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					</table>Decarbonizing the transport sector poses a substantial challenge for G20 countries as they grapple with varying stages of motorization, decarbonization, and the transition to sustainable transport, according to a report by <a href="https://www.agora-verkehrswende.de/" target="_blank" rel="noopener">Agora Verkehrswende</a>, <a href="https://www.giz.de/de/html/index.html" target="_blank" rel="noopener">Deutsche Gesellschaft für Internationale Zusammenarbeit</a>, and <a href="https://niti.gov.in/" target="_blank" rel="noopener">NITI Aayog</a>.
Over the decades, the transport sector has significantly contributed to global CO₂ emissions, accounting for approximately one-quarter of emissions from fuel combustion and 15% of total greenhouse gas emissions annually.
In G20 countries, transport constitutes nearly one-fifth of energy-related CO₂ emissions, with a steep increase of 64% since 1990 and 79% worldwide. China, India, and Indonesia have witnessed exponential growth in transport emissions, underscoring the need for robust decarbonization strategies.
While some G20 nations have made progress in reducing transport-related emissions, the U.S. remains the largest emitter, contributing 5.4 tons CO₂ per capita in 2019. Despite a worldwide drop in emissions during the COVID-19 pandemic, transport emissions in G20 countries have risen. Only Japan and Germany have achieved emission reductions since 1990, though both still have relatively high per capita emissions.
Around 80% of the energy in the G20 transport sector in 2019 was derived from gasoline or diesel, highlighting the continued reliance on fossil fuels. Moreover, the sector consumes more than half of the global oil demand, leading to fossil fuel dependency and economic burdens.
While economic growth is yet to be decoupled from motorization rates, efforts to reduce emissions must be accelerated.
In recent years, the electric vehicle (EV) market has experienced a remarkable surge in momentum, witnessing exponential growth in G20 countries. The EV fleet in these nations expanded nearly eightfold, reaching an impressive 8.4 million vehicles in 2020, up from around one million in 2015. China and the U.S. led the fleet growth, with 4.9 million and 1.4 million EVs added, respectively. China continued its robust performance, hitting approximately 6 million new EV sales in 2022. Over 90% of all EVs worldwide are concentrated in 25 cities.
Despite the positive EV trends, the transport sector in G20 countries continues to subsidize or exempt fossil fuels from fuel taxation in various forms according to the report. These financial supports include fuel tax credits for businesses in Australia, tax reductions or exemptions in Brazil, USA, Germany, France, and other nations, direct payments to taxi drivers and public transport in China, customs duty reductions for crude oil in India, and generous funding for oil exploration, extraction, and refining as well as stockpiling of crude oil in Japan.
Countries must phase out these subsidies to accelerate the adoption of EVs and align with climate goals in the transport sector. Moreover, merely supporting EV use is insufficient; countries must implement disincentive mechanisms, such as malus systems, to discourage using internal combustion engine (ICE) vehicles and fuel consumption.
Indian Scenario
India&#8217;s dynamic economic development and rapid urbanization have driven a surge in mobility demand, moving people and goods a crucial backbone of the nation&#8217;s progress. However, this growth has also significantly increased transport emissions, from 105 Mt CO₂ in 2000 to 325 Mt CO₂ in 2019, as noted in the report. While emissions showed an 18.4% growth from 2015 to 2019, per capita emissions increased by 13.5% during the same period. Remarkably, despite robust growth rates, India&#8217;s per capita emissions stand at a modest 0.25 metric tons CO₂, the lowest among G20 countries.
While India&#8217;s total CO₂ emissions from fuel combustion increased by a staggering 375% between 1990 and 2019, they represent a relatively low share of total emissions, comprising only 14%. This is partly attributed to the high carbon intensity of India&#8217;s power generation.
However, projections indicate that transport sector emissions could substantially increase, potentially rising by 65% by 2030 and a significant 197% by 2050 compared to 2020. Road transport remains the primary contributor to sector emissions, closely followed by rail transport, where nearly 7% of sector emissions account for one of the highest shares in the G20.
India has committed to several ambitious measures to address these challenges and embrace a greener future. The country aims to increase the share of rail in freight transport to 45% by 2030 and intends to achieve a 30% share of electric light-duty vehicle sales by the same year. Notably, India signed the COP26 declaration, setting a target to transition to 100% zero-emission cars and vans by 2040.
The Indian government has implemented national, subnational, and municipal measures to support public transport, promote low-carbon freight, and enhance vehicles&#8217; energy and carbon efficiency. From fuel efficiency standards for heavy-duty vehicles to electrifying its railway network, India is taking dedicated actions to ensure a cleaner mobility landscape.
The Gati Shakti platform has been instrumental in integrating new transport systems, while industrial corridors are being planned to shift freight transport towards cleaner modes. Initiatives like high-speed rail projects aim to reduce road and air transport reliance. Additionally, India has invested in metro rail systems, focusing on cost-effective solutions for smaller cities, and emphasized green mobility in urban areas.
Research suggests India&#8217;s pursuit of greener policies in passenger and freight transport sectors can avoid up to 1.7 gigatons of CO2 by 2030.
Among G20 nations, India stands out for its rapid and impressive evolution in the EV market. India has over 2.4 million registered EVs as of June 2023.
In the second quarter of 2023, EV sales <a href="https://www.mercomindia.com/electric-vehicle-sales-q2-2023" target="_blank" rel="noopener">stood</a> at 371,340 units, a year-over-year increase of 66% compared to 223,293 units sold in the same period last year.
Recognizing the potential and importance of electric mobility, the Indian government took early initiatives by launching the National Electric Mobility Mission Plan 2020 in 2013, followed by the Faster Adoption of Manufacturing of EVs (FAME) Phase I and Phase II. These programs have allocated $1.25 billion to incentivize EV adoption through upfront subsidies and the development of robust charging infrastructure.
Under FAME II, subsidies are set to benefit one million electric two-wheelers, 500,000 electric three-wheelers, 55,000 electric cars, and 7,000 electric buses, with an additional $125 million dedicated to setting up charging stations. So far, the program has successfully supported over 200 thousand EVs, primarily two- and three-wheelers.
Recently, a parliamentary committee <a href="https://www.mercomindia.com/parliamentary-panel-fame-program-by-two-years" target="_blank" rel="noopener">recommended</a> extending the FAME-II program by two years beyond its March 31, 2024, deadline.

