To truly decarbonize last-mile logistics, electrification must go hand-in-hand with renewable energy integration. India’s delivery fleets—estimated at over 5–8 million vehicles—can eliminate nearly 6.5 to 26 million tonnes of CO₂ annually by switching to electric two-, three-, and four-wheelers. However, the real transformation happens when the electricity that powers them is clean, writes Akshay Kashyap, MD & Founder, Greenfuel Energy Solutions Pvt. Ltd.
India’s booming last-mile delivery ecosystem — the invisible engine of e-commerce and urban convenience — is also emerging as a silent contributor to the country’s carbon footprint. An estimated 5–8 million vehicles now crisscross India’s cities daily to deliver everything from groceries to gadgets. This fleet includes roughly 4–5 million two-wheelers serving e-commerce, food, and quick-commerce platforms, along with 0.3–0.7 million cargo three-wheelers, light commercial vehicles, and courier fleets operating from micro-hubs.
Collectively, these last-mile vehicles are responsible for an estimated 2 percent–8 percent of India’s total road transport emissions — translating to 6.5–26 million tonnes of CO₂ each year. As India pushes toward net-zero and clean mobility, addressing the carbon intensity of last-mile delivery will be critical to making urban logistics both efficient and sustainable. According to World Economic Forum modelling, delivery vehicles may account for ~13 percent of total city carbon emissions by 2030.
Electrification of Last Mile Delivery Fleets
To truly decarbonize last-mile logistics, electrification must go hand-in-hand with renewable energy integration. India’s delivery fleets—estimated at over 5–8 million vehicles—can eliminate nearly 6.5 to 26 million tonnes of CO₂ annually by switching to electric two-, three-, and four-wheelers. However, the real transformation happens when the electricity that powers them is clean. By installing on-site solar panels and battery energy storage systems (BESS) at depots and micro-hubs, operators can generate renewable power during the day and store up to 30–40 percent of excess energy for peak or evening charging. A DC-coupled solar-plus-storage setup can further reduce energy conversion losses by up to 10–15 percent, enhancing operational efficiency. This integrated approach enables delivery fleets to operate on self-generated green power, creating a closed-loop, net-zero ecosystem that decarbonizes both vehicle and energy value chains—one parcel, one kilometer, and one city at a time.
Taxis Driving the Last-Mile of Passenger Mobility
Taxis and ride-hailing fleets form the backbone of India’s last-mile passenger connectivity—bridging metro stations, airports, and transit hubs with homes and workplaces. With over 2.5 million registered taxis and app-based vehicles on Indian roads, these fleets account for an estimated 8–10 percent of total urban passenger trips each day. However, their heavy concentration in city centers makes them responsible for nearly 4–6 million tonnes of CO₂ emissions annually, even with a large portion running on CNG. Transitioning this segment to Compressed Biogas (CBG) offers a direct and scalable route to net-zero operations. CBG, produced from agricultural residues, municipal waste, and biomass, is a renewable and carbon-neutral substitute for fossil CNG. Each kilogram of CBG used in place of natural gas can avoid up to 2.7 kg of CO₂ emissions, while simultaneously creating rural income streams through waste-to-energy value chains.
Importantly, India’s SATAT (Sustainable Alternative Towards Affordable Transportation) initiative aims to establish 5,000 CBG plants capable of producing 15 million tonnes of biogas per year, enough to replace a major share of CNG consumption in public transport. By adopting CBG at scale, India’s urban taxi fleets can deliver seamless last-mile connectivity while eliminating their carbon footprint and reducing natural gas imports by up to 20 percent—a true win for both climate and energy security.
E-Rickshaws and E-Autos: Accelerating India’s Net-Zero Last-Mile Transition
India is home to an estimated 2.4 million e-rickshaws and over 1.5 million autos operating across cities and peri-urban areas, forming the backbone of its last-mile passenger and goods mobility network. Together, they contribute a significant share of short-distance urban emissions—especially where older ICE autos or lead-acid e-rickshaws still dominate. Transitioning these vehicles to fully electric platforms powered by renewable energy or biogas-based hybrids can drastically reduce their lifecycle emissions. While e-rickshaws already offer zero tailpipe emissions, their true carbon footprint depends on the source of electricity used for charging.
By integrating solar-powered charging stations and battery-swapping networks supported by renewable grids, these fleets can become genuinely green. In parallel, the conversion of conventional CNG autos to Compressed Biogas (CBG)—a carbon-neutral fuel produced from agricultural and municipal waste. Together, clean electricity and CBG can deliver a net-zero last-mile ecosystem, reducing over 15–20 million tonnes of CO₂ emissions annually while creating new rural energy value chains and green jobs.
Conclusion: A Clean Fuel Blueprint for Urban India
If India were to electrify its 5–8 million last-mile delivery vehicles and transition urban taxi and auto fleets to Compressed Biogas (CBG), the combined climate and economic gains would be transformative. Electrification of delivery fleets alone could avoid 25–30 million tonnes of CO₂ emissions annually, while displacing roughly 8–10 billion liters of petrol and diesel—translating into foreign exchange savings of nearly USD 5–6 billion each year. Simultaneously, scaling up CBG under the SATAT initiative’s 5,000-plant target could replace a major share of fossil CNG, cutting an additional 15–20 million tonnes of CO₂ annually and saving another USD 2–3 billion in natural gas imports. Together, these measures could eliminate over 40–50 million tonnes of CO₂ per year and save nearly USD 8–9 billion in forex, while strengthening India’s energy self-reliance.