alternative fuels the why what when and how

8/8/2019 Alternative Fuels the Why What When and How

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S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L

The why, what, when and how

Ashutosh Goel Siddharth Bhatt Amol Bhutada

+ - - + - - + - [email protected] [email protected] [email protected]

November 2008


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Objective - W hy to read this report?

strategies in this impor tant future aspect of alternative fuels in

automobile business

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Executive summary

Cars wi most i e y go a e ectric in t e next 5-7 yearsBattery technology (range, weight and cost) is the key technological challenge

In the interim, various hybrid technologies will be popularExperimentation with various degrees of hybridisation mild, full, plug-in

Other fuels, such as ethanol, bio-diesel and blends to grow but will be limited by suppliesIssues related to availability of crop area and impact on crop prices, and lifecyclecarbon emission still unresolved

In the medium term, Indian market will primarily be geared towards bio-fuel blendsmandated by government.CNG/LPG penetration to be limited by availability.

Not sure of which approach will succeed, players are hedging their bets by investing inmultiple technologies

Home grown Indian players are taking small steps to position themselves, through in-house R&D, small acquisitions and alliances

Tata Motors Miljobil acquisition in Norway for electric car, agreeement with MDI of France for compressed air based car, in-house R&D on bio-fuels and hybridsM&M in-house R&D on hybrids and electric

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Contents

Sr.No. To ics Pa e Nos.1 Why Alternative Fuels? 5

2 Major Alternative Fuel Groups 6

3 Gaseous automotive fuels CNG & LPG 78

4 Biofuels bio diesel & ethanol fuel 9 11

5 Brazil a case study on ethanol 12 13

6 Hybrid electric vehicles 14

7 All electric vehicles 15

8 Hydrogen fuel cells 16 17

9 Capabilities of global auto majors GM, Ford, Toyota, Honda, Nissan 18 1910 Tesla Motors an all electric company 20

11 Indian auto majors Tata Motors, M&M, Maruti Suzuki 21 24

12 Reva Electric Car Company 25

n anw ee er

compan es ec ro erm

n a

,

ero

ra

o ors

14 Global incentives for electric vehicles 28

15 Auto component makers to benefit Everest Kanto Cylinders, Minda Auto 29

4

17 Conclusion 31

18 Appendix 32 36


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W hy Alternative Fuels??

Alternative fuels have come in sharperfocus recently 1.6

1.8

= 1

)

Growing concern regardingenvironmental impact of carbondioxide (CO2) emissions from 1.2

1.3

.

I n d e x

( 1 9 7

High crude oil prices

1.0

1970 1975 1980 1985 1990 1995 2000 2005Source: EPA and Environment Defense Agency, US.

Depleting fossil fuel resources

96

128

160

a r r e

l )

Crude oil priceshad risen five

times in the last 4years

As a result, significant investmentsare underway by auto majors acrossthe globe to develop alternative fuel

32

64 ( U S D /

b

5

0

1 9 7 8

1 9 9 0

1 9 9 2

1 9 9 4

1 9 9 6

1 9 9 8

2 0 0 0

2 0 0 2

2 0 0 4

2 0 0 6

J a n - 0

8

M a r -

0 8

M a y - 0

8

J u l - 0 8

S e p - 0

8

N o v - 0

8

Source: Energy Information Administration (EIA), US.


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W hat are Alternative Automotive Fuels?

Conventional automotive fuels include : petrol/gasoline and diesel

Alternative fuels include : CNG, LPG, bio-diesel (vegetable oil, jatropha), bio-alcohol(ethanol), chemically stored electricity (batteries and fuel cells), hydrogen, etc.

Major

Gaseousfossil fuels Bio-Fuels

Electric-hybrids

HydrogenFuel-cells

- (from sugarcane,

corn) (vegetable oil,

jatropha)

6


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Gaseous au tomotive fuels

Compressed Natural Gas(CNG)

Liquefied Petroleum Gas(LPG)

LPG is primarily produced as a by-product of petroleum refining, and is a mixture of propane(60%) and butane (40%).

It is made by compressing natural gas (87% ismethane), and is stored and distributed in hardcontainers at a normal pressure of 200220 bar.

Engine No modification to the engine required .

Storage Not much of an issue since the

storage tank takes a much smaller space. LPGtank weighs ~ 5-7 kgs when empty.

