Electric Vehicle: NITI Aayog proposes regulatory framework for electric mobility

NITI Aayog has proposed a regulatory framework for electric mobility, even as it forecasts sales of electric two-wheelers in India will increase to 22.01 million in 2031, from 0.23 million in 2021 if demand incentives persist after 2024 and battery costs fall while power increases due to a significant improvement in technology.

“At some point in the future, there may be a suitable ecosystem for enforcement of an electric mobility regulation or other clean transportation options,” de Aayog said in its report Forecasting Penetration of Electric Two-Wheelers in India, jointly developed with TIFAC.

According to the report, released Tuesday, improving technology and reducing battery costs are key to self-sufficiency in electric mobility, which is expected to reach 100% penetration by 2031 with a combination of technology improvement and demand incentives continuing beyond 2024.

The report predicts that in the optimistic scenario, where battery costs fall at a CAGR of 8%, the range and power of the vehicles will increase by 20% by FY 2024 (due to technological advancements) and the demand stimulus will continue through FY 2031 India is expected to register sales of 22.01 million units, compared to 0.23 million units sold in 2021.

In the stimulus-driven scenario, which assumes that the demand stimulus will last all the time, but with only a 2% reduction in battery costs per year and no improvement in range and performance, sales of electric two-wheelers in FY 2031 are estimated at 5, 49 million units, with a market penetration of 21.86%, the report said.

In the challenged diffusion scenario, which assumes most conditions are unfavorable, the maximum market penetration of only 5.82% is reached in FY 2024, followed by a decline due to the withdrawal of the demand stimulus and finally reached 3.1% in FY 2024. FY 2031, it said.

This would translate into sales of 0.98 million units and 0.78 million units in fiscal years 2024 and 2031, respectively.

De Aayog believes that a shift to electric mobility is essential for India, given the high volume of petroleum imports, negative impact on the trade balance, valuable foreign exchange and the environment.

Leave a Comment

Your email address will not be published.