Transportation's Role in Reducing U.S. Greenhouse Gas Emissions ...

Transportation’s Role in Reducing U.S. Greenhouse Gas Emissions: Volume 2
incremental vehicle costs. Incremental vehicle costs at full production volumes are
estimated at $3,000, although current conversion of conventional vehicles is much higher.
Considering fuel cost savings, CNG vehicles are estimated to result in a net cost savings of
-$130 per tonne, based on AEO fuel cost projections. Due to the high global warming
potential of methane – the primary component of natural gas – it is important to minimize
leaks during distribution, storage, and dispensing, which could offset GHG reductions for
use.
Along with electricity and hydrogen, natural gas is “fungible,” with multiple end use
options. In addition to transportation and home heating, natural gas has a substantial role
in the energy sector producing electricity. To the extent that multiple end use options are
available, replacing coal power with natural gas offers substantially greater GHG
reduction potential (about 50 percent) than its use in transportation (about 15 percent).
Increased demand for natural gas resulting from carbon limits placed on electrical
generating units may limit CNG and LNG availability for transport, although a detailed
analysis of such impacts is beyond the scope of this assessment.
Liquefied petroleum gas (LPG), also referred to as propane, is commonly used in fleet
vehicles in the United States, and benefits from a relatively well-established fueling
infrastructure. Potential GHG reductions are about 17 percent relative to conventional
gasoline vehicles. LPG is produced as a byproduct of petroleum and natural gas
processing, and as such, the ability to expand LPG supplies is highly constrained, with
little potential for significant expansion in the transportation sector. While a limited
number of original equipment manufacturer (OEM) engines are available for heavy-duty
vehicles, LDV owners must have their vehicles converted for LPG use at this time.
Moderate cobenefits associated with LPG use relative to gasoline are expected. Barriers to
expanded use of LPG include higher incremental fuel costs, expensive retrofits, and
significant limitations on LPG production and sales volumes for vehicle use; GHG
reduction potential is estimated to be less than 0.5 mmt CO2e annually.
Many of the synthetic fuel options available may actually increase life-cycle GHG
emissions, although biomass feedstock should result in substantial reductions. Synthetic
fuels lend themselves to easy adoption, however, requiring little to no modification of
vehicles and infrastructure. Most of these fuels also promise significant reductions in
other pollutants relative to conventional fuels.
Alternative aviation fuels can be used without significant modification in aircraft. While
point of use GHG emissions may be reduced slightly (two to four percent) for synthetic jet
fuels, life-cycle emissions can increase substantially depending upon the feedstock used in
the process. In order for biomass jet fuels to meet stringent commercial aviation fuel
standards, these fuels need to be refined with a hydrotreating process. The costs for this
additional processing and feedstock prices will determine the cost competitiveness of these
fuels. Synthetic jet fuels have been estimated to cost about $75 to $80 per barrel of oil
equivalent. Along with battery electric vehicles, hydrogen fuel cell vehicles (HFCV) offer
the greatest long-term GHG reduction potential, but only if the hydrogen is produced by
low carbon pathways, such as electrolysis using renewables, coal with carbon
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