Fuel economy but one step to cutting greenhouse gases

Fuel economy but one step to cutting greenhouse gases

A new report from the International Transport Forum suggests that merely improving fuel economy is not enough for the global transportation industry to reduce greenhouse gas emissions. The report, “Transport Outlook 2010: The potential for innovation,” indicates that while managing fuel economy plays a role, its impact is limited

A new report from the International Transport Forum suggests that merely improving fuel economy is not enough for the global transportation industry to reduce greenhouse gas emissions. The report, “Transport Outlook 2010: The potential for innovation,” indicates that while managing fuel economy plays a role, its impact is limited.

“Innovation is the key to managing the growth of greenhouse gas emissions from transport,” the report said. “Energy efficiency will need to increase rapidly to contain growth, as containing demand may prove very hard even if it were desirable. Innovation, in the sense of better technology and faster take‐up in markets, is required and will not take place without strong and credible policy commitment. Improving fuel economy is essential, but in the long run not enough, when instead the energy base of transport needs to change if emission levels are to be kept low indefinitely.”

The report said the importance of technological innovation combined with a regulatory environment to support innovation in transportation is key.

“Policies to incentivize improvements of existing technology are part of the answer and are relatively well understood,” the authors wrote. “Policies to trigger transformation towards new energy carriers for transport in the longer term are needed as well. These are much less understood and take us into uncharted terrain.”

The report covers both air and ground transport and discusses the global economic recovery and its impact on greenhouse gases.

“The 2008 [economic] shock has had a bigger impact on trade than earlier crises have,” the authors said. “One reason for the big impact on trade is the geographical fragmentation of production processes. This fragmentation has been facilitated by good and cheap transport, although it is not the only or even the main explanatory factor. Globalization of production has been facilitated by transport and it has intensified the volatility of trade and of transport flows. Transport is therefore increasingly exposed to macroeconomic risk.”

As the world economy recovers, the report noted, trade imbalances, particularly with China, could impact transportation. “Trade flows are correlated with freight transport flows (and with business travel), so their future development may be slower and geographically more dispersed than might be expected on the basis of the experience of the pre‐crisis decade,” the authors said.

As freight volumes return with trade, transportation will need to adjust, particularly if the flow of freight is not along current lanes. How can the industry reduce greenhouse gas emissions under this scenario? The report said the answer lies in transforming the energy base.

“We conclude that the policy focus should be on transforming the energy base for moderately modified transport patterns,” the authors stressed. “The reasons are twofold. First … if development patterns in fast‐growing economies are anywhere near expectations, then extremely constraining demand management policies would be needed to stabilize CO2 emissions. It is unlikely that such policies are possible, and it is unlikely that they are desirable as the cost of attaining abatement targets might be very high. Second, failure to attain targets holds major climate risks, so uncertainty on policy success should be kept low. Technology oriented policies are in that sense preferable, as they provide a more direct influence on transport emissions than demand management.”

The report, whose projections cover the 2010-2050 timeframe, does not specify which technologies should be pursued. It concludes that as economies recover and grow, a growth in greenhouse gas emissions is inevitable, especially as it relates to the vehicles needed to meet growing transport demand.

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