Reducing the Impacts of the North American Transportation Sector

Workshop participants discussed a variety of policies and programs that can be used to help the transportation sector evolve in a more sustainable direction. This includes both technological solutions to improve the emissions and fuel efficiency of cars and social/ economic solutions to change individuals' transportation use decisions.

Technological Solutions: Changing Vehicle Fleet Characteristics

Future technologies

Amory Lovins, Director of Research at the Rocky Mountain Institute, talked about the future of car design. He explained that due to recent advances in materials, electronics, software, and manufacturing technology, we are at a ‘point of discontinuity' in the evolution of the automobile. He claimed that it is now possible to meet all of our stated goals for auto design — low emissions, high efficiency, power, safety — without having to make trade-offs between these goals. This approach is embodied in the ‘hypercar' 4 . Hypercars are built from ultra-light carbon fiber composites rather than steel. They use hybrid electric propulsion systems, low-drag design, and energy efficient accessories. Hypercars have virtually zero emissions, 4 to 8 times the fuel efficiency of today's cars, and as much power and safety as top of the line models out today.

Lovins claimed that, from a production standpoint, hypercars should offer distinct improvements as well. In the long run, production costs should be equal to or cheaper than today's cars because the hypercars are mechanically much simpler, use less building material, and eliminate the need for painting. This could lead to an order of magnitude drop in production time, parts count, assembly time, and investment for tooling and equipment. The biggest barrier to mass production is the fact that the auto industry is so heavily invested in their current manufacturing equipment. Nonetheless, models of the hypercar may enter the market around 1999, and there have been recent announcements of both concept cars and early products.

The hypercars represent perhaps the most dramatic possibility for advance in vehicle design, but a wide range of more incremental new technologies are currently being developed, tested, and used. Fuel cells and hybrid electric technology were cited as particularly promising options for the future. Some of the other technologies discussed at the workshop include new options for energy storage (batteries, ultra-capacitors, flywheels), lighter materials, advanced electronics, and alternative fuels such as hydrogen, natural gas, propane, methanol, and ethanol. In response to a question about the future role of diesel technology, David Green, from Oak Ridge National Laboratory, explained that diesel engines do offer significant advantages in terms of fuel efficiency, but they need to be improved to reduce emissions of NO x and particulates; this offers another candidate for hybrid technologies.

Most agreed that we cannot predict which of these technologies will eventually emerge as successful. Dan Sperling, from the University of California at Davis, pointed out that one possible outcome of this wide range of new technologies is the rise of specialized, ‘niche' vehicles. Under such a scenario, households could have multiple cars, including small limited range electric vehicles for short trips.

Clearly, the technology options exist to make cleaner and more fuel-efficient vehicles. However, Christine Sloan, from General Motors, reminded the workshop participants about the significant hurdles that exist in mass producing and selling these vehicles. Many customers value factors such as cost, safety, power, and reliability more than low emissions and fuel economy. The challenge is to develop technologies that permit vehicles to be both efficient and affordable. The environmental benefits of new technologies must be based on a full life cycle analysis, including consideration of the recyclability of the materials used. Sloan also cautioned that there has not been enough attention paid to making these technologies practical from a manufacturing standpoint, and that production costs must be greatly reduced if the new vehicles are to be cost competitive.

On a similar note, some participants expressed concern over the dearth of effort to develop clean vehicle technologies that are suitable for developing countries

4  

Hypercars: The Next Industrial Revolution; Pub.T96-9; Rocky Mountain Institute; Snowmass, CO.