Phasing Out Fossil-Fuel Subsidies Vital to Accelerate EV Adoption in G20 Countries

<a href="https://www.plugpower.com/" target="_blank" rel="noopener noreferrer">Plug Power</a>, a U.S.-based provider of hydrogen engines and fueling solutions enabling e-mobility, announced that it raised around $1 billion in one of the largest bought equity deals in the cleantech sector.
With this recently completed capital raise, the company’s post-closing cash balance stood at $1.7 billion. The company said that the new investments would be utilized to implement and advance its green hydrogen strategy and other strategic growth initiatives.
“We are very pleased with the reception from the institutional investors and the market, resulting in a meaningfully upsized capital raise. This ideally positions Plug Power to accelerate the growth of the green hydrogen economy in the United States and globally,” said Andy Marsh, Chief Executive Officer of Plug Power.
The company recently unveiled its plans to develop five regional green hydrogen facility in the United States. It stated that it would continue to work with its strategic partners, including <a href="https://www.brookfield.com/" target="_blank" rel="noopener noreferrer">Brookfield Renewable</a> and <a href="https://www.apexcleanenergy.com/" target="_blank" rel="noopener noreferrer">Apex Clean Energy</a>, to source low-cost renewable energy.
Green hydrogen projects are hydrogen electrolyzer projects powered by renewable sources.
According to its press statement, all five green hydrogen facilities, with a production capacity of around 100 tons per day, will be operational by 2024. The first two green hydrogen facilities are expected to become operational in 2022.
“We have identified several locations working with strategic partners where we can produce green hydrogen at parity with grey hydrogen and see further opportunities to reduce the cost of green hydrogen,” said Sanjay Shrestha, Chief Strategy Officer and Head of Plug Power’s green hydrogen generation business.
Plug Power said that the generated hydrogen would help decarbonize transportation and logistics industries and facilitate the anticipated growth of the hydrogen economy. The global hydrogen economy could reach $2.5 trillion by 2050, representing 18% of the worldwide energy demand, according to management consultancy <a href="https://www.mckinsey.com/" target="_blank" rel="noopener noreferrer">McKinsey &amp; Company</a>.
According to <a href="https://www.rystadenergy.com/" target="_blank" rel="noopener noreferrer">Rystad Energy</a> research, the global pipeline of utility-scale green hydrogen projects with capacities greater than 1 MW now <a href="https://mercomindia.com/over-60-gw-green-hydrogen-projects/" target="_blank" rel="noopener noreferrer">exceeds</a> 60 GW, with 87% of this capacity coming from gigawatt-scale projects.
Recently, a hydrogen production and adoption <a href="https://mercomindia.com/hydrogen-harnessed-energy-storage-report/" target="_blank" rel="noopener noreferrer">model</a> prepared in the U.K. suggested that hydrogen could solve its power storage issues. Electricity generated from offshore wind projects can be used to produce hydrogen by <a href="https://mercomindia.com/hydrogen-harnessed-energy-storage-report/" target="_blank" rel="noopener noreferrer">electrolyzing</a> seawater. According to the study, hydrogen can be transported through pipelines and stored to produce more electricity later when renewable power generation dips. Hydrogen can also be used in industrial heating applications and <a href="https://mercomindia.com/inclusion-hydrogen-fuel-central-motor-vehicles-act/" target="_blank" rel="noopener noreferrer">transport</a>. It could be one of the least-cost pathways to reducing carbon emissions.

