2. Resilient, Low Carbon Transport
Summary
- The long-term challenge is to reduce greenhouse gas emissions from the transport sector by using alternative renewable fuels, increasing vehicle efficiency, using more efficient modes of transport and making shorter and fewer motorised journeys;
- Increasing the diversity of transport fuels through the introduction of biofuels and electric cars will also make New Zealand more resilient to international oil price uncertainty and risks of supply disruptions;
- Continued upgrading and improvements to public transport are required to ease traffic congestion, reduce roading costs and reduce greenhouse gas emissions;
- Making these changes will improve the transport choices available to New Zealanders, as well as improving the health of our communities and our economy.
From Vision to Action
- Public consultation on a minimum biofuels sales obligation with decisions and announcements in late 2006;
- Consider establishing a group of experts to advance planning for a higher percentage of biofuels post 2012 and the introduction of new technologies such as plug-in electric (hybrid) vehicles;
- Consult on mandatory point-of-sale labelling of fuel efficiency for vehicles;
- Consider a sales-weighted fuel economy standard for vehicle imports and pricing mechanisms to influence purchase decisions;
- Consider restricting the importation of second-hand vehicles in conjunction with air quality control measures, including considering restrictions based on age;
- Consider restricting the importation of vehicles unable to accept a minimum level of biofuels;
- Consider economic incentives to influence fuel efficiency through consumer purchasing;
- Investigate ways to improve driver behaviour to maximise fuel economy;
- Increase support for public transport and non-motorised forms of transport;
- Investigate options for encouraging the use of different ways to move freight, and develop a New Zealand Shipping Strategy;
- Continue to monitor and develop emerging transport fuels;
- Restore oil reserves to 90 days and develop an updated emergency response strategy to respond to international and national disruptions in oil supply.
2.1 Our Direction
New Zealanders have a strong culture of mobility. We travel frequently, have a high level of vehicle ownership by comparison with other countries, and our fuel costs have historically been relatively low. Our geographic isolation has made us reliant on ships and planes to connect us to the rest of the world, and our use of energy for freight transport has increased as the economy has grown.
If we make no changes to the way we travel and transport freight, transport energy use is expected to grow by about 35% by 2030 - with three-quarters of that growth coming from road transport. Greenhouse gas emissions from transport would increase at a similar rate. The risks of climate change make it unacceptable for us to continue on this path. Likewise, change is desirable to increase the resilience of our transport system to disruptions in oil supply and price uncertainty, as well as addressing the local environmental impacts currently associated with fossil-fuel-based transport.
Our key challenge is to reduce the greenhouse gas emissions from transport fuels while continuing to improve our quality of life and to benefit from a strong, competitive economy. A focus on reducing greenhouse gas emissions from the transport sector will also help to reduce New Zealand's dependency on oil.
Our transport objectives through the NZES are to:
- continue to meet the demand for transport services;
- reduce greenhouse gas emissions from transport;
- continue to manage other effects of transport, such as exhaust emissions that affect local air quality;
- maintain reliable supplies of transport fuel during any short-term disruptions;
- increase the transport system's resilience to higher or more volatile fuel prices.
2.2 The Progress We've Made
The government has already set New Zealand on a course to meeting these transport objectives. Initiatives under way include:
- public consultation on a minimum biofuels sales obligation with decisions and announcements in late 2006;
- consulting on mandatory point-of-sale labelling of fuel economy for vehicles;
- encouraging drivers to consider fuel economy when they buy their vehicles, through the Fuel$aver website;
- considering a sales-weighted fuel economy standard for vehicle imports and pricing mechanisms to influence purchase decisions;
- considering restrictions on the importation of vehicles unable to accept a minimum level of biofuels;
- taking steps to protect New Zealand from short-term oil disruptions;
- encouraging good urban design to make our cities more amenable to the use of public transport and to non-motorised means of transport;
- carrying out innovative research into transport issues;
- increased central government funding for public transport services by 16% over the last year;
- committing $301 million in 2006 to fund public transport, including a commitment of over $66 million to the Northern Busway in Auckland;
- committing $1 billion in order to renew and upgrade the rail network, including major upgrades to suburban commuter rail in Auckland and Wellington.
