The draft National Auto Policy released on February 16 is an important document that is set to shape an industry that contributes 50 per cent of the manufacturing GDP and 7 per cent of jobs in the organised sector. With 2030 staring them, the industry was looking nervously for a firm direction to work and grow. The NAP, thankfully, has replaced the term ‘electric vehicle’ with the more comprehensive, ‘green mobility’.

A major drawback of the policy document is that though ‘green’ has been quantified, incentives laid out, and set against a deadline for implementation, it has not been defined in a holistic manner.

The NAP fails to recognise that the absence of a tailpipe does not indicate absence of pollution. Based on a comprehensive fuel-cycle analysis, many scientific works classify the polluting pathways into three types: Well-to-Tank (WTT), Tank-to-Wheel (TTW) and Cradle-to-Gate (CTG). WTT and TTW are together called Well-to-Wheel (WTW).

Polluting pathways

WTT analyses the efficiency and emissions generated during the process of producing the fuel and transporting it from the source to the vehicle. For electric vehicles, this indicates pollution due to power generation. TTW analyses the efficiency and emissions generated during vehicle operation, popularly known as tailpipe emissions. Thus, WTW (the first two pollution pathways) provides a holistic view of the efficiency and emissions associated with any fuel pathway. Lastly, the CTG analysis, which assesses the pollution generated during the manufacture of the vehicle and its subsystems, is also important and cannot be ignored.

The definition of ‘green’ is thus crucial because there is the danger that one may classify electric vehicles as zero emission vehicles and account for maximum incentives by not taking into account the WTW and CTG emissions.

If these are also accounted for in calculating emissions, electric vehicles may attract maximum GST even in 2028!

The difficulty in quantification does not lie with the auto sector but in the power generation sector. Let us consider WTW emissions, from a publication in a highly regarded, peer-reviewed, high impact-factor journal, Energy .

This study, the first to be based on the Indian drive cycle, reports a figure of 224 g/km of CO2 for the Battery Operated Electric Vehicle, the norm used in the draft NAP. The corresponding figures are 185 for gasoline vehicles, 128 for diesel, and the lowest is for CNG hybrid at 89. With these WTW numbers, we see that for sub-4m category of vehicle lengths, GST for EV should be 43 per cent and for diesel it should be 29 per cent. If the vehicle length is greater than 4m, EVs attract a GST of 55 per cent and diesel vehicles a GST of 43 per cent.

The NAP does not define how the emissions are to be quantified. It is not fair (or even correct) to consider TTW emissions alone just because this may be an easily quantifiable and practical method. NAP also recognises that electric vehicles can contribute towards improving ‘urban’ air quality. However, it is important that pollution is considered in its entirety, on the principle of ‘one who pollutes should pay’ — popularly known as ‘externalities’ by economists.

Unfavourable environment

The source of pollution in EVs is due to the current power generation mix. With 60-70 per cent coal-based power generation, India is not a favourable destination for electric vehicles, at least in the medium to large vehicle categories. Considering 2030, unless coal-based generation comes down to less that 30 per cent, EVs will continue to attract maximum GST if the more logical WTW is considered. Interestingly, if diesel buses are replaced by EVs, the overall WTW emissions may be 80 per cent higher!

Studies have been carried out by several academics the world over and the results are similar. China with the largest EV community is not reducing its coal-based power generation. The other analysis, namely CTG, is even more damaging for EVs. Another well-cited paper (Hawkins et al, Journal of Industrial Ecology ) reports that EV production is two times more polluting than those of IC engine vehicles. For a 1,50,000-km vehicle life, EV production results in CO2 emission of 87 to 95 g/km, while IC engine vehicle production results in an emission of 43 g/km.

In a critical sense, the auto policy needs to be closely linked to the energy policy. According to the National Energy Policy drafted by the NITI Aayog, even in 2040, the overall fossil fuel contribution (coal + oil) will be as high as 78 per cent, with solar and wind accounting for the rest (22 per cent).

Hence, the key question is whether the EV manufacturer is to be encouraged? Does he need to pay higher GST to account for the polluting energy industry?

The draft policy has not addressed these issues, the most important from an environmental point of view.

Another important problem that has not been considered is the pollution due to toxic waste during manufacture of batteries, disposal of dead batteries etc, though one may argue that these things would improve in the future.

Electrified, not electric

The motivation to promote electric mobility is understandable as there is a need to reduce our large oil import bill. On the other hand, IC engines are continuously being improved with technologies such as hybrids and the recent push towards alternate fuels such as methanol, which may be even more successful in reducing overall emissions. In fact, methanol from indigenous coal and our large proven reserves of natural gas would be viable options to reduce oil imports.

This also underscores the need for an integrated energy and transportation policy for India. Considering hybrids which have the potential to straightaway offer a 100 per cent increase in mileage for a small car, it might make more sense to talk of ‘electrified’ vehicles, rather than ‘electric’ vehicles.

The term ‘green mobility’ has never been more complex. The definition is crucial for an overall reduction in the environmental impact of the transportation sector. While it is acknowledged that EVs can contribute to improving urban air quality and have a role in the larger scheme of things, the NAP should take into account the life-cycle impact of the product and be agnostic to the underlying technology. It may require a nuanced technical analysis; we have the expertise. After all, global warming does not care about the source of CO2.

Ravikrishna is a professor at IISc, Bengaluru; Kumar is a professor at IIT-Madras

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