Decarbonizing India’s road transport: A meta-analysis of road transport emissions models
Where are India’s electric trucks?
This piece originally appeared in The Wire.
Last year, at COP26, India pledged to achieve net-zero greenhouse gas emissions by 2070. The transportation sector is responsible for nearly 14% of India’s total greenhouse gas emissions. It is also the fastest-growing greenhouse gas emission sector in India. Road transport, in particular, accounts for over 90% of transport emissions in the country. Therefore, to achieve the net-zero goal, India has to decarbonise road transport.
Electrification is a great strategy for decarbonisation, even today with India’s current electricity mix; over the years, the benefits will only increase as more and more renewable energy becomes available to power the vehicles. And there are existing electrification efforts focused on two- and three-wheelers, cars, and buses. These are steps in the right direction, but are they enough? Unfortunately, no, and it’s because they don’t include trucks.
India has more than 2.8 million trucks that run over 100 billion kilometres per year. While they comprise only about 2% of on-road vehicles, these trucks are responsible for about 40% of emissions and fuel consumption from road transport. Studies suggest that the share of electric trucks when it comes to overall freight trucks should be 79% by 2070 to reach net-zero emissions.
In that case, why do we not yet see any electric trucks on Indian roads?
First, it is absolutely feasible to electrify trucks. Indeed, some leading countries have already set targets to phase out internal combustion engine medium and heavy trucks. California in the United States has committed to 100% zero-emission trucks by 2045. Additionally, Austria will require that 100% of new registrations of heavy-duty vehicles less than 18 tonnes be zero-emission starting in 2030, and for those greater than 18 tonnes, starting in 2035. Norway has set a 50% zero-emission sales target for new heavy-duty trucks by 2030. It’s not only about developed countries, either. Our neighbouring country, Pakistan, has an electric truck sales target of 30% by 2030 and 90% by 2040.
So, if the electrification of trucks is possible, then why is it not happening in India? There are multiple reasons, but here are three of the main ones.
Lack of financial incentive
In 2021, more than 300,000 electric vehicles were sold in India, aided largely by a push from the national government through the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme. The second phase of the scheme, FAME-II, was launched in 2019 with Rs 1,000 crores to support 7,000 electric buses, 500,000 electric three-wheelers, 55,000 electric passenger cars and 1 million electric two-wheelers. The programme did not include any support at all for trucks. States like Delhi topped the FAME support with additional funding through their own electric vehicle policies.
More than 2,000 electric buses are currently operating on Indian roads. Recently a tender for an additional 5,450 buses was concluded, and Tata Motors was selected as the preferred bidder. A lot of this is due to support from FAME.
Right now, we have zero electric truck models available on the market, and that’s because there’s zero demand for these trucks. However, if trucks were included in a FAME-like scheme, we would at least see original equipment manufacturers spend more on research and development and bring in models for potential buyers.
Legacy trucking businesses are largely unorganised
It is estimated that more than 80% of the overall logistics spend in India goes to the unorganised sector. The trucking market is highly unorganised and three-quarters of the fleet is operated by those who have five or fewer trucks. In addition, 30%–50% of trucks return empty after delivering their cargo. From this, we can begin to see the challenges that arise in terms of waste of resources, high costs, heavily intermediated returns, and redundancies in the sector. This legacy business model presents a huge barrier in innovation.
For example, the high upfront cost of electric buses is being tackled by operating them under a lease model as opposed to outright purchase by the state transport undertakings (STU). The STUs are mitigating the technological risks of these buses by asking the manufacturers to operate the buses. The same cannot be applied to trucks as operators are small and fragmented. The technical and financial risks are enormous to be tested by these operators. Therefore, there is a need to identify innovative business models and public-private partnerships that enable smaller truck operators to afford electric trucks.
Still waiting for a policy push
India is the sixth-largest commercial vehicle market in the world and a large exporter of vehicles and spare parts. Because there is a large ecosystem that exists in the incumbent system, electrifying the commercial vehicle sector will need the right policy push. For example, California’s Advanced Clean Trucks (ACT) regulation requires manufacturers to compensate for deficits resulting from their sales of internal combustion engine trucks in California by selling a certain number of zero-emission trucks. Any excess credits can be traded among manufacturers. The ACT regulation has played a massive role in the scaling up of zero-emission trucks in California. Back home, many states in India have come up with electric vehicle policies, but most of them are currently silent on the freight sector. India needs a policy for electrifying its trucking fleet.
The share of road transport in freight movement in India is projected to constantly increase because of an improving highway system and the cost-competitiveness of the road sector. International Council on Clean Transportation studies estimate that heavy-duty truck activity might quadruple by 2050 to over 400 billion kilometres annually. Clearly, decarbonising the sector is vital for reaching the net-zero target.
It’s clear from the research that the internal combustion engine does not offer any realistic path to deep decarbonisation even if it includes alternative transport fuels like biodiesel, compressed natural gas (CNG), and liquefied natural gas (LNG). Only battery-electric and hydrogen fuel cells offer true solutions within the time frame of the Paris targets. And since hydrogen fuel cell technology is in the early phase of development and will require extensive infrastructure to be effective, it is clear that battery electric vehicles would work in most use cases.
Accelerating the use of electric trucks in India is doable. Just look at recent years as a guide. India leapfrogged from Bharat Stage (BS) IV emission standards to BS VI and bypassed BS V, even though it was once considered impossible. This is proof that with enough regulatory motivation, the ecosystem can be changed. The same level of ambition is needed for electric trucks. Doing this will be more than worth the effort because zero-emission trucks are aligned with India’s ambitious climate, air quality, and energy security goals.