Ever since the Indian government announced to stop the sales of fossil fuel-based cars, automakers around the country are working towards electrification of the vehicles. It is said that 2-wheelers, 3-wheelers, and commercial cars will be leading electric vehicle penetration in India by 2030. Driving the EV adoption in the country, OEMs, battery management companies, and automakers together are creating a conducive ecosystem for India’s electric mobility vision.
Lithion Power is the ‘Battery as a service’ operator that provides lithium-ion batteries for e-bikes and 3 wheelers. Besides, they provide power to Electric Vehicles by battery swap. The company has set Lithion Swapping Points (LSP) across North India. We sat down with Mr. Chandrashekhar Bhide, who is the co-founder of the company, to understand more about how the company is contributing towards the electrification of vehicles in India.
Q. Lithion Power is one of India’s largest “battery at service” providers. How did the journey start and how many battery swapping stations are currently active?
Lithion Power was originally founded by Piyush Gupta who is the CEO of the company and I am the co-founder. Before starting Lithion Power, he was trying to create an electric bus from scratch which was in 2017 and it was a fairly ambitious project and he worked on it for more than a year. But then it was a little bit ahead of its time. So at that time, he decided to shift focus and pivot to batteries. That’s when Lithion Power was born.
Our core focus is the batteries because irrespective of the size of the vehicle and customer segment, we still need battery experts and there weren't any battery experts in India. Lithion Power was started with the agenda of becoming the most trusted and most technically qualified battery experts. The initial product lines were all focused on batteries. We design and develop battery management systems telemetry units, and we also started battery as a service business model. This was around three years back that we went commercially live and till COVID-19 hit, we had about 250 odd assets on our platform that got reduced because of COVID-19. There was a tremendous amount of pain in the system, people went back to their hometowns, there weren't too many drivers around and since we are focused more on B2B segmenting, it brought a lot of brands because of the COVID-19 and because of cash flow related issues. Now, we are rebuilding the business. Our numbers are right now small as compared to what we were at last year before COVID-19.
Q. Where are these charging stations currently spread across?
We started in Delhi and then we readily grew outwards because we wanted to have a network of closely connected battery charging and swapping stations. Currently, our presence is in the Delhi NCR region. But that is good enough right now because the bulk of the electric vehicle population in the country is in the Delhi NCR region. The four northern states accounted for more than 50% of the electric vehicles in the country.
Q. How does a typical Lithion Swapping Point (LSP) work? As an EV owner, how could one swap his/her batteries?
The end customer who is the driver of an electric vehicle will have a mobile app where you can see what the state of affairs in the battery is. You will come to know what is the charge remaining in your battery, how many more kilometers you can go, etc. The entire information is available in real-time. You will also have a real-time map or live location map for the Lithion Swapping Points in your vicinity, typically in a 3-5 km radius. Only those swapping points will be displayed on the map where there are batteries available at the current time. For example, in a 5 km radius, say there are five Lithion Swap Points but at that given point of time only three of them have an available battery, then it will show only three. You would have to drive to one of those locations that are shown on the map.
It is an assisted service model, so you don't have to do everything yourself. There will be a person who will just ask you for your unique ID which is typically the mobile number and the operator will come to know which is the battery that is currently put in your vehicle, how many kilometers you have driven, how much money you owe for the charge since the last swapping you have done, etc. So, all that information comes upfront. After that, the operator will take one specific battery from a charging station.
There will typically be a charging station having multiple batteries connected, the swapping point operator has a screen in front of them wherein they can see which is the best-suited battery; it is suggested by the system. Say, if it is a 3 x 3 matrix, then probably it will say the top left corner battery is for this particular customer. This all takes less than a minute. The battery is typically below the driver seat or the passenger seat, depending on the design of the vehicle. That is physically removed from the existing vehicle, put aside, and then the charged battery is taken from the rack and then connected to the vehicle and the empty slot, the previous battery is put for charging.
The entire process takes hardly between 2-3 minutes depending on the manual dexterity of the person involved. The end customer also pays for the energy that they have consumed in the previous cycle, and they can pay it through the mobile app. There is payment gateway integration and customers can pay using Paytm, wallet or UPI, or any of the existing modes. That is a simple, quick, and efficient process.