Engine: No modification required.

Storage is an issue, since it takes most of the

boot space in a car with big, heavy storagecylinders that weigh ~50 kg, when empty.Availabi li ty 619 stations primarily in Westernand Southern India. (refer appendix for details)

Availability: At 376 stations, primarily Delhiand Mumbai (refer appendix for details).

CNG (%)Compared to

LPG (%)

Environmentalcomparison

Type of pollutants(lesser by)

petrol anddiesel

comparedto petrol

compared todiesel

Carbon dioxide 25.0 15.0 10.0 Carbon monoxide 80.0 60.0 75.0

7

rous ox e . . . Hydrcarbons 90.0 90.0 85.0

Particulates n.a. 50.0 90.0 Source: Planning Commission (2003)


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Comparative economics of CNG & LP G vs. petrol

x P etrol car Diesel car CNG car LPG car

Incremental cost over petrol car (Kitcost etc) ( approx. in INR)

not applicable 80,000 60,000 40,000

Mileage (km/litre) (in city driving condition)

13 15 15 13

based fuels

Price per itre per g INR 59.0 38.0 21.7 37.0Cost/km (INR) 4.54 2.53 1.45 2.85Payback period (keeping this as fixed variable)

not applicable 1 year 1 year 1 year

Average km per day required for aayback eriod of 1 year as

133 65 79

com ared to etrol ... ANo of days likely to travel in ayear B

300 300 300

No of kms in a year (A x B) C 39,900 19,425 23,655

Savings in cost/km (as compared to petrol car) (INR) D

2.01 3.09 1.69

Savings for the year as compared topetrol (INR) (C x D)

80,005 60,058 40,032

Incremental cost over petrol car 80,000 60,000 40,000

Source: Edelweiss research Note: 1 litre = 0.96 kgs.

For a payback period of 1 year, when compared with petrol option:

CNG fuel is economical for a passenger who travels at least 65 kms/ day

8

LPG fuel becomes more economical if the daily travel is above 79 kms

Diesel fuel is desirable if daily travel exceeds 133 kms


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Bio-Fuels

W hat is Bio-diesel?Sources Made from Jatropha plant, vegetable/plant oils, etc.

Blends Bio-diesel can be mixed with petroleum-diesel in anypercentage, from 1 to 100, which is represented by a number following aB. For example, B5 (5% bio-diesel), B20 (20% bio-diesel) etc.

Engine issues:Minor modification to the en ine re uired if the bio-diesel blend increasesbeyond 25%. Also, there is need to add a heater to improve ease of fuelflow. Bio-diesel emissions compared to conventional fuels

Emissions B100 B20

- - (% )

(% )

Regulated emissions - -

Total unburned hydrocarbons (93.0) (30.0)

Carbon monoxide (50.0) (20.0)

Particulate matter 30.0 22.0

comparison

Nitrogen oxide 13.0 2.0

Non-regulated emissions

Polycyclic aromatic hydrocarbons (PAH) (80.0) (13.0)

NPAH (Nitrate PAH) (90.0) (50.0)

9Source: Planning Commission (2003)

Carbon dioxide (LCA) (80.0)

Sulphur dioxide (LCA) (100.0)


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Ethanol Fuel

W hat is Ethanol Fuel?

SourcesCan be produced from sugar cane, and maize (corn), sugar beet, as well as cellulose

waste.

Blendsse n t e orm o en s w t petro gaso ne, w c s represente y a num er

following a E. For example, E10 (10% of Ethanol), E85 (85% of Ethanol) and E100(100% of Ethanol).

En ine issues:Minor modification to the engine required if the ethanol blend increases beyond 24%.For example, in a cold country, engines using 30% to 100% ethanol blends, may needa cold-starting system.

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Economics & Availability of Ethanol Fuel

In India, ethanol (made from sugarcane molasses) is currently priced at Rs.21.5 per l itre bythe sugar companies for sale to oil companies for blending in petrol.

P resent Scenario:The Indian Government made 5% ethanol blend (E5) mandatory from November 1, 2007

across the country. However, currently the Oil Marketing Companies blend on an average only~ 3% - mainly due to unsolved issues like different sales tax across various states. sagreemen s on e as s o pr c ng.

The Indian Government plans to have 10% ethanol blended fuel (E10) mandatory from early2009.

resen capac y o e ano pro uc on s an s a ~ m on res. owever, a en ngrate, demand is likely to be ~ 1.5 billion litres.

