New Delhi: India’s transition to cleaner road transport is unlikely to be powered by a single fuel or propulsion technology, according to a new study by The Energy and Resources Institute (TERI), which finds that electric vehicles, CNG and LNG could each play distinct roles depending on vehicle type, usage, infrastructure and the stage of the transition.
Titled Study on Comparative Assessment of Vehicular Fuels in India’s Energy Transition, the report evaluates petrol, diesel, CNG, electricity and LNG across six vehicle segments — two-wheelers, three-wheelers, private four-wheelers, commercial four-wheelers, light commercial vehicles and heavy-duty vehicles — for the current period as well as 2030, 2040 and 2050. Assessment of Vehicular Fuels R…
Its central conclusion is that India should not attempt to identify one universal replacement for existing transport fuels. Instead, TERI argues for a phased and differentiated transition in which technologies coexist and their roles evolve according to the vehicle segment and operating environment. Assessment of Vehicular Fuels R…
In other words, India’s road to cleaner mobility may have more than one lane.
EVs emerge strongly in smaller vehicles
The study finds electric mobility particularly competitive in two-wheelers, three-wheelers and some urban applications, where vehicle weight and energy requirements are comparatively manageable.
Under current market conditions, EVs offer the lowest ownership costs for two- and three-wheelers, according to the report, helped by relatively low energy and maintenance expenditure. However, the assessment also identifies constraints in some larger vehicle categories, including charging infrastructure, payload, battery-related environmental impacts and dependence on imported components and critical minerals. Assessment of Vehicular Fuels R…
Looking towards 2040-2050, TERI expects electric vehicles to become the dominant pathway for two-wheelers. Three-wheelers are projected to follow a coexistence model, with EVs gaining ground while CNG continues to play a complementary role. Assessment of Vehicular Fuels R…
CNG retains a significant role in cars and commercial mobility
For passenger cars, taxis, buses and light commercial vehicles, TERI finds that CNG currently offers a comparatively favourable combination of economics, environmental performance and operational practicality.
The report says CNG remains relevant because of its operating economics, quick refuelling and an infrastructure network spread across 784 districts. It also notes that LNG could have a more specialised role in long-haul freight. Assessment of Vehicular Fuels R…
For private four-wheelers, the study envisages a more gradual shift towards electrification. CNG retains strong relevance in the interim, particularly for high-mileage users, while EVs become more competitive as technology, infrastructure and economics improve. For heavy-duty vehicles, TERI sees CNG continuing to serve regional freight, LNG strengthening in long-haul applications, and battery-electric trucks remaining more selective under the conditions assessed. Assessment of Vehicular Fuels R…
Economics carries the highest weight
Affordability emerged as the single biggest factor in TERI’s analytical framework.
Economic considerations received a combined weight of 31.49%, followed by environmental factors at 22.34%, technical considerations at 21.25%, social factors at 13.87% and geopolitical considerations at 11.05%. Assessment of Vehicular Fuels R…
The study used a multidimensional framework covering technical readiness, environmental sustainability, economic viability, social considerations and geopolitical or energy-security risks.
TERI also carried out surveys and stakeholder consultations to feed into its assessment. The report says the primary survey covered 2,315 vehicle owners and drivers across 10 locations, gathering information on vehicle use, infrastructure access, fuel and maintenance spending and technology preferences.
Life-cycle emissions complicate the picture
The study stresses that comparing fuels solely on tailpipe emissions can produce an incomplete picture.
Its environmental assessment considers the full life cycle, including fuel production, electricity generation, vehicle manufacturing, operation and end-of-life impacts. It covers factors ranging from climate change and particulate matter to toxicity, water use and mineral-resource consumption. Assessment of Vehicular Fuels R…
EVs perform favourably on operational air pollutants, the report says, but their current life-cycle performance is sensitive to India’s electricity-generation mix and battery manufacturing. Under the present Indian electricity mix, TERI says CNG generally records the lowest overall environmental burden across most vehicle categories included in its assessment. Diesel-based mobility, meanwhile, performed relatively poorly on both life-cycle and air-pollution measures. Assessment of Vehicular Fuels R…
That assessment is particularly important because the study is not treating a zero-emission tailpipe as the finish line; it is looking further upstream at how the energy and the vehicle itself are produced.