Q. Could battery swapping be the solution for Range Anxiety Problem with Electric Vehicles, why do you think so?
We are focused more on the B2B side of things. We are not active in the B2C segment. Retail individual customers like you and me probably will not be using swapping points that much because a typical individual will use their vehicle for maybe 30 - 40 kilometers, not more than 50 kilometers daily. A single charge will be sufficient for them to cover this distance. When the vehicle is back home in the evening or at night time, you can charge it and use the vehicle the next day. That works for B2C, but for B2B, typically, across two customer segments: One is the shared passenger mobility. So you would have seen hundreds of electric rickshaws, electric autos below every metro station. They cover anywhere from 100+ kilometers daily. The second customer segment is the last mile goods delivery, intra-city goods delivery. These will be for e-commerce players.
Both these types of customers cover 90- 100+ kilometers daily. A single charge, depending on the configuration of the battery, will last you anywhere from 60 - 80 kilometers and commercial fleets cannot afford to wait for 4-6 hours to get fully charged. In fact, in the B2B segment, the vehicle, if it is standing around doing nothing, then it is not considered good. You need to start the asset, maybe have two drivers and make them work in shifts and then run the vehicle. In this case, you don't want to have too much downtime for the vehicle. In this scenario, swapping is the best solution because you just swap out the battery, and in 2-3 minutes and you're done and the vehicle is back on the road. In the B2B segment, the actual running of the vehicle is directly proportional to the revenue potential, which is why B2B makes sense. In B2C, you don't try to get the revenue out of the driving of a car; it is for your convenience to move from point A to point B. We believe that swapping will be preferred for the B2B segment but swapping and charging will co-exist if we look at the total electric vehicle industry in general, which includes the B2C players.
Q. As a service provider, what are some of the challenges that you face when deploying and running a battery-swapping station? How did Lithion Power deal with these challenges?
One of the challenges that we faced was the mindset of customers that the battery in my vehicle should be my battery. There is a difference between possession of an asset versus ownership of an asset. A good analogy could be the LPG cylinder that is used for cooking. You and I as end customers as end-users of the LPG cylinder, do not worry that much about the owner of the cylinder. All you are worried about is the 14.2 kg LPG inside the cylinder. You don't even worry about how red the color is. As long it is working fine, and not damaged, nothing else matters. Similarly, the battery is just a container for energy. So you need not worry about how clean the battery looks, how good the battery looks as long as you are getting your promised energy. So, the initial customers were a little worried because they were saying this is my battery. It took some time for them to understand that you don't worry so much about the battery because what we're promising is the energy. Later on, people wanted to make cash payments also. We had an online model because we were feeling that everybody will make payments using UPI, Paytm, etc. But for the rickshaw drivers who were earning money in cash. At the end of the day, they have a lot of cash. So, they wanted us to accept cash which we enabled. Those were initial challenges and now there are not so such challenges, people are comfortable using them.
Q. The battery packs and connectors used in Electric Vehicles are not yet standardized in India, how Lithion Power manages to swap batteries between different Electric Vehicles.
The external form factor varies, but not to a great extent in the same class of vehicles. If you've seen an electric rickshaw, it is a very standard design and there are 150 odd manufacturers of electric rickshaws or electric autos and this is in the Delhi NCR region alone, but they have a very similar design. If you stand below a metro station, in 10 minutes you will see 30-40 different types of rickshaws, but you will notice that the design is very similar. The battery packs are also very similar. The Ah will vary, some batteries will have 70-100 Ah. But, we are not dealing that much in the battery form factor; it is in the energy and as long as you are getting your required energy, it doesn't matter.
The second thing is the physical form factor. If you have seen a battery, it is more or less the standard dimension with minor differences in inches and even the place in which the battery fits inside the vehicle that has got some space. This is consciously built-in by the electric vehicle OEMs because they understand that batteries will be changed after a few months, a year or so. So, there is always some space, and it is a rectangular form factor.
