There are two sides to India’s electricity market — new and old. On the side of the new, there are young, innovative companies carving out business models within regulatory limitations. On the other side is the familiar story of revenue leakage, outstanding dues of billions of rupees and government bailouts.
Lithium Urban Technologies, a provider of electric car fleets to companies in India, is one of the companies tapping into new opportunities. It offers “up to 40 per cent” savings to clients switching from their conventional fossil-fuel vehicles fleet as electric vehicles are cheaper to run. They can be even cheaper if cost-competitive renewable energy is used to charge the vehicles. “We found a fantastic one-to-one correlation between companies that adopted renewable energy and companies that adopted electric vehicles. Renewables means savings on power and that means an even stronger case for electric mobility. Many of our clients get their power from renewables,” Sanjay Krishnan, co-founder and CEO of the company, said in an interview with BloombergNEF. “I can run my electric fleet at less than Rs 1 per kilometre, against Rs 5.50 per kilometer for a diesel vehicle,” he asserted.
Clients of the company include Google, Unisys, American Express, Accenture, Wipro and Blackrock. The company installs its own chargers to offer a zero-capex service to its clients, and claims to have the largest charging network in India, as well as the highest utilisation rate, of 90 per cent, for its chargers.
With a fleet of 1,100 vehicles — mostly made up of electric models from Mahindra & Mahindra — active across 11 cities, it runs a “profitable” operation, and intends to raise further capital for expansion. The plan is to more than double the fleet to 2,500-plus vehicles by January 2021, and also add new models from Tata Motors, and from Morris Garages, owned by China’s SAIC Motor Corp.
As for Tata Motors, it meanwhile announced a partnership with app-based taxi service provider Prakriti E-Mobility to deploy 500 Tigor electric vehicles in the national capital, Business Standard reported in December. Startup BluSmart offers rides on all-electric vehicles, and at a flat price. “You know our fare. It’s Rs 149, anywhere to anywhere in Gurugram,” the website says. In the two-wheeler space, electric Yulu bikes are becoming ubiquitous across many cities in India, including Delhi.
Power minister R K Singh said last week that India would eventually be an electricity-based economy. “We want to electrify our whole economy. The energy would be through electricity rather than through petroleum products or other forms of energy... We will electrify the economy and make electricity green (renewables generation). Those are our long-term goals.”
The government’s intention to electrify everything, including mobility and cooking, and to do that with green electricity, would throw open new opportunities for smart solutions. That would mean an even larger play for innovation and disruption — the two forces that have changed the contours of many sectors.
Renewable energy capacity additions in India were, however, somewhat subdued last year, and will be so this year too, though a pick-up is expected in 2021 and 2022.