Summing up: What’s the potential for India to set a sectoral target for road transport CO2 emissions in its NDC?

The seventh and final blog in a series focused on our meta-study of India’s road transport emissions analyses.

At the start of this week, the Intergovernmental Panel on Climate Change (IPCC) urged nations to increase the ambition of their Nationally Determined Contributions (NDCs). India’s current NDC includes an economy-wide emissions reduction target and it is 2 °C compatible. But there aren’t targets for all emitting sectors, and these would help drive policy and action, including in transport. Like all nations that are party to the Paris Agreement, India has to submit another NDC by 2025. By specifying an emissions reduction target for road transport in its next NDC, India could come closer to aligning with what the IPCC has indicated is needed.

We previously explained that the emissions reductions captured by various models fail to showcase the full potential for India because most of the models do not incorporate many of the commonly employed decarbonization strategies. In this blog, we endeavour to show how much the emissions curve of on-road transportation could be bent, over and above the High Ambition scenarios previously discussed. We do this by creating an Aggressive Policy scenario, and it comes from adding three interventions to the High Ambition scenario: passenger mode shift from cars and two-wheelers to buses, freight mode shift from road to rail, and deeper electricity grid decarbonization.

Below we describe each of the additional interventions in the Aggressive Policy scenario. All other assumptions related to fuel efficiency improvements, vehicle electrification, and the use of alternate fuels are the same under the Aggressive Policy scenario as they are in the High Ambition scenario.

Mode shift from cars and two-wheelers to buses. As we discussed in the second blog in this series, in most of the models, the share of buses declines under the business-as-usual (BAU) scenario. Maintaining and further increasing the share of buses will be critical to achieving this mode shift, but studies show that improving the quality of public transport is typically not enough to pull users away from their cars and two-wheelers. Thus a mix of push and pull strategies, implemented in tandem, is likely to be required. Hence, improving and expanding public transport in cities is one part of the equation, and car and two-wheeler ownership and use restraint measures such as stringent parking norms, low-emission zones, vehicle mileage tax, and a car license plate lottery policy could also be employed.

In the Aggressive Policy scenario, we assume that the above measures would result in a gradual shift from private cars and two-wheelers to buses starting in 2022. We expect a shift of 10% of car and two-wheeler activity to buses by 2030 that increases to 20% by 2040 and then remains at that level until 2050. To accommodate the additional demand on bus systems, an additional 40% new bus sales would be required in 2025, and that would gradually need to be increased to 46% and 50% by 2030 and 2050, respectively. However, if the average passenger load of the bus systems improves by 25% (from 38 to 48 passengers per bus), the additional new bus requirement could be brought down to 30% and 40% by 2030 and 2050, respectively.

Freight mode shift from road to rail: Shifting freight from road to electric rail is considered a quick win for decarbonizing the transport sector in many countries. In India, however, the share of road in freight movement has been constantly increasing because of an improving highway system and the cost-competitiveness of the road sector. The railway share, meanwhile, has declined steeply. India’s limited capacity for operating freight trains, lack of reliability (freight trains do not even have a timetable), and high freight charges are some of the issues that plague the railways.

There has long been realization that the above trends need to be reversed. Many efforts are being taken by Indian Railways to improve railway capacity and reliability, and also the tariff structure. This is being done through measures including building dedicated freight corridors and route rationalization. Considering the proposed improvements in the railway infrastructure and service quality, we expect mode shift to take place gradually from the heavy-duty trucks segment to railways starting in 2025. We expect the shift to reach 10% of freight activity, in the unit of billion tonne kilometers, by 2030, 20% by 2040, and remain at 20% until 2050, as shown in Figure 1.

Grid decarbonization: Under the High Ambition scenario, in addition to assuming a high level of vehicle electrification, grid decarbonization was also assumed. The carbon intensity of the grid was assumed to reduce from 613 gCO2/kwh in 2020 to 84 gCO2/kwh in 2040. The carbon intensity of the grid was assumed to remain at the 2040 level until 2050, as it was considered that any further decarbonization would prove challenging. In the Aggressive Policy scenario, however, we refer to India’s high rate of renewable energy deployment and global pressure to retire coal plants, and consider that deep decarbonization of the grid would be possible beyond 2040. In this scenario, the carbon intensity of the grid would reach 50 gCO2/kwh in 2050.

Figure 2 illustrates the emissions trajectory for the High Ambition and Aggressive Policy scenarios under two post-COVID sales scenarios: the likely sales/plausible scenario and the low-sales/progressive scenario. In a likely sales scenario, which we think is the more plausible future, new sales are expected to return to the 2018 level by 2024; meanwhile, in the low-sales scenario, in which a progressive green recovery path is pursued, they are expected to return to the 2018 level only by 2028. Both scenarios were explained in detail in the blog earlier this month.

As you can see, the additional reductions from Aggressive Policy are substantial. Under a likely sales post-COVID scenario with Aggressive Policy, on-road transport CO2 emissions are expected to reach 111,787 kt in 2050, and that is a return to 2006 levels. Combining the Aggressive Policy scenario with the low-sales scenario would result in even lower levels of CO2 emissions, 93,491 kt in 2050, and that is a return to 2004’s level of emissions from the road transport sector. Under both the likely sales and low-sales projections, the Aggressive Policy scenario offers a 36% emission reduction in comparison to the High Ambition scenario (111,787 kt vs. 175,602 kt under the likely sales scenario and 93,491 kt vs. 146,357 kt in the low-sales scenario). Also, it is clear from Figure 2 that in the post-COVID context, whether we follow an Aggressive Policy scenario or a High Ambition path, emissions will reach peak by 2030.

Importantly, this analysis indicates that it should be possible for India to lower its cumulative road transport CO2 emissions by almost 45%–50% between 2021 and 2050; the savings are 45% in the High Ambition scenario and 50% in the Aggressive Policy scenario, both compared to the BAU scenario. In terms of annual CO2 savings, these could be as high as 76% in the case of High Ambition and 85% in case of Aggressive Policy scenario in 2050, compared to the BAU scenario. A sectoral commitment of a similar order, at least 45% cumulative CO2 emissions reduction between 2021 and 2050 in comparison to BAU emissions during this period from the road transport sector, or bringing CO2 emissions to at least 25% below the 2020 level, should be made in the next NDC. Not only will such an emissions reduction target provide strong policy direction in the country, but it will make India a global leader in clean transportation and the fight against climate change.

This is part of NDC Transport Initiative for Asia (NDC-TIA). NDC-TIA is part of the International Climate Initiative (IKI). The Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) supports the initiative on the basis of a decision adopted by the German Bundestag. For more visit: https://www.ndctransportinitiativeforasia.org/.

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