A range of non-conventional fuels, such as biogas, ethanol, hydrogen and biodiesel, holds great potential for advancing India’s green transition.
12 Apr 2025 | 734 Views | By Yukta Mudgal
India is rallying to achieve its net-zero target by 2070, and using sustainable fuels is one way to support this growth. However, higher costs, supply issues, and lack of infrastructure are some challenges standing in the way of the greater adoption of these fuels, although the industry is coming up ...
This is an Autocar Pro Plus article. Subscribe to continue reading.
India is rallying to achieve its net-zero target by 2070, and using sustainable fuels is one way to support this growth. However, higher costs, supply issues, and lack of infrastructure are some challenges standing in the way of the greater adoption of these fuels, although the industry is coming up with novel ways around these obstacles.
The Ministry of Road Transport and Highways is encouraging automakers to adopt alternative fuels such as battery-electric, hydrogen, ethanol, and LNG to reduce both the import bill and emissions. Recognizing the limitations of reducing diesel-powered grids too quickly, Cummins India introduced a new strategy called HELM (high efficiency, low emissions, and multi-fuel) – offering an internal combustion engine technology that allows customers to use multiple fuel options, including natural gas, diesel, and hydrogen.
"We realized that reducing diesel-powered grids could set us back in the industry, so we developed HELM as our guiding strategy for product development. All major platforms are transitioning to multi-fuel capabilities across various regions and applications," said Nilesh Deshpande, Director of Engineering, Engine Business, Cummins India, at the Future Powertrain Conclave in Chennai, powered by Autocar Professional. According to Ramakrishna Donakonda, Vice President, Powertrain and e-drive, Daimler Truck Innovation Centre India, one of the solutions is to continue with diesel and make a slow transition toward sustainable fuels.
"Diesel in most OEMs today is still the bread and butter; what keeps the company running." He also recommended that the easiest means to achieve the zero emission target is using battery electric vehicles. We look at the various fuels and their stage of adoption in India.
CNG Surge
In 2023, the National Biofuels Coordination Committee, chaired by Petroleum Minister Hardeep Singh Puri, announced the phased blending of compressed biogas (CBG) with compressed natural gas (CNG) for transportation, and piped natural gas (PNG) for households, starting from the financial year 2025-26. The target is to achieve a 5% blending rate by 2028-29. According to the petroleum ministry, CBG blending in total CNG and PNG consumption is set at 1% in 2025-26, increasing to 3% in 2026-27 and 4% in 2027-28.
Blending will remain voluntary until 2024-25, after which a Central Repository Body will oversee its implementation and compliance based on guidelines approved by the petroleum ministry. One of the companies that has seized the opportunity to increase the production of its CNG parts is Greaves Cotton.
"Post BS-VI, because of technology adaptation, the complexity of the diesel powertrain has increased. So that gave scope to CNG to increase its market share," Sandip Chaudhari, Chief Technology Officer, Greaves Cotton said at the event.
Chaudhari explained that, between 2016-2019, the three-wheeler CV segment comprised around 70-80% diesel vehicles and 20-30% CNG. "Now, post-COVID or post-BS-VI era, it is a clear trend that diesel is declining. The diesel market share has come down, and it is declining by 2%-4% every year, whereas CNG is around 40-45%," Chaudhari said.
CNG is a more environmentally friendly and efficient fuel compared to petrol and diesel, and is estimated to be the second most preferred fuel for passenger vehicles in India. Currently, CNG-powered vehicles make up approximately 14% of total passenger car sales in the country. Chaudhari, whose company makes CNG equipment such as cylinders, said electric vehicles (EVs) have a higher initial cost of acquisition.
Moreover, from an infrastructure readiness perspective, a CNG vehicle is a better option than an EV, he argued. For India’s largest passenger car maker Maruti Suzuki, every third car sold is CNG-powered.
Hydrogen Shift
Another key fuel that is set to play a critical role in the achievement of energy independence by 2047 and net-zero emissions by 2070 is green hydrogen. Green hydrogen is produced through electrolysis, a process that splits water into hydrogen and oxygen using electricity from renewable sources such as solar, wind, or hydropower. Another method involves biomass gasification to generate hydrogen. This creates a clean fuel that produces no greenhouse gases, offering a strong alternative to fossil fuels, while reducing the carbon footprint.
To accelerate hydrogen adoption, the Indian government launched the National Green Hydrogen Mission in 2023. This initiative aims to enhance the production, use, and export of green hydrogen, with a production target of at least 5 million metric tonnes per annum by 2030.
The mission also promotes the use of hydrogen in buses, trucks, and four-wheelers via fuel cell or internal combustion engine technology. Auto component giant Bosch, expects hydrogen-based technology sales to reach 5 billion euros by 2030, with hydrogen internal combustion engine vehicles capturing 10-15% of the Indian truck market by the end of the decade.
"When we look at net zero, it's clear that hydrogen can support us. Fuel price is a big factor, but this also presents an opportunity for India to transition from an energy importer to an energy exporter," said George Anthony P, General Manager of Powertrain Systems Engineering, Bosch India.
Another company with designs on this segment is Daimler Truck and Bus, which is developing vehicles powered by battery-electric, hydrogen, and biogas technologies. The German truck maker sees hydrogen as particularly suited for long-haul trucking due to the convenience of quick refueling compared to battery charging. "The advantage of hydrogen as a fuel of the future is that significant investments have already been made in the engine technology.
With less than a 20% modification, these engines can remain financially viable. Additionally, India has a cost advantage, producing engines at the lowest prices globally," pointed out Donakonda of Daimler Truck Innovation Centre India. However, widespread adoption of hydrogen-powered trucks is still years away, but industry leaders are optimistic about the future.
"If any country will lead this transition, it will be India," said Deshpande of Cummins India. "What's beneficial about hydrogen is that many existing vehicle components remain unchanged—only the powertrain needs modification, with the main challenge being hydrogen's price." For hydrogen technology to become economically viable, large-scale production is essential.
"You need hydrogen produced at an industrial scale for prices to drop significantly. This requires strong commitment from governments, energy companies, and key market players," noted Donakonda. This has led to the classic dilemma: fuel availability versus vehicle readiness. "It's always the chicken-andegg story—if I have the fuel, do I have the truck? If I have the truck, do I have the fuel? This dependency will always exist. No one wants to make massive investments upfront. First, we need the fuel, then we need cost viability," explained Donakonda.
Biofuels and Ethanol
The third missing piece for the puzzle is biofuels. India is on track to achieve its 20% ethanol blending target ahead of its October 2025 deadline. Ethanol, produced either through sugar fermentation or petrochemical processes, offers a viable alternative fuel. While it may affect certain vehicle components due to its hygroscopic nature, 20% ethanol blend in petrol is expected to have minimal impact.
Ethanol production is already ramping up, with E20 not posing a major concern. However, achieving E85 (85% ethanol blend) requires a three to fourfold increase in ethanol production, which is unsustainable if reliant solely on sugarcane, according to Anthony. "Clear industry standards are essential for biofuels to scale. The commercial sector lacks confidence due to weak regulations. Strengthening quality control will accelerate adoption," said Deshpande.