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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop Reducing the Impacts of the North American Transportation Sector Workshop participants discussed a variety of policies and programs that can be used to help the transportation sector evolve in a more sustainable direction. This includes both technological solutions to improve the emissions and fuel efficiency of cars and social/ economic solutions to change individuals' transportation use decisions. Technological Solutions: Changing Vehicle Fleet Characteristics Future technologies Amory Lovins, Director of Research at the Rocky Mountain Institute, talked about the future of car design. He explained that due to recent advances in materials, electronics, software, and manufacturing technology, we are at a ‘point of discontinuity' in the evolution of the automobile. He claimed that it is now possible to meet all of our stated goals for auto design — low emissions, high efficiency, power, safety — without having to make trade-offs between these goals. This approach is embodied in the ‘hypercar' 4 . Hypercars are built from ultra-light carbon fiber composites rather than steel. They use hybrid electric propulsion systems, low-drag design, and energy efficient accessories. Hypercars have virtually zero emissions, 4 to 8 times the fuel efficiency of today's cars, and as much power and safety as top of the line models out today. Lovins claimed that, from a production standpoint, hypercars should offer distinct improvements as well. In the long run, production costs should be equal to or cheaper than today's cars because the hypercars are mechanically much simpler, use less building material, and eliminate the need for painting. This could lead to an order of magnitude drop in production time, parts count, assembly time, and investment for tooling and equipment. The biggest barrier to mass production is the fact that the auto industry is so heavily invested in their current manufacturing equipment. Nonetheless, models of the hypercar may enter the market around 1999, and there have been recent announcements of both concept cars and early products. The hypercars represent perhaps the most dramatic possibility for advance in vehicle design, but a wide range of more incremental new technologies are currently being developed, tested, and used. Fuel cells and hybrid electric technology were cited as particularly promising options for the future. Some of the other technologies discussed at the workshop include new options for energy storage (batteries, ultra-capacitors, flywheels), lighter materials, advanced electronics, and alternative fuels such as hydrogen, natural gas, propane, methanol, and ethanol. In response to a question about the future role of diesel technology, David Green, from Oak Ridge National Laboratory, explained that diesel engines do offer significant advantages in terms of fuel efficiency, but they need to be improved to reduce emissions of NO x and particulates; this offers another candidate for hybrid technologies. Most agreed that we cannot predict which of these technologies will eventually emerge as successful. Dan Sperling, from the University of California at Davis, pointed out that one possible outcome of this wide range of new technologies is the rise of specialized, ‘niche' vehicles. Under such a scenario, households could have multiple cars, including small limited range electric vehicles for short trips. Clearly, the technology options exist to make cleaner and more fuel-efficient vehicles. However, Christine Sloan, from General Motors, reminded the workshop participants about the significant hurdles that exist in mass producing and selling these vehicles. Many customers value factors such as cost, safety, power, and reliability more than low emissions and fuel economy. The challenge is to develop technologies that permit vehicles to be both efficient and affordable. The environmental benefits of new technologies must be based on a full life cycle analysis, including consideration of the recyclability of the materials used. Sloan also cautioned that there has not been enough attention paid to making these technologies practical from a manufacturing standpoint, and that production costs must be greatly reduced if the new vehicles are to be cost competitive. On a similar note, some participants expressed concern over the dearth of effort to develop clean vehicle technologies that are suitable for developing countries 4   Hypercars: The Next Industrial Revolution; Pub.T96-9; Rocky Mountain Institute; Snowmass, CO.

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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop such as Mexico and China. Sloan responded that ‘clean' cars are very difficult to sell to developing nations if they cost more than standard vehicles; the challenge will be to make them affordable so they will penetrate the market and achieve the desired environmental benefits. Other participants felt that it may take some kind of international standards to make the auto industry place higher priority on environmental impacts when selling and manufacturing vehicles to developing countries. There is a United Nations working group trying to harmonize vehicle regulations worldwide; however, some felt that the possibility of this effort succeeding is not high. Wesoky pointed out that, in contrast to the auto industry, airlines are subject to international emissions standards (on take-off and landing only). Primarily because of economic considerations, aircraft fuel efficiency has continued to improve steadily over time. Most of the improvement has come from better propulsion technology, in particular smaller engine cores that run at higher temperature and pressures, thus requiring less fuel to produce a required thrust. Though NOx generally increases with higher temperature, innovative combustor design has actually resulted in lower emissions of this pollutant. Current research programs promise as much as a further 70 percent reduction in NOx below today's regulatory standards in about a decade. Public/private partnerships The principal United States policy instrument to promote energy-efficient auto technology is the Partnership for a New Generation of Vehicles (PNGV). Scot Staley, from the U.S. Commerce Department, and Christine Sloan explained that PNGV is an unprecedented public/private partnership program involving many government agencies, national laboratories, universities, the big three auto manufacturers, and several smaller suppliers. The ultimate goal of PNGV is to develop a car that gets up to three times the fuel efficiency of today's cars while maintaining performance, utility, safety, and affordability. Two important operating goals of this program are to bring any new technologies into use as soon as they are commercially viable and to pay attention to design and manufacturing costs as an essential research topic. A few ‘concept ' vehicles have already been made and are beginning to be sold by some of the major auto manufacturers. However, nothing is on sale yet in the United States that can meet all the PNGV goals. All of the leadership, management, and technical teams in the PNGV program are jointly run by government and industry. The government objectives are to reduce pollutant and GHG emissions from cars, to reduce our dependence on foreign oil, and to change the balance of trade. Industry's objectives are to provide technology to help the U.S. auto industry maintain global leadership and to address environmental concerns without having to resort to command-and-control regulations. According to Staley, this partnership works because it helps all those involved to meet their objectives. PNGV was largely viewed by the workshop participants as a highly successful program; however, some general concerns were raised. Staley, Greene, and others stated that the program warrants far greater levels of funding, guaranteed over reasonably long time scales. Sperling brought up the point that ‘winner' technologies could be chosen prematurely, leaving good options behind. Some suggested that the program needs to be expanded to be more international in scope; but others disagreed, saying that this would be far too complex to handle. Sloan added that cooperative arrangements should not be too cooperative, that is, they should still try to take advantage of competition as a powerful motivating force within the auto industry. Regulatory tools In addition to such partnership programs, there are many regulatory tools that governments can use to encourage development of efficient and alternative fuel vehicles. Some of those discussed include: corporate and government fleet quotas; liability limits for companies bringing new products to market; tax credits to manufacturers for selling clean vehicles; tighter Corporate Average Fuel Economy (CAFE) standards, perhaps tradeable between manufacturers. There were several points of disagreement among the participants about the effectiveness of these different policies. For instance, many people supported strong emission standards, but others stated that this approach was too inflexible and called for some kind of average fleet emissions standards (analogous to the CAFE standards). Some participants indicated that the fleet quotas and regulatory standards should be deliberately set ahead of the R&D curve, to drive the technology forward; but others argued that the public will not accept new regulations unless it is convinced that the needed technology is already available.

