The NITI Aayog and the Rocky Mountain Institute
(RMI) released a report on opportunities for the automobile sector and
government under the Faster Adoption and Manufacturing of Electric Vehicles II
(FAME II) scheme.The technical report titled ‘India’s Electric Mobility
Transformation: Progress to Date and Future Opportunities’,quantifies the
direct oil and carbon savings that the vehicles incentivized under FAME II will
deliver. RMI is an Indian and global nonprofit organisation focused on driving
the efficient and restorative use of resources.The report also quantifies the
catalytic effect that FAME II and other measures could have on the overall
Electric Vehicle(EV) market. According to the analysis, if FAME II and other
measures – in public and private space - are successful, India could realize EV
sales penetration of 30% of private cars, 70% of commercial cars, 40% of buses
and 80% of two and three-wheelers by 2030.Extrapolating from the same, the
lifetime cumulative oil and carbon savings of all electric vehicles deployed
through 2030 could be many-fold larger than the direct savings from FAME II.For
example,achieving these levels of market share by 2030 could generate
cumulative savings of 846million tonnes of CO2 over the total deployedvehicles’
lifetime.The FAME II scheme, which was notified by the Union Cabinet in
February 2019, aims to further accelerate the government of India’scommitment
to a clean mobility future, sees the electrification of transportation as a
primary focus area. FAME IIintends to catalyze the market for faster adoption
of EVs to ensure durable economic growth and global competitiveness for India’s
automotive industry.
Key highlights from the report:
Effects of FAME II will go beyond the vehicles
that are eligible under the FAME II
There is considerable energy and CO2 savings
associated with the two, three, and four-wheeled vehicles and buses covered by
FAME II over their lifetime, as well as the potential savings associated with
greater adoption levels by 2030
The electric buses covered under FAME II will
account for 3.8 billion vehicle kilometers travelled (e-vkt) over their
lifetime
In order to capture the potential opportunity in
2030, batteries must remain a key focal point as they will continue to be the
key cost driver of EVs.
Vehicles eligible under FAME II scheme can
cumulatively save 5.4 million tonnes of oil equivalent over their lifetime
worth Rs 17.2 thousand crores.
EVs sold through 2030 could cumulatively save 474
million tonnes of oil equivalent (Mtoe) worth INR 15 lakh crore and generate
net CO2 savings of 846 million tonnes over their operational lifetime.
India needs auto industry's active participation
to ease electric mobility transition. The auto and battery industries could
collaborate to enhance customer awareness, promote domestic manufacturing,
promote new business models, conduct R&D for EVs and components, consider
new business models to promote EVs
Government should focus on a phased manufacturing
plan to promote EVs, provide fiscal and non-fiscal incentives for phased
manufacturing of EVs and batteries. Different government departments can
consider a bouquet of potential policies, such as congestion pricing, ZEV
credits, low emission/exclusion zones, parking policies, etc. to drive adoption
of EVs.
India’s electric vehicle market is poised for
growth with a blend of policies, such as FAME II, and the automotive industry’s
willingness to provide new mobility solutions to the citizens of the country.
Such a transformation will create enormous economic, social and environmental
benefits for the citizens of India.