sectoral economic costs and benefits of ghg mitigation - IPCC

Seth Dunn
Discussion: Climate Change Mitigation in the Transport
Sector - Moving Towards Low-Cost Solutions
Seth Dunn
1 Introduction
The debate over costs and benefits of greenhouse gas mitigation is of critical importance with
respect to the transport sector—the fastest-growing source of emissions. Within the transport
sector, the costs and benefits of addressing private automobile use are vigorously debated.
Though much emissions reduction potential lies in the automotive sector, the industry has
historically resisted safety and environmental regulations despite the consistent, if limited, track
record of standards in making cars safer, cleaner, and more efficient.
Models that suggest that the costs of transport GHG mitigation will be high generally have two
major deficiencies, one of technology and one of policy. First, they assume a limited availability
of alternative fuels, such as natural gas and hydrogen, even in the medium- to long-term - despite
growing momentum to bring fuel-cell cars to market by 2004. Secondly, they assume that the
main policy instrument will be a dramatic increase in fuel prices - an approach that is neither
politically realistic nor necessary.
This paper discusses a nascent “technology pull” underway in automotive innovation, and
catalyzed by a “policy push” which, if strengthened, could greatly lower the costs of fuel
substitution. It reaffirms Dr. Bose’s suggestion that “local-global” synergies be tapped, and
demand and supply measures balanced, in crafting transport strategies, and suggests the
importance of fuel economy standards, clean car mandates, and land use policies into these
strategies. Finally, it outlines the results of a modeling effort by Tellus Institute that shows
significant energy and carbon savings and net employment increases through implementation of
a diverse policy package over the next decade.
2 Automotive Innovation: The Argument for a Policy Push
As world automobile production continues to rise and the overall fleet size expands, the need to
encourage innovation in this sector becomes increasingly critical from a GHG mitigation
perspective. Annual passenger car production has increased nearly five-fold since 1950. This has
pushed the global car fleet to more than 508 million in 1998 (See Figure 1). The rate of car
population growth has generally exceeded that of the human population over the last halfcentury,
leading to a decline in the number of people per cars from 48 in 1950 to less than 12 in
1998.
As the global trend in car use continues upward, evidence is accumulating that public policies
can induce and enhance technological innovation in the automotive sector. In its 1996 report
Green Auto Racing, the Natural Resources Defense Council surveyed 13 national governments
and 7 international bodies to find and assess their policies to promote advanced fuels and
vehicles in the automotive sector (See Table 1). Based on the survey responses and a literature
search, the authors found that policies and programs fell into five overlapping areas (See Table
2).
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