125 June 2010 CER

The Voice of European Railways

Measures to develop a sustainable transport system

“Future of Transport” conference, Leuven, 25 June 2010

Matthew Ledbury, Senior Policy Adviser (Environment)

225 June 2010 CER

The Voice of European Railways

Transport: only sector in which GHG emissions are increasing

Source: EC 2007 and UIC Energy/CO2 database

Sea and IWW; 183 (15%)

Road896 (70%)

Other (pipeline) 10

(1%)Railways20 (2%)

Aviation150 (12%)

CO2 emissions 2005 in EU27 (million tonnes)

+25%

325 June 2010 CER

The Voice of European Railways

Trajectory of current transport emissions v. desired decrease in overall emissions

425 June 2010 CER

The Voice of European Railways

Transport forecasts expect continued future growth

source: European Environment Agency TERM Report 2010 (EEA 2010)

Mio. Passenger kilometres – EU 27 Mio. Tonne kilometres – EU 27

525 June 2010 CER

The Voice of European Railways

Where should reduction efforts be made?

“…in order to reduce transport‘s GHG emissions by around 89% compared to 1990, it is essential that both technical and non-technical options are taken up. Given the already ambitious assumptions underlying the technical scenarios, it would be very challenging (if not impossible) to deliver such levels of GHG emission reduction by stimulating technical options alone…”

‘EU Transport GHG: Routes to 2050?’ studyFinal report published June 2010

625 June 2010 CER

The Voice of European Railways

Why an overall target for reducing transport emissions is needed

2020

20202020

2020

100

80100

100

80100

Greenhouse Gas Emissions Transport volume

80%

80%

70%

70%

73%

180%

73%

180%

1. Mode specific targets: Each sector reduces transport volume and thus GHG Emissions by 20%

2. Overall transport target: substantial modal shift to rail, lower specific emissions, absolute emissions target reached without decreasing transport volume

2010

2010

2010

2010

In % of 2010: In % of

2010:

In % of 2010:In % of

2010:

Rail Road

Rail Road

Rail Road

Rail Road

Transport volume declines

Transport volume unchanged!

725 June 2010 CER

The Voice of European Railways

Role of economic instruments: effect of current low prices for road transport

EUR per litre petrol equivalent

Source: DG TREN, 2008

Road is perceived as the cheapest transport mode:

• Fuel prices largely stable (corrected for inflation)

• Productivity gains due to modern technology and logistics concepts

• Important costs are externalized to society

If prices are not adjusted, traffic volumes will continue to grow uncontrollably

825 June 2010 CER

The Voice of European Railways

Road does not cover its costs – government revenue hardly covers infrastructure cost

0

20

40

60

80

100

120

140

160

Fuel Taxes 33

Road tolls 16

Other Taxes 5

Infrastructure 51

Accidents 30

Congestion 24

Noise 18

Air pollution 16

CO2 Emissions 5

EU 27 – HGV Revenues and Costs in billion Euro

Total Revenue: 54

Total costs: 144

Source: Are Trucks taking their toll? (CE Delft, 2009)

?Price Gap

925 June 2010 CER

The Voice of European Railways

Internal costs (€/lorry km)

(paid by users)

External costs (€/lorry km)

(paid by society)

Wages

Energy/Fuel

Rolling Stock

Administration

Other1)

TOTAL

Infrastructure

Air pollution

Climate change

Accidents

Congestion

Noise

Other2)

TOTAL

0,39

0,27

0,21

0,18

0,21

1,25

0,20

0

0,04

4

0,12

2

0,05

5

0,09

0

0,00

4

0,07

8

0,51

5

Source: Internalisation of External Costs on Transport, IWW Karlsruhe 2009

1) E. g. insurance, taxes, etc.2) E. g. land use, water and soil pollution, etc.

External costs need to be internalised following the “polluter pays” principle

1025 June 2010 CER

The Voice of European Railways

Source: Internalisation of External Costs on Transport, IWW Karlsruhe 2009

Internalisation of external costs would change modal split of freight

1125 June 2010 CER

The Voice of European Railways

Conclusions

The ‘avoid-shift-improve’ strategy should be followed for reducing emissions

The better use of price signals to improve the efficiency of the transport system through internalising external costs is essential

In order to properly address CO2 emissions, a reduction target specifically for the transport sector should be established

Investment in transport should be focussed on where it will help reduce emissions from transport as a whole

1225 June 2010 CER

The Voice of European Railways

Thank you for your attention!

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