2.3 Our Choices
Ensuring that our transport system is resilient and less reliant on oil will require moderate changes at many levels. The draft NZES proposes a conscious change in the way we think about transport energy and services. Many of the changes proposed will bring lower fuel costs and greater transport choice, as well as wider health and air quality benefits.
This strategy proposes four priority areas for action, with a focus on reducing greenhouse gases:
- Developing and adopting future fuels;
- Improving the fuel efficiency of vehicles on New Zealand's roads;
- Shifting to more efficient means of transport;
- Ensuring a secure and diverse supply of transport fuels.
Actions to reduce greenhouse gas emissions are interrelated, as shown in Figure 2.1 below. Different actions have a different impact on greenhouse gas emissions.
Figure 2.1: Schematic of the Types of Actions That Can Reduce the Use of Fossil Fuels and Associated Greenhouse Gas Emissions from the Transport Sector
Actions to reduce travel focus on reducing the number of motorised trips, the length of trips and the tonnage of goods carried. Short-term measures to reduce travel include teleconferencing instead of flying between cities, and encouraging drivers to combine trips where possible.
Other actions have a longer-term focus. As cities sprawl, commuting times and distances increase. Changes to urban form and the siting of services tend to "lock in" travel behaviour over time. Planning and design that minimises the transport impacts of proposed siting of industry, services and urban transport systems can have significant long-term benefits.
The links between good urban form and transport are recognised in the New Zealand Urban Design Protocol (2005). International research shows good urban design offers benefits for communities, individuals, the economy and the environment. Features that bring energy and transport gains are planning for higher density urban form, mixed land use and greater connectivity between key urban sites, including more accessible public transport and support for pedestrians and cyclists.
A number of major urban areas are already considering urban design approaches that link land-use planning decisions and transport infrastructure in order to reduce sprawl, improve access and reduce congestion. These measures would also provide more cost-effective alternative means of transport and improve energy efficiency. At a local level, regional land transport strategies and regional and district plans are required to consider energy efficiency.
In the short term, greenhouse gas emissions from the transport sector are likely to be reduced most effectively by using alternative fuels and by increasing the fuel efficiency of the vehicles on our roads. The sections below discuss these issues in more detail.
2.3.1 Developing and Adopting Future Fuels
New Zealand will continue to rely on international oil supplies for transport energy for the foreseeable future, but our level of reliance will depend on how much of our fuel mix is made up of alternatives. In the short term, alternative fuels most likely to be of greatest potential benefit to New Zealand are biofuels and electricity.
The domestic supply of biofuels will ultimately be determined by the feedstock available, the economics of conversion technology and the relative price of oil. There is also likely to be some international trade in biofuels from which New Zealand may benefit.
Switching to electricity as a fuel for our vehicles would make the most of New Zealand's abundant renewable electricity supplies, particularly if transport was not competing for supply at times of peak demand.
Following European trends, the use of diesel vehicles is expected to increase in New Zealand. Given the high energy efficiency of many new diesel vehicles, such a trend could improve, over time, the average fuel efficiency (also known as fuel economy) of the New Zealand vehicle fleet.
2.3.1.1 Biofuels
To reduce greenhouse gas emissions, biofuels provide an alternative to fossil fuels. The government has proposed a biofuels sales obligation that will make it easier to introduce biofuels to the existing fuels market. The sales obligation proposes a minimum volume at a level that the motor industry and fuel distribution systems are capable of supporting.
One major advantage of biodiesel is that it can be used in almost all of today's diesel vehicles, including heavy freight. The potential for markedly increasing the uptake of biofuels - particularly bioethanol - is presently limited by the composition and turnover of our vehicle fleet. However, in time, and as requirements under the biofuels sales obligation start to take effect, the fleet composition is likely to allow increasing bioethanol blends with petrol and higher-level biodiesel blends.
At present, New Zealand adopts technology primarily through the importation of second-hand vehicles from Japan. As a result, given the average age of imported vehicles from Japan, new technology arrives in this country seven years on average after it is available in Japan. At present, Japan uses biofuels at about the same levels as New Zealand does now. It is therefore likely to be at least a decade before we begin importing used Japanese vehicles compatible with significantly higher biofuel blends.
The rapid integration of biofuels into New Zealand vehicles needs management, given the following:
- We should not create an incentive to import biofuels to meet requirements set by the sales obligation before first establishing a competitive domestic supply.