-2008):

20% ethanol blended petrol (E20) across the country will be mandatory by 2017.

o remove a cen ra axes on o- ese an accor ec are goo s s a us o o- ue s acould ensure a uniform 4% sales tax (VAT) on the product across states.

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Brazil a case study on Ethanol

Basic facts ~ 50% of the fuel used by gasoline powered passenger vehicles in Brazil is made up by ethanolin 2008.

Flexible-fuel vehicle fleet of ~ 6 million.

Ethanol fuel is supplied from all the fueling stations in Brazil. It has 33,000 fuelling stationsspread across the country.

How Brazil implemented its Ethanol Strategy?

Brazilian tryst with ethanol started from mid 1970s, after the major oil crisis in 1973.

,Alcohol Program titled Pro-Alcool , a nationwide program which had the following 3 incentives:

guaranteed purchases of ethanol by the state owned oil company, Petrobras.low-interest loans for agri-industrial ethanol firms.

,set gasoline price at the pump.With this, the Government made the ethanol production competitive without resorting to anysubsidy. The ethanol was to be produced from fermented sugarcane due to low cost of sugarat that time.

Subsequently, to execute the ethanol program in the national automobile industry, theGovernment made it mandatory in 1977 to have 20% blend of ethanol with gasoline (E20).

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Brazil a case study on Ethanol

As the ethanol program started showing positiveresults, the country moved towards E100 (100%

How Brazil implemented its Ethanol Strategy? (contd )

YearAlcohol

E100 carsFlex fuel cars

Total carsmnfd. (I ncl.

% Ethanol

ethanol) based vehicles. By 1988 vehicles runningon 100% ethanol held almost 90% of the Braziliansmarket.

However, a crisis in ethanol supply in early 1990s

mnfd.mn .

exports)cars

1979 3,328 912,018 0.41980 239,251 933,152 25.6

1986 619,854 815,152 76

1990 71,523 663,084 10.8

left thousands of vehicles out of fuel. Sales of ethanol-only (E100) cars tumbled after thisshortage, and were further hit by the prevalence of low petrol prices in the late 1980s to early 1990s.In 1990, production of E100 vehicles fell to 10.9%

1998 1,188 1,254,016 0.1

2000 9,428 1,361,361 0.7

2002 48,022 1,521,431 3.2

2003 31.728 39.853 1,361,361 4.8

2004 49.796 282.706 1,862,780 17,8

o e o a car pro uc on.

The proportion of E100 vehicles to total carproduction continued to decline till 2002. In 2003,Volkswagen built the first flexible-fuel car which

2005 43.278 776.164 2,011,817 40.7

2006 758 1.249.062 2.092,003 59.7

2007 3 1,716,716 2,388,402 71.9

mid-2008* 0 1,054,518* 1,364,444* 77.2*

Note: * Data until June 2008.

cou run on e er pe ro or e ano . e ue s caneither be mixed in the same tank or have separatetanks and fuel systems.

The proportion of flex fuel cars rose sharply from ~

vehicles now

ource: raz an u oma ers ssoc a on , an .

Data shown for flex-fuels does not included light commercial vehicles.

3% in 2003 to 77% in June 2008. Current y t emandatory blend is allowed to vary nationwidebetween 20% to 25% ethanol (E25).

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-

Hybrid-Electric vehicles

Vehicle Technology

Regular Hybrids Plug-in Hybrids

Dual powertrain with an internal combustionengine (ICE) and electric motors to powertheir propulsion system. Source of power ischosen based on driving conditions.

Vehicle with batteries that can be recharged byconnecting a plug to an electric power source.In addition the batteries are charged by an on-board engine to extend the driving range.

a so c arges e e ec r c a er es. ebatteries are also charged by capturing kineticenergy via regenerative braking.Some of the popular models include ToyotaPrius, Honda Civic , Nissan Altima, Ford Escape

The prime source of power is the batteriesunlike regular hybrids where the ICE is theprime source of power.Some of the models likely to be launched in2010 include GMs Chevrolet Volt , Toyotas

. r us , s o , e c.