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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop One recurring theme of the discussions was that policies for encouraging R&D alone aren't enough. Many environmental benefits have little market value (i.e., many consumers are not as interested in energy efficiency as they are in other features of cars). Government intervention is often needed to provide incentives for industry to sell these clean vehicles and for people to buy them. However, Sperling emphasized that government intervention should be flexible and incentive-based, and should not try to pick winners among the competing new technologies; because we have no way to predict which technologies will ultimately prove the best, diversity and experimentation in regulation is critical. Finally, it was pointed out that because old vehicles are responsible for such a disproportionately large fraction of pollutant emissions, measures to fix these cars or to remove them from circulation can yield large benefits. Workshop speakers from all three countries attested to the effectiveness of strong vehicle inspection and maintenance programs and retirement/buy-back programs for old vehicles. Social and Economic Solutions: Changing Individuals' Use Decisions Several speakers emphasized that individual choices about transportation use may ultimately be the most important factor determining the magnitude of impacts of the system as a whole. In particular, when it comes to the challenge of cutting CO2 emissions, new technology will only get us so far; we will have to also greatly reduce the amount of vehicle travel. However, the freedom and mobility afforded by the personal vehicle has come to be seen as a cherished ‘right' in many countries, and direct attempts to restrict people's driving have not been successful. Thus, the workshop discussion focused on more indirect approaches, including demand management, pricing strategies, and educational measures. Providing alternatives to the automobile is certainly an important part of the solution, and thus public transit is one of the primary answers that people look to. However, as pointed out by Lee Schipper, this has not proven to be a simple answer. The environmental benefits of transit often depend on how heavily it is being used; for example, in the United States today, an average city bus actually emits more CO2 per passenger mile than an average car. Schipper explained that around the world, transit only seems to work as an efficient, dominant form of transport in very large, dense cities — at least an order of magnitude increase in density would be required in most places. Also, non-work trips (for shopping, educational, recreational activities) account for much of the recent growth in vehicle miles traveled, and these activities are almost impossible to serve entirely with public transit. So simply providing the transit systems is not enough, they must be time and cost competitive with the automobile. Land use controls to increase urban and suburban density and to encourage more compact, mixed-use communities, is a commonly suggested strategy for reducing transportation demand; however, several difficulties in implementing these changes were mentioned: zoning is usually a local issue; major infrastructural/developmental changes can take decades to occur; and planning cities so that people live near their work is complicated by the fact that most households have two workers traveling to different locations. Simpler land use changes include making cities more friendly to cyclists and pedestrians, and minimizing parking availability. Many workshop participants emphasized the need for full cost pricing of transportation activities. Currently, the cost of transportation does not include the externalities such as accidents, air pollution, traffic congestion and noise, infrastructure development, and ecosystem and biodiversity loss. These externalities can be very difficult to quantify economically, particularly the environmental costs that are intergenerational in nature. Neil Irwin, from the IBI Group, reviewed a study done in Canada to assess the true costs of different transport modes.5 External costs in Canada for the urban car, defined to include the costs of accidents and air emissions, were $5.6 billion. Full costs, which also include the price of urban sprawl, parking, congestion, etc., totaled $26.2 billion. To have true full cost pricing, user charges would have to increase 10 to 50 percent for the urban car, 131 percent for urban transit, 258 percent for interurban rail. (The mass transit subsidies are so large due to the fact that they seldom operate at full capacity). It was concluded from this study that full cost pricing would be unrealistically expensive for urban transit and inter-city passenger rail; external cost pricing 5   Full Cost Transportation and Cost-Based Pricing Strategies, IBI Group and Boon, Jones and Associates, Inc. 1995.