- If the relative price of tallow and other biofuels feedstock increases significantly, the price of transport fuels would increase as oil companies pass on the costs of meeting the sales obligation. This is, however, analogous to price rises for oil being reflected at the pump. Given the relatively low percentage blends of biofuels under the sales obligation, the effect on prices is not expected to be high.
- The development of local biofuels feedstock might lead to competition with forestry and food crops for land use.
A gradual increase in the use of biofuels over time, as proposed in the biofuels sales obligation, will allow the government time to consider and address these issues. Technological developments may also eventually resolve them.
Action: Decisions on a minimum biofuels sales obligation before the end of 2006 and development of necessary legislation to provide for implementation.
Action: Over the next 15 years, transport policies will allow for an increasing proportion of biofuels in our fuel mix.
Action: The government and the biofuels industry will discuss opportunities for greater development of New Zealand-based biofuels, particularly cellulose-based biofuels.
2.3.1.2 Electric Powered Vehicles
About 70% of electricity generation in New Zealand is from renewable sources. The electrification of transport reduces greenhouse gas emissions, as long as marginal new electricity generation has lower emissions per unit of energy required compared with fossil fuel alternatives. To date, electricity use for transport has been confined to buses and trains.
The advantages of transferring a proportion of the light vehicle fleet to electricity would depend on the relative economics, potential for uptake and the level of petrol and diesel that was displaced.
Other benefits accrue from promoting vehicles (such as hybrid plug-ins and full electric cars) that produce lower or no harmful exhaust emissions in urban areas. Hybrid cars are available now, and a sales-weighted fuel economy standard might be a useful incentive to encourage motorists to use them.
To adopt these technologies as early as possible, we need to consider and remove potential barriers to the introduction of hybrid plug-ins and full electrics into New Zealand. Barriers potentially include how we presently classify our vehicles, the ability of these vehicles to conform to present safety regulations, our ability to collect land transport charges for roading costs from the new technologies, and the development of appropriate time-of-use metering for electricity charging in order to avoid motorists all recharging their batteries at peak times. The environmental impact of manufacturing and disposing of long-life vehicle batteries would also have to be considered.
Action: New Zealand will work to remove barriers to the early adoption of low emissions vehicle technologies, including hybrid plug-in and electric vehicles.
Action: The government will consider establishing a group of experts drawn from research and industry to advance consideration of implications of moving to significantly higher levels of biofuels beyond 2012 and the introduction of plug-in electric vehicles (hybrids or wholly electric) in significant numbers.
2.3.2 Improving Fuel Efficiency
Vehicles on New Zealand roads use the large majority of our transport fuels. Increasing the fuel efficiency of vehicles on our roads offers the largest potential gains in reducing greenhouse gas emissions. Fuel efficiency can be improved by the technology of the vehicle driven and behaviour choices, such as how the vehicle is driven and how many people are in the vehicle.
Recent increases in fuel prices at the pump have led to some consumer demand for smaller, more fuel-efficient vehicles. However, the ability of these price fluctuations to significantly improve the fuel efficiency of the fleet over a sustained period of time appears limited. The speed of uptake of new technology (including more fuel-efficient technology) is largely dictated by customer buying patterns. New Zealand traditionally has had a slow vehicle replacement rate and a large stock of cheap, older used vehicles.
The launch of the Fuel$aver website in 2006 has made it easier for New Zealanders to find information on fuel efficiency, while the annual EnergyWise Rally has successfully promoted the benefits of fuel efficiency and fuel-saving driving techniques.
Driver behaviour can help improve the fuel economy of the existing vehicle fleet. Differences in driver behaviour alone can vary fuel use by up to 35%,22 and it has been estimated that a targeted driver training programme for heavy vehicle drivers could give energy savings of at least 10%, or 6.1 PJ per annum.
Action: The government will consider measures to improve the fuel efficiency of vehicles on New Zealand roads, including:
- mandatory labelling of vehicles for fuel efficiency at point of sale;
- requiring government fleet purchases to lead by example;
- restricting the import of less inefficient second-hand vehicles in conjunction with air quality control measures, including consideration of restrictions based on age;
- developing a regulated sales-weighted fuel economy standard for new and second-hand vehicle imports;
- varying the costs when a vehicle is bought, registered for the first time or has its annual charge to reflect vehicle fuel economy (in other words, lower charges for more fuel efficient vehicles);
- further investigating opportunities to improve driver behaviour and their commitment to fuel economy.
