Newly released research by international banking group HSBC outlines a scenario for reducing transport emissions by 76% by 2040 through combining technology and regulation in a way that results in electricity, hydrogen and biofuels replacing oil as the primary fuel feedstock across transport modes.
The report labels transport as the ‘second frontier’ for decarbonisation in light of progress being made in reducing emissions from electricity production and given that reducing emissions in the power sector alone will be insufficient to limit global warming in 2100 to below 2⁰C above preindustrial levels.
The transport sector is currently responsible for 24% of emissions from use of fossil fuels for energy and 15.7% of the overall total from human activities, while power generation is responsible for about 27% of greenhouse-gas emissions associated with human activity.
The report’s ‘Clean-Power-and-Transport-2040 scenario’ indicates that supportive policy, technological advances and cost improvements can be used to close the prevailing ‘emissions gap’ between a business-as-usual case and a trajectory consistent with limiting warming to below 2°C by by the end of the century.
The scenario assumes that zero-carbon electricity, together with low-carbon transport, will close the gap by 72% under a 2°C warming scenario and by 48% under the more ambitious goal of limiting warming to 1.5 °C.
The reduction in electricity emissions is underpinned by higher policy ambition, spurred by the improved economics of deploying renewable-energy technologies such as wind and solar.
The HSBC report does not factor in full sectoral decarbonisation for transport, however, owing to the challenges of reducing emissions from trucks, aviation and shipping.
For cars, which were responsible for 36.8% of 2015 transport emissions, emissions are assumed to fall to zero in light of the emergence of technologies, such as electric vehicles, which “are proven and increasingly commercially viable”.
Likewise, emissions from buses, trains and light goods vehicles and two and three wheelers are assumed to fall to zero on the back of electrification.
A recent report published by the International Renewable Energy Agency (Irena) also highlighted the potential to reduce energy-related emissions by pairing renewables electricity to other energy end uses, such as transportation and heating.
“By 2050 electricity could become the central energy carrier, growing from a 20% share of final consumption to an almost 50% share – and, as a result, gross electricity consumption would more than double . . . The primary drivers for this increased electricity demand would be over one-billion electric vehicles, increased use of electricity for heat and the emergence of renewable hydrogen,” the Irena report stated.
It added that, by 2050, renewable energy would supply two-thirds of final energy.
The production of hydrogen from renewable energy, using electrolysers, is also being highlighted by international agencies as a way to replace fossil fuel-based feedstocks in transport.
A recent article published by the International Energy Agency states that hydrogen is set to play a key role in the world’s transition to a sustainable energy future.
Producing green hydrogen, however, will require the cost of electrolysis, the process through which hydrogen is produced from water using renewable energy, to fall.
“Total global electrolysis capacity is limited and costly at the moment. Most industry experts expect that a significant increase of electrolysis capacity will reduce costs by roughly 70% in the next 10 years,’ the article states.
The HSBC report argues that the transport sector is becoming the next part of the energy system where the virtuous circle of policy and economics will catalyse better clean technologies.
“Whether catalysts for transition come from country level policies, or from non-State actor measures, or from technological advancement, we believe that some transport subsectors will see a rapid change in their fuel feedstocks in coming years, even as populations increase and mobility drivers change with growing affluence, particularly in emerging markets,” the HSBC report states.