Growth of Alternate Financing for Zero Emission Trucks (ZETs) through Carbon Credits and Green Credits in India

The client seeks to develop a report evaluating carbon and green credit monetization for Zero Emission Trucks (ZETs), outlining a practical integration mechanism. It will assess credit potential, recommend fiscal and non-fiscal incentives, and analyze value chain impacts across OEMs, shippers, carriers, and logistics providers to enable a low-emission, inclusive transition.

Objective

The client wanted to develop a report, focusing on identifying alternative financing mechanisms to support the adoption of Zero Emission Trucks (ZETs) in India. Given the exclusion of electric trucks from the FAME scheme, the study explores how carbon credits and green credits can replicate the success of electric buses, which benefited from FAME incentives. It also aims to develop implementation guidelines tailored to the Indian context to facilitate scalable deployment of ZETs.

Our Approach

Technological Adaptation

Assessed segment-level ZET demand for 13 applications (FMCG, parcel load, cement, minerals, steel/metals, etc.) across GVWs (12–55 MT) and formulating adoption scenarios for diverse powertrain technologies (BET, hydrogen ICE, hydrogen fuel cell) across various trucking applications up to 2050

Project Development

Assessed Business case of Alternate Financing through CCs and GCs for ZET stakeholders including OEM, Carrier/ Operator, Shipper and Investor. Benchmarked different Carbon Markets, Mechanisms and Methodologies for suitability to national ZETs growth including Different carbon market mechanisms.

Green Credit Financing

Assessed suitability of Green Credit Program to ZETs and developing appropriate mechanism for representative ZET use case and appropriate aggregation between select industry players. Synthesised key enablers to create market for ZETs CCs and GCs - buyers, sellers, pricing, M&V methodology and corresponding Barriers

Roadmap

Developed a roadmap for Alternate Financing for ZETs with clear responsibilities of all stakeholders involved and Disseminating results to wider stakeholders.

Industry Mechanisms

Developed India specific mechanism with close working with real life stakeholder a suitable Carbon Project for representative ZET use cases and appropriate aggregation between select industry players with required any suggested changes in Mechanisms and Methodologies

Outcome

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