Environmental Policies and Resulting Outcomes –
An Analysis of Transport Sector Case Studies in
India
Mahesh Patankar (mpatankar@iitb.ac.in)
Anand Patwardhan (anand@cc.iitb.ac.in)
Shailesh J Mehta School of Management
Indian Institute of Technology – Bombay
CMU – February 2004
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Outline
 Context
 Indian transport policy / regulatory framework
 Research questions and literature review
 Framework outline
 Environmental policy – technology link
 Technology hierarchy
 Framework quantification
 Case studies (description and analysis)
 Going beyond…..
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Context
Increase in vehicles
40000
37231
35000
30295
30000
# of veicles '000
Sharp increase in public
and private road
transport, leading to
higher energy use and
environmental impacts
(Numbers in figure – all
types and entire country)
25000
20000
19152
15000
10000
9170
5000
4521
2472
0
1975
1980
1985
1990
1995
1997
Year
Deteriorating local air
quality is a matter of
concern –
leads to policy response
for environmental
control
Transport sector contributes to
29 to 35 % GHG emissions in
India!
Source: MoST, India, NEERI, India
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Indian transport policy framework - structure
Ministry of Surface
Transport (MoST)
Central Government
Ministry of Environment &
Forests (MoEF)
Ministry of Petroleum &
Natural Gas (MoPNG)
State Pollution Control Board
State Government
Regional Transport Office
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Indian transport policy framework - functions
Ministry of Surface
Transport (MoST)
(Designs new road projects,
guidelines on vehicle industry
standards)
(Sets emission standards
Central Government
Ministry of Environment &
– vehicular and ambient
Forests (MoEF)
air quality)
Ministry of Petroleum &
Natural Gas (MoPNG)
(licensing and supply
chain of petroleum
products)
(Air quality
State Pollution Control Board monitoring, reports to
the MoEF)
State Government
Regional Transport Office
(Regulates tail-pipe
emission permits)
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
What determines the success of policy?
Research goal:
Understand process of policy formation, effect of alternate fuel
policies and its success parameters
Understand the differences in “success parameters” using case
studies
Questions:
Can the environmental policies alone ensure diffusion of clean
fuel in India
What are the compelling conditions that ensure “success rate”
of clean fuel policies
Can a framework be established that will act like a “policy tool”
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Summary and gaps
Research area
Main observations
Example /
references
Technology diffusion Lack of a single model that Pry et al, 1971;
models describe market discusses tech regimes
Stier, 1983; Sharif
penetration over time
et al, 1982
Technology clusters
and regimes concepts
define networks, and
determinants
Lack of model applicable
to Indian context
Rosenkopf, 1998;
Kemp, 1997;
Jacobsson et al,
2000
Studies in transport
and energy sectors; link
between env policy
and technical change
Research at systemic level Soares, 2001;
– opportunities for
Site, 2001; Bose,
integrated solutions; lack of 1998
studies linking env policies
and transport technology
changes
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Components of framework
Environmental policy
Technology
diffusion, market
response
Hierarchical
conceptualization of
technology and
technological change
Outcomes –
environmental benefits,
market development
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Framework policy – tech change
Decision
making
Public
perception
Ancillary
infrastructure
Requires and involves
technology, systems and
regime
Set of enablers (standards)
Stage 1
Policy stage
Stage 2
Use stage
Outcome
(Environmental
benefits, market,
technology)
Regulators
Individual
decision
Actors, responsible for use
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Framework explanation
Stage 1 – Policy stage acts as the “Policy-push” to facilitate
change
An enabling stage, may not be sufficient
Stage 2 – Provides “Market-pull” to implement and achieve
results of the policies
Ensures availability of ancillary infrastructure – represented
as a technology regime with clearly defined determinants
Determinants are complementary, interdependent
Individual decisions dependent on availability of ancillary
infrastructure
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Technology hierarchy - ancillary infrastructure
Technology-based regime
Technology System
Technology Product /
Process
New business, developing
institutions, governing
organizations, involvement
of banks, defined market,
complementing applications
Increase in
infrastructure,
complementing
technologies, defined
application area
Changes in end-use, in
one application area,
environmental benefits
(References: Kemp 1997, Jacobsson, 2000)
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Examples of technology - regimes
Theoretical
description
Technology
change
Authors
(Stier, 1983)
Level
of
describing
change
Micro
(singe
production
process)
Constituents
of
framework
Increasing
share of the
technology
in the pulp
and
paper
industry
Technology
system
change
(Rotmans et
al, 2002)
Macro
(long-range
societal
changes)
Technology,
economy,
institutions,
ecology,
culture,
behavior,
belief
system
Technology
regime
change
(Kathuria,
1999)
Micro
(single
process
–
CNC
machines)
Component
supplier,
user,
competition
in the export
and
domestic
market,
participation
in
fairs,
exhibitions,
patents
disclosure
Technology
regime
change
(Geels,
2002)
Macro
(long-range
technology
change)
Financial
network,
suppliers,
user
and
producer
groups,
research
network,
societal
groups,
public
authorities
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Components of regime changes
Technology and technology
system Indicators:
Example: Fuel availability
Engine retrofit techniques
Complementary
technologies,
regimes
Policy and standardization
Example: Fuel use policy
Inspection and maintenance
Retrofit standardization
Interventions by courts
Indicators:
Directives and
standards
Transport regime
around a fuel
Developing institutions,
markets
Example: Infrastructure
