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In its latest corporate briefings, Indus Motors has expressed its hope for a new automotive policy that extends incentives to hybrid electric vehicles (HEVs) as well, in addition to battery electric vehicles (BEVs). That’s not surprising. After all, Toyota Prius happens to be one of the most dominant HEV marques in the world, and Toyota is one of the top EV-group sellers without having a pure EV in its line. In fact, HEVs are projected to mark a much bigger growth compared to BEVs and have already outrun the volume race by a mile.

Domestic OEMs in Pakistan have not been too receptive to earlier automotive policies but have come far on that front, particularly on their opinion on electric vehicles. In fact, the remarkably slow progress on the launching of EV policy for four-wheelers has often been linked to a clear discontent of auto lobbies calling it ad-hoc and confusing for existing (and new) automobile players.

But first. What really is the difference? Simply, BEVs are powered by battery packs (30-60 kWh) and an electric motor. The batteries are charged using the electric charging outlet. HEVs have both an internal combustion engine (ICE), electric motor and small battery packs of 1-3 kWh (recall that internal combustion engines are run on fossil fuels such as gas, diesel). They don’t need to be charged externally and the engine keeps on charging the batteries as the car is driven. But they also cannot be driven on electric power alone but do provide better mileage. Then there are plug-in hybrid EVs (PHEV) which also have ICE and an electric motor, and much bigger batteries (10-15 kWh) that can be plugged-in to charging stations. In theory, this can allow the vehicle to be run on purely electric power for 20-40 miles without any fuel burning until the engine kicks in. This naturally means they pollute less. But because of the larger battery size, they are more expensive than HEVs.

Hybrids have been called “bridge” technology until a time when charging infrastructure is robust and sustainable enough to take on the load for an electric future. Their demand has been phenomenal as while they provide benefits of an EV, they also cost less and drivers don’t have to suffer from “range anxiety”—that longer journeys can be covered without having to worry about losing power and not have a charging station in sight.

But research has now surfaced that argues that PHEVs may not be as environmentally friendly as earlier thought. In fact, lab testing suggested they would emit only 44g per km of CO2 but the actual number is actually much higher—117g per km—when tested on the road for PHEV users. This research that comes from the Transport & Environment campaign group, supported by the environmental organization Greenpeace U.K., argues that CO2 emissions from plug-in hybrid electric vehicles were well over (2.5 times) their official test levels which meant that over its life, a new PHEV would emit 28 tons of CO2, compared to a HEV’s 33 tons, petrol car’s 39 tons and a diesel car’s 41 tons. Lower than other variants, but still not nearly zero.

The policy treatment for BEVs, HEVs and PHEVs is typically different. In Pakistan’s case where the industry has barely broken ground, there is a clear chicken-and-egg problem here. As argued in a report on EVs produced by the LUMS Energy Institute &U.S.- Pakistan Center for Advanced Studies in Energy (USPCAS-E): “Charging infrastructure only makes commercial sense if enough EVs are on roads while EVs require charging infrastructure to get rid of the so called ‘range anxiety’ phenomena and that requires sufficient penetration of charging infrastructure”.

It makes sense that until the time charging infrastructure truly develops, hybrids should be encouraged; but if incentives for BEVs and HEVs/PHEVs are the same—the latter being cheaper—consumers would not take the great leap of faith to go completely electric.

There is another problem. The aforementioned research from the UK also found that many PHEV owners rarely charged their vehicles which means they relied pure on the ICE to power their cars while many in-built mechanisms of many PHEVs would shift to ICE if the driver accelerated hard implying that the COs emissions (or lack of) for PHEVs was highly depend on driver behaviors. For a driver that does not charge the battery and is likely to accelerate more will result in much higher emissions.

While BEVs and PHEVs have experienced the same policy treatment, non-plug-in hybrids have not received the same concessions as pure EVs in many countries. Other have moved back and forth on their EV policies learning from experience and time. India is a clear example that was not providing subsidies to hybrids at all but after a long consideration (and lobbying from auto players), the government gave in. The incentives are based on battery capacity now.

The point is, the government of Pakistan needs to be careful in creating a policy conducive for a long-term electric future and whether plug-in and non-plug-in hybrids are extended concessionary treatment (and how much) should be decided based solely on a very robust analysis of short-term and long-term costs, benefits and of course, trade-offs; shielding itself from the vested interests of big stakeholders.

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