Action: As a response to emerging vehicle technologies, increased fuel economy and alternative fuels, the government is exploring the need to move, in the long term, to a distance-based charging regime for all vehicles to meet land transport costs.
2.3.3 More Efficient Means of Transport
Between 1999 and 2006, estimated passenger use of public transport increased by 68% in Christchurch, by 43% in Auckland and by 23% in Wellington, replacing an estimated 49 million car trips. Rising fuel prices are one reason for the increase.
Investment in public transport in cities has increased significantly. In 2004, the government re-purchased the rail network and committed to spend $200 million upgrading the track, while Toll Rail is spending $100 million on new rolling stock. The government will spend a further $600 million over the next four years on renewal and upgrading of the Auckland rail network. Over the next decade, the government will allocate $276 million to upgrade commuter rail services in the Wellington region.
As New Zealand's largest population centre, Auckland requires special attention. In 2005, Auckland developed a new Regional Land Transport Strategy that recognised its level of public transport was only half that of comparable cities. The new strategy aims to double public transport patronage over the next decade. The main aim is to reduce traffic congestion, but the proposal would also reduce private car fuel consumption by an estimated 52 million litres of fuel (approximately 2 PJ of petrol and diesel) per year by 2016. The strategy's affordability is the subject of the Auckland Transport Strategic Alignment project.
Local councils, particularly those in urban and semi-urban areas, play an important role by providing public transport services, developing Travel Demand Management Plans and implementing programmes to support non-motorised means of transport, such as Walking School Buses.
Walking and cycling are actively supported through the government strategy Getting there - on foot, by cycle. Policies that encourage use of more fuel-efficient modes of transport are also expected to increase the number of vulnerable road users such as motorbikes, smaller cars, pedestrians and cyclists. Their safety needs to be considered.
Action: Public transport and non-motorised forms of transport will need continued and increasing support.
In 2005, the government released the National Rail Strategy to 2015, which focuses on increasing the amount of freight and the number of commuters using rail. The Rail Strategy aims to reposition rail so that commercially viable freight services become attractive alternatives to road transport. Such a shift would also support a reduction in greenhouse gas emissions.
The amount of freight that can be switched from road to rail is limited by time, route and other specific requirements. However, in the long term, land-use decisions, including where to site industry and services, could benefit rail transport.
Siting activities that use heavy freight near ports and ensuring good links to the rail network could also encourage the use of coastal shipping services. The government is presently looking at ways to promote maritime transport and is developing a New Zealand Shipping Strategy.
Action: Continue to support lower emissions alternatives to road transport.
Action: Work with those involved in the shipping industry, including associated rail and road operators, to develop a New Zealand Shipping Strategy.
2.3.4 Security of Supply
Around 86% of New Zealand's oil consumption is used in the transport sector. Energy security for transport can be improved through measures that address short-term disruptions, increased diversity in the fuel mix, greater use of domestic fuel supplies, and reduced demand for transport energy.
New Zealand manages the risk of short-term supply disruptions through its membership of the International Energy Agency (IEA). We are required to hold 90 days of oil reserves (measured as net oil imports) as a buffer and to have the capability to reduce oil demand to enable the IEA to ease supply and demand pressures in the event of a major market disruption.
New Zealand is currently below its 90-day obligation, mainly because of declining domestic oil production. The government is working to meet its 90-day requirement by tendering for additional reserve stock. It has limited domestic storage capacity, so expects to hold the reserve stock here and in Australia, the United Kingdom or the Netherlands. The government expects the storage arrangements to be in place by the end of 2006.
The government recently released a revised draft Oil Emergency Response Strategy for consultation.23 The strategy will be used as necessary to respond to international and national supply disruptions. It will set out the policy and operational approaches to managing an emergency disruption of oil supplies.
Action: The government will ensure that the 90-day reserve stock obligation is met and complete the development of an updated Oil Emergency Response Strategy.
New Zealand has sufficient coal reserves to fuel the transport sector through conversion processes such as transforming coal to liquids. However, both the transformation process and the use of the fuel results in significant greenhouse gas emissions compared to conventional petroleum fuels. While providing energy security, its use is not preferred until carbon emission can be captured and stored (either underground or via forests). Even then, it would not offer any significant advantage in greenhouse gas emissions terms than continuing to use conventional petroleum fuels.
