Marketplace Transport sector faces challenge of low emissions future
The Paris Climate Conference in mid-December produced broad global targets for the world to avoid excessive warming for the first time ever. And one of the main sectors that will probably have to deliver significant emissions savings for national and overall targets to be met will be the transport sector. The sector has not come up with significant savings so far and that means that the spotlight is now on fuels companies and vehicles manufacturers, among others, to deliver.
The European Union took one major claim to the Paris conference late last year. That’s the fact that economic growth in the club of 28 has been achieved in the past years without increased emissions of the greenhouse gases that produce climate change.
But one sector stands out as having failed to live up to that claim: transport. For some fuels, like high performance aircraft fuel, no convincing alternatives have yet been found. And for goods haulage and personal transport, a lot more journeys are being made in today’s globalized world and they have eaten up any efficiency improvements from more efficient vehicles and better performing fuels.
“Demand for transport has been increasing which has offset the benefits of technological improvements.”
Lauara Lonza, of the European Commission’s Joint Research Centre, which regularly looks at the options of using different fuels for transport, made that point quite starkly at a conference in Prague last week charting some of the ways forward.
“The reason why the transport sector does not show impressive improvements, if you want, in its entirety is really due to the fact that transport has been increasing, so demand for transport has been increasing which has offset the benefits of technological improvements.”
But Lonza is not discouraged by the lack of emissions savings from the transport sector so far. She stresses that fuel options, such as various types of bio-fuel, have been opened up that simply were not around a decade or so ago.
“There have been substantial improvements in the efficiency of power trains and vehicles. There has been a development of a new market at the end of the day when it comes to alternative fuels. So now there are a range of opportunities which was not there until fairly recently. So what we may expect over the next 20 years is an increased range of options. Now that range of options needs to be managed as effectively as possible considering both greenhouse gas emissions reductions and efficient use of energy.”
To illustrate the importance of choosing the right options, cheap solar power could be used to produce alternative vehicle fuels such as hydrogen or methanol but instead of using it for that relatively expensive process it would be probably better all round if it just stayed as electricity and replaced power produced at coal-fired power plants in the Czech Republic or Poland.
The Prague conference was being hosted by independent fuel supply companies. These are basically the middlemen traders who don’t drill or produce oil or refine it. They buy up fuel and deliver it and they are commanding an ever greater slice of the European energy market as traditional oil companies retreat from the retail side of the market.
Thierry De Meulder is the president of the UPEI grouping. He argues that the EU target for a better fuel performance from the transport sector for 2030 is already too ambitious let alone the Paris conference ambition of cutting greenhouse gas emissions by 80 percent compared with 1990 levels.
“I came here from Belgium by car, and when I see the number of cars and trucks on the motorway, I cannot imagine that within 15 years a 40 percent reduction of fossil fuels will be really possible to achieve. I think it is not realistic. So, the fear is not that we are going to lose our business, the fear is that the objective is not really realistic enough. But we know that in Europe, after Paris, the objectives are changing. When you have see how Europe has developed its objectives, well when they see it is not possible they will change their objectives. I think that is what will happen here again as well.”
“I think that the electric car is not the real solution. If you take the emissions needed to produce the electric car and the batteries that goes with it. If you take that in terms of emissions then you are overcoming all what we have said already. So this is not really a positive development. I think the hybrid car is something that can work, especially in connection with the gasoline engine. So I think that has a lot of chance that it can proceed. A truck without fossil fuel, I think it is not possible. If you take compressed natural gas or liquefied natural gas (LNG) the cost is so high to get that and carry it on your truck that it’s a no go situation. So I think that diesel in trucks will remain. On ships and on airplanes, I have a lot of difficulties to see that we are going to replace fossil fuel by biofuel.”
“The market will force the car producers to produce more efficiency there.”
And it’s not surprising that the fuel companies appear to believe that a lot of the running on fuel efficiency and emissions cuts should be made by car and truck producers. Mr De Meulder again:
“There is a lot to do in terms of efficiency of the engines. They can consume a lot less than they are doing for the moment. Diesel has been behind a lot of these efficiency increases. On gasoline there is still a lot to do and I think that this is a very important element. And I think that the car industry has to do that because otherwise they are not going to be able to sell their cars any more. The customers want to have something that is cheaper and is easy to use. The market will force the car producers to produce more efficiency there.”
Car makers are a major factor in the Czech manufacturing scene with Škoda Auto, for example, the biggest exporter in the country. Besides Škoda, Hyundai also produces in the country and there is also the joint venture of Toyota and Peugeot Citroen. And it should come as no surprise that the car manufacturers as a whole believe that European lawmakers are on the wrong track when they seek even greater fuel and emissions reductions from new cars.
Michal Kadera is head of external affairs at Škoda Auto. He argues that one of the main flaws in the EU strategy towards car companies is that the worst emissions often come from older cars and that these still prevail on markets in Central and Eastern Europe with tougher new limits for new cars doing little to improve the overall situation.
On the relatively small Czech car market there are around 5 million passenger cars. But of this total only around 200,000 new cars are sold every year and around 300,000 second hand cars are being imported every year from Western Europe. Michal Kadera again:
“So actually we are buying these wrecks. The average age of these old vehicles purchased in the Czech Republic is 10 years. So something on the Western borders that people do not want to use any longer because it is more expensive to repair and it’s less ecological and they can’t commute into the city centre, we’re just buying it here because of the local regulation and a big political problem of at least the EU 10, the acceding EU countries, to regulate and ban the import of old cars. And what happens to the yet older cars, we are just selling them further to the east. So eventually we will have at a certain point a cleaner Europe but we are just shifting the problems to the East. So on a global scale that might not be that effective.”
“We believe that for the time being, for the next few year, before electro-mobility becomes a yet bigger and cheaper option, CNG is a very good alternative.”
So far, Škoda Auto has been fairly slow to offer alternative fuel models and has not rolled out any electric cars. The main emphasis has been on mixing conventional fuels with Compressed Natural Gas (CNG).
“We believe that for the time being, for the next few year, before electro-mobility becomes a yet bigger and cheaper option, CNG is a very good alternative. We have two models that are fueled by CNG, the smallest is the Citigo. The car is quite unique in combining a gas tank and CNG tank so altogether you can do a wonderful mileage of 620 kilometers. If you like more space, the Škoda Octavia, our best seller, is combining a 50 litre fuel tank, that’s a full range fuel tank, with 15 kilogrammes of CNG which gives close to 1,000 kilometers on a tank.”
But the Czech manufacturer is nonetheless looking at rolling out hybrid electric cars, perhaps from 2019. The first model to get such treatment could be the top of the range Superb with the next the large SUV which Škoda Auto is preparing for production. The details of the policy have still to be fully worked out in concert with parent company Volkswagen, which has taken the lead so far with electric cars in the group.