Phase I Phase II Phase II I

Gradual progression tow ards an all-electric vehicle

All-petroleum

vehicle

Regular hybrid electric vehicle P lug-in hybrid vehicle All-electricvehicle

(1997) (2010)(~2015)

Most use of petroleum

Main use of petroleum. More use of electricity

Residual use of petroleum.More use of electricity

Mostly electric

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All Electric vehicles

100% electric cars that run on electric motor and does not have any internal combustionengine on board.

e a er es are c arge rom an ex erna source. owever, e a ery capac y m s

the driving range.

Key Issues:attery tec no ogy w t arge capac ty or ong r v ng range, current y m te to

about 80-100 kmWeight and cost of batteries.

urren ava a e mo e s:India: Reva uses lead acid batteries.US: Tesla Motors Roadster uses lithium-ion batteries.

Reva EV Tesla Roadster

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Hydrogen Fuel Cells

Cars powered by Hydrogen fuel-cells which combine stored hydrogen withatmospheric oxygen to generate electricity and water vapor.

Storage issu es:

Hydrogen is stored in a compressed form in a cylinder.

Hydrogen fuelled car

Stored at a high pressure of 350 bar. Since it has very low density, needslarge on-board storage.

How is Fuel cell different than battery operated electric vehicle?

Battery operatedElectric Vehicle

Fuel Cell Vehicle (FCV)

Use electricity from an externalsource.

Electricity is stored in the batteries

Create their ow n electricity.

Create electricity through a chemicalprocess using hydrogen fuel and oxygen

electric motor.

Fuel source Electricity frommains

.

Fuel Source use hydrogen which isstored in high pressure tanks. FCVs canalso be fueled with hydrogen-rich fuelssuch as methanol or natural as butthese must be first converted intohydrogen gas by an on-board device called

a reformer. 16


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Major investments in hydrogen-fuel cells

Hydrogen F uel-cell vehiclesExpected to be in mass production by ~2017 (the horizon has been slippingfor years)

Some of the major investments in the Hydrogen Fuel-cell technology:USA US $ 1 bn on Hydrogen Research, since the launch of Hydrogen Fuel Initiativein 2003.Europe US $ 730 mn ( 470 mn), for fuel-cell and hydrogen initiative. Expectsprivate sector to match this figure.Germany US $ 777 mn ( 500 mn) through establishment of National Organizationof Hydrogen and Fuel-cell Technology in Germany.

nves men requ re or mass pro uc ng y rogen ue -ce cars:According to Oak Ridge National Laboratory, sponsored by US Department of Energy (DoE):

US $ 10 bn of public funding for 2 mn hydrogen fuel-cell cars on US roads by 2025rising to US $ 45 bn for 10 mn cars.

,US $ 55 bn of Government investment to put 2 mn hydrogen cars on roads by 2023.

Fuel-cell costs to drop in future:Currentl fuel-cells cost ~ 107 kilowatt t ical mid-size car is 100 kW . As er Oak

17

Ridge study, the cost is likely to drop to $ 45 /kilowatt in 2010 and $ 30 / kilowatt by 2015.


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Capabilities of Global Auto majors

GeneralMotors

o ue s as mo e s a run on ex- ue s o e ano o- ese .Has a goal of having half of annual vehicle production be E85 or biodiesel capableby 2012.

Hybrids Has 8 hybrid cars in its portfolio (with limited availability). Vehicles

(GM).

Plug -in hybrids plans to launch Chevrolet Volt by end-2010 .

Fuel Cells has tested a production model, Chevrolet Equinox powered byhydrogen. Still not for sale.

Biofuels goal to have half its production to be E85 ready by 2012. Has fewtruck and van models which run on B5 blend of bio-diesel. Presently working onB20 blends.

Hybrids 2 major brands, Ford Escape and Mercury Mariner hybrids; sold~47,000 vehicles on hybrids to date. Plans to launch hybrid technology on Ford Fusion and Mercury Milan . Ford expects to double its annual production of

Motor, .

Plu g-in hybrids Escape plug-in hybrid is likely to be on the road onlyafter five years.

H dro en vehicles called as H Series the com an is resentl workin

18

on vehicles that run on hydrogen fuel cells, hydrogen ICE (on a shuttle Bus),and plug-in hybrid.


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Capabilities of Global Auto majors

Toyota

r us -model. Plans to introduce Lexus and other models on the hybrid platformin 2009.Sold 4,29,000 units in 2007 (up by 33% Y-o-Y). Plans to sell ~ 1 mnunits p.a. by 2011-12. Plans to have hybrid option on all its models by

.

