Electric Vehicles are flying off the shelves faster than you can drive them at this point. With the government actively promoting e-mobility, now is the perfect time to invest in setting up EV Charging Stations to serve the rising demand. In order to combat pollution and incentivise e-vehicle's establishment in key areas, the Indian government has provided significant grants and subsidies to energy companies. In this article we will talk about how to set up a profitable Electric Vehicle charging station and the laws and regulations that go into setting up a commercial property for this purpose.
Why Setting Up An EV Charging Station is Profitable?
Establishing an electric vehicle (EV) charging station in India presents a potentially lucrative venture for many reasons. Primarily, a rising demand for EVs, supported by government incentives and rising fuel prices due to the current geopolitical climate, pushes an increasing number of drivers toward embracing e-mobility. Nevertheless, the existing charging infrastructure lags significantly, creating an untapped market for newcomers. This means your station is likely to see high utilisation, especially if strategically located near highways, commercial hubs, or residential areas with high EV adoption.
Beyond direct charging revenue, you can unlock additional sources of revenue. Offering value-added services like cafes, convenience stores, or even valet parking can attract customers and extend their dwell time, leading to more spending. Plus, government subsidies and attractive financing options can significantly offset initial setup costs. So, with careful planning and a strategic location, your EV charging station can be a profitable and future-proof business in the booming Indian EV market.
Let's talk about how the Indian government is actively supporting e-mobility, particularly in a population dense city like Mumbai.
Government Subsidies
The government of Maharashtra, including Mumbai, has introduced several incentives to encourage the establishment of electric vehicle charging stations, particularly for commercial real estate. These incentives aim to foster the growth of the EV ecosystem and support sustainable practices. Here are key aspects of the government incentives:
Builder Incentives: The Brihanmumbai Municipal Corporation (BMC) aims to encourage real estate builders and entrepreneurs to set up EV charging stations in upcoming properties. All upcoming projects, both residential and commercial properties are required to have at least 20% of parking spaces reserved for Electric Vehicle owners. Additionally, the BMC also aims to waive off installation fees for EV chargers. But wait, that's not all. Premises installing EV charging stations or individual chargers will receive property tax rebates.
Energy Incentives: The government provides upfront subsidies on chargers under the FAME scheme. Slow chargers get a subsidy of Rs 10,000 each while fast chargers get Rs 1 lakh subsidy. Additionally, charging stations in particular get preference in getting electricity connections from distributors compared to other commercial establishments. In fact, the Ministry of Power has made it compulsory for electricity boards to grant new EV charging stations with a connection within seven days in metro cities, 15 days in municipal areas and 30 days in rural areas.
De-regulation: This shift in policy has effectively removed the licensing requirement, empowering literally anyone to set up charging stations, provided they abide the specified technical standards of the partner companies. This decentralisation of the process aims to promote widespread accessibility and participation in the development of the EV charging infrastructure.
Types of EV Charging stations
There are 3 types of EV charging stations, each of which serve different purposes and vehicle types. Here are the types for you to consider:
DC Charging Stations: These are typically large commercial charging stations (3600 to 4500 square feet) that cater exclusively to mid-sized to large 4 wheeler private and commercial vehicles such as cars, trucks and buses. They support fast and turbo charging and cater to a large variety of vehicles, even ones with proprietary connections. These stations host exclusively DC Chargers to provide this service and require a large investment to facilitate a continuous DC power supply in large quantities.
AC Charging Stations: These facilities are smaller (100 to 800 square feet) in size and cater to smaller vehicles such as 2 wheelers and Rickshaws. They may either support charging or they can be battery exchange stations where users can swap out their dead batteries for publicly available fully charged batteries that match their vehicles. Some facilities offer both services. Since smaller vehicles charge quicker than cars and are much more common, the requirements for AC Charging Facilities are much less. All you need are an adequate number of chargers, power supply and parking spaces. The entire real estate footprint of these facilities can be much smaller because after all, it is for small and quick charging vehicles.
AC/DC Charging Stations: This charging facility provides both slow and rapid charging options for various types of electric vehicles, including two, three, and four-wheelers. It incorporates AC and DC chargers with varying capacities. EV owners can conveniently choose between slow charging via an AC charger or fast charging through a DC charger, based on their time constraints, traffic at the station and preferences. These facilities are the largest out of the three because of the sheer number of options available. These facilities are akin to roadside strip malls with a very large square footage (5000 to 20,000 square feet) and boast amenities like shops selling essential goods, multiple restaurants, bathrooms, regular petrol stations and in some cases even small hotels.
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Location
EV Charging stations can be set up in both residential and commercial properties, however commercial establishments are a strategic choice for electric vehicle (EV) companies due to the opportunities they offer for branding, advertising, and improved revenue sharing, thanks to the higher foot (wheel) traffic. In a commercial setting, location is key. Just like a regular fueling station, EV facilities need to be easily accessible and located at regular intervals. If a person Googles "electric car charging station near me" on a major national highway, your facility should be on the list. Scout the ideal location for your planned facilities. The prime locations for such facilities are near main roads, highways, near and around state borders and large highway stops and commercial strips.
Since electric vehicles take a while to get charged, having adequate amenities such as clean bathrooms, a good restaurant or chain fast food joint attached or in close proximity is a bonus that will attract users to your facility. In addition to this, EV facilities should offer adequate parking spaces for patrons who are using chargers and patrons who are waiting in line. All these amenities should be provided while leaving space for an on-site substation, transformer and safety equipment.
Conclusion
Maharashtra's EV policy targets setting up at least 1,500 charging stations in the state by 2025. In establishing a public EV charging network, it is important to understand where the demand for public charging will arise. Spatial distribution of parameters such as population densities, traffic volumes, commercial and institutional/workplace clusters can help predict the charging demand in different parts of the city. This, in turn, helps authorities or charge point operators in deciding the number of chargers required in a given area. This is a huge opportunity for entrepreneurs and corporations alike to set up shop and take advantage of the significant number of opportunities offered by the government. The demand is rising and is waiting to be captured.
