Where next for transport and carbon budgets?

Blog 6 February, 2024

The Climate Change Committee (CCC) is currently building its methodology and evidence base for the 7th five-year carbon budget 2037-2042. A week sometimes feels like a long time, so looking ahead nearly twenty years might not make it to the top of most people’s radars. However, the approach which the CCC takes in steering the UK towards Net Zero and what is thought to be possible (or unlikely) in our future pathways really matters. As part of the new Energy Demand Research Centre I worked with John Barrett and colleagues on a response to the CCC’s methodology consultation.

Here I will pull out three key issues and examples for the transport sector which explain why it is important that more people engage with this now so that the CCC can take a rounded view.

Are we on track in 2037?

The CCC assumes that we will meet the obligations set out in the 6th carbon budget. This means, if their ‘balanced pathway’ is met that GHG emissions in 2037 will be 152MtCO2e. The total budget for the 7th carbon budget would be around 605MtCO2e or an average of 121MtCO2e per annum (which is less than 2019 for domestic transport). Overall the reduction is suggested to be around 71% from 2022 levels.

Of course, there is a very live debate about whether we are on track to meet our obligations for the 6th carbon budget. My own analysis suggests an overshoot of 224 MtCO2 in surface transport emissions. This is based on the core traffic growth from the DfT National Road Traffic Projections and the effects of the Zero Emissions Mandate between 2019 and 2037. There is a further 114MtC of risk if we continue to upsize the new fossil fuel vehicles that are still being bought, rather than tracking to the efficiency assumptions in the plan. The CCC’s 7th budget methodology, perhaps understandably, does not engage with this, assuming that corrective action would be taken as required by law. But, if that is true, the scale of the corrective action and the nature of it could very well have a significant impact on the start point in 2037.

Better than nothing at all?

The CCC suggest that “The baselines for each sector in our analysis will be a projection of emissions representing a hypothetical world without further decarbonisation in the UK. This means that low-carbon technologies would remain at today’s stock levels and today’s efficiencies.” The CCC acknowledge that this differs from both the Government’s Carbon Budget Delivery Plan and sectoral approaches to baselining. I feel that this remains a confused picture across the board where it then becomes possible to maintain that a project or policy is better (or worse) depending on whose rules you apply. Applying today’s technologies as the baseline does not make any sense to me. It implies undoing some existing commitments and suggests that, even if the UK Government did nothing, we would not somehow benefit from spill over effects from changes elsewhere in the world.

There appears also to be a tendency for DfT/Westminster assumptions to be taken to be the pivot point. There are very different policy goals in Wales and Scotland for road traffic levels as well as in London, across the Sub-National Transport Bodies etc. Many organisations have a legitimate role in debating how this should be understood and these voices need to be heard now.

Technology in First Class, Demand Measures in the Rear View Mirror?

There appears to be an in-built bias in the treatment of different solutions for reducing carbon emissions. The CCC methods consultation states that “We avoid relying heavily on potential speculative future technological advances lacking a firm evidence base. We look to reasonable demand reduction options where a key technology cannot be relied upon in the future, and where demand reduction offers the potential for more efficient use of resources and/or significant co-benefits.”

From this, we can see that demand only appears where technology cannot solve the problem. Haven’t we been here before? The introduction of EU vehicle efficiency standards was intended to drive down transport emissions per mile, but this has in fact been trending upwards since 2012. An example where demand shifts delivered emissions reductions was the change in tax arrangements for company car tax in around 2000, which was credited with a significant reduction in vehicle miles driven. We know that Air Passenger Duty is sensitive for politicians and is generally set at levels where it has limited impact on travel demand. However, there is no end of enthusiasm for Sustainable Aviation Fuels even though these cannot be delivered at anything like the cost of fossil fuels (which will increase prices) and still raise legitimate concerns over the wider impacts of contrails.

The CCC says it will consider demand changes to be “feasible… based on observed societal change elsewhere and historically, behavioural and social science research, data on public attitudes as well as wider societal impacts”. Sounds reasonable. Who wouldn’t want to rely on evidence we can gather? Except that this appears to minimise the chances of adopting anything genuinely new.

The same bar is not set for technology which focuses on the maturity of the technology, its costs and likely uptake. Of course, if a technology does not exist or only in prototypical settings we can’t know what the observed societal uptake or impacts would be – but it appears that we are set to include just such policies in the balanced pathway, over and above demand reduction. It is not clear who is the arbiter of what is feasible and what is not.

There should be a commitment to treat all potential policy interventions with an even hand rather than putting technology first. There should also be an acceptance that, for transport, technology change and demand change are inexorably linked.

Looking out from 2037 is fraught with uncertainty. The CCC’s task is unenviable in many respects. They are genuinely open to inputs to ensure that their work is as robust as it can be and they are transparent in the decisions they take. However, there is much to be done to help establish a balanced debate about the merits of different future pathways for transport and now is a key time to engage.

Find out more about the CCC’s Proposed methodology for the Seventh Carbon Budget and how they are gathering evidence on the CCC website