Plug Power Raises $1 Billion to Develop Green Hydrogen Network in the US

The electric vehicle sector in India saw a lot of positive moves in 2019, with the launch of FAME India – II, introduction of tax exemptions for buyers, subsidies for manufactures, Goods and Services Tax (GST) cuts, and duty imposition on imports to push domestic production. However, the industry is still in its nascent state because of technological and infrastructure constraints, along with a lack of awareness.
Electric vehicle adoption in the country is still hindered by a plethora of issues like the lack of robust EV charging infrastructure, long battery charging duration, limited mobility range, and domestic production issues.
From the viewpoint of an average consumer, EV is still not a convincing option. It remains almost exclusive to individuals who want to reduce their carbon footprint. Petrol and diesel cars are still cheaper and much more affordable. In India, this is making it difficult for an average consumer to make the shift to EVs.
That said, 2019 proved to be a year when the central and state governments finally woke up to the benefits of EVs &#8211; improved air quality and reducing import bills.
The biggest incentive to the prospective EV consumers came in the form of tax reduction. The government has <a href="https://mercomindia.com/gst-electric-vehicle-reduced-5/" target="_blank" rel="noopener noreferrer">cut</a> the applicable rate of GST on EVs from 12% to 5%. Additionally, the GST rates on chargers or charging stations for EVs have been reduced from 18% to 5%, effective August 1, 2019.
The budget announced by the BJP government also had several sops for the consumer, encouraging the switch to intelligent mobility. Finance minister Nirmala Sitharaman <a href="https://mercomindia.com/budget-2019-renewable-e-mobility/" target="_blank" rel="noopener noreferrer">announced</a> additional income tax deductions to the tune of ₹150,000 (~$2,190.97) on the interest paid on loans for the purchase EVs. This amounts to a benefit of around ₹250,000 (~$3651.63) over the loan period to the taxpayers who take on debt to purchase EVs. In her speech, Sitharaman also talked of a plan to make India a global hub for EV manufacturing.
To encourage the widespread adoption of electric mobility, the government announced the second phase of the FAME program with a total budget of ₹100 billion ($1.41 billion) to be deployed over a period of three years starting April 1, 2019.
Towards the beginning of 2019, the Ministry of Power (MoP) <a href="https://mercomindia.com/700-million-plan-for-ev-infrastructure-revamp/" target="_blank" rel="noopener noreferrer">proposed</a> a plan to develop electric vehicle infrastructure across 70 cities and 20 highways in the next five years between 2020-25 at a cost of ₹50 billion (~$700 million).
A key announcement came in June by the National Institute of Transforming India (NITI) Aayog, the government’s think tank, which charted its ambitious plan to mandate electric vehicles by 2030.
This was met by strong opposition by automobile manufacturers who argued that such a move would spell doom for the domestic industry and jobs. A significant chunk of products in the value chain in the existing automobile manufacturing is outsourced to smaller companies who specialize in manufacturing just one or two components.
However, the government has acknowledged that its vision of achieving 100% e-mobility by <a href="https://mercomindia.com/100-percent-evs-2030-can-create-300-billion-market-ev-batteries-india/" target="_blank" rel="noopener noreferrer">2030</a> cannot be achieved without a robust e-mobility ecosystem, including the domestic vehicle manufacturers, charging infrastructure companies, fleet operators, and service providers.
The threat of the looming technology disruption that will arise from switching entirely to electric vehicle manufacturing and the jobs they support prompted transport minister Nitin Gadkari to acknowledge these concerns in a new roadmap.
Meanwhile, the union cabinet has also <a href="https://mercomindia.com/government-blueprint-ev-battery/" target="_blank" rel="noopener noreferrer">approved</a> the creation of the Phased Manufacturing Program (PMP) to support the development of large-scale, export-competitive integrated batteries and cell-manufacturing giga-scale projects in India. The program, valid until 2024, will help in localizing the production across the entire electric vehicle value chain. Further, to boost domestic manufacturing, the PMP also <a href="https://mercomindia.com/government-proposes-customs-duty-hike-on-ev-parts/" target="_blank" rel="noopener noreferrer">proposed</a> a 15% customs duty on EV parts, the doubling of customs duties on completely built-up (CBU) buses and trucks to 50% and hiking rates for semi-knocked down two-wheelers, buses and trucks to 25% from 15% earlier.
The year saw several initiatives undertaken by the government to make things easier for the EV manufacturers.  The ministry of road transport and highways (MORTH) <a href="https://mercomindia.com/ev-likely-registration-fee-exemption/" target="_blank" rel="noopener noreferrer">put forward</a> a proposal to relieve electric and battery-operated vehicles from registration charges. It said it had planned to introduce differential registration fees as per the Central Motor Vehicles Rules (CMVR), 1989.
For the broader adoption of EVs in public transportation, the Department of Heavy Industry approved 5,095 electric buses to be deployed in 64 cities under the FAME-II program.
The National Electric Mobility Mission Plan (NEMMP) 2020 also <a href="https://mercomindia.com/national-electric-mobility-plan/" target="_blank" rel="noopener noreferrer">set targets</a> for the deployment of seven million hybrid and electric vehicles (EVs) in India by 2020.
While the EV sector is gathering speed, the government is now trying to focus on developing a robust infrastructure for the charging of electric vehicles. Without an adequate charging network, the widespread adoption of EVs will remain impractical and unfeasible.
In line with this, the Union Power Minister R.K. Singh <a href="https://mercomindia.com/new-guidelines-charging-stations-highways/" target="_blank" rel="noopener noreferrer">approved</a> amendments in electric vehicle charging guidelines and specifications. He also stated that to address issues regarding inter-city travel and long-range or heavy-duty electric vehicles like buses and trucks, the central government plans to install fast-charging stations at every 100 km on each side of the highways.
Besides the government’s announcements to help the cause of EVs, the segment also saw plenty of initiatives from the private sector, with companies shifting to EVs for employee transportation, partnering up and <a href="https://mercomindia.com/bses-ola-battery-swapping-new-delhi/" target="_blank" rel="noopener noreferrer">building</a> charging networks, and working with the government to establish a firmer foundation for EVs. The government has also, to a reasonable extent, taken into account the concerns of industry stakeholders and has promised to work on its policies with a more holistic mindset.
This year, the government has reiterated its intentions for the future of electric mobility in India. It aims to grow the segment in the country into one that is not just sustainable, future-proof, and practical, but also a market leader in the segment. Given the shape of things in 2019, the next year looks promising for the domestic EV sector.

