EV Future in Pakistan

A DETAILED REPORT ON ELECTRIC VEHICLES INCLUDING INTERNATIONAL PRACTICES, OMC

STRATEGY, APL STRATEGY, AND EV FUTURE IN THE PAKISTANI MARKET ALONG WITH
CHALLENGES AND SUGGESTIONS

REEJA BAIG
STUDENT OF COMSATS UNIVERSITY ISLAMABAD |
Executive Summary
This report provides a detailed study on Electric Vehicles including the international
practices, market dynamics in terms of OMCs strategy, EV future in Pakistani Market,
Challenges in the Pakistani market along with the possible suggestions to overcome these
challenges.

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Contents
Executive Summary.....................................................................................................................................1
International Practices.................................................................................................................................3
Overview of the EV charging station infrastructure....................................................................................3
Types of EV charging................................................................................................................................4
Components of an EV charging station....................................................................................................4
Use of EV in different environments........................................................................................................5
EV charging in Pakistan................................................................................................................................5
Automotive Sector in Pakistan................................................................................................................5
Performance of the Automotive Sector...................................................................................................6
Market Dynamics (OMC strategy)...............................................................................................................7
Strategy of APL............................................................................................................................................7
Challenges in the Pakistani Market.............................................................................................................8
Suggestions..................................................................................................................................................8
Conclusion...................................................................................................................................................9

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International Practices
Due to growing concerns over environmental degradation, the global automobile industry is
transitioning from hydrocarbon-based fuels to more efficient and environmentally friendly
technologies. The use of fossil fuel vehicles (FFVs) and related environmental degradation
are anticipated to rise in the future due to the current population growth and increase in
industrial activities unless proactive measures are taken. Therefore, it is essential to place
more emphasis on environmentally friendly technologies, particularly Electric Vehicle
Technology.

EVs are gradually but surely taking over the automotive industry on a global scale. Since
vehicular emissions are one of the main causes of GHGs, EVs are being promoted especially
in light of the global commitments to reduce GHG emissions. Although China continues to
dominate the global EV market, sales are also accelerating globally.

Due to more expensive inputs and material costs associated with batteries, etc., EVs have a
much higher capital cost than comparable automotive technologies because they are still in
the early stages of technological development. Nevertheless, several predictions state that
as we advance along the technological development curve, prices for these inputs and
materials should decline as volumes of production and market uptake rise.

The cost of ownership of electric vehicles (EVs) is expected to be at par with that of fossil
fuel vehicles (FFVs) within the next few years, according to analysts. International Energy
Agency (IEA) forecasts around 250 million EVs on road by 2030, excluding two and three-
wheelers.

Overview of the EV charging station infrastructure

The EV automakers are concentrating on building out the infrastructure for EV charging
while also investing in long-range battery vehicles.

The focus of EV charging solution providers is to deliver more cutting-edge and dependable
e-mobility charging solutions that assist in building a digital space connecting vehicles,
buildings, and utilities. To meet their current and future needs, electric vehicles need to be
charged quickly and on-demand, with reliable connectivity.

Types of EV charging
The three types of EV charging are described below:

1. Level-1 EV Charging (120 Volts) :

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 The majority of electric cars come equipped with a control box and a power wire that
can be used to charge level-1 electric vehicles at 120 volts. Installing Level-1 chargers is
not necessary; they just need to be plugged in. The only disadvantage of level 1 chargers
is that it takes around 16–18 hours to fully charge a 60-kWh car.

2. Level-2 EV Charging :

Electric vehicle supply equipment (EVSE) and electrical wiring must be installed before
using level-2 electric car charging equipment, which supports currents up to 240V AC. A
60-kWh car can be fully charged in 7 to 8 hours using a 7 kW EV charger, which is
substantially quicker than Level-1 chargers. Level-2 chargers can be utilized in residential
or commercial settings such as houses and flats, small offices, hotels, and retail
establishments.

3. Level-3 EV Charging (480 Volts):

Public charging stations are the main application for DC rapid charging. Comparing these
systems to level 1 and level 2 chargers, they are extremely pricey. Commercial usage for
DC (level 3) EV chargers can be found in fleets of cars and public transportation systems
that need quick charging and can handle a large number of vehicles at once. An electric
car may be recharged using level-3 charging in 20 to 30 minutes.

Components of an EV charging station

An electric vehicle charger, the power grid, a facility meter, an energy controller, a network
operations center, and other pertinent parts make up the EV charging station.

Battery, Power Conversion System, and Software are the three primary components of the
power storage system of an electric vehicle charging station.

The infrastructure for EV charging includes electric vehicle charging software. It aids with
the management of EV charging stations and their users for charge point operators and e-
mobility service providers. The EV charging software has several important capabilities,
including the ability to connect and monitor the charger, view live meter data, bill and pay
customers, monitor expenses, manage users, and more.

Use of EV in different environments

With modern smarter, more dependable, more accessible, and emission-free solutions,
electric vehicle charging solutions are designed for all types of clients. The most recent EV
charging technologies include on-demand EV fleets, high-quality AC wall boxes, DC rapid
charging, and a compact design. The AC Type 2 chargers used at public charging stations are
appropriate for usage in a variety of settings, including workplaces, retail establishments,

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hotels, and public commercial charging. A centralized management program may be used to
handle these systems since they are reliable and long-lasting.

