CapaCITIES – how smaller cities can decarbonise transport

In cities across India, it's not only the traffic that can cause headaches. While transport is the country's fourth largest source of emissions, current transport systems are also linked to poor air quality in the majority of Indian cities, noise pollution and traffic. This causes significant disruptions to business and daily life but is not unique to India - many countries around the world face similar challenges. As e-mobility options increasingly rise to prominence, there are innovative solutions that can make these problems a thing of the past.

The CapaCITIES project is helping multiple Indian cities and states implement climate action at scale by designing holistic and resilient climate action plans and supporting implementation and financing of climate actions. One of the key findings of the project is that transitioning to e-mobility is one of the best ways to tackle transport system problems and that electric mobility must be a focal point for implementing climate action in cities. Not only does expanded e-mobility directly address transport emissions, it can also have multiple community benefits and a number of knock-on effects. Ultimately this helps cities chart a course towards low carbon economic development.

Multiple efforts to expand e-mobility in India have already been taken by central and state governments, such as the FAME II scheme of the Government of India and state-level EV policies focusing on demand-side adoption incentives and the development of charging infrastructure. While the schemes and policies have shown a marginal acceleration in the adoption of electric vehicles in larger cities like Delhi, adoption in smaller cities has been limited.

Barriers to e-mobility in smaller cities

Outside of India's eight metropolises with million plus populations, smaller cities with populations up to one million make up a significant portion of transport emissions. Much of these emissions are attributable to prevalent two- and three-wheeled modes of transportation. While switching to e-transport can significantly lower these emissions, there are several major obstacles preventing adoption, including: awareness (myths), inadequate processes for setting up charging infrastructure, insufficient ecosystem services (service, resale, and dealer networks), a lack of financing and insufficient supportive policies. While the schemes and policies of central and state governments have largely been able to address price barriers to adoption with fiscal incentives, these other obstacles require localised policy or program interventions at the city level.

This is where the CapaCITIES project comes in. The team is currently working with eight Indian cities and two states in designing innovative climate resilient infrastructure projects like green mobility programs. While there are many obstacles, the raw potential and hunger for innovation is what will truly transform transport systems, air quality and millions of peoples' health. That's why we think it's time to face these challenges head on and speed on the transformation to healthy, livable cities with burgeoning green transport systems.

Major obstacles preventing E-mobility adoption:

1. Awareness (myths about EVs and first mover shyness): Against the backdrop of older and more primitive EV transportation options, consumers have limited information and awareness of new highly efficient EV models that are comparable to internal combustion engine (ICE) vehicles. For instance, most consumers in the 3-wheel segment are not aware of electric options in the larger L5 category (performance speed and load equivalent to fossil fuel vehicles) and raise concerns regarding load, speed, capabilities on a gradient and down time for charging. These concerns have been mostly addressed with modern L5 EVs launched by various manufacturers.
2. Inadequate processes to support charging infrastructure: Charging infrastructure network service providers need clearances from multiple government departments to set up retail as well as captive stations. Availability of space or land is also a challenge. A streamlined process for the permission and clearances to set up charging infrastructure as well as designating space can help to broaden the base of charging infrastructure in a city.
3. Insufficient ecosystem services: The dealer, service, and charging networks provided by manufacturers is very limited in smaller cities. Most manufacturers focus on bigger cities or cities with lucrative policies, while consumers raise concerns on accessibility to dealer pre- and post sales.
4. Financing: Due to limited experience and knowledge about the residual and resale value of electric vehicles, only a limited number of banks and non-banking financial companies (NBFC) venture into EV lending. This is a major barrier given that the 2-wheel and 3-wheel consumer segments largely depend on financing.
5. Supportive policies: Central and state government policies can fall short in addressing city-specific needs and barriers, but there are few local policies and programs and the city level to fill the gap.

How can local policies support these transitions?

How can cities address the barriers listed above through local policies and programs? For many cities, a public-private partnership program can be a gamechanger towards addressing local barriers.

The role of cities

Urban local bodies, transport departments, traffic police, power distribution companies, and other city-affiliated stakeholders can focus on the following actions as part of a public-private partnership program:

• Policy support: Issuance of new permits only to EVs within municipal limits; compulsory transition of freight vehicles to EVs in a phased manner; target setting for phased transition of vehicles used by e-commerce companies, or compulsory transition of private ICE vehicles to EVs.
• Incentive support: Early bird subsidies provided by the city for first number EV adopters as a pilot to drive adoption; incentives for scrapping old vehicles in exchange for a purchase credit for EVs (if not in state policy); explore arrangement with guarantee operators and financial institution for financing of EVs; facilitate subsidies and incentives under state government EV policy, including upfront incentives and GST reimbursements.
• E-mobility promotion and myth busting: Announce 'Year of Electric Vehicles' wherein the city would organize an information, education, and communication (IEC) campaign for EV adoption in partnership with private partners.
• Infrastructure support: Provide dedicated space for charging infrastructure, e.g. below highway flyovers, near public gardens, existing auto stands; reserve 20% of public parking spaces for EVs (with charging infrastructure).
• Multimodal integration and real time traffic management: Leverage data from IOT devices on EVs to formulate real time traffic management strategies and integrate with public transport to improve share of public transport and conduct real-time traffic management.

The role of the private sector

The private sector, including vehicle manufacturers and charging infrastructure developers as well as their ecosystem partners (dealer & service networks, charging service providers, financiers, resale networks, etc.) and fleet operators (cab aggregators, freight aggregators, last mile delivery e-commerce companies, etc.) can focus on the following actions as part of a public-private partnership program:

• Awareness campaign: In collaboration with local NGOs, launch a city-specific awareness campaign with the auto unions including free training on how to operate EVs and explaining the advantages of EVs.
• Develop dealer and service networks: Ensure adequate dealer and service network support for sales and service of vehicles.
• Charging infrastructure network: Develop adequate charging infrastructure network to support transition, for instance through a pre-agreed number of chargers per sale of a given number of vehicles.
• Financier network: Ensure ready access to finance is available for vehicles at affordable rates through channel partner financiers. For instance, in some cities private sector manufacturers have partnered with innovative financing agencies backed with digital behavioural assessments, guarantees, and flexible daily repayment models which have been fairly successful in enabling EV financing.
• Co-financing: support the piloting of adoption drives to build consumer confidence, for example by providing vehicles on a rental basis or with discounted purchase prices.
• Commitments: Sign commitments to support a phased transition of fleets to EVs for e-commerce companies like Amazon, Zomato and fleet aggregators.
• Data sharing: Ensure available data from EVs is shared with cities for traffic management and seamless integration of intermediate transport means, for example between automobiles/tuk tuks with buses and metro services.

Under such a public-private partnership program, the city can partner with multiple private sector stakeholders towards accelerating e-mobility transition in a technology neutral manner that takes into account the ever-evolving nature of EVs and charging technologies. A well-designed program would require the cooperation and participation of multiple government agencies such as regional transport offices (RTO), state transport departments, traffic police, the office of the district collector, tourism departments, and many others. A well-developed institutional framework is key, particularly one that establishes an empowered core committee with representation from key government departments that can oversee implementation with the city as the 'anchor department.'

The CapaCITIES project

Climate change is a global issue, but it is on-the-ground local action that is needed to make fundamental changes. The CapaCITIES team is presently working with eight Indian cities and two states in designing innovative green mobility programs, with the real potential for impact lying in the ability of other local governments to replicate and scale up these innovative approaches. The findings above represent the team's work through a series of primary assessments of local stakeholders in tier 2 (population less than 1 million) Indian cities, and the team is working closely with cities and state governments to enable wider replication of designed solutions.