After Swiggy and BluSmart Mobility, Reliance BP Mobility Limited signs agreement with Mahindra to accelerate electric vehicle (EV) adoption

Why Is Reliance Bullish On Battery Swapping For EVs?

by Sourav Datta - Thursday, December 9, 2021 06:26 PM IST
Why Is Reliance Bullish On Battery Swapping For EVs?Jio BP Mobility Station (PC: BP website)
  • Reliance BP Mobility Limited (RBML) has signed an agreement with Mahindra and Mahindra Limited to accelerate electric vehicle (EV) adoption.

    Earlier, RBML had partnered with Swiggy to establish battery swapping points for Swiggy’s delivery fleet to reduce downtime due to charging.

Reliance Industries’ fuel retailing joint venture with British Petroleum – Reliance BP Mobility Limited (RBML) has signed an agreement with Mahindra and Mahindra Limited to accelerate electric vehicle (EV) adoption.

RBML will be evaluating the Mahindra Group and their channel partner locations for setting up new mobility stations with EV charging and battery swapping facilities.

“The partnership aims at accelerating EV adoption in India with high-performance and swappable batteries that will help in dispelling range anxiety. The solutions would afford great convenience to customers who can ideally bring in a depleted battery to their nearest swapping station and within minutes move on with fully charged batteries by paying a nominal fee,” said the joint press release by Mahindra and RBML.

However, this isn’t the first time Reliance has been focusing on battery swapping. In the past, the fuel retailing arm has partnered up with companies such as Swiggy and BluSmart Mobility. Under the agreement with Swiggy, Jio would establish battery swapping point for Swiggy’s delivery fleet to reduce downtime due to charging.

The Swiggy partnership was the first deal that indicated RBML’s serious interest the battery swapping space. The company announced its focus on setting up “multiple thousand battery swapping stations” over the next five years.

“Battery swapping is set to lead the green wave in the last mile delivery and passenger segments,” said the press release by RBML.

RBML is one of the largest private players in the fuel retailing sector that is dominated by public sector oil marketing companies. But, Reliance has been moving away from its oil business into the 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 EV charging business for business-to-business, business-to-customer, and the bus segment.

What explains Reliance’s Bullishness on Battery Swapping?

The idea behind battery swapping is to remove a discharged battery from a vehicle, and replace it with a charged battery. As a result, a customer need not buy a battery, but rather lease it out from operators such as RBML.

Since batteries constitute a large part of an EV (around 30-55 per cent), such a move would help reduce the upfront costs of buying an EV. As a result, the cost is merely operational, reducing the customer’s financial burden.

The government has allowed buyers to buy an EV without the batteries, and later lease batteries from companies. Another cost reduction factor comes from the station operator’s side. Setting up a swapping station is said to not require large areas, as compared to charging stations.

Another advantage is the reduced downtime of the vehicle or fleet due to longer durations taken to recharge vehicles. Charging a discharged battery takes longer than swapping a battery, according to industry reports. Fast charging has been criticised for degrading battery quality as well.

Hence, along with saving money, battery swapping can save time as well. Therefore, riders who require low downtimes, such as rickshaw owners, office-goers, delivery fleets or other commercial fleets, can opt for battery swapping.

A large part of the electric fleet in India consists of two-wheelers and three-wheelers. These vehicles have smaller batteries that weigh quite less, making it easier to change batteries. In the case of larger vehicles, battery swapping could be unfeasible as batteries are quite heavy and large.

Increasing Preference for Swapping?

Apart from Reliance, several other companies, especially some original equipment manufacturers (OEMs), have focused on battery swapping. Selling EVs without battery would allow them to lower costs while depending on a battery-swap network.

For instance, Bounce recently introduced its new scooters that are offered at much lower rates than the market rates of similar vehicles as the vehicle batteries were optional. The company would be building a network of swap stations, rather than building a charging network.

Disadvantages of Swapping

Others are still focused on creating a charging network, rather than focusing on building vehicles with detachable batteries. Ola for instance has set up some battery swap stations, but has surprisingly created fixed battery options for its new EVs. Similarly, Ather Energy has focused on creating a charging network rather than building vehicles with detachable batteries.

Some remain concerned about factors such as increased wear and tear with portable batteries, lack of standardisation, lack of feasibility for larger vehicles and several other concerns. Better Place, a car company focused on battery swapping went bankrupt in 2013 as its innovation did not find many takers. Swapping is costly and difficult for cars as well, leading to low adoption of the technology so far.

Nevertheless, with large players such as Reliance and Mahindra stepping into the field with their deep pockets, we could potentially see the problems of scale, swapping networks, and standardisation solved to a degree.

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