- In the pathway to net zero, the current policies favour electric vehicles which have challenges such as a lack of supportive infrastructure, no battery recycling guidelines and an import dependency for batteries.
- Natural gas is a better alternative for the personal transport segment and people are adopting natural gas vehicles without artificial incentives, write the authors of this commentary. Hybrid CNG cars are also relatively less expensive compared to EVs.
- Hydrogen fuel cell vehicles could be adopted for heavy and passenger vehicles as a long-term approach towards energy transition and net zero.
- The views in the commentary are that of the authors.
India, at the climate conference COP26 last year, announced that it aims to stop adding greenhouse gases to the atmosphere by 2070. An energy transition in the transportation sector is an essential component in this journey to net zero. Net zero pathways for transportation should have distinct plans for short, medium and long-term horizons with synchronised strategies for personal, passenger and heavy vehicles components due to the distinct nature of the segments. Unfortunately, the current policy discourse is skewed towards electric vehicles (EVs), which is definitely a broad feasible solution for the short to medium-term in the passenger vehicles segment. EVs as a solution for public and heavy transport segments are not suitable even for the short-term future because of various constraints. Hydrogen cell-based vehicles can be a long-term solution towards energy transition for heavy and passenger segments.
EV penetration (annual registration) in 2014-15 was 2,344 and increased to 17,921 in 2015-16, thanks to the introduction of Faster Adoption and Manufacturing of Electric Vehicles (FAME) in March 2015, a scheme launched under the National Electric Mobility Mission, to encourage electric and hybrid vehicle purchase by providing financial support. This data is from the VAHAN Dashboard, a data repository of all vehicles registered in the country. FAME has propagated a steady penetration of EV in the Indian market. In 2018-19, the EV registrations stood at 1.47 lakhs (147,000) which further increased to 1.68 lakhs (168,000) in 2019-20.
FAME has significantly helped in the initial growth of EVs and has also helped initiate sustained electric mobility in India. By 2021-22, EV penetration reached 4.3 lakhs (430,000) about 2.6% of the total vehicles registered. However, according to a recent NITI Aayog and GIZ study, the Indian government has set an ambitious target of EV sales by 2030 comprising 80% of two and three-wheelers, 70% of commercial cars, 40% buses and 30% private cars.
The challenges with EVs in the long run
The schemes FAME I and II, production linked incentives (PLI) and even the recently tabled battery swapping policy are in place to spur faster adoption of EVs without definite recycling guidelines. The average life of a lithium-ion battery is only three years or 300-400 charging cycles, which means that EVs bought under FAME I, are now already on the verge of dumping their battery waste.
India’s EV journey, unfortunately, is conditional on imports, especially from China, a dominant player (around three-quarters of the global battery cell manufacturing capacity) in the battery supply chain. Currently, India has import dependency for fossil fuel (mostly for oil) to meet its energy demands, but the sources are more diverse. A hasty decision to transit to EVs will compel India to rely heavily on concentrated sources such as China, a risky move in the current geo-political scenario.
Natural gas as an alternative for the personal transport segment
Given the challenges faced by EVs, natural gas, a less polluting source compared to other petroleum products, could be an effective alternative and complement EV in the decarbonisation strategy for the short and medium-term. Natural gas can also address issues like import dependency, energy vulnerability, initial investment requirement and infrastructure development.
In 2018, the number of CNG (compressed natural gas) car registrations was 29,474 and hybrid CNG cars was 1,11,236, out of the 2.3 crore (23 million) car registrations in India. The total number of EVs registered that year was about 1,32,339. In 2021, during the pandemic, the total number of car registration declined to 1.7 crores (17 million) out of which CNG only was 1,65,027 and hybrid CNG was 2,38,652 while EV was 3,14,443. The EV registrations were mostly riding on the back of the government policy to promote EV (mostly e-rickshaw) and the government-arranged public transport (buses). The data indicates people’s acceptance of hybrid CNG as a credible alternative without being artificially incentivised.
India has a proven reserve of 43 trillion cubic feet (2017 data) of natural gas with a share of only 0.63% of global reserve. Based on India’s natural gas consumption, its domestic reserve can sustain about 22 years of consumption. As per government data, natural gas production (net) in 2016-17 was 30,848 million metric standard cubic metres (MMSCM) which has increased to 33,131 MMSCM in 2021-22. According to a recent study by KPMG, the share of natural gas in India’s energy mix is around six percent (2019-20) and is expected to reach 15 percent by 2029-30.
Compared to EV, the infrastructure is relatively better for both CNG and hybrid CNG cars. The proactive role of state and union territory governments (especially in New Delhi) to promote CNG-fuelled vehicles in the early 21st century, helped the infrastructure development. It also created awareness among consumers. Improved infrastructure gives flexibility to a consumer to switch fuels as and when required. Hybrid CNG cars are relatively less expensive compared to EVs, which is again an added advantage for a typical consumer. The price difference has made a significant contribution in hybrid-CNG adoption among consumers and is reflected in recent data. The availability of spare parts for a natural gas vehicle (NGV) or a hybrid NGV can make its adoption easier. Transforming CNG or hybrid cars (which is a short to medium-term solution) to hydrogen vehicles (cars) would be relatively easier than building a new infrastructure altogether for EV.
Hydrogen-based vehicles for the heavy and passenger transport segments
For heavy duty trucks and water transport, hydrogen fuel cell could be an attractive option for transition away from fossil fuel. In India, hydrogen fuel cell-based passenger vehicles (bus inaugurated in Pune), water transport (to be launched next year) are already in place while hydrogen fuel cell-based trucks are going to be introduced in Australia very soon.
All modes of transportation (maybe other than air) should, given the current scenario, converge to hydrogen-fuelled vehicles in the long-term. Given the resource and technology constraints, as a short to medium-term solution, hybrid CNG cars may be preferred over EVs for the personal vehicle segment, while hydrogen-fuelled vehicles could be adopted for heavy and passenger vehicles (buses).
Saswata Chaudhury is Senior Fellow at The Energy and Resources Institute (TERI) and Arijit Das is Fellow, India Development Foundation.
Banner image: An electric bus in Bengaluru. Photo by Ramesh NG/Flickr.