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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop would be more appropriate, and would provide incentives to change people's travel behavior, by encouraging less use of single occupant autos and more use of transit, walking, and cycling. Many participants felt that the most powerful way to influence personal decisions about transportation use is to send the right pricing signals, so that people can make choices that are economically reasonable as well as environmentally benign. In the United States in particular, the current pricing signals are motivating people to drive more — while the costs of driving (in terms of real fuel prices) keep getting cheaper, mass transit is often becoming more expensive. There was some debate about the most effective ways to change these pricing signals. Raising fuel prices is one of the most direct ways to change pricing signals. Canada and Mexico have tried raising gasoline prices, but in the United States the political difficulty of this option is daunting. Mark Corrales, from Apogee Research, Inc., pointed out that this is a tool of limited effectiveness, as driving seems to be fairly price inelastic. In general, raising fuel prices was seen as a necessary but insufficient part of the solution. John Flora, with the Transportation Division of the World Bank, and Erik Haites, from Margaree Consultants, Inc., both argued that new car taxes are not effective, because cars in and of themselves do not cause the externalities — driving does. Road or fuel taxes allow you to target the actual behavior that is causing the problem. Congestion pricing, which involves adjusting highway tolls with car occupancy, location, and time of day, was cited as a particularly flexible and directed tool for motivating where and when people use their cars. The Canadian study mentioned above found that public support for new taxes often depends on the use of the revenue. Most people will support increases in the cost of driving if the revenue is spent to improve local transportation infrastructure or to mitigate air pollution from cars, but not if the money goes into the general revenue. Schipper observed that even with the appropriate pricing signals, people often won't change their behavior until they are convinced that things have to be different. Climate change in particular does not resonate with most people as an issue they need to deal with personally. Other, more immediate transportation problems such as urban smog and traffic congestion are of greater concern to most people and thus are easier targets to start with. Fortunately, attacking these other transport problems almost always mitigates CO2 in the process. Approaches Currently Being Used in the Three Countries An important part of planning future actions to reduce transportation sector pollution is to carefully examine the success of current and past actions. Thus one of the workshop panels reviewed the approaches that have been (and are currently being) tried in each of the three countries. Canada. Richard Gilbert pointed out that the Canadian and U.S. auto industries are closely integrated, and it is difficult for Canada to act independently in regulating its part of the industry. Nonetheless, the government of Canada recognizes that current transport trends are not sustainable and has been putting a lot of effort into exploring and developing sustainable transportation plans. Gilbert described a variety of actions taken in Canada. The federal and provincial governments both tax fuel. Taxes are higher than in the United States, but they are still much lower than might be necessary to move people towards sustainable transportation. Inspection and maintenance programs for private automobiles (mandatory in British Columbia and soon to be mandatory in Ontario) seem to be quite effective in maintaining fuel efficiency, even though they are aimed more at reducing local and regional pollution. Ontario levies a large tax on high-consuming autos and has a rebate for the most efficient vehicles; but this has not had a major effect because it applies to less than 10 percent of the cars. There is about twice as much public transit use in Canada as in the United States, which results from a generally more concentrated pattern of settlement as well as higher fuel prices. Ken Ogilvie noted that recent changes in the political priorities of Ontario's government may affect transit adversely. Provincial subsidies for mass transit are being withdrawn, and more importantly, provincial restrictions on ‘greenfield' development have been lifted, which will likely lead to an increase in the rate of sprawl at the edges of Ontario's urban areas. Mexico. Mariano Bauer explained that Mexico has experimented with many policies to reduce driving and emissions, and some have been more successful than

