GS Paper III

News Excerpt:

Recently, HSBC Research stated that India needs to “embrace” hybrid vehicles over the next 5-10 years on the way to full electrification, because they are more practical and less polluting.

System Architecture and working of Hybrid Electric Vehicle:

• They use an electric motor, connected with a petrol engine in series. In such mechanisms, the combustion engine has no contact with the wheels of the vehicle, except via the electric motor. 
• The working here relies on the petrol engine burning fuel and creating energy, but instead of creating kinetic and heat energy, a generator converts the energy from the petrol engine directly to electricity, which powers the electric motor, giving power to the car.

There are mainly 2 types of Hybrid Electric Vehicle:

• Hybrid Electric Vehicle (HEV): The vehicle uses both the internal combustion (usually petrol) engine and the battery-powered motor powertrain.
  • The petrol engine is used both to drive and charge when the battery is empty. 
  • These vehicles are not as efficient as fully electric or plug-in hybrid vehicles.
• Plug-in Hybrid Electric Vehicle (PHEV): Uses both an internal combustion engine and a battery charged from an external socket (they have a plug).
  • This means the vehicle’s battery can be charged with electricity rather than the engine.
  • PHEVs are more efficient than HEVs but less efficient than BEVs.

Key findings of the HSBC Research:

• Calculations by HSBC Research show overall carbon emissions are lower in hybrids compared to both electrics and those that run on petrol and diesel for similarly proportioned vehicles.
• India's electric mobility plan is currently focussed on battery electrics. But as global examples show, there are challenges to wider adoption of EVs in India.
• India needs to “embrace” hybrid vehicles over the next 5-10 years on the way to full electrification.
• According to HSBC, Hybrids are critical not just from a cost of ownership perspective, but also for India’s decarbonisation drive.
• Total (wheel-to-wheel, or WTW) carbon emissions from an EV is currently 158 g/km, compared to 133 g/km for hybrids, it means that a hybrid is at least 16% less polluting than the corresponding EVs.
• According to research, even if India’s share of non-fossil fuels is 40% by 2030, hybrids will still release 8% less emissions than EVs, which, however, will be half of today (16%).

‘Global Best Practices for promoting Electric Vehicles and India’s situation:

• Upfront Subsidy: The experience in markets from Norway to the US and China shows that the electric push works only if it is backed by state subsidies.

• The problem with this kind of overt subsidization in India, is that much of the subsidy, especially the one offered as tax breaks for cars, ends up in the hands of the middle or upper middle classes, who are typically the buyers of battery electric four-wheelers.

• Charging Network: An analysis by the World Bank has found that investing in charging infrastructure is between four and seven times more effective in ensuring EV adoption compared with providing upfront purchase subsidies.

• • Both Norway and China, while offering purchase subsidies, have seen faster adoption of EVs also as a result of sustained efforts at expanding the public charging infrastructure. 
  • In India, the number of EVs had crossed 1 million by mid-2022 and will likely grow to 45-50 million by 2030, only about 2,000 public charging stations are currently operational across the country.
• Electricity Source: In several countries that have pushed EVs, much of the electricity is generated from renewables.Norway, for example, has 99% hydroelectric power. 
  • In India, the grid is still fed largely by coal-fired thermal plants. Therefore, unless the generation mix changes significantly, India would be using fossil fuel generation to power EVs. 
• Value Chain: The demand for Li-ion batteries from India is projected to grow at a CAGR (compound annual growth rate) of more than 30% by volume up to 2030, which translates to more than 50,000 tonnes of lithium requirement for the country to manufacture EV batteries alone.
  • However, more than 90% of the global Li production is concentrated in Chile, Argentina, and Bolivia, alongside Australia and China, and other key inputs such as cobalt and nickel are mined in the Congo and Indonesia. 
  • India would be almost entirely dependent on imports from a small pool of countries to cater to its demand.

Way Forward:

To advance India's electric mobility plan with a focus on sustainability, a balanced strategy is crucial. Embracing hybrid vehicles for the next 5-10 years can serve as a practical medium-term solution, given their lower carbon emissions compared to battery electric vehicles. The government should incentivize and promote hybrid technologies by encouraging collaboration between automakers and raising awareness about it in the general masses.