and level-2 charging, and the Plug-in Hybrid Electric Vehicles (PHEVs) are hybrid-like vehicles with a bigger battery and electric motor. It has a charging outlet and a gas tank, and utilise L2 chargers to recharge.

There are several business advantages to establishing charging stations for individuals and self-help groups in Tier II and III towns. Apart from monetary value, the other business advantages are as follows: For starters, they offer something that your competitors do not, giving your company an advantage. Secondly, it improves connections with the customers if the stations are in Tier 2 or 3 one can take early mover advantage as well. Another advantage is by supporting a green business initiative and reducing your carbon footprint, a step towards becoming a green company.

Different types of subsidies are available from both the central and state governments for the installation of charging stations. According to Union Power Secretary Alok Kumar, the government will shortly revise the Faster Adoption and Manufacture of (Hybrid and) Electric Vehicles Scheme (FAME) to offer subsidies for the establishment of upstream infrastructure to businesses building up EV charging infrastructure. Also, upstream infrastructure, like transformers, is installed by discoms or utilities to deliver energy to EV charging stations, which cost about Rs 5–6 lakh from state governments. In UP, the development of charging and battery swapping facilities throughout the State is being given special emphasis with a capital subsidy to the first 2,000 charging station service providers, up to a maximum of Rs 10 lakh per charging station. The proposal also includes a cap on capital subsidies at 5 lakh rupees per swap station, subject to a maximum of 1,000 such stations. Any Delhi resident can call or make an online request through the DISCOM online site for the installation of an EV charger from authorised suppliers in their home or business through the facility. According to Delhi’s EV strategy, the first 30,000 slow charging points will receive a subsidy of Rs 6,000 each.

The cost of the EV charger, installation, and three years of maintenance are all included in the user’s final payment after deducting the Rs 6,000 subsidy. According to the official statement from the government, these EV chargers can be purchased for as little as Rs 2,500 after subsidies. The Delhi government claims that it provided a subsidy of Rs 60 lakh for these 1,000 charging stations.

According to these new regulations, anybody or any organisation may now build public charging stations without a permit. All that is needed to address this are the technical, security, and performance standards and protocols.

The general public still has a relatively limited grasp of electric vehicles (EVs), including their advantages, hazards, available subsidies, methods and prices for charging, battery life, maintenance expenses, and resale value. The Niti Aayog’s November 2021 introduction of the e-Amrit online site will be an important milestone in this area. The portal offers a wealth of knowledge about EVs and works to raise awareness among a range of stakeholders, including consumers, businesses, and service providers. Also, companies that are dealing in the EV space need to build a bridge to educate people about the outcomes of opting for an electric vehicle. The good news is that there are various methods to profit from charging stations for automobiles. In exchange for branding on the EV charging stations, one can enhance foot traffic to increase profitability at your location, charge consumers directly to optimise earnings, or even turn to outside corporations to cover the cost of the chargers. When any one start to consider the options, it’s clear that the question “Are automobile charging stations profitable?” the answer to the question is “Yes”. Research states that, by 2040, electric cars are predicted to account for the bulk of all new automobile sales globally, with 33% of them being light-duty vehicles. The year 2022, has witnessed a significant surge in total EV sales. In accordance with Vahan Dashboard, the total number of EV sales reached 77849 in 2022 which is 185% higher in comparison to the year 2021. A private consumer expectation survey conducted recently showed that around 66% of Indians think that the use of EVs will surpass petrol and diesel cars in 2030.

In conclusion, an electric car charging station has a solid economic potential. The establishment of a charging infrastructure opens the door to more clients Like petrol stations, EV charging stations may be a reliable and solid source of income.

- Lalit Singh, Chief Growth Officer, TelioEV