The Deep Dive: Smart Policy

Monday, April 3rd: 12:30 - 13:30 - Main Stage


Policymakers talk about how they can transform their energy and transport systems while creating jobs and economic growth.


CONTEXT:

ENERGY EFFICIENCY
Offers the biggest opportunity to make fast progress. For the industrialized world and fast growing economies this must be on the top of the to do list.

The overall energy intensity of transport has been improving at a rate of 2.0% per year for passenger transport since 2010, but only 1.0% per year for freight transport. Passenger aviation and freight shipping have been reducing their energy intensity at rates of around 4.0% per year since 2010. This accelerated to 2.8% a year for passenger transport over 2012-14 due to a structural shift of activity towards less energy intensive non-OECD regions.

Annual investment in energy efficient transport grew to $64 billion in 2015 primarily due to rising vehicle sales in the US and China. Vehicle efficiency standards played an important role in improving efficiency and increasing investment. The average energy efficiency performance of passenger and commercial light-duty vehicles (LDVs) increased by 20 to 25% across countries with vehicle fuel economy standards over the past ten years. Virtually all of the US passenger vehicle fleet is covered by mandatory vehicle standards that have been in place since the 1970s. In the EU, implementation of mandatory vehicle standards started in 2009.

Continued improvements in energy intensity globally will be particularly critical for light duty vehicles that have the highest energy intensity of all modes, and air travel that is growing fast and is the second most energy intensive sector. Over the period to 2030, 70% of the projected annual average energy efficiency investments of $919 billion are in the transport sector, responding to an expected increase in the coverage and stringency of fuel-economy standards, especially for passenger vehicles (IEA, 2016a).

For developing countries that will see increasing motorization of passenger and freight travel, the introduction of fuel economy standards and oversight mechanisms are an opportunity to reduce energy intensity. However, heavy-duty vehicle standards are quite new even for countries with large vehicle-manufacturing sectors.

RENEWABLES
Transport will be critical to meeting the SEforALL target to double the share of renewable energy in total final energy consumption. This is challenging and will require the widespread adoption of more ambitious policies, such as a large scale shift toward the electrification of transport. This has been accelerating. Over 2012-14, 9% of the growth in renewable energy consumption came from transport, reaching a 2.8% penetration rate in 2014. However, policies are not yet catching up with the rapid deployment of electric vehicles and their potential role as enabler for better integration of variable renewable energy sources in power systems (REN21 2016).

Progress of advanced biofuels as a direct alternative to petroleum products has been promising but current and projected production represents just over 0.1% of the global liquid transport fuel demand. The pace of advanced biofuels production has to increase exponentially to displace a significant part of petroleum-based transport fuels. While policy support has shifted toward the promotion of advanced biofuels, globally most of the policies adopted in 66 countries focus on first-generation biofuels. Only Italy has adopted an advanced biofuel blend mandate (REN21 2016).


MODERATOR:
Drew Kodjak Executive Director International Council on Clean Transportation (ICCT)
SPEAKERS:
H.E. Irene Cañas Vice Minister for Energy Costa Rica
Karen Douglas Commissioner California Energy Commission
Patrick Oliva Senior Vice President External Relations Sustainable Mobility and Energy Transition, Michelin Group
H.E. Maroš Šefčovič Vice-President, Energy Union European Commission
Sheila Watson Deputy Director & Director of Environment and Research FIA Foundation