companies, user benefits,
increasing businesses and
investments
Indicators: Increase
in indigenous mfg,
ROI for users and
suppliers
Societal benefits
Example: Lower vehicular
pollution
Health benefits
Indicator: Public
health
Mortality
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Framework variables - quantification
Variable
Technology and
technological
changes
Policy changes and
standardization
Developing markets
and institutions
Societal benefits
What is represented
Clear, identified individual technologies, evolving
complementarity in the technologies
Increase in CNG network developed, average queuing time in a
month (relative queuing time - compared to conventional fuel)
Captures the legislative directives in the proposed fuelswitching options
Evolving standards in the existing products and systems
Share of indigenously manufactured components in the CNG
supply and use
Share (cost) of indigenously manufactured components in
product chain
Return on investment (ROI), changes over time or rate of
change of net disposable income for individual operators
Return on investment for infrastructure developers
Identified and measured environmental benefits, reduced health
impacts
Representation by the public interest groups and the resulting
changes in the policy, infrastructure
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Outcome of environmental policy – Case Studies
Growth in use of CNG in transportation fuel
30000
50
45
Taxicab owners granted an exten
sion till March 2001
25000
40
Number of vehicles
35
20000
15000
Pollution test made mandatory
Institution of Lal Committee Direction to set CNG stations30
in South Mumbai
25
1992 - Writ Petition in the court
Higher compliance check
By Smoke Affected Residents’ Forum
20
10000
15
10
5000
5
0
0
1995-96
1996-97
1997-98
1998-99
1999-2000
2000-01
Mumbai: A
clear link
evident
between the
court
regulations
and the
increasing
vehicles and
sale
2001-02
Year
CNG taxicabs and cars
CNG 3-wheelers
CNG buses
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Outcome of environmental policy – Case Studies
12000
45000
40000
Steady increase in the
vehicles converted to
CNG, conversion of buses
to CNG at a larger scale
than that in Mumbai
No. of vehicles
10000
35000
8000
30000
25000
6000
20000
4000
15000
10000
2000
5000
0
0
2001
Tracking policy and year – New Delhi
Buses - DTC
Buses - Private
2002
Year
Minibuses
Private cars
Taxicabs
Time extension till Sept 2001
Events
Supreme court ruling on phase
Out (Buses, Autos, Taxicabs)
Time limit set for Mar 31, 2001
1995 - Writ Petition
in the court
By Mr. MC Mehta
1995
1998
2000
August 2001 – Govt. directed to ensure supply
Oct 2001 – DTC and school buses given
time extension till Jan 31, 2002
2001
April - Rejects plea for further time
extension
Disclosure of data on reduced emissions
with CNG
2001
Distinct policy steps to
ensure supply of CNG as a
fuel
2002
Year
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
3-wheelers
Outcome of environmental policy – Case Studies
CNG Sales in Mumbai
Mumbai:
CNG sale increased manyfolds, but not sufficient to
cater to the entire fleet
50000000
40000000
30000000
20000000
10000000
0
1999
2000
2001
2002
CNG sales growth Kgs per month
Year
14000000
12000000
10000000
8000000
6000000
4000000
2000000
0
Se
p9
D 9
ec
-9
M 9
ar
-0
Ju 0
n0
Se 0
p0
D 0
ec
-0
M 0
ar
-0
Ju 1
n0
Se 1
p0
D 1
ec
-0
M 1
ar
-0
2
New Delhi:
CNG sale increased manyfolds, but not sufficient to
cater to the entire fleet
Kgs per month CNG sales
Kgs/month CNG sale
60000000
Month- year
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Outcome of environmental policy – Case Studies
Success rate of policy / implementation - observations
-
Supply constraint resulted in chaotic conditions in both the
cities (media reports, CNG demand forecast for the vehicle
fleet – much more than the actual supply)
-
Policies alone did not provide the sufficiency condition for
“use”, though it resulted in conversion / engine retrofits
-
Drivers pushing CNG sales up include pricing policies
resulting in economic benefits to users, lesser queuing time at
the filling stations, availability of conversion kits, financing
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Outcome of environmental policy – Case Studies
New Delhi
Specific policy measure
Mumbai
Policy thrust with Court intervention
Enabling condition
Evolution of technological system Shift from import to local suppliers
Evolving markets
Evolution of public-private partnerships
User benefits
Economic benefits with fuel switch-over
Differences in “fleet-management”, refueling
time
Evolving enterprises
Corporatized public
Foreign direct
entities
investment in a joint
venture company
Technology / systems
Similar supply chain in both cities, higher level
of quality assurance in Mumbai
Political will
Political support in both the cases
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Discussion – case studies
Case studies used in validation: CNG use in Mumbai and New Delhi,
Unleaded gasoline in India and Thailand, Multi-point fuel injection
Case studies
Enabling policy condition
(Policy push)
Presence of ancillary
infrastructure (Market pull)
CNG use in Mumbai
√
√
CNG use in New Delhi
√
√
Unleaded gasoline in India and
Thailand
√
Multi-point fuel injection
√
Clear evidence of interaction with the policy and a clearly identified
technology regime
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Limitations
- Proposed framework validated with qualitative data
- Case studies in other developing countries may show
different features
- Data gaps on the improvement in ambient air quality
- Other factors like industrial and commercial sector
would have a bearing on improved air quality
- Case studies represent “specific” fuel switching
options, for a comprehensive fuel switching policy,
framework will have to be different
Other merits of the case studies:
Use in other socio-technical experiments, learning for other
options in alternate fuel use
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004
Going beyond….
Proposed case studies
1. Passive solar in developing countries
2. Rainwater harvesting in India
3. Green buildings program in Asia
Mahesh Patankar & Anand Patwardhan, SJM School of Management, IIT-Bombay, February 2004