The need for a comprehensive policy to ensure a connected, shared, electrified mobility for the people was highlighted by Dr. Rajiv Kumar, Vice Chairman, Niti Aayog, while delivering the keynote address at the Petro India, an annual flagship event, organised by Observer Research Foundation and India Energy Forum on 16 March 2018 at New Delhi.
The theme of the conference was “Future of Mobility in India: Outlook & Challenges”. The deliberations took a closer look at the projected revolution in transport and mobility by provoking a meaningful conversation and debate around the future of mobility and implications for India, placing them within the context of the evolving global mobility paradigm and India’s socio-economic realities.
The entire conference was framed around four key Issues namely -- Perspectives from the Automobile Sector, Policy Options & Challenges, Perspectives from the Refining Sector and Transition to Low Carbon Growth. It brought together expert panellists from the automobile sector as well as the traditional and new fuels industry in India including policy makers, academia, think-tanks, private & public sector companies etc., to debate the outlook for the country along this course and also to debate appropriate responses from the oil refining segment, the automobile segment, the refuelling segment.
In the keynote, Dr. Rajiv Kumar stressed upon the need to adopt to modern technology which offers energy efficiency and zero emissions in such a way so that the transition from internal combustion engines (ICE) to electric vehicles (EVs) is smooth. He said India needed to develop a policy based on its specific needs and the prevailing environment in the country. Drawing attention on electric storage and charging facilities, he stressed upon need for a different protocol for charging of electric vehicles. He said Niti Aayog would first focus on two and three wheelers, which constitute a major chunk of private owned transport, and also public transport.
Ashok Dhar, Director of ORF Kolkata in his theme presentation pointed out that India is a very complex transport market where there is a big gap between the supply and demand. While questioning the demand supply gap of EVs, he suggested using technological advances in bio-fuel engines to lessen pollution.
Former Union Power Secretary Anil Razdan also stressed the need for a clear policy regarding the EVs and said that it would be wiser to focus on first two and three wheelers.
In his address, ORF Chairman Sunjoy Joshi said there were ‘many moving parts’ in the market and that there was a need for everyone to come together and work together. He pointed out that the pace and direction of transition was uncertain and emphasised that in the transition away from fossil fuels, the electricity sector would play a vital role.
The Chair of the opening session ‘Perspectives from the Automobile sector’, J M Mauskar, Advisor ORF observed that the two drivers behind the transition in fuels for mobility were climate change and national commitments made to address climate change and the concern over urban pollution. He noted that the shift towards electric vehicles will have impact on the fuel mix depending on whether coal or natural gas is used to generate power.
Dr. Tapan Sahoo Senior Vice President of Maruti Suzuki felt that focussing too much on EVs was not the right choice. He suggested that policy makers should prioritise on hybrids.
Shohinder Gill, CEO, Hero Electric & Director, The Society of Manufacturers of Electric Vehicles explained how lack of clarity in policy was leading to “uncertainty” that was impacting the EV industry and that this had a negative impact on the image of the country among overseas investors. He stressed upon the need for favourable policies including subsidies to the electric vehicle industry so as to facilitate expansion of electric mobility.
Representing the nodal agency, Society for Indian Association of Manufacturers (SIAM) responsible for development of automobile sector, P K Banerjee, Deputy Executive Director highlighted the fact that by 2026, the Indian automotive industry would be among the top three of the world in engineering, manufacture and export of vehicles and components. He also indicated that the single major factor for the slow penetration of electric vehicles was the price of battery pack.
Dr. Christoph K. Klunker, Senior Fellow, ORF shared Germany's experiences on Future of Mobility. He brought out the linkages between the broader economy of Germany and the automobile industry to illustrate the complex challenge in making a transition from ICE to EVs. He mentioned that over 7 percent of Germany's total economic output was directly and indirectly connected to car production. He also pointed out that only 3 percent of vehicles sold in Germany were fully or partially electrified and that Germany’s car industry saw internal combustion engines to remain dominant for the foreseeable future.
Opening the second session on Policy Options & Challenges S C Tripati, former Secretary, Petroleum & Natural Gas & Patron, India Energy Forum said that in India the transition would be gradual as large subsidies and public spending programmes cannot be accommodated in India.
Girish Sirodkar from consulting firm, PWC remarked that transition to EVs is inevitable and asked the government to come up with a clear, comprehensive policy and remove the uncertainty in the market. He also called for private players in charging infrastructure and noted that battery swapping would help in faster adoption of EVs.
