Fueling the Future Podcast

Fueling the Future Podcast
By Fueling the Future Podcast
About this podcast
Despite a prolonged period of low crude oil prices, citizens and policymakers in many countries have never been more serious or committed to combating climate change in all sectors, including transport. GHG emissions are increasing, and so is transport-related air pollution. But with oil prices so low, people are driving more than ever. Meantime, the December 2015 Paris Agreement will force steep cuts in transport-related GHGs. Countries are now responding with new “low carbon fuel and vehicles” (LCFVs) initiatives requiring biofuels blending, electrification, other alternative fuels and tough fuel efficiency standards, among other measures. The stakeholders in the transport space have never been more challenged, but opportunities abound to deliver sustainable solutions to the market while growing shareholder value. This podcast explores these issues with top global experts in the field. Want to learn more? Check out www.futurefuelstrategies.com!
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By Shava Sadhana
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Nov. 30, 2017
Recently I spoke with David Rapson, Associate Professor in the Department of Economics and Co-Director of the Davis Energy Economics Program (DEEP) at the University of California at Davis (UC Davis) about a study he co-authored with colleagues from UC Davis, Yale and MIT called, “Attribute Substitution in Household Vehicle Portfolios.” Essentially, the team revealed an unintended consequence of tighter fuel standards as reported in CityLab: When a two-car household replaces one of its vehicles, a household that already owns a fuel efficient car tends to buy one that has less for its second car. This decision making erodes more than 60% of the fuel savings that first car should have yielded. Following are a couple of highlights from our discussion. You can listen or download the podcast below or listen to it in ITunes. On the Most Surprising Findings in the Study: “Well, the main result is that there actually does seem to be a very strong relationship between the attributes of a car that you have when you buy a new car, the car that you already have in your portfolio, and the car that you end up buying. And so we have a thought experiment in mind that forms the basis for our empirical approach in this project. So when you think about it, for two-car households in an ideal world we would want them to flip a coin and drop one of those cars, just sell it or retire it. They’re then with a car that we call the “kept car,” and our research question of interest is how do the attributes of that kept car influence the choice of the next car that’s bought?   And in particular, we’re curious about how the fuel economy of the kept car affects the fuel economy of the bought car. And what we find is that it actually has a very strong effect. If you were to cause a household to buy a fuel efficient vehicle today, then the next time they replace a vehicle, they’re going to choose a less fuel efficient car. And there are lots of reasons why this might be the case, but the extent to which that shows up very clearly in the data, is the most surprising thing to me. It does appear that households really are viewing the cars that they own as a portfolio. So they may, for example, want to have one car that is fuel efficient and then another car that has more power or comfort or safety or seats, and those attributes that I just named are negatively correlated with fuel economy. If you care about both fuel economy and all those other things, then if you force a household to buy one car that’s more fuel efficient, they might then go and buy a less fuel efficient car next time, and that’s in fact what we find.”   On What The Study Means with Respect to the Effectiveness of Fuel Economy Standards: “This is a belief that I and many energy economists have held for quite some time, and this study that we’re discussing today is just one other reason why we do, but I think taking a step back and looking at the incentives that fuel economy standards produce in the transportation economy is something that’s worth doing. If your goal is to reduce gasoline usage, or say reduce greenhouse gases, then fuel economy standards are going to produce some incentives that act in the direction of achieving that goal, but there are going to be unintentional incentives that accompany the way that it’s set up, that act in the opposite direction. I think it’s really important if we care about carbon emissions, carbon abatement, and the cost effectiveness of climate change mitigation policies, then we really should be concerned about the unintended consequences of this type of policy. And I can describe to you just in very plain English, a few of the things that are going on there with fuel economy standards.   