2019: A Year of Positive Momentum for India’s EV Sector

The National Aluminum Company Limited (NALCO) tendered a 50 MW solar project on Engineering Procurement and Construction basis (EPC) to be developed in any state in India. The bid-submission deadline is August 22, 2017. This is a global tender and the project can be developed in any solar-rich state in India.
The scope of work includes, identification and procurement of land, design, engineering, supply, packaging, forwarding, transportation, unloading, storage at site, site development, construction, erection, installation of equipment, testing, commissioning of the project along with associated pooling sub-station and transmission system at 33kV/132 KV up to nearest grid-substation of distribution company/state transmission utility including grid connectivity, metering arrangement and right of way.
The successful bidder will also provide operation and maintenance (O&amp;M) services for a 10-year period, including free O&amp;M for the first year after commissioning. NALCO may increase the O&amp;M contract period by another 15 years.
“The solar project will be funded and owned by NALCO and the bidder will have to procure 110 hectares of land for the project,” confirmed a NALCO official.
Image credit: SolarTown Energy Solutions Pvt. Ltd.

NALCO Tenders 50 MW Solar Project

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Solar installations are starting to pick up in the Indian transportation sector. Replying to a question in the Lok Sabha regarding the government’s plan to install solar power systems in railway stations and airports as well as the state-wise details of the proposed installations, Mr. Piyush Goyal, Minister of Power stated, “the government is boosting solar installations with emphasis on rooftop solar, however, the state-wise targets have not been set.”
Mr. Goyal also stated that solar power installations of capacities 37.11 MW and 10.5 MW have already been installed at various Indian airports and railway stations.
<a href="https://mercomindia.com/wp-content/uploads/2017/06/Solar_Transportation.png"><img loading="lazy" decoding="async" class="aligncenter size-full wp-image-4600" src="https://mercomindia.com/wp-content/uploads/2017/06/Solar_Transportation.png" alt="" width="394" height="135" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2017/06/Solar_Transportation.png 394w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2017/06/Solar_Transportation-300x103.png 300w" sizes="(max-width: 394px) 100vw, 394px" /></a>
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He also said that solar panels have been installed on the rooftop of four coaches running on the Pathankot-Joginder Nagar route in the Kangra Valley section. These solar panels are used for lighting the train coaches. Fourteen other coaches shuttling on the Kalka-Shimla route have also been fitted with solar panels on a trial basis.
Commenting on the plan of action to promote the usage of renewable energy at railway stations and airports in India, Mr Goyal, said that the Ministry of New and Renewable Energy (MNRE) has granted subsidies and incentives for an aggregate of 500 MW capacity to the Ministry of Railways which has a target of installing 1 GW of solar power by 2020. Indian airports are also working towards installing 18.4 MW solar power projects across India.
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