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In the Green Transition, Transportation Is the Next Big Baddie

usscmc by usscmc
December 23, 2019
In the Green Transition, Transportation Is the Next Big Baddie
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Climate change crusaders are quick to lionize someone like

Tesla’s

Elon Musk

and to demonize Big Oil executives. The reality, though, is that even “green” transport risks becoming a villain.

Sustainability seems hardest for the firms that generate energy or extract the necessary commodities since moving away from oil and gas and into renewable sources requires turning their entire business models upside down. But the past five years suggest that businesses that move people and goods may actually have as difficult a road ahead.

This the first of a Heard on the Street series on transportation and the environment.

During this period it has been the only sector in which greenhouse-gas emissions have consistently risen both in the U.S. and in the European Union. By contrast, energy producers have finally started to get cleaner by switching from coal to gas and investing in renewable sources.

Road, aviation, waterborne and rail transportation put together now account for eight metric gigatons of carbon-dioxide equivalents, which is 24% of global greenhouse-gas emissions, according to the International Energy Agency. In the U.S. this figure rises to 34%.

United Nations climate talks in Madrid ended last Sunday without explicit pledges on key issues, but with an agreement to have carbon-cutting plans ready for next year’s conference. To be consistent with the existing Paris Agreement goals, transport emissions need to peak around 2020 and then fall around 70% relative to 2015 levels, estimates by the IEA show.

In theory, electric and plug-in hybrid vehicles chart a clear path to lower emissions. Even once the costs of making the batteries and generating the electricity that feeds them is taken into account, most estimates suggest that they emit roughly half as much greenhouse gases as a gasoline car.

But recent experience proves that consumer tastes can easily sabotage steps toward sustainability: In the U.S., rising demand for pickup trucks has offset any gain from electric vehicles. And faster economic development in emerging nations will inevitably mean higher emissions, even if each vehicle pollutes less.

In China and India, the number of motorized vehicles per person quintupled and tripled, respectively, between 2007 and 2017, according to U.S. Department of Energy data. Catching up with U.S. levels of motorization—which admittedly are very high—both countries would need two billion extra vehicles. Even if 100% of those were electric, they would add more emissions on their own than the total level allowed by the Paris goals.

Greenhouse gases coming from aviation also keep surging despite the fact that planes are becoming increasingly fuel efficient because air traffic growth has surged.

Furthermore, while environmental policies have tended to focus on passenger transport, this misses a big chunk of the picture, because almost half of transportation emissions now come from freight.

In theory, electric and plug-in hybrid vehicles chart a clear path to lower emissions.


Photo:

Angel Garcia/Bloomberg News

Trucks are harder to electrify, due to the extra weight and shorter range of batteries. Between 2005 and 2015, passenger transport energy intensity fell by 27%, compared with only 5% for freight, with road cargo vehicles showing no improvement at all. Adoption of rail, a cleaner alternative, isn’t picking up. Meanwhile ocean freight, which is by far the most efficient form of transport per ton mile, faces a reckoning from new rules that take effect in January because it relies on the dirtiest fuel to be so economical.

No technological solution on its own is likely to be enough to meet climate demands. Urban planning that emphasizes the use of trains, as well as allowing more employees to work from home, will play a big role, experts say. But higher taxes and hard limits on travel and freight might be the only solution.

As far as maligned industries go, transportation risks earning a permanent spot in the gallery of rogues.

Write to Jon Sindreu at [email protected]

Copyright ©2019 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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