Plug-in hybrids To launch plug-in hybrid version of Prius by end of 2009. By 2010, plans to build about 400 demo plug-in hybrid vehicleswhich can charge batteries from all sockets.

early next decade. Plans to mass-produce lithium-ion batteries to feed thesame.

Natural Gas Civic GX

Honda Hybrids Civic hybrid, CR-Z concept sports car. Fuel Cells FCX Clarity.

Nissan

Hybrids has Nissan Green Programme 2010 where it is developingin-house an electric car with a 300 kg lithium-ion battery. It will go on salein US & Japan in 2010, Israel & Denmark in 2011 and the rest of the worldby 2012.

19

Electric Under partnership with Renault, Nissan is developing its firstelectric model in Israel, to mass market by 2011.


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Tesla Motors an all electric sports car company

-e ec r c car ma er, s ar e opera ons n anbegan producing electric cars in March 2008.

Volumes So far the company has delivered 30 Roadsters andhas 1,200 orders pending for delivery.

TeslaMotors

Technology Plug-in electric car, powered by lithium-ion batteries

that needs 3.5 hours to charge for the range of 220 miles (~393kms).

Car Mod els:es a oa s er s rs pro uc on car, an a e ec r c spor s car,

with starting price of ~US$ 109,000 . Expects to sell 1,500 carsin the model year 2009.

Model S an all new electric sedan with zero emission. Plans tolaunch this model in late 2010 at a price of ~US$ 60,000. Thecompany expects to produce ~ 15,000 cars p .a.

Tesla Roadster(Electric sports car)

100% electric-

20

.Top speed of 200 km/hr


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Tata Motors Alternative Fuel Strategy

DICOR(Better DieselTechnology)

Closely associated with diesel models. Existing products Tata Indica DICOR, Indigo DICOR,Indigo Marina DICOR & Safari DICOR. To use Fiats CRDi technology in future products. c

h n o

l o g y

Gas BasedCNG & LP G

LPG Car Factory fitted LPG kit in Indica Xeta. CNG Dealer fitted CNG kit. Existing Products Indica LPG Dual, Indica CNG & Indigo

Marina CNG x i s t i n g

T

Bio-fuels Presently testing the bio-diesel fuel in its staff buses at y

Electric Electric Car acquired 50.3% stake in Miljobil (Norway)in Oct 2008; will launch electric Indica in 2009

.

e c

h n o

l o g

Compressed

ec r c ce e-up w rys er s o a ec r c o orCars group

Tie up with MDI of France. To su ort further develo ment and refinement v

e l o p

i n g

Air of the technology for engines powered by air,and its application and licensing for India.

D e

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M& Ms Alternative Fuel Strategy

yCRDe(Better DieselTechnology)

Introduced Scorpio CRDe. Technology for New CRDe Engine Development is already

absorbed.

e c

h n o

l o g

Gas BasedCNG & LPG

-followed by Champion Alfa Small 3-wheeler.

Launched a CNG variant of its one tonner pick-up vehicleBolero in July, 2008.

Plans to introduce CNG in Scorpio and LCVs and to launch CNG& LPG variants of Lo an. E

x i s t i n g

Bio-fuels

Showcased B100 Scorpio and Bolero concept. Biodiesel engine technology in the process of absorption. 2nd generation Biofuels in the process of absorption. g

y

H brid Plans to introduce diesel-electric hybrid versions of Scorpio

ans o aunc o- ese o- ue ase corp o n .

T e c

h n o

l o

Electric

.

Hybrid Vehicles technology in the process of absorption.

Showcased the concept version of HY-Alfa, hydrogen powered e v e

l o p

i n g

HydrogenFuel Cell

Alfa three-wheeler. Technology for Hydrogen ICE & Fuel Cell Vehicle Development in the process of absorption.

