The commercial industry finds itself in a critical phase of transition as the energy sector undergoes significant changes. Nitin Jirafe believes these times are particularly interesting, especially in light of how the energy landscape is shifting. Diesel, the dominant source of fuel in this sector, is gradually being replaced by a range of alternative energy options. This transition, he notes, offers exciting opportunities, particularly for companies like Tata Cummins and Cummins India, which are deeply involved in developing and promoting new fuel technologies.
For Cummins India, the commitment to decarbonisation is front and centre. As Jirafe highlights, the company is working towards the goal of becoming carbon neutral by 2050. This ambitious target is closely tied to India’s role in the broader journey, with several initiatives already underway to support the country’s transition to sustainable energy sources.
The Promise of LNG
One of the most promising technologies currently on the table is Liquefied Natural Gas (LNG). Jirafe views LNG as a here-and-now fuel, offering a practical alternative to diesel. Cummins has already developed an LNG engine that delivers performance comparable to that of traditional diesel engines. These engines have already made their way onto the roads and are performing well. According to Jirafe, the focus now is to continue refining LNG as a viable low-carbon option for commercial vehicles. However, he acknowledges that there is still work to be done, especially in terms of infrastructure.
For instance, LNG fuel stations are still being set up across India. Jirafe draws a comparison with China, where LNG penetration is much higher, with the country already having almost 25% of its commercial vehicle fleet running on LNG. In contrast, India is still in the early stages of establishing the necessary refuelling infrastructure. He emphasises the need to speed up the rollout of LNG stations to ensure this alternative fuel can truly compete with diesel in the commercial mobility space.
Hydrogen: The Fuel of the Future
Looking further ahead, hydrogen stands out as a key component of the energy transition. Jirafe expresses strong optimism about hydrogen, describing it as the fuel of the future. Cummins is already deep into the development of hydrogen internal combustion engines, with the company’s Jamshedpur plant leading the charge. This facility is not only focused on producing hydrogen engines but is also manufacturing Type 4 hydrogen tanks for storage, a crucial component of the hydrogen infrastructure.
The company’s investments in hydrogen technologies are significant, with hundreds of millions of dollars already poured into research and development. According to Jirafe, this investment is critical for staying ahead of the curve in the race for clean fuel solutions. Despite the excitement surrounding hydrogen, Jirafe acknowledges that the next 5-10 years will be pivotal for proving these technologies on a commercial scale. There are still challenges to overcome, especially in terms of distribution and scaling the technology to meet the needs of the commercial vehicle sector.
Overcoming Adoption Challenges
The adoption of new technologies like LNG and hydrogen faces several hurdles, one of the biggest being the economics of the transition. For instance, the price gap between LNG and diesel is still relatively small, about 10%. This is not enough to drive widespread adoption, so Cummins is focused on expanding that gap. Jirafe believes that as LNG becomes more affordable, more entrepreneurs will be encouraged to set up refuelling stations, creating a more robust infrastructure for the fuel.
Hydrogen, meanwhile, faces a different set of challenges. The technology still needs to be proven on a commercial scale, with Jirafe admitting that the journey is still in its early stages. The second major obstacle is distribution. For hydrogen to become a viable option for commercial vehicles, it must be readily available across major freight corridors. This is an area where significant progress is still needed.
Union Budget 2025
Government policy plays an essential role in the development and adoption of these new technologies, Jirafe notes. Cummins India is fully aligned with the government’s vision for energy independence and the push toward sustainable mobility. The company is actively involved in supporting government initiatives aimed at advancing the transition to cleaner fuels, and Jirafe sees the Union Budget 2025 as a crucial moment for accelerating these efforts.
The budget, he hopes, will provide the necessary financial support to further these technologies and ensure they become affordable for customers. The challenge, as Jirafe points out, is that for these alternative fuels to gain mass adoption, they need to offer a clear economic advantage. This will be critical in convincing customers in the heavy and medium commercial vehicle segments, where economics are paramount. Jirafe compares this to the airline industry, where airlines seek to maximise the usage of their planes to ensure profitability. Similarly, commercial vehicle operators want to maximise their assets, and any new fuel technologies must prove their worth in terms of total cost of ownership.
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