EV charging in Pakistan
Pakistan is one of the least carbon-emitting nations in the world, yet it also has one of the
worst effects on the environment. Pakistan co-chairs the 32-nation Group of Friends on
Sustainable Energy, which is dedicated to a shift from fossil fuels to renewable energy,
together with Denmark and Norway. Pakistan aims to build 3000 of these EV charging
stations in the first four years, which would cost a sizable amount of Rs 9.6 billion.

The introduction of electric vehicles (EVs) in Pakistan is anticipated to have a significant role
in reducing the country's enormous import expenditure for oil. Newer technologies, such as
EVs, have the potential to kickstart an entirely new sector in Pakistan, resulting in several
green enterprises and job possibilities as well as an improvement to the country's
socioeconomic climate.

Industry analysts believe that the 2-3-wheeler category in Pakistan has the highest potential
for partial conversion to EVs shortly. The adoption rate of EVs is anticipated to be slow at
first due to Pakistan's road infrastructure and consumer behavior, but both current and
potential new stakeholders and investors are evaluating the market and waiting for a
favorable policy framework from the government to encourage their entry into this sector.

Due to the country's budgetary and economic position, the Pakistani government may not
be able to offer direct consumer subsidies for electric cars (EVs). Other countries, too, have
increased tax cuts, incentives, and subsidies for EV adoption. With the savings in fuel import
costs, the decrease in expenses associated with emissions, the reduction of idle power
capacity, and income from charging revenues, these early incentives, tax advantages, and
benefits are anticipated to pay for themselves.

Automotive Sector in Pakistan

In Punjab, the transportation sector is responsible for 43% of the emissions. The information
in the coming lines illustrates how various industries contributed to emissions. Agriculture
makes up 20%, industry 25%, and the electricity sector 12%. In terms of number, motorbikes
are more prevalent than automobiles, light trucks, or heavy vehicles when it comes to
transportation. Additionally, they work in urban areas and are therefore seen as a source of
pollution.

If reducing environmental pollution is the primary factor in switching to electric vehicles, the
way power is produced also matters. Since a significant portion of Pakistan's power is

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produced from fossil fuels, the environmental goals cannot be completely met unless this
issue is also handled by the relevant government institutions.

The Pakistani automobile industry may be divided into the following subsectors: cars, light
commercial vehicles (LCVs), two- and three-wheelers, tractors, trucks, buses, etc. The
details are as shown in the table :

Category No. of Units

Cars 6
Trucks / Buses 7
Jeeps / SUVs 3
LCVs / Pickups/ Van 7
Two/ Three Wheelers 132

Performance of the Automotive Sector

Significant portions of all vehicles produced in Pakistan are 2-3 wheels. More than 2.4 million
motorbikes were produced in Pakistan over the same period, out of 2.86 million total
vehicles. Either a portion of the current market will be taken over by EVs, or a partially new
market will be created just for them.

Motorcycles, rickshaws, and loaders provide the potential for market penetration since it is
simpler to create their infrastructure than it is for regular cars, which could need charging
stations on highways and motorways. Motorcycles and rickshaws that run on regular
gasoline are only sometimes exported from Pakistan.

Manufacturers of auto components are mostly found in the regions of Gujranwala, Lahore,
and Karachi. About 3600 auto parts suppliers are operating in Pakistan, including 286
registered ones (Tier-I: 700, Tier-II: 1300, Small and Cottage Units: 1300). The availability of
skilled vendors for producing common parts is an advantage for Pakistan in its move
towards electric vehicles (EVs).

Indeed, EVs do not have maintenance expenditures related to replacing lubricants and
filters. However, one of the key factors that customers consider when choosing an
investment is the cost of replacing the battery in EVs, which is significant. With time, it is
anticipated that battery costs will decline.

Market Dynamics (OMC strategy)

As sustainability becomes a pressing issue of the day, forward-thinking businesses
throughout the world are working to minimize their carbon impact and so are the oil
marketing companies.

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Pakistan State Oil (PSO): Being a major market player, PSO has been able to install 03 EV
chargers. It inaugurated its first Electric Vehicle Charging Station in Pakistan at Capri Gas
Station at F7 Markaz, Islamabad, followed by Sunshine Petroleum, Lahore. As a part of its
plans, PSO is in the process of installation of two more Electric Vehicle Chargers on the M2
motorway at Bhera north & south service stations. This would serve as a beginning of a new
era in the automobile industry of Pakistan. PSO, Pakistan’s national energy company, claims
its support toward positive advancement and environmental sustainability by installing more
EV Charging stations as the number of vehicles increases.

Gas and Oil Pakistan Limited (GOPL): Gas & Oil Pakistan is pleased to be Pakistan's first OMC
to introduce electric vehicle charging facilities. The first of these EV charging is now
operational at the Lahore-based GO Company Owned & Company Operated (COCO) retail
location. GO intends to expand the number of electric car charging stations at more retail
locations throughout Pakistan's roads and motorways.

