Reliance Industries’ fuel retail joint venture with British Petroleum – Reliance BP Mobility Limited (RBML) has signed an agreement with Mahindra and Mahindra Limited to accelerate the adoption of electric vehicles (EVs).
RBML will assess the locations of the Mahindra Group and its distribution partners for the establishment of new mobility stations with facilities for recharging electric vehicles and exchanging batteries.
“The partnership aims to accelerate the adoption of electric vehicles in India with high-performance, replaceable batteries that will help alleviate range anxiety. The solutions would provide great convenience to customers who can ideally take a depleted battery to their nearest exchange station and in minutes go with fully charged batteries at minimal charge, ”Mahindra’s joint press release said. and RBML.
However, this isn’t the first time Reliance has focused on battery swapping. In the past, the fuel retail arm has partnered with companies such as Swiggy and BluSmart Mobility. Under the agreement with Swiggy, Jio would establish a battery exchange point for Swiggy’s delivery fleet to reduce downtime due to charging.
The Swiggy partnership was the first agreement that showed RBML’s serious interest in the battery swap space. The company said it was focusing on building “several thousand battery exchange stations” over the next five years.
“The battery swap is expected to lead the green wave in the last mile delivery and passenger segments,” the RBML press release said.
RBML is one of the largest private players in the fuel retail sector, dominated by public sector oil marketing companies. But, Reliance has moved away from its petroleum business for renewable energy and ancillary businesses in recent years.
It plans to leverage its fuel retail network and those of its partners to set up the electric vehicle charging activity for the business-to-business, business-to-customer and bus segments.
What explains Reliance’s optimism about the battery swap?
The idea behind battery swapping is to remove a dead battery from a vehicle and replace it with a charged battery. As a result, a customer does not need to buy a battery, but rather rent it from operators such as RBML.
Since batteries make up a large part of an EV (around 30-55%), such a move would help lower the initial costs of buying an EV. As a result, the cost is simply operational, reducing the financial burden on the customer.
The government allowed buyers to buy an electric vehicle without the batteries, and then lease the batteries to companies. Another cost reduction factor comes from the operator side of the station. The establishment of an exchange station would not require large surfaces, compared to recharging stations.
Another benefit is the reduction in vehicle or fleet downtime due to the longer times required to recharge vehicles. According to industry reports, charging a dead battery takes longer than swapping out a battery. Fast charging has also been criticized for degrading battery quality.
Therefore, besides saving money, battery swapping can also save time. Therefore, cyclists who need reduced downtime, such as rickshaw owners, office workers, delivery fleets, or other commercial fleets, may opt for the battery swap.
A large part of the electric fleet in India consists of two-wheelers and three-wheelers. These vehicles have smaller batteries that weigh much less, making it easier to change batteries. In the case of larger vehicles, battery swapping might be impractical as the batteries are quite heavy and bulky.
A growing preference for exchange?
Besides Reliance, several other companies, especially some original equipment manufacturers (OEMs), have focused on swapping batteries. Selling electric vehicles without batteries would allow them to reduce their costs while relying on a battery exchange network.
For example, Bounce recently showcased their new scooters which are priced well below market rates for similar vehicles because the vehicle’s batteries were optional. The company would build a network of exchange stations, rather than building a charging network.
Disadvantages of the exchange
Others still focus on creating a charging network, rather than focusing on building vehicles with removable batteries. Ola, for example, set up battery swap stations, but surprisingly created fixed battery options for their new electric vehicles. Likewise, Ather Energy has focused on creating a charging network rather than building vehicles with removable batteries.
Some remain concerned about factors such as increased wear and tear on portable batteries, lack of standardization, lack of feasibility for larger vehicles and several other concerns. Better Place, an automotive company focused on exchanging batteries, went bankrupt in 2013 because its innovation did not find many takers. Trade-in is also expensive and difficult for cars, resulting in low adoption of the technology so far.
Still, with big players like Reliance and Mahindra entering the field with their deep pockets, we could potentially see the issues of scale, networking, and standardization resolved to some extent.