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The Indian Government aims to shift one-third of the petrol and diesel vehicles to electric vehicles by the year 2030! Whether this goal is achievable will depend on not just the government policies, which are far from being in place at this stage, but also on how well are the other stakeholders in the industry prepared and more importantly on whether on not the public is willing to make this shift. The stakeholders obviously for this industry include the local government, town planners, transport authorities, energy suppliers (private/public), component and vehicle manufacturers and lastly, the public. Unless these stakeholders work together on a collaborative and joined-up approach and unless the public identifies some convenience and cost advantages in electric vehicles, achieving the 2030 e-mobility revolution may be a challenge.
Government’s enthusiasm to switch to electric mobility is factored largely by the alarming levels of pollution and inability of the ecosystem to deal with the same. However, in this enthusiasm to adopt electric mobility, we need to ensure that we are not coming out of one issue only to enter a new one, for instance, we may be able to solve the air pollution issue however end up creating heavy metal ion land fill issue for ourselves resulting from excessive usage of Lithium ion batteries. Similarly, the rush to shift from internal combustion engines to electric vehicles should not result into a flawed policy and inadequate implementation framework. We have to be careful enough that a granular analysis and a judicious approach is adopted for gradually developing the electric mobility ecosystem and learnings from experience of other countries and ecosystems are ensued. The following are few of extremely critical issues in the emobility area that need careful handling at the ground level itself so that we can have a robust e-mobility ecosystem in place:
While each of the above matters need granular level attention, only a few critical issues examples are being covered in this article, solely for the purpose of triggering brainstorming on the legal aspects aroundthese issues.
Ownership: the E-mobility ecosystem is projected to survive on two primary kinds of battery usage models, the ‘ownership model’ where the consumers own, use, charge, destroy and also are responsible for their batteries, and ‘the rental model’ or the ‘battery swapping model’ where the users exchange their uncharged batteries with fully charged batteries with different battery providers to avoid the plug-in charging delays, inconvenience, etc. Both the ownership model and the swapping model raises complex legal and financial issues like financing the acquisition of the batteries on a large and commercial scale, identifying the right owner of the battery in the supply chain, i.e. whether the battery is owned by the vehicle owner or the battery owner in case of the swapping model, liability and insurance obligations when the battery owner is different from the vehicle owner, repair and disposal obligations, whether the resale of the vehicle include automatic ownership of a rented battery, benchmarking of the batteries and standardization of quality and requirements, regulatory framework around the usage and disposal of batteries. While the ownership model seems pretty much straight, the implementation of the swapping model may need certain special clauses in the battery rental agreements such as duration of the lease, payment premiums, penalties in case of damage to rented batteries or loss or no return of the same within the allowed contracted time period.
Charging Infrastructure: here too, there can be multiple options ad models available to the consumers as well as the providers, for instance, plug-in models at the parking lots of the residences, townships, commercial complexes, fuel stations, etc. However, this model may result in public convenience, traffic congestions and electricity overload during certain hours in certain areas. Similarly, another option is “battery swapping” model, as discussed above, however, this option may need several layers of ‘standardization’ as the features of the battery should meet the requirements of the vehicles both at the structural/morphological level as well as at the electronics/electrical level. Any mismatch between the two may compromise with the health and safety of the consumers. Additionally, the swapping model needs to ensure fastest turn- around time of uninstalling, swapping and installing, failing which the whole purpose of reducing the time involved in plug-in charging will get defeated. Also,
Electricity/charging vendors need to have flexible business models so that the users are not restricted to any specific charging stations, brands, outlets or rental schemes or payment modules.
Environmental issues: while the disposal of batteries and usage of coal reserves for recycling the battery raises environmental concerns, the same may also need some legal framework to identify ownership of the batteries and liabilities and environmental damage. Similar to several other countries, like Europe, the obligation for collection on distributors and for disposal/recycling can lie on the producer of the battery and the cost of disposal and recycling is not incurred by the consumer. This set-up has been criticized heavily and changes in such rules have been widely demanded for.
We may also need to ponder that excessive usage and recycling of batteries may generate very high demand of electricity load. Such amounts can only be accounted from the coal reserves, exhaustion of which is already on the radar of environmentalists.
Health issues: in the European nation the automobile batteries are characterized as dangerous products as the storage, handling and testing conditions may cause sever heath and safety issues in events of accidents or mishandling. Mandates for working conditions, educational qualifications, norms for storage/ testing/ handling must be brought in place before substantial number of electric vehicles are on road. It may also be considered that currently, the manpower leading the automotive industry are from mechanical or automobile engineering background. However, such technical expertise may not be sufficient or suitable for the handling electric vehicles that incorporate several components and technologies falling under the electronics and electrical space and even software for that matter since smart vehicles and smart charging options are provided by nothing but smart softwares. Appropriate training and courses must be established to develop resources competent and qualified enough to handle both automotive and electrical issues.
Anti-trust issues: In order to develop a coherent ecosystem, it is imperative that various stake holders will be cooperating and collaborating with each other at various levels and for various strategic reasons. For instance, the car manufacturers will need to partner with fuel stations or electricity distribution companies. Similarly, battery suppliers will need to partner with car manufacturers as well as energy distributors. Such alliances may raise anti-trust issues in the market, specially in the cases where certain parties or alliances will have dominant positions in the market owing to their ownership of standardized technologies.
If the public and the government is determined to transform the automotive industry from ICE type to e-mobility type, several changes in the infrastructure, laws, regulations, lifestyle will have to be implemented. The e-mobility ecosystem and technologies therein are not of the category that can be added as a top layer in the running ecosystem or infrastructure. If adopted, the entire underlying structure of each layer of the existing ecosystem and infrastructure will need to be modified substantially. Although the issues discussed above are critical, they only provide a glimpse of where we are heading and what is out there.
Garima Sahney leads the patent practice at Saikrishna & Associates, a Tier-1 IP Boutique Firm. With several years of experience in the patents industry, Garima has dealt extensively with patent drafting, filing, prosecution, litigation, prior art searches, landscapes, claim mappings, due diligence, validity assessments in the domains including biotechnology, pharma, chemistry, mechanical, telecommunication and software. She routinely advises fortune 500 companies and has in the past advised several firms (including MNCs, domestic firms and start-ups) on strategizing R&D, patent filings, competitive space, due-diligence, patent licensing opportunities/ negotiations, managing portfolios, identifying strategic patents for commercial purposes, etc.
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