In a first-of-its-kind, a few electric two-wheeler manufacturers are likely to benefit through carbon credits for reducing CO2 emissions through sales of green vehicles.
Four major electric two-wheeler makers in the country, Hero Electric, a 100% subsidiary of Hero Group, Delhi-based Lohia Automobiles, Ahamedabad-based Electrotherm and Bangalore-based Eko Vehicles are in the process of registering themselves with United Nation Framework Convention on Climate Change (UNFCCC), a global governing body that is involved in reducing carbon emissions worldwide.
Grutter Consulting executive director Rohini Balasubramaniam told FE, ?All these electric two-wheeler makers have signed contracts with us.? Grutter Consulting is a Switzerland-based company that works on clean development mechanism (CDM) projects in transport sector. ?This is for the first time that electric two wheeler-makers are going to get carbon credits,? she added.
Transport sector accounts for a significant share of the world?s greenhouse gas emissions (GHGs). Projects which reduce GHGs in the transport sector can be matched with innovative finance mechanisms, she said. There are opportunities in the area of the CDM, voluntary emission reduction markets as well as regional and domestic carbon offset schemes, she said.
Germany-headquartered TUV Nord, one of the leading global voluntary emission reduction (VER) verification agencies, has already validated Eko Vehicles and submitted its report. Meanwhile, the ministry of environment and forest has also verified the project and offered letter of acceptance (LoA) for the CDM project of Eko Vehicle, she added.
“Next we are in the process of applying to Switzerland-based Designated National Authority (DNA). The LoA from DNA is mandatory to register with UNFCCC,” she said.
The LoA from DNA is expected in another two months and the project will be registered with UNFCCC in the next eight-month period. After UNFCCC gives its nod, Eko Vehicles will be entitled to $4 million worth carbon credits, she said.
Even before listing in UNFCCC, several European companies have approached to book the company’s carbon credits in advance, said Anil Ananthakrishna, chairman & chief executive officer of Eko Vehicles. So far Eko has sold more than 18,000 units of electric vehicles in India. TUV Nord has also evaluated other vehicle makers Hero, Electrotherm and Lohia. Grutter will apply to MoEF and DNA for these companies in coming months. Each of these companies have chance to earn carbon credits in the range of $4 million to $6 million, Rohini added. She also said talks are on to sign contract with BSA, another major player in the Indian electric vehicle market, to proceed with CDM project. For effective CDM project, she said any electric vehicle manufacturer should be able to sell atleast 15,000 units a year.
