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Concentrate on car effectivity to scale back GHG emissions

by Index Investing News
May 22, 2025
in Opinion
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Sustainable transportation is a key facet of lowering world carbon emissions to stem the local weather disaster. The keep away from, shift, enhance, and gas (ASIF) framework outlines a complete strategy to creating extra sustainable transport methods. Whereas a lot consideration is given to various gas applied sciences, notably electrical automobiles (EVs), the effectivity enchancment technique stays one of many least mentioned however extremely efficient levers of sustainable transportation. This technique, nevertheless, usually will get overshadowed by the joy surrounding new gas applied sciences. Whereas all different methods, akin to modal shift from non-public to public transport or street to rail transport, are vital, effectivity enchancment is a vital but under-appreciated coverage lever.

The growing popularity of SUVs, which tend to be larger and heavier, only exacerbates the challenge of reducing emissions (Bloomberg)
The rising recognition of SUVs, which are typically bigger and heavier, solely exacerbates the problem of lowering emissions (Bloomberg)

Effectivity enchancment is usually a technical challenge handled on the car manufacturing and regulatory ranges, however it’s an space usually ignored in public discourse on sustainable transportation. A major instance of that is the Company Common Gasoline Effectivity (CAFE) requirements, which regulate the gas effectivity of automobiles when it comes to grams of carbon dioxide emitted per km. The Bureau of Power Effectivity (BEE) in India has set strict gas effectivity targets for the four-wheeler passenger automobiles section (M1 class).

Although the second part of CAFE norms have been rolled out for M1 in 2023, no such norms have been mandated for different classes of passenger and business automobiles. In case of professional quality automobiles (HDVs), a constant-speed gas financial system norm was rolled out in April 2023. Shifting to CAFE norms for HDVs could make producers give attention to excessive effectivity automobiles. This offers rapid and impactful outcomes.

As a part of the laws, each globally in addition to domestically, lab-based check cycles are shifting nearer in the direction of real-world driving cycles, known as Worldwide Harmonised Gentle Automobile Take a look at Process (WLTP). The WLTP is taken into account nearer to real-world driving situations as in comparison with the sooner testing cycle, such because the Modified Indian Driving Cycle (MIDC), which was criticised for being far faraway from on-road realities of driving behaviour or atmosphere.

Underneath the CAFE norms, producers should meet corporate-level effectivity targets. Which means the common emissions from all of the automobiles a producer sells should be beneath the goal set by the regulator. To assist corporations meet these targets, the regulator affords choices like tremendous credit for environment friendly fashions like EVs and hybrid EVs (HEVs), which affords flexibility to producers to promote extra electrical or hybrid automobiles to offset gross sales of heavy, much less environment friendly automobiles.

India’s regulatory framework is according to world norms however suffers some lag. In 2027, Part III of the CAFE norm is proposed to be mandated for implementation, setting even stricter requirements for car effectivity. The phased implementation of those norms permits car producers’ time to adapt their designs, engineering, and portfolio to fulfill the upcoming targets. Penalties for non-compliance, based mostly on the Power Conservation (Modification) Act 2022, stay substantial.

Once we have a look at the European Union’s CAFE targets, we see an analogous trajectory. From 2020 to 2024, the goal for passenger automobiles was 95 grams of CO2 per km (underneath the New European Driving Cycle), and for 2025-2029, the goal is 93.6 grams of CO2 per km. Extra formidable targets are set for 2030-2034 (49.5 grams of CO2 per km), based mostly on the WLTP. These targets mirror the worldwide pattern towards stricter emissions laws and underscore the significance of effectivity enchancment within the transport sector.

As automobile gross sales proceed to develop in India, the necessity for effectivity enchancment turns into much more urgent. The rising recognition of SUVs, which are typically bigger and heavier, solely exacerbates the problem of lowering emissions. With rising automobile possession and rising gas demand, India faces each environmental and financial challenges, with extraordinarily excessive import dependency of 88% for gas and the related stress on international change.

Enhancing the effectivity of automobiles on the street, no matter whether or not they run on fossil fuels, hybrid methods, or electrical energy, offers a direct and efficient answer to lowering emissions. On condition that India has an extended technique to go earlier than reaching excessive ranges of EV penetration, which is at the moment nearly 2.5% of complete gross sales, specializing in effectivity enchancment within the present fleet might yield vital advantages when it comes to decreased gas consumption and emissions within the medium to long-term. Furthermore, elevated effectivity would cut back India’s reliance on imported oil, serving to to curb the nation’s commerce deficit and vitality safety.

Sharif Qamar is affiliate director, and IV Rao is distinguished fellow, The Power and Sources Institute (TERI). The views expressed are private



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