Why India's EV sector is torn between swappable and integrated batteries

Electric vehicle makers and service providers are grappling with the question of whether swappable or integrated batteries should drive the electric future

An interesting divide is shaping up in the electric vehicle industry. And it’s not about the debate on whether legacy automakers or cash guzzling startups will rule the EV market. It is, rather, a technological conundrum: should EV makers bet on battery swapping technology or integrated charging? 

A swappable battery is like an LPG cylinder that is exchanged with the fuel station when the charge is exhausted; an integrated battery set-up requires charging at specific hubs, such as automobiles being refuelled at petrol pumps.

Players in the EV sector are betting on both approaches. In December, Reliance Industries first inked an agreement with the Mahindra group to develop and retail swappable batteries, and then announced that it was looking to acquire UK-based battery maker Faradion for $100 million. While most batteries in the EV space currently use lithium ion, Faradion claims that it has developed a better alternative — a battery that uses sodium ion, which makes it more sustainable, packs in greater energy and is also cheaper.

On the other hand, Hero Electric, owned by Vijay Munjal and Naveen Munjal, has tied up with EV startup SpareIt, which operates a network of electric charging hubs and service centres in six cities. It aims to ramp up its presence to 1,000 charging centres by March.

“There is no one right answer to whether battery swapping or integrated battery charging is the better way. The most important factor is the use-case — any vehicle which is for personal use sits idle 80 per cent of the time, and so, players focussed on this market would prefer electric charging,” says Nakul Kukar, co-founder of EV startup Cell Propulsion.

“EV makers and charging companies that cater to the B2B market — such as e-commerce delivery fleets and light commercial vehicles — will tend to adopt swappable battery technology. These vehicles are idle only for 20 per cent of the time and cannot afford to wait at a charging station for hours to refuel,” he adds.

Take, for instance, EV start-up Oye! Rickshaw, which operates a fleet of over 8,000 electric three-wheelers for e-commerce companies like BigBasket, Ninjacart, Dealshare and Jio Mart. “Our batteries have a 50-km range on average, at one go. We believe we will be able to build a very efficient network for e-rickshaws. We went for swappable because downtime is costly and most of these EVs have no dedicated parking lots, which makes it a challenge,” says Shuvajyoti Ghosh, head, Energy division, Oye! Rickshaw.

“The benchmark we are competing with is lead acid batteries that go kaput very fast. Swappable also ensures that you do not have to carry a lot of spare capacity, as the battery is always on charging or discharging mode,” he adds. While lithium ion batteries help bring costs down by 30 per cent for drivers, battery swapping when compared with battery charging lowers costs by another 20 per cent, the company says.

However, swapping won’t be feasible in the long run for heavy commercial vehicles (CVs), as it would require sophisticated robotics to replace a battery, reckons Ghosh. For this reason, rapid charging hubs that can fully charge a vehicle in 15-20 minutes will be required when heavy electric CVs become commonplace.

“At one level, it might seem as if using swappable batteries is cheaper. But the total cost of ownership is actually higher because the refueling stations need to have batteries equivalent to 1.5 times the number of vehicles coming in to swap on any day. This extra cost is transferred to the driver,” says Ravneet Phokela, chief business officer of EV maker Ather Energy.

He believes swappable batteries would also require that EV makers standardise their battery specifications, which would make it unattractive for the end-consumer. “Standardising batteries will come at the cost of performance. Also, the battery is the heart of the EV, along with the motor. If you standardise it, you lose your unique selling proposition, and it hurts innovation. That is why most two-wheeler makers — be it Ather, Ola, Bajaj or TVS — are choosing integrated batteries over swappable systems,” says Phokela.

However, Rajeev Singh, who leads the automotive practice area at Deloitte India, says that a few two-wheeler makers are setting up a consortium to standardise swappable batteries. “Such examples extend to four wheelers to a certain extent in the passenger vehicle segment, but far too less currently in case of commercial vehicles."

“A model worth trying out for light commercial vehicles makers for intra-city logistics is to sell their vehicles minus the battery. And then a swappable battery can be provided as a service additionally to the fleet,” he adds.

But Arun Vinayak, chief executive officer of Exponent Energy, an EV startup that is building a rapid charging solution, thinks otherwise: “Commercial EV makers will tell you that they have a battery swapping product, but nobody really wants it. Mobile phones used to have swappable batteries earlier, but now people have realised that you need to integrate the battery far more deeply if you want to juice out better performance. The same thing will happen in EVs.” 

“If you standardise battery packs, OEMs will be left with building the bells and whistles of the EV powertrain. That is the worst thing that can happen to the EV ecosystem. It will kill competition and there will be no differentiation,” he adds.