The Ministry of Power has categorised electricity utilised at an electric vehicle (EV) charging station to be counted as ‘power consumed’, and has thus negated the need for a separate power trading license.
The government’s notification goes on to state that under the Electricity Act of 2003, the charging of EV batteries at a charging station involves ‘utilisation’ of energy for its conversion into
chemical energy which gets stored inside the battery, and in no way, involves the ‘sale’ of electricity to any person, as the electricity is consumed within the premises owned by the charging stations,
which may be connected to the distribution system or otherwise, for receiving electricity.
According to the clarification note, the Electricity Act carries clear definitions for ‘consumer’ and ‘trader’ of electricity. As per the definitions, a consumer means any person who is supplied with the
electricity for his or her own use and includes any person whose premises are for the time being connected to the grid for the purpose of receiving electricity. On the other hand, trading of
electricity is defined as procurement of electricity for its resale thereof.
Applying the same logic, an EV charging station does not involve any further activities namely transmission, distribution or trading of electricity, which require license under the provisions of the
Act. Hence, the charging of batteries of electric vehicles through charging stations does not require any license under the Electricity Act of 2003, the clarification states.
The government’s stand is now expected to give a boost to the development of charging infrastructure and drive e-mobility in the country in the coming future.