Smaller, smarter and more efficient vehicles are the future of transport...
According to ‘Repowering Transport,’ a new report recently released by the World Economic Forum, countries seeking to reduce oil dependency as well as emissions of their transport sector must support the development, distribution and adoption of new technologies through a structured policy approach, public-private partnerships, risk hedging and collaborative financing.
As things stand today, global transportation and fossil fuels (petrol, diesel) are inextricably linked. More than 60% of the 87 million barrels of oil consumed every day power the world’s transportation system. And if you’re wondering whether the Toyota Prius and its ilk have made a significant difference, get this – liquid fossil fuels account for more than 96% of the current energy supply to the transport sector.
The ‘Repowering Transport’ report estimates that an annual investment of about US$400 billion would be required to achieve just 25% penetration of alternative energy sources (electricity, biofuels, CNG/LPG) from 2010 to 2030, and reduce total oil consumption in the world’s transport sector by 0.5% per year. However, even though that’s a massive sum of money, it’s still relatively moderate compared to the US$740 billion needed every year in global oil subsidies and maintaining status quo in the worldwide transport sector.
According to the Repowering Transport report, lack of financing for ‘green’ transportation is not because capital isn’t available. Instead, it’s because of the uncertainty prevalent in the regulatory environment and the challenges in risk assessment in this area. To deal with this, the report proposes a two-pronged policy approach to achieve energy diversification – establish and impose fuel taxes and carbon fees, and set progressively higher fuel efficiency performance standards.
While India hasn’t made any significant efforts to reduce its transportation sector’s dependence on oil, countries like China and Brazil have taken strong steps in this area. China has pledged a US$15 billion investment in electric vehicles, coupled with a tight-knit collaboration between government and private enterprise, aiming to put 5-10 million electric vehicles on the road by 2020. Brazil, on the other hand, has been promoting the use of biofuel, which today powers a fifth of the country’s entire transportation system. It’s time India also sat up and took notice of these initiatives. We need to figure out, as soon as possible, what steps we need to take in the short- to mid-term future.
‘The report finds that oil will continue to be the dominant fuel for transportation over the next 20 years but innovative partnerships among business, government, academia and civil society marks are accelerating technology development of alternative sources,’ says John Moavenzadeh, Head of Mobility Industries at the World Economic Forum. Countries like Canada, Sweden, the United Kingdom and the US have started work in a big way towards forging these partnerships and making them work. We, here in India, need to make sure we don’t get left behind.