Next are the connectors. Taking the gas cylinder example further, you wouldn't be facing any problem in using any kind of cylinder. It doesn't matter who is the provider of the cylinder as long as the regulator on top of the cylinder is the same and the connector to the gas stove is the same. We did the same thing; the connectors on both ends are standardized. This is very true for the three-wheeler industry. There is a connector called Anderson connector which is a kind of the de facto connector for connecting the battery to the vehicle. So, that problem is also more or less solved. For two-wheelers, the form factor could be an issue because, in the three-wheelers, the real estate isn't that much. Many of the two-wheelers are not designed here, they import securities assemble here, put the label, and sell. So, they use a standard two-wheeler battery pack which is mostly from a neighboring country. It is also not that difficult but yes, the location or the placement of the two-wheeler battery is sometimes different. Sometimes, it is below the seat, sometimes it is below the footrest but there are only X number of such configurations and the battery sizes are also more than three-wheeler but it is not that unmanageable.
The technical characteristics inside the battery are more important so, you need to know what is the total battery pack voltage, how much is the Ah. The battery management system which is the heart of the battery needs to be a smart connected battery and it should have two-way communication. This is something that we have designed and developed in India for India. We work with multiple electric vehicle OEMs, multiple battery pack manufacturers and they use our smart connected products and their vehicles automatically come on to our platform. We are already working with some 30 such partners, which is why we can do it for the vehicles of these OEMs.
Q. How does Lithion Power monitor the health of batteries that are being swapped?
We are not giving battery as a service; we are giving energy as a service. For example, if you want 50 Ah, I can give you a 100 Ah battery pack with a 50 Ah charge in it for I can do a 60 Ah battery pack with a 50 Ah charge. What you are going to pay for and what you want is a 50 Ah or whatever that number is. For you, technically it doesn't matter what is the battery getting used as long as you get the energy and most consumers don't understand energy, but roughly the kilometers traveled.
We have the battery management systems, telemetry units, these are all designed developed by us and these continuously send data to the server/cloud on 24 x 7 basis, irrespective of whether the vehicle is running on the ground, whether the vehicle is parked, whether the battery is on the charging rack and getting charged if it is getting charged, how many more time it needs to get fully charged if it is fully charged, then what is Ah. So, we get data 24 x 7 about what is the state of affairs of the battery and we do this on the daily basis. We know, for every battery, what is the state of charge, what is the state of health, etc. For the last 3+ years of commercial operations, we have collected billions of records, translating to 100 plus billions of data points. We have built our internal models, which help us determine how good a battery is, and sometimes that is way more accurate than the manufacturers’ datasheet. Because the manufacturers’ datasheet is for standard tests conditional check, they will have 10-star mark conditions. But in reality, the performance will be different and we will know that because we would have seen the performance of that battery every second.
Q. Can you elaborate a bit more on the BMS that Lithion Power has developed. What parameter does this device measure and who does all this analytics?
We know that battery is a collection of cells. Multiple cells are assembled and there is electronics or printed circuit board put on top of this. That determines how reliable and how dependable will the collective battery pack output charge will be. There are certain features that a good battery management system should have. It should protect against overcharging, its total voltage should not go above a particular point, so there is overcharge protection. Similarly, there are upper and lower thresholds for the current. A battery pack is typically rated for nominal current and a peak current. There are optimal ranges within which a battery pack should operate. All that is controlled by the electronics on top of it, there are multiple other sensors inside the battery pack. For example, there will be temperature sensors and not just one; ideally, it should be multiple temperature sensors. It will monitor temperature at different places from different points within the battery pack, the power temperature, ambient temperature, etc. There are multiple such sensors and all of these sensors are connected and they can send data.
It has a GSM module, GPS module and in our implementation, it also has onboard memory storage so a lot of data gets collected and is sent to the cloud. It could be individual cell voltages, current being drawn, capacity left, location parameters like latitude and longitude, few details about the vehicle, about the driver. All these details are saved locally if there is no network availability. If there is network availability; it is sent to the cloud. It will constantly monitor all these parameters and ensure that it is within a specific optimal operating range. Let’s take an example of MOSFET temperature. MOSFET is one kind of electronics component, if the temperature crosses 85 degrees Celsius, then there could be a safety risk. If it reaches 90 degrees, then there could be a fire. So you need to constantly monitor and then take actions there and then. All these things are done by a battery management system. The telemetry unit collates the data and sends it to the server and does the communication between the connected assets and the server.