Shell Pakistan (SPL): Additionally, K-Electric and SHELL Pakistan worked together on their
EV pilot project to deploy three EV chargers, mostly in Karachi (50 KW each). SPL and KE will
investigate the possibility of additional locations to strategically extend the EV charging
network over the course of the next three to five years. ABB and SHELL (International) have
formally agreed to a contract/MOU for the supply of EV chargers all over the world.

Strategy of APL
Following Pakistan State Oil and Shell Pakistan, Attock Petroleum has created an electric car
charger for Pakistani users.

To address the demands of the Pakistani market for electric vehicles, APL has planned to
deploy cutting-edge EV charging infrastructure on its retail network. As major automakers
have set goals to minimize carbon emissions by updating and restructuring their product
lines and switching to the production of electric cars, electric vehicles are anticipated to play
a significant role in the transportation sector in the future years.

APL is thus keeping an eye on this market's expansion and will be looking into the possibility
of putting EV chargers in its retail network to contribute to the dynamics of the changing
environment.

At its flagship retail outlet in Islamabad's Blue Area, APL has completed the installation of its
first EV charging station. The business is also looking into the possibility of putting in an EV
charging station at one of its landmark locations in the future as per the viability and
demand.

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Challenges in the Pakistani Market
Pakistan, a developing nation with underdeveloped road infrastructure and challenges in
providing particular financing or subsidies for EVs, may therefore confront the following
issues, which require cooperation among multiple government departments and
stakeholders to be resolved.

1. In Pakistan, there is no established program for vehicle retirement, and aging cars,
buses, and trucks all contribute to pollution. It takes coordinated efforts from all
relevant departments to accomplish goals sustainably.
2. The general public has to be made aware of the benefits of electric cars over those
with internal combustion engines.
3. EVs are an expensive choice. A sizeable portion of the overall cost of an EV is made
up of the battery cost. The typical battery life is five years, thus clients in Pakistan
would not be enticed to pay the initial fee.
4. Pakistan's road system, particularly in its less developed regions, is not suitable for
electric vehicles (EVs), which are predicted to be high-tech and lightweight.
5. No specific funds are available to help with the gradual import replacement through
localization, which might reduce the price of EV-specific parts in the future.
6. Given Pakistan's underdeveloped conformity assessment system, standardization,
quality, and equipment safety would be challenging.
7. The main problem is the lack of charging infrastructure. Work must be done to
determine who will invest in the infrastructure for charging.
8. Battery disposal must be assured since it poses a risk to human health.

Suggestions
The possible suggestions to deal the challenges in the Pakistani market are as follows:

1. Measures such as the lowering of the GST, road tax exemption, income tax
advantage, decreased electricity tariff, toll costs, permits, attractive leasing, free
insurance, and registration, etc. are recommended in order to increase consumer
interest.
2. Incentives for both departing players / manufacturing units and new entrants have
been suggested to encourage stakeholders to set up EV manufacturing facilities and
introduce EVs, along with interventions to promote the production of parts and
components for the local market and potential export in the future.
3. Interventions from the related government organizations may be required as stated
below:

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  To assist in the development of charging infrastructures, NEPRA, CDA,
Metropolitan Development Authorities, and OGRA should offer the necessary
measures.
 Pakistan Standards and Quality Control Authority (PSQCA)will help with the
implementation of EV and other vehicle quality standards. EDB and PSQCA will
assess UN Regulations 100 and 136 together in a technical committee before
adding them to the list of regulations to be implemented. Similar to this,
PSQCA must consider IP 67 criteria for water resistance in motors.
 Excise & Taxation Department of Islamabad and other important cities will
handle registration incentives, tax breaks, and uniquely designed EV license
plates.
 NHA will put incentives in place including toll tax exemptions.
 Departments of provincial excise and taxation will amend the MVR ordinance.
4. Currently, there is no mechanism to register an all-electric vehicle in Pakistan. The
Government of Pakistan, in collaboration with relevant entities, shall take the
following measures:
 A special/distinguishable registration plate color and design will be allocated
to electric vehicles by registration authorities.
 In case of no registration fee, the categorization is not required. Registration
authorities to devise a suitable mechanism.
5. Setting up standards is a crucial first step in advancing electric transportation.
Standards can be created concurrently and support a certain policy.
6. Charging infrastructure be installed at different points in all selected cities initially and
will be expanded to all secondary cities. In each selected city at least one\DC fast
charger to be installed in every 3x3 km grid/4x4 km grid (as per advice from relevant
department).

Conclusion
The necessity of the hour is to transition to EV charging facilities. The adoption of electric
cars in Pakistan has the potential to address current and future issues in a number of areas,
including transportation, the environment, and power generation among others, in addition
to improving the country’s economy. The implementation phase must, however, be properly
planned and carried out while taking into consideration the possibilities, difficulties,
strengths, and limitations. It wouldn't be much use if the electric car strategy led to a
situation resembling the compressed natural gas catastrophe. To analyse the potential
direct, indirect, long-term, and short-term repercussions on the stakeholders, a very
thorough policy evaluation is required.