Speaking on the hybrid technology challenges for mobility & policy options Dr. R. K. Malhotra, Director General, FIPI mentioned that EVs will only shift carbon emissions from consumption to generation centres, if power is not generated by renewables. He said that hybrid vehicle technology offered a good interim solution before country transitions to 100 percent electrification of mobility as this would provide sufficient lead time to gain experience with batteries and EV technologies to all stakeholders. He was of the view that efficiency gains in engine will dominate ICE technologies in future. He highlighted that even a complete ban on IC Engines will not cause any significant impact on carbon emission reduction and that decarbonizing power sector held the key to carbon emission reduction.
Dr. Rumi Aijaz, Senior Fellow, ORF highlighted the fact that introduction of new technologies in motor vehicle may lead to addition in the number of motor vehicles and cause traffic congestion and reduction in air quality and lower parking space. He called for improvement in public transportation systems.
Prof. R. Srikanth from National Institute of Advanced Studies stated that EVs were critical for Sustainable Development as they reduce dependence on imported crude, reduce Greenhouse Gas emissions, minimise local air pollution from transportation and contribute to improving the health of urban dwellers. He called for incentives to all fleet owners and shared mobility companies to provide fast-charging stations for own as well as public use can accelerate roll-out.
In the third session on ‘Perspectives from the Refining Sector’, the Chair Mr G.C. Charturvedi, Former Secretary, Petroleum & Natural Gas and Chairman, Oil & Gas Group, India Energy Forum said that petroleum products will continue to be in demand in the production of vehicles and in the production of a number of chemicals even if there is a shift away from fossil fuels in the case of mobility.
Vartika Shukla, Executive Director (R&D), EIL in her address mentioned that India had moved very swiftly in oil consumption and had surpassed Japan to take the third place after China and USA. In her view, the first and foremost challenge in the refining industry was concern over negative externalities such as deterioration of respiratory health & degradation of the environment. She pointed out that India was committed to its INDCs made at COP-21 and that it was rapidly shifting to towards cleaner fuels is like LPG replacing kerosene. She indicated that given refining margins were under pressure and crack-spread between crude and products was marginal, there were hardly any incentives for fuel upgradation like BS-VI. She highlighted the fact that unless refineries are integrated with the petrochemicals, their returns were likely to be below average for the industry.
N.K. Bansal, Director (Refining), FIPI highlighted the diversity in of refineries in India in terms of age, size, technological sophistication and location. He noted that the refinery sector started its preparedness for BS-VI emission standard implementation projects and that BS-VI fuel supply would start in April 2018. He observed that more than 90 percent of retail outlets had already started delivering BS-VI fuel in a very regular manner. He said that given the diversity of refineries preparing for the BS-VI fuel was a challenge.
Dr. SSV Ramakumar, Director (R&D), IOC described the current scenario and future options for methanol (blending) as transportation fuel. He said that most of the methanol is used as a raw material or precursor of formaldehyde or some of the other chemical derivatives like methyl tertiary butyl ether and not as transportation fuel. He noted that methanol as a fuel blending option was a mere 12 percent. Dr Ramakumar pointed out that Asia Pacific region was the dominating region accounting for almost 60 percent of methanol usage followed by Europe and North America. He concluded that India may find it hard to compete on cost with imported methanol from China and that blending ethanol may increase imports.
Opening the final session on low carbon technologies, T K Arun, Editor, Economic Times, observed that electric vehicles could be labelled low carbon vehicles only if the electricity used by the vehicle is generated through low carbon fuels such as solar energy and asked the panellists to address the issue of low carbon fuels.
Prof. L. M. Das, Emeritus Professor, IIT- Delhi said that Hydrogen was an ideal fuel that could be adapted to the petrol engine and that the alternative fuel laboratory in IIT Delhi had experimented with fuels like ethyl alcohol, methyl alcohol, biodiesel and CNG. The Professor showed clips of films on hydrogen vehicles being used in Pragathi Maidan, New Delhi in 2012 that were giving 80 km/kg of hydrogen.
In his presentation on Urban Infrastructure: Challenges & Policy Options for Low Carbon Mobility Amit Bhatt, Strategy Head (IUT), WRI pointed out 66 percent of the Indian population was inherently using low-carbon transport modes of walking and cycling and that motorised transport was the primary mode only in urban areas. He gave the example of Atlanta and Barcelona that have the same income profile and same population, but Atlanta without city planning had ended up as a personal vehicle based city while Barcelona had evolved as city that relies mostly on public transport.
Pankaj Wadhwa, Senior Vice President, Petronet LNG made the case for Liquid Natural Gas (LNG) as replacement for diesel as fuel for transport vehicles particularly in public and commercial transportation vehicles that would half the pollution levels. He said that China had about 300,000 trucks running on LNG and that India had prepared a pilot plan for setting up up 22 LNG dispensing stations.
Overall the conclusion was that means and ends of policy on mobility needed further clarity in the short term.
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