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Council on Energy, Environment and Water Integrated | International | Independent
Report

India’s Electric Vehicle TransitionCan Electric Mobility Support India’s Sustainable Economic Recovery Post COVID-19?

Abhinav Soman, Harsimran Kaur, Himani Jain, Karthik Ganesan
November 2020 | Technology, Finance & Trade

Suggested Citation: Soman, Abhinav, Harsimran Kaur, Himani Jain, and Karthik Ganesan. 2020. India’s Electric Vehicle Transition: Can Electric Mobility Support India’s Sustainable Economic Recovery Post COVID-19? New Delhi: Council on Energy, Environment and Water.

Overview

This report, supported by Shakti Sustainable Energy Foundation, explores the impact of India’s electric vehicle transition on India’s economic recovery. It examines the impact of a 30 per cent EV sales share in 2030 on domestic value-addition, jobs, crude oil imports, revenue generated from taxes, local pollution and greenhouse gas (GHG) emissions. In addition, the study quantifies these impacts in different mode-share scenarios - (i) high public transport scenario, (ii) high private vehicle scenario, and (iii) shared mobility scenario.

A 30% EV transition in 2030 will result in a slew of gains as well as trade-offs, the impacts of which can be staved off through prescient planning

Source: Authors' Analysis

Key Findings

  • The on-road passenger and freight vehicle stock is set to increase by over 2.7 times between 2016 and 2030. A high mode share of public transport in 2030 will result in a 57 per cent reduction in on-road vehicle stock.
  • A 30 per cent EV sales share in 2030 will lead to savings on crude oil imports worth INR 1.1 lakh crore (USD 14.1 billion). A combination of high public transport mode-share with 30 per cent EV sales will further lead to INR 2.2 lakh crore (28.3 billion) of savings on crude oil imports.
  • A 30 per cent penetration of EVs in new vehicle sales in 2030 will result in the central and state governments losing 15 per cent of potential petroleum tax revenues compared to a business as usual (BAU) scenario as a result of reduction in fossil fuel consumption.
  • The new manufacturing activities and increase in electricity consumption are expected to generate close to 1.2 lakh jobs in 2030 with 30 per cent EV sales. On the flip side, the petroleum and automotive (ICE vehicle) sectors would lose 1.6 lakh jobs.
  • The market for high value-add components in a scenario with the projected 30 per cent EV penetration amounts to INR 2.1 lakh crore (USD 27.8 billion) in 2030 for batteries, electric powertrain, and charging infrastructure.
  • The largest reduction in GHG emissions (20 per cent) would be achieved in a scenario that combines 30 per cent EV sales with a higher mode-share of public transport.

Key Recommendations

  • Emphasise on new economic activities such as battery recycling (urban mining) and other services associated with electric mobility for job creation under an EV transition plan.
  • Adopt training and skilling initiatives to create a workforce that can cater to the needs of EV manufacturing as a prerequisite to meet any anticipated demand for EVs.
  • The government should adopt pre-emptive strategies to wean away dependence on petroleum tax revenues to deal with the expected dip in central and state government revenue collection along with the promotion of electric mobility.
  • Policymakers must focus on promoting public transport parallely with promoting electric mobility to realise the full benefits of an EV transition. A majority of trips and passenger travel demand must be met by public transport and non-motorised transport options such as walking and cycling.
A combination of high public transport mode-share with 30 per cent EV sales will lead to INR 2.2 lakh crore (28.3 billion) of savings on crude oil imports

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