Should not EVs and Hybrids be treated equally for govt. Subsidies?

• India’s road transport sector contributes about 12% to the country’s CO2 emissions, according to the International Energy Agency, making it the third most greenhouse gas emitting sector after energy and agriculture.
• The Union government has been attempting to fast track decarbonising transport for almost a decade with the introduction of the Faster Adoption and Manufacture of Hybrid and Electric Vehicles, or FAME in 2015.

FAME

• FAME attempts to generate demand for electric vehicles (EVs) and hybrids by subsidizing retail sales, encouraging the manufacture of components and creating and nurturing an EV ecosystem nationwide.
• However, the lack of charging infrastructure, import dependence on advanced battery components and technology, and a grid still dominated by coal-based power, leading to an increase in EVs overall carbon footprint from mining rare earth elements.
• The government in 2017, withdrew the subsidy support for “mild hybrids” affecting popular car models.
• When we look at commercial vehicles, freight vehicles are just 5% of the overall vehicle population, but they alone contribute 34% of emissions, yet we do not have the hybrid truck discussion on the table.
• Also, more than 75% of electricity is produced from coal. So, when EV enthusiasts say that it is CO2 free, it is not.
• We also don’t have the basic raw materials for making battery electric vehicles. Large amounts of metals like cobalt, nickel and lithium are imported.

Reforms

• Absolutely, but the government should look at the overall objective.
• It must specify life cycle emission and GHG norms. For a country like India, the subsidy is not sustainable because of the sheer numbers.
• In the backdrop of the rapid deployment of renewables across India and the country’s COP26 commitment to generate power from renewables to 500 GW by 2030.
• We are striving to ensure our grid becomes greener and cleaner. But if we wait for our grid to become green and then start our transport transition, it might be too late.
• So there would be some overlap where both sectors’ transition must go hand in hand. We will keep electrifying our transport, while we green our grid.
• As the government frames FAME 3, it should think we must consider multiple calculations and factors.
• Policies must evolve with the changing sectoral landscape. It must aim towards zero-emissions vehicles because that will help us reach our climate and energy security goals.