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EV-only plan for net zero carbon roads is unviable; give auto LPG a chance, Auto News, ET Auto


 It is time the authorities considered promoting vehicles using alternative clean fuels such as auto LPG as an option along with EVs.
It is time the authorities considered promoting vehicles using alternative clean fuels such as auto LPG as an option along with EVs.

By Suyash Gupta

The government of India has continued to demonstrate a policy intent for a cleaner and environment-friendly transportation system in the country led by electric vehicles (EVs). These policy releases range from the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) scheme 2015, later extended to 2019, to its recast, as FAME II, extended till 2024, and the release of the National Electric Mobility Mission Plan 2020,

These policies have sought to promote EVs in two ways: One, by fostering the making of original and new electrical vehicles by OEMs; and two, by way of encouraging a retrofitment ecosystem for conversion of the combustion engine-based vehicles into electric vehicles.

However, the question is whether this aggressive pursuit of increasing EVs on the Indian roads is possible at least in the short and medium term? And if considering the conversion route, whether it is possible to convert a staggering 300 million cars (only increasing by the day) or even a third of them by 2030?

It is time the authorities considered promoting vehicles using alternative clean fuels such as auto LPG as an option along with EVs. Auto LPG has a well-developed infrastructure and supporting ecosystem in the country.

Is the Government cautiously optimistic?

The government has scaled down its target of hitting 100% electrification of vehicles by 2030, to achieve EV sales for 30% of private cars, 40% of buses, and 8% of two-wheelers and three-wheelers by 2030. In an estimate, this scaled-down target also implies having 102 million vehicles on the roads, which is not a small number. In fact, top automobile experts have estimated that at best, about 8%-10% of EV sales may be possible by 2030 which is well short of the government’s target of 30%.

The fact that the government has deferred its targets means that somewhere there is a degree of skepticism on its part; or at best it is cautiously optimistic.

This cautious approach of the government to a much-touted and ambitious target of the unbridled proliferation of electric vehicles could stem from several debilitating factors like the enormous transitional investment needed especially for charging infrastructure; the lack of resources and components for battery systems within the country; high cost of EV conversion as compared to auto LPG; and high cost of electric vehicles.

The cost of converting an ICE vehicle into an auto LPG is a modest INR 25,000 to INR 30,000 as compared to the cost of transition into EVs at nearly INR 3 lakh to INR 5 lakh a unit.~

Enormous transitional cost: Even for reduced EV target, it has been estimated that India would need an investment of around USD 180 billion, and over 2.9 million charging points will be required by 2030. But now there are only about 15,000 charging points including those at homes and workplaces.

Apart from the financial challenge, which also includes the cost of real estate, the logistical complexities of identifying charging sites and installing charging stations for different end-user groups including residential societies, office complexes, highway users, and commercial fleets need to be worked out.

Lack of local resources for battery systems: Enough has been written about and discussed on the fundamentally inadequate battery infrastructure in the country. The poor quality of batteries, the faulty battery management systems, and the use of defective designs and modules have already been responsible for a series of fire incidents.

India also lacks raw materials such as lithium and cobalt to develop a flourishing ecosystem domestically. As a result, the dependence on countries such as China not only goes against the grain of India’s self-reliance drive but also is fraught with enormous politico-commercial risks.

High cost of EV conversion: With some state governments initiating the process for retrofitting of old vehicles primarily with the aim of replacing the high carbon-emitting petrol and diesel vehicles, the cost component is quite a deterrent. It has been estimated that retrofitting an old ICE vehicle with EV technology can cost anywhere between INR 3 lakh to INR 5 lakhs.

This is as much as the cost of a new vehicle. For a cost-conscious country such as India, it would be hard to imagine that the end-users or even the commercial vehicle users would be willing to convert their existing ICE vehicles into EVs. There is also not much of a retrofitting ecosystem for EVs in the country.

Demoralizing the consumer: From the end-consumer’s perspective, the higher cost of a new EV than that of an ICE vehicle is certainly a deterrent. Moreover, the acute shortage of charging infrastructure, lack of service options, range anxiety, and the cost of batteries will drive consumers away from EVs.

Over 4 lakh EVs are sold in the country now. But this is an insignificant number when compared to the existing 300-million strong (and still counting) ICE vehicles in the country. Given the end-consumer disinclination to opt for retrofitting for various reasons, including the prohibitive cost component, imagine the increase in the number of vehicles on Indian roads even in the face of some of them being phased out over the years.

Auto LPG can play a key role

Against such a daunting backdrop, the adoption of auto LPG can turn out to be another potent weapon in the government’s battle plan against transport-related pollution. Notably, auto LPG has a global warming potential (GWP) of zero, a hugely desirable attribute for the government’s low carbon mobility drive. It also leads to negligible emissions of particulate matter and nitrogen oxides.

With more than half of the country’s electricity still sourced from fossils, well-to-wheel emissions need to be fully considered. Even for consumers, it is at least 40% cheaper. The cost of converting an ICE vehicle into an auto LPG is a modest INR 25,000 to INR 30,000 as compared to the cost of transition into EVs at nearly INR 3 lakh to INR 5 lakh a unit.

Therefore, it is indeed imperative for the government to pursue a multi-pronged approach, employing both the EVs and auto LPG as a part of its strategy for a low carbon transportation in the country. Enormous subsidies given to the EV sector have not so far shown any positive results in terms of a price reduction from the end-consumer standpoint.

Also, given the still stuttering EV (including battery systems) value chain, it is unlikely that there will be any change in the coming years. The new EVs manufactured by OEMs are essentially products assembled with components from outside. So, it does not also add strength and value to the self-reliance movement of the country. Perhaps if the government extended the same favorable treatment to auto LPG by way of reducing GST on conversion kits and on the fuel itself besides making type approval norms for conversion kits for perpetuity, it can go a long way in its mission towards clean mobility.

(Disclaimer: Suyash Gupta is the Director General of Indian Auto LPG Coalition. Views are personal.)


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