CBG blending could strengthen the CNG pathway
The report also places significant emphasis on compressed biogas, or CBG, as a potential means of reducing the carbon footprint of the natural-gas mobility ecosystem.
It states that blending 20% CBG with CNG could make the overall CNG fuel carbon-neutral on a life-cycle basis, while also potentially increasing the share of domestically sourced energy. Assessment of Vehicular Fuels R…
Gaurav Kedia, Chairman, Indian Biogas Association, said:
“Both TERI and NITI Aayog have highlighted the enormous potential of CBG. The fact that just 20% CBG blending with CNG can make the entire CNG vehicle stock carbon-neutral on a life-cycle basis shows what this pathway can achieve. CBG addresses several priorities together – it is carbon negative, offers greater energy security and a stronger rural economy. That makes it a truly Atmanirbhar fuel for India.”
Subhash Kumar, Director General, Association of CGD Entities, and former Chairman and Managing Director and Director Finance, ONGC, said:
“This study deserves credit for putting the evidence so clearly on the table. CNG has cleaner credentials and with increasing blending of CBG, the natural gas pathway will become progressively cleaner. In today’s world witnessing global turbulence, integration of CBG in national fuel system will not only result in an ever cleaner NG/CBG based mobility ecosystem but it will also strengthen national economy and will add people to income of rural areas.”
Kumar Shanker, Managing Director, IGL, said:
“TERI’s study brings out clearly the overall benefits of CNG. It combines the lowest overall life-cycle emissions with favourable economics, affordability, infrastructure readiness and operational practicality. A fuel with such an all-round advantage merits continued recognition in our multi-fuel clean-mobility policy. Furthermore, greater blending of CBG will further strengthen CNG’s environmental advantage.”
Infrastructure could determine how quickly fuels change
TERI identifies infrastructure as one of the most immediate constraints on the pace of transition.
When availability, geographical distribution and service time are assessed together, diesel currently scores highest on the infrastructure indicator, followed by petrol, CNG and EV charging. The report argues that simply counting charging points does not fully represent EV infrastructure capacity because charging generally takes considerably longer than conventional refuelling. Assessment of Vehicular Fuels R…
Regional differences are also significant. Delhi has the strongest CNG infrastructure position in the assessment, while Bengaluru and Delhi perform relatively strongly on EV infrastructure. Other locations show varying levels of readiness, reinforcing TERI’s argument that a national policy may need locally differentiated implementation.
Energy security does not end with electrification
The study also cautions that electrification changes the nature of external dependency rather than removing it altogether.
Petrol and diesel expose India to imported crude and global oil prices; CNG and LNG retain exposure to natural-gas supply chains. EVs can reduce direct oil dependence but increase reliance on battery materials and geographically concentrated supplies of lithium, cobalt, nickel and graphite. Assessment of Vehicular Fuels R…
TERI therefore calls for diversified sourcing, domestic production and manufacturing, recycling and material recovery alongside the transition to cleaner mobility.
TERI calls for technology-neutral, fleet-specific policy
The broader recommendation is for a technology-neutral policy at the national level, but one that differentiates between regions, vehicle classes and applications.
TERI says EV adoption should be accelerated in areas such as last-mile mobility where economics and charging access favour electrification. CNG should continue where it remains economically, technically and environmentally justified, while LNG should be developed selectively for long-haul freight corridors. Assessment of Vehicular Fuels R…
The report argues that electricity-sector decarbonisation, battery recycling and circularity, critical-mineral security, domestic alternative-fuel production and infrastructure expansion will all have to progress alongside vehicle electrification.
That leaves India with a more complicated transition than simply replacing a petrol pump with a charging plug — but potentially a more practical one. TERI’s assessment suggests that the central policy question is no longer which single fuel should win, but which technology best fits each vehicle, route and use case as India moves towards its longer-term climate, air-quality and energy-security goals.
