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BATTERY SWAPPING FOR ELECTRIC TWO-WHEELERS IN INDIA: STRATEGY HINTERLANDS

Created with support from NITI Aayog, this work explores the emerging landscape of battery swapping for electric two-wheelers (E2Ws) in India. There are clear benefits to battery swapping, a plug-and-play solution for charging the battery of an electric vehicle, and it takes just a few minutes to charge an E2W. Because battery-swappable E2Ws are sold without a pre-fitted battery, their upfront cost is significantly lower than those that include a battery, and this can be an important consumer benefit in a price-sensitive market like India.


We conducted quantitative analysis of the impact of various parameters on vehicle total cost of ownership (TCO). Results show that TCO per kilometer (km) for both conventional two-wheelers and E2Ws is lowest when they are used for commercial operations with higher daily utilization rates such as e-commerce deliveries and shared mobility. For E2Ws this is largely because of the avoided opportunity cost of charging, and the figure below illustrates this for the ride-hailing use case.


This research helps create an agenda for future strategy that supports the battery-swapping business model in India. Because lower battery prices in the future would diminish the cost benefits of acquiring an E2W without the battery, early policy could focus on things less likely to change in the near and medium term, such as the value of time saved on charging and on supporting battery swapping operators (BSOs) in maintaining best practices for operational safety and end-of-life care. That means things like extending future FAME subsidies to two-wheelers sold without pre-fitted batteries and relevant operational and safety standards for BSOs.


Although not many of the current two-wheeler models in India support battery-swapping, both Sun Mobility and Hero MotoCorp (the latter in partnership with Gogoro) have recently made progress toward offering this service. Battery swapping is an innovative electric vehicle refueling model that can be used by vehicles with a detachable battery. When the battery’s charge gets depleted, the driver can go to a battery-swapping station to replace the depleted battery with a fully charged one within just a few minutes. The batteries are owned, maintained, and charged by the swapping service, and the vehicle operator pays a fee for the service.


This paper evaluates if electric two-wheelers in India with the battery-swapping option have achieved cost parity relative to electric two-wheelers with the point charging option and with conventional gasoline two-wheelers. The authors consider this by estimating the total cost of ownership (TCO) of two-wheelers across three use cases—personal use, ride-hailing, and last-mile delivery. Results show that for all three use cases, the electric two-wheelers with point-charging and battery-swapping options are considerably cheaper than the gasoline two-wheeler. Additionally, while two-wheelers with battery swapping are costlier than two-wheelers with point charging for the personal and last-mile delivery use cases, the opposite is true in the case of ride-hailing operation, where the TCO of the electric Okinawa iPraise+ with swapping is 15% less than that of the Okinawa iPraise+ with point charging and 3% less than the Ather 450X with point charging. The fueling cost is the largest cost contributor across all types of uses for the battery-swapping option. If this cost is reduced, the battery-swapping model will become more cost-attractive because it has the unique advantages of zero opportunity cost and zero battery-replacement cost.


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