D

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Maruti Suzuk is Alternative Fuel Strategy

Gas BasedCNG & LPG

Entered the alternative fuels market with the launch of OmniCargo LPG in March 2004. Other LPG models WagonR LPG Duo, M800 LPG Duo. All the above models have factory-fitted LPG kits. Presently working on CNG versions of its car models.

e c

h n o

l o g

DICOR(Better DieselTechnology)

Licensed Fiats 1.3 litre Multijet CRDi diesel engine andestablished a diesel engine plant in Haryana in JV with parent. Introduced diesel engine in Swift in January 2007. Likely to have diesel option in Splash to be launched in 2009

E x

i s t i n

g T

Bio-fuels Suzuki Motor Corp plans to introduce bio-fuel based flex-fuelsvehicles in Brazil that run on E25 and in US that run on E85. l o g

y

. )

Marutis parent Suzuki has tie-up with GM since 2001 to jointly

Brazil by March 2009. Suzuki plans to introduce E100 vehicles by 2010.

g T e c

h n o

k i M o t o r

C

n t

i n J a p a

HydrogenFuel Cell

work on Hydrogen Fuel cell vehicles. Had 3 models tested earlier MR Wagon FCV and WagonR FCVin October 2003 and MR Wagon FCV again in December 2004. Latest model SX4 FCV tested in June 2008.

D e v e

l o p

i

( a t

S u z

i t s p a r

Suzuki has a wide ranging alliance w ith General Motors for developing

hybrid and fuel cell vehicles 23


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Marutis Alternative fuel Volumes trend

Maruti Suzukis Alternative fuels volumes as % of Total Volumes

8.4%9.0% a

6.0%

6.8%

5.4%

7.2%

l v e

h i c l e s a s

l e s v o

l u m e s

0.5%

1.4%1.7%

1.8%

3.6%

l t e r n a t

i v e

f u

%

o f t o t a l s

Note The above sales volumes do not include sales of diesel vehicles.Source: Company data

0.0%FY04 FY05 FY06 FY07 FY08 FY09

Marutis Sales Volumes from models that run alternative fuels recorded a116% CAGR in the last 5 years to FY08.

Volumes increased from 2,229 in FY04 to 48,403 in FY08.

24

FY09 volumes are for the months April-July 2008.


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Reva Electric Car Company (RECC)

Reva Electric carProduction Capacity: 6,000 cars p.a., plans to increase to30,000 units p.a. in near future.Sold ~ 3,000 cars so far.

- . . ,not attract excise duty.

Battery costs ~ INR 50,000, has to be replaced once in threeyears.Running cost: 40 paise per km against INR 4/km for a petroldriven car.

Revas Fuel cell drive: Revas fuel cell prototype was launched in July 2004.

Besides India, Reva is sold in UK, Italy, Malta,

Sri Lanka, Cyprus &Greece. It is being test

Still a prototype & not yet commercialized.

Tie-up w ith Argentum Motors:

marketed in US, Norway,Spain, and other European countries.

E-vehicle EV-1, is a 3.5 metre length concept vehicle tobe produced in 6-8 months time.

powered by lithium-ion batteries. Target markets France and other European markets.

25

.metre length) and a 4 seater car.


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Electrotherm (India) Ltd.

YoSpeed

Background:YOBykes launched first in February 2006 . Sales volumes 16,500 units in FY08 .

, . , ,p.a.

Sales & Distribution Network 200 YOWorld 3S points.

Products:6 models with price range between INR 16,000 -28,000.

Do not need registration and are exempt from road taxes.

Technology:Operates on lead-acid sealed batteries.

Future Plans:Plans to launch electric three-wheelers.

Plans to launch Hybrid Electric Bus.

26


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Hero Ultra Motors

JV between Hero Ex orts art of the Hero Grou and Ultra Motor Com an UK.

BackgroundMarathon

(Price: Rs.31,000

Got separated in May 2008 and now running separately

Products Maxi (constituted 80% of sales), Optima,Marathon and Velociti electric scooters.

Sold 21,000 units in FY 08 , lans to sell 65,000 un its in

ex-s owroom oc

FY09 .

TechnologyUses lead acid batteries.

Future PlansLooking at electric three-wheeler to be rolled bybeginning of FY10.

Velociti(Price: Rs.34,000

(ex-showroom Delhi)

- on electric & CNG/diesel.

I nitiative to increase charging stationsPlanning to set up 2000 outlets, hopes to expand the

, .