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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop others. Charging large highway tolls to reduce driving caused people to travel along back roads instead. Instituting ‘no drive' days, based on license plate number, resulted in people purchasing second cars to get around the restrictions. On the other hand, recent laws requiring new cars to be made with catalytic converters and to use unleaded gasoline have been successful in reducing emissions of pollutants such as lead and carbon monoxide. The World Bank has funded a major, comprehensive air pollution mitigation program for Mexico City. Carl-Heinz Mumme, from the World Bank, described the following components of the program: vehicle measures — centralized vehicle inspection programs were set up, as were a combination of command and control regulations (e.g. mandatory age limits on taxis, retrofits on high-emitting vehicles) and credit lines, so that people can make the necessary investments. fuel related measures — the price differential between leaded and unleaded gasoline was lowered; a surcharge was put on gasoline, with the profits going to set up a trust fund for environmental activities. scientific measures — strong air monitoring programs, emission inventories, and air quality modeling studies were established, and annual air quality audits are carried out to gauge progress. institutional measures — an environmental commission was created to provide a forum for federal and local authorities, energy industry representatives, air pollution scientists, and health officials to all work together in planning policies. United States. Mary Nichols, with the Environmental Protection Agency (EPA), explained that U.S. transportation and air quality issues can be tightly intertwined with other policy issues, and often require coordination among several federal agencies. For instance, programs promoting the use of ethanol as an alternative fuel involve the EPA and the Departments of Transportation, Energy, and Agriculture. In recent multi-stakeholder, Federal Advisory Committee discussions about mitigating greenhouse gas emissions from mobile sources, there was consensus on the need to simultaneously address three challenges: auto design, fuel design, and vehicle use. However, there is still significant disagreement about which specific instruments are best suited to meet these challenges. The Clean Air Act (in particular the 1990 amendments) contains a host of regulatory tools to address the issue of mobile source emissions, including tighter emission standards for highway and off-road vehicles, mandates for the use of clean fuels in highly polluted regions, particulate standards for urban buses, fleet quotas for efficient and alternative fuel cars, and strong inspection and maintenance programs. The other major legislation relevant to this issue is the Intermodal Surface Transportation Efficiency Act (ISTEA), which sets policy guidance and funding levels for highway and transit programs. Nichols explained that some of the most successful and popular programs are those which take a decentralized approach to transportation planning. For example, the Congestion Mitigation and Air Quality (CMAQ) program, a part of ISTEA, provides state and local officials with the means to design and implement programs which are best suited to their communities ' needs. This has helped to build up a large portfolio of effective programs for improving and promoting mass transit systems, for encouraging better land use planning, and for reducing transportation demand. A key component to success is providing local planners and decision makers with the financial and intellectual tools they need to make good choices about how to improve their transportation systems. Reducing the Impacts — Summary On the whole, most participants expressed the opinion that there is no single ‘magic bullet' solution that will substantially mitigate the atmospheric impacts of the transportation sector, and that significant changes will require improvements in vehicles, fuels, and infrastructure on the one hand, and changes in the patterns of personal and freight transport on the other hand. These changes will have to be driven by a combination of regulations, economic and social policies, and private/public partnerships. Ogilvie, as well as several other speakers, emphasized that the success of any of these changes will hinge upon substantial public education and information campaigns. It must be clear to the public what the full range of environmental impacts stemming from transportation are, how personal travel choices affect the problems, and what the options are for cleaner transportation. This kind of education will be needed not only to directly influence transportation use decisions, but also to shore up public support for political reforms and increased R&D funding.

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Atmospheric Change and the North American Transportation Sector:: Summary of a Trilateral Workshop It was also pointed out that these educational efforts will need to take into account the powerful influence of the media and advertising on the public psyche. Most of today's car advertisements tout the virtues of unlimited travel, high power, and the ability to ‘conquer ' nature. Changing this message to emphasize the benefits of clean transportation could go a long way towards aiding the market penetration of new vehicles and changing people's use patterns. Dan Sperling emphasized the need to consider long term goals. While most people want to have both an effective transportation sector and a clean environment, should this ultimately be achieved through universal ownership of pollution-free cars? universal use of transit? greatly reduced travel altogether? Of course, the optimal strategy will often depend on local or regional conditions. Francisco Guzman, from the Instituto Mexicano del Petroleo, noted that modeling studies are thus an important tool for evaluating the effectiveness of different strategies. These models, however, need to be comprehensive in nature, integrating technological, environmental, social, and economic factors, and they must consider the non-linear responses in both social and physical systems. Mauricio Fortes, from Academia Mexicana de Ciencias, emphasized that these questions about long term goals are particularly poignant when looking at Mexico and other developing countries around the world. Most people in these countries hope to emulate the high-consuming lifestyle of more affluent societies, so the solutions will require not just technological and policy shifts, but paradigm shifts as well. Finally, Sperling pointed out that addressing these problems in a comprehensive manner requires better integration between the transportation and atmospheric science communities. One immediate benefit of the workshop was simply the opportunity for such a diverse group of experts to share information and learn the ‘language' of each other's fields. But true interdisciplinary cooperation means more than just occasional conferences or consultations, it requires sustained collaboration in research and modeling studies, policy development, and education.