Action: It is proposed that New Zealand continues to investigate the utilisation of coal supplies, (especially lignite) in an environmentally responsible way, particularly for the production of chemicals or electricity.
2.3.5 Diversity of Transport Fuels
Use of biofuels and electricity has already been covered under future fuels (section 2.3.1). Liquefied petroleum gas (LPG) is a reasonably efficient, clean-burning fuel. While some of the advantages of greater use of LPG are from a diversity and security perspective, there are also some modest gains in reducing greenhouse gas emissions. As most LPG is sourced from New Zealand there may be the potential to increase the amount of LPG that is used by the transport fleet.
Action: The government recognises the contribution that biofuels, electricity and LPG can make to improving energy security for the transport sector.
Use of hydrogen technology could improve energy security by ensuring greater diversity of fuel sources. It would also reduce greenhouse gas emissions from the transport sector if it were produced from renewable resources or from fossil fuels, as long as the carbon dioxide released during the production process could be captured and stored.
However, a number of significant technical issues have yet to be resolved before hydrogen fuel technology can be widely used, including those relating to storage and transportation. As a result, hydrogen is expected to have only niche uses for the next 25-30 years. In addition, the development of hydrogen fuel-cell vehicles supplied by distributed hydrogen would require significant lead time to address safety, distribution and infrastructure issues.
Action: New Zealand will continue its research into developing and commercialising niche applications of hydrogen. It will also strengthen opportunities for international collaboration to ensure it can be a fast adopter if use of hydrogen as an energy carrier becomes commercially viable.
2.4 Into the Future
Many of the measures discussed above will be addressed in the replacement NEECS.
There are other longer-term initiatives that will contribute to the development of a resilient transport system that is less reliant on oil. In particular, the government's Digital Strategy and its support for broadband will reduce pressure on transport services by promoting teleconferencing and other means of distance-based communication.
Emerging technologies will also play a significant role in reducing greenhouse gas emissions from the transport sector in the future. These are discussed in greater detail in Chapter 6.
Walking School Buses have proved a fun and safe way for children to walk to and from school with adult supervision. Each bus walks along a set route, with at least one adult "driver" picking children up at designated stops and walking with them. Walking School Buses have been introduced in schools around New Zealand and are a popular way to reduce traffic, encourage fitness and help children learn road safety.
Pupils at Gladstone Primary School, Mt Albert, Walk from School
Photo courtesy of APN.
2.5 Have Your Say
This chapter discusses measures to reduce greenhouse gases from our transport system. The government welcomes feedback on questions raised in this discussion, such as:
On energy security:
How important is it for New Zealand to be more self- reliant for transport fuels, for example, through the development of local biofuels and electricity as a transport fuel?
On biofuels:
While the government has agreed to introduce a minimum biofuels sales obligation, should New Zealand aspire to reach a higher level over time? If so, how could this be achieved?
On public transport:
Do you agree government spending on public transport should continue to increase, recognising the wider benefits this brings?
On emerging technologies:
How much priority should New Zealand give to monitoring the latest transport technologies?
Should we have a role in developing these, or are we better to wait until the technologies become available and then import them?
On improving fuel economy:
Should the government take steps to improve the fuel efficiency of the vehicles on our roads? If so, what tools (regulation, incentives, information) should be used?
If so, how stringent should these measures be?
On electric powered vehicles:
Do you agree with a policy to encourage early uptake and use of hybrid plug-in and full electric vehicles? If so, what should these measures be?
On freight:
A number of factors limit our ability to increase significantly the amount of freight being transported by trains and ships. Should the government be doing more, and, if so, what? Do you agree with the need to develop a New Zealand Shipping Strategy?
On urban design and kilometres travelled:
Should the government be more active in influencing decision-makers to take into account transport energy and infrastructure cost considerations when making land-use decisions? If so, what tools (regulation, incentives, information) should be used?
How can government best encourage individuals and businesses to make sensible changes to the way and distance they travel?
On responding to changing vehicle technologies and fuels:
Do you agree that, in the long term, there is merit in changing to a distance-based charging regime in order to ensure adequate land transport funding, irrespective of which fuels vehicles use?
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