Q. Who manages the entire data? Does the customer get to see any of these data or not?
Currently, in our implementation, we have complete access to the data. If the customer wants, we provide them access to whatever data points they need. For example, we work with some fleet operators. They are not so much worried about let’s say, the temperature readings, but they are worried about the utilization of their assets. For our fleet operators and their managers, we have a dashboard wherein they can see on a live location map, where are their vehicles and drivers right now, in which direction are they headed, at what speed they are moving, what is the current being drawn every second. There is a driver performance indicator. From a pool of X drivers, there is a rating of each driver on a couple of parameters. How safe is their driving, how efficient is their driving? For example, you and I will drive a vehicle differently. You could probably drive it very safely within a certain optimal speed whereas, I could be driving it very rashly, I would be unnecessarily accelerating and then screeching to a halt. Since we have smart electronics inside, we will come to know because the current will suddenly spike and then the next second it will drop. So, then I will know that this particular driver is a rash driver because of the jerky driving characteristics. There are certain trends that we can derive based on the real-time data collected and then we pass it on to the fleet operators to understand the relative driving performance of their drivers.
Q. How do you see the market for battery swapping stations in India?
We believe that for B2B customers who want to use their assets for growing their business revenues; I think swapping is a very good option because it's very simple. If you want to charge a battery by regular charging, then it will take you 4-6 hours. If you can afford downtime of four to six hours, charging is the way to go. If you don't want to go with that option and run your vehicles in shifts and get 1.5 -1.6 or 2x as revenue then swapping is a good solution. But we also understand that for B2C segments, this probably is not a good solution because they don't need it. So, we believe that battery swapping and charging will coexist and depending on the use case, depending on the type of customers, there will be a certain bunch of people who will prefer swapping and again this is more focused for three-wheelers and two-wheelers because that is the largest addressable customer segment right now. The total number of electric cars in the country is less than 20,000 and that is scattered all over the country.
On the other hand, Delhi alone has got more than two lakh electric vehicles. Right now, the bulk of the electric vehicle population is electric three-wheelers which is the largest segment out of 2.5 million electric vehicles in the country 2.2 million roughly are electric three-wheelers and there are about two and a half electric two-wheelers and 20,000 electric cars. So, even though you know when people talk about electric cars, Elon Musk and Tesla come to mind right but the reality in India is that bulk of the electric vehicles is electric rickshaws and electric autos and for them, battery swapping is a very good solution. It also depends on the electric vehicle OEM because for example, if a particular OEM decides to make their batteries not swappable, which means they cannot be physically removed from the vehicle, then, of course, they cannot get onto a third party open platform like ours.
Q. What are your plans for Lithion Power?
We recently started a separate line of business which is into last-mile delivery for e-commerce partners. Earlier, we were working with local fleet operators and we were powering their fleet. But now, we are having an electric vehicle fleet and doing last-mile deliveries for Big Basket and a few others. You can imagine, most of these e-commerce companies are under tremendous pressure to have some bottom-line profits. They are having a lot of business, especially in these COVID times, the monthly volume has grown anywhere from 15%- 25% because nobody wants to get out of their homes, everybody wants everything to be delivered at that their doorstep. All the e-commerce platforms have announced plans to have an increased number of electric vehicles in their fleets. We are working with some of them and the vehicles are on our platform, the drivers on our platform and our drivers are the delivery boys who do the last-mile delivery to the customers. This is something that we started a couple of months back and we are expanding with each passing month. Right now we are in the Delhi NCR region. But shortly we will be launching our services in a couple of other cities that as well.
These are all connected businesses. EV charging and battery swapping business are growing along with the fleet delivery business, as in I do not want to create a swapping network where there is no fleet. There are a few other players in the market who have created EV charging infrastructure at high rates and the utilization of that is very low i.e. less than 5%. On our network, the utilization is very high because it co-exists and it is co-located with the fleet delivery vehicle.
We believe that whatever businesses we are in right now going to tremendously increase in the next year, more players are coming in. Of course, everybody knows about Tesla setting up a subsidiary in India. Some large traditional auto giants are tying up with battery swapping pioneers outside India and now starting it in India as well. So this space is going to see a tremendous amount of action. And we are ready!