27


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I ncentives galore on electric vehicles

Several countries offer w ide ran in incentives to Electric Vehicles EV ow ners. Some of the incentives are listed below :

Countries Incentives

USA USD 4,000 subsidy to each EV buyer

Preferential arkin areas

Subsidy on the installation of charging infrastructure

United Kingdom (UK) Free parking in some areasCertain areas in London are EV-only zones

Exempt from GBP 8 per day congestion tax

Japan D rect su s y o USD 2,600

Up to 50% subsidy of incremental cost of clean energy vehicles

Norway No import duty on Reva

EV can drive in bus lanes

No congestion charge on city toll ring road

Free parking in government-owned parking spots

Cheaper insurance for EV

France EUR 2,000 subsidy to each EV player

Free parking for EV

Lower road tax

Italy EUR 1,800 subsidy to each EV player

Free parking facilities in certain cities

No road tax for first five years of ownership

28Source: RECC

Malta Removed 50.5% registration tax on cost, insurance and freight

No USD 55 charge for entering the capital city

15% tax rebate (up to USD 1,300) on 18% VAT


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Auto component companies to benefit

Everest Kanto Cylinders (EKC) CNG cylindersManufacturer of high pressure cylinders for CNG andindustrial applications.

Everest Kanto CylindersCNG cylinders

Will be in a advantageous position as CNG based vehiclesproliferate across the country.

Recently, EKC received orders for CNG cylinders (of overUSD 13 mn) from Pakistan and few Middle Easterncountries.

Minda AutoGasM in a A uto Gas Lt . CN G LP G Kits.

Provides CNG / LPG kits and other alternative fuel solutionsto various Auto OEMs and for the replacement market.

Parts of CNG / LPG Kit

OE supp ier to Maruti Suzu i or WagonR Duo an Bajaj Autofor its three-wheelers.

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Conclusion

, .From the book Zoom: The Global Race to Fuel the Car of the Future,

by Iain Carson and Vijay V. Vaitheeswaran

( The Economist correspondents)

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CNG Availabili ty of fuel

CNG Fueling Stations 376 stations in few select cities

Uttar Pradesh (total 12)Kanpur (5)

Delhi NCR (166)

Agra (3) Tripura (1)

P resently, CNG stations are

GUJARAT(total 29)Surat (23)

Vadodara (3)

cities like Delhi and Mum bai.How ever, plans suggest 20 major cities of the country

w ould be covered by CNG by 2010.

MAHA RASHTRA (total 159)

Some of the major companiesMumbai (130) Pune* (29)

Indraprastha Gas (Delhi), Mahanagar Gas (Maharashtra), GAIL & Gujarat Gas (Gujarat), Bhagyanagar Gas (AP),

33

Andhra Pradesh (total 9)Vijaywada (6)

Hyderabad (3)

Green Gas (UP), Tripura Natural Gas (Tripura)

* CNG stations in Pune are likely to be in place by end-2008.


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LPG Availabili ty of fuel

ue ng a ons s a ons across n a cover ng + c es

Southern & Western India the regions w here proliferation of LPG stations is more thereby leading to higher availability of Auto LP G as compared to other states /

reg ons

Delhi NCR (16)

Punjab (10) Uttar Pradesh (7)

Assam (4)Haryana (1)

Gujarat (126) West Bengal (12)

Madhya Pradesh (27)Rajasthan (32)

Goa (3)

Maharashtra (108)

Karnataka (79)

Chhattisgarh (10)

Orissa (1)

Kerala (64) Tamil Nadu (61)

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Global Statistics Volumes

Gas based fuels Over 7.5 mn vehicles in 39 countries use Auto LPG .

Bio-fuels USA On road fleet of over 7.3 mil lion E85-capable vehicles.

,road in the U.S.Brazil Annual Sales of ~2 mn vehicles running on E25.

Hybrid-electrics About 3.5 lakh s vehicles sold in the US in 2007.

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~ 5 lakh vehicles run on CNG across I ndia

Total vehicles running on CNG stood at ~ 5 lakhs spread across major cities w here CNG is available (as of April 2008)

81% of the CNG run vehicles are concentrated in Delhi and Mumbai combined.

59,916

7,735200 000

250,000

7,266

100,000

150,000

( U n

i t s )

7,077 5,738 3,900 1,773 1,623 17730

,

V e

h i c l e s

r u n n

i n g o n

D e

l h i

M u m

b a

i

S u r a

t

K a n p u r

n k l e s h w a r

L u c k n o w

A g r a

V a

d o

d a r a

H y

d e r a

b a d

Source: Ministry of Petroleum and Natural Gas, India

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alternative fuels the why what when and how

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