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Four Policies Can Reduce U.S. Transport Emissions 45%, Cut Oil Use 23%, Save 5,300 Lives Per Year

America’s transportation sector is undergoing a profound shift toward cleaner and more efficient vehicles. Today, transportation is responsible for 27% of U.S. greenhouse gas emissions, but continued cost declines in electric vehicle (EV) prices and sufficient deployment of charging infrastructure could dramatically reduce transportation emissions over the coming decades.

However, EVs are not the only mechanism for achieving emissions reductions in the transportation sector. Four other promising policies can combine to reduce U.S. transportation emissions 45% by 2050 compared to business-as-usual (BAU) and help accelerate the transition to clean mobility for people and goods.

Using the Energy Policy Simulator (EPS), a peer-reviewed, free and open-source computer model, we assessed the effects of a variety of non-EV policies on transportation sector emissions, financial costs/savings, and avoided premature deaths. The model is able to calculate the combined effects of packages of policies and to disentangle the contributions made by individual policies, allowing policymakers to understand which strategies will most effectively achieve their goals.

Four Policies Can Cut U.S. Transportation Emissions Nearly In Half By 2050

The scenario we set up includes four types of policies, which ramp in linearly from 2017-2050, ultimately reaching global best practice levels:

  • Fuel economy standards for five vehicle types (light-duty on-road vehicles [LDVs], heavy-duty on-road vehicles [HDVs], aircraft, rail, and ships)
  • Transportation demand management (TDM) policies for passengers and for freight. For passengers, this represents measures that reduce passenger car use such as zoning for higher density along public transit corridors, zoning for mixed-use development, and improved public transit systems. For freight, it represents truck-to-rail mode shifting and improved logistics.
  • A feebate, which is a fee levied on the sale of inefficient passenger LDVs used to fund a rebate to the buyers of efficient passenger LDVs
  • A low-carbon fuel standard (LCFS), which encourages a shift from petroleum fuels to biofuels or electricity

These policies are applied on top of a BAU case that includes strong growth in EV penetration (65% of new LDV sales by 2050). The relative contributions of each policy to greenhouse gas abatement are shown in Figure 1.

Figure 1. U.S. transportation sector emissions. The “Remaining Emissions” area are the emissions that remain after all listed policies are applied. The reduction attributable to each policy is shown as a colored wedge.

 

The policies reduce transportation sector emissions by 45% in 2050.  The contribution of each individual policy to abatement can be more clearly seen in Figure 2, which displays the same data as Figure 1 but omits the “Remaining Emissions” wedge.

 

Figure 2. Abatement from various transportation sector policies.

 

Fuel economy standards for LDVs achieve more greenhouse gas (GHG) abatement than any other policy in this package.  Standards increase in effectiveness through the early 2030s, then begin to lose efficacy (despite the fact that standards continue to become more stringent through 2050).  This is because, in farther-out years, more of the vehicle fleet is composed of EVs, which are not sensitive to LDV fuel economy standards.

Passenger TDM policies are also strong, as they can potentially eliminate vehicular trips entirely (for example, by allowing more people to walk or bike to work) or to shift travel onto highly efficient modes, such as rail.

A feebate, the third-strongest policy, provides a financial incentive for buyers to opt for more efficient LDVs while remaining revenue-neutral for the government.

Fuel economy standards for HDVs and aircraft are similar in importance.  Aircraft standards need to be set by international bodies such as the International Civil Aviation Organization, which adopted a CO2 emission standard for aircraft in March of this year.  The U.S. adopted HDV fuel economy standards in August of 2016, but the Trump administration may attempt to roll them back.

A strong LCFS helps drive decarbonization through 2030 but ceases to be effective once EVs reach a high enough penetration to satisfy the LCFS requirements.

Decarbonizing Transportation Saves U.S. Money And Lives

The EPS also allows us to predict the financial cost or savings of a policy package and to break that cost or savings into component policies (Figure 3).

Figure 3. A cost curve depicting the greenhouse gas abatement and cost-effectiveness of various U.S. transportation sector policies. The width of each box corresponds to the total quantity of greenhouse gases (in CO2 equivalent) abated from 2017-2050 by that policy. The height of each box corresponds to the cost of the policy per ton CO2e abated (net present value, 2017-2050, at a 7% discount rate). Boxes below the X-axis save money (they have negative cost), while boxes above the X-axis cost money.

 

Passenger TDM is the most cost-effective policy because TDM encourages mode shifts to cheaper means of transport.  Less money is spent on fuel and on vehicles if people are able to walk, bike, and take public transit for a larger percentage of their trips.  Of note, however, the EPS only includes changes in vehicle and fuel costs as a result of the TDM policy – it does not include changes in infrastructure cost.  It is unclear whether TDM would increase or decrease infrastructure cost, as this depends on whether the reduction in construction and maintenance costs for roadways, highways, parking facilities, and airport gates would be offset by the cost of improving public transit and intercity rail systems.

Fuel economy standards create moderate cost savings for each of the five vehicle types, as reductions in the amount of fuel that must be purchased outweigh the increase in upfront vehicle purchase price associated with the efficiency improvement.

The package of transport policies results in a reduction in U.S. petroleum fuels consumption of 1,063 million barrels in 2050, a 23% reduction (Figure 4).

Figure 4. U.S. consumption of petroleum fuels. Note that this includes petroleum fuels used in all sectors (e.g. the transportation, electric power, industry, and buildings sectors), but only the transportation sector’s fuel use is reduced by the transportation policy package.

 

Air pollution causes 200,000 early deaths in the U.S. each year.  Most of these deaths are due to particulates, which can be emitted directly or can form in the atmosphere from gaseous pollutants.  The transportation policy package reduces particulate pollution and thus saves lives: By 2050, more than 5,300 people avoid an early death each year thanks to good transportation policy (Figure 5).

Figure 5. Premature U.S. deaths avoided per year due to the transportation policy package. This is an annual, not a cumulative, figure.

 

A New Era Of Clean, Efficient Mobility

A strong package of transportation sector policies can reduce GHG emissions, save money, reduce U.S. oil consumption, and save lives.  It is a win-win for the environment, the economy, and human health.  Fuel economy standards for LDVs and passenger TDM measures are the two strongest policy options, but they are far from the only policies that are worth enacting.  The four policies modeled here, as well as policies to promote EV adoption, can hasten a new era of clean, efficient mobility.

By Jeffrey Rissman

Jeffrey is Head of Modeling & Energy Policy Expert at Energy Innovation and leads modeling efforts for Energy Policy Solutions.

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