A realistic look at decarbonising road freight

By Nick Leggett, CEO, Road Transport Forum

The ongoing discussions and debate around the world’s climate ‘emergency’ will not abate. As a result, you will continue to hear from me on this topic and I won’t apologise for that.

Road Transport Forum will release its response to the Climate Change Commission’s Draft Advice for Consultation once it is submitted. Unsurprisingly, we have a lot to say; when do we not?

New Zealand’s transport industry must confront the need to significantly reduce greenhouse gas emissions over the coming decades. How fast we can do that, will be almost entirely dependent on the research and development that goes into alternative fuel sources that can be used to power heavy transport in the New Zealand market. It’s going to require significant incentives from government, willing industry customers, and reliable technology that will allow us to shift our transport movements to low or no emission options.

Before we consider New Zealand’s position and response to climate change, we have looked to see what international transport industries are telling us. Bigger markets have more money for research and development.

A very useful Deloitte study – Decarbonizing road freight: Getting into gear – commissioned by Shell in Europe, looks at the challenges faced by heavy transport. Globally, the sector accounts for about 9% of Co2 emissions – here in New Zealand, we estimate it is around 6%. Demand for goods delivered by road transport is likely to steeply increase (by over 50% by 2050) over the coming decades but to be able to meet the targets set out in the Paris Agreement, absolute emissions from road freight will need to decline almost 60% by that date.

The Deloitte report shows that insufficient regulatory incentives, a lack of infrastructure, and the lack of a willingness from customers to incentivise lower-emission road freight, are significant impediments to progress. Sound familiar?

Once incentives are there for transport operators, and the technology is also in place, asset replacement to that technology will have to occur. This is going to take time – probably well over a decade once we get to a point where there is confidence to make the shift. Decisions will have to be made now about when to replace current vehicles and whether to extend truck lifespans to avoid risk of resale loss.

The advice from international firms is that operators should experiment, pilot alternative energy vehicles, and not wait for the perfect solution. It’s positive to see transport operators beginning to dip their toes into the water of fossil-fuel alternatives in New Zealand, but it is early days and they still need to have a reliable fleet moving their customers’ products.

Industry is clearly beginning to take up transition technologies such as bio-fuel, “to reduce the tailpipe emission profile of today’s trucks”. This is a pragmatic choice for operators who recognise that these are better than nothing and that it is all many of them have to practically reduce emissions. It’s likely that with the recent New Zealand Government mandate on biofuels, our own operators who own the right kinds of vehicles, will likely be responding in a similar way.

There is a strong belief by the international transport workforce that the decarbonisation agenda is an important one for their firms to be part of. Some 70% of respondents to a survey for the Deloitte report believed that decarbonisation should be in their firms top three focus areas.

The report notes that reducing emissions is a global effort and we have to learn from others. Never is that truer than in a small market at the bottom of the planet, such as New Zealand. That isn’t a defeatist statement; merely realistic. RTF will attempt to inject realism into these discussions as they relate to the transport operators we represent.