The way they’re set up, fuel economy standards require a vehicle fleet-weighted average fuel economy for each manufacturer. So let’s say that the standard has set an average of 25 miles per gallon, then say Ford would have to sell cars the weighted average fuel economy of which exceeded that threshold. What that essentially does is it makes it more costly for them to sell gas guzzlers, which causes them to raise the price of that a little bit, so it’s like taxing gas guzzlers. And, it’s like subsidizing gas sippers or fuel efficient cars, because in order to comply with that subsidy they need to get the right mix. And on the face of it that sounds quite reasonable, to tax gas guzzles and subsidize gas sippers.   But when you actually think about it, if our goal is to reduce gasoline demand, we don’t want to subsidize cars that consume gasoline, we want to have fewer cars on the road that are consuming gasoline, so we don’t want to subsidize any of them even if they’re fuel efficient. So that’s one area where the policy is going to be imperfect. Another is that it’s putting households, putting consumers into cars that are less expensive to drive a mile. I think many of your listeners might be familiar with the term the “rebound effect.”  This is a common feature of energy efficiency interventions where they reduce the cost of producing whatever the energy consuming durable is doing, so in this case we’re talking about transportation.   A fuel efficient car costs less to drive a mile and what happens when something costs less? We consume more of it, and so that incentive is operating in the opposite direction to what we want. We would like people to be driving less if our goal is to reduce the amount of gasoline that’s consumed. Our best read of the literature is that the rebound effect is large, it’s probably somewhere between 20 and 60 percent of the anticipated savings from making a car more efficient on average is going to be eroded by all of the follow on rebound effect incentives that are created. ”   The post David Rapson: We Need Reconsider How We Set Fuel Economy Standards appeared first on Future Fuel Strategies.
Nov. 24, 2017
Recently I interviewed Jeffrey Rissman of the NGO Energy Innovation about an interesting couple of articles recently published on Forbes online and the NGO’s Energy Policy Simulator. What caught my eye was the headline, “Four Policies Can Reduce U.S. Transport Emissions 45%, Cut Oil Use 23%, Save 5,300 Lives Per Year,” which was produced based on analysis conducted using the Simulator. I also wrote about it recently for my regular Top 5 feature. A prior set of articles dealt with an outlook on electric vehicles. Following are a couple of highlights from our discussion. You can listen or download the podcast below or listen to it in ITunes. On What Surprised Him Following the Analysis: “I guess I’m somewhat surprised. I mean, one of the benefits of having an objective tool with all of this transparent data is you can run it and see what comes out. If it leads to an insight, a good policy I was overlooking because it hasn’t been in the news very much or whatever reason, then the Simulator’s doing its job. A feebate [one of the four policies] is sort of like that where it’s just not a policy we tend to hear a lot about, but I understand why it’s strong after the Simulator reads out to me. It’s both a tax and a subsidy rolled into one and it helps overcome this psychological barrier where people are so cost sensitive to the upfront cost of a vehicle and much less so to the lifetime fuel savings of the vehicle. It sort of make sense in retrospect.   As far as the low carbon fuel standard dimension, that’s also a policy we can model and it is a strong policy in our simulation, at least out through 2030 or so. We saw a drop off in effectiveness after that point because we were seeing current levels of electric vehicle penetration high enough to satisfy the low carbon fuel standard settings we were choosing in our policy package. To continue to be effective beyond 2030, assuming that the world does in fact follow a strong EV deployment trajectory, it may be necessary to implement sort of an accelerating low carbon fuel standard to ration it up significantly in those out years.” On How Electric Vehicles Are Considered in the Analysis: “So, EVs are a very important factor in how the transportation sector, at least in the United States, evolves in the next 10 to 15 years and even more so, I think out to 2050. That’s because they gain a lot in market share. Our simulation had a fairly aggressive prediction for EV deployment, showing it could be up to 65% of new vehicle sales by 2050. That would require strong deployment of charging infrastructure. As I said, it’s a bit of a bullish prediction, but actually less so than Bloomberg New Energy Finance’s prediction. This is something that drives decarbonization into the transportation sector, even in a business as usual (BAU) case. In our modeling, the transport sector is the only sector in the U.S. economy that achieves emissions reductions through 2050 in a BAU case. The other sectors do require additional policy to get there.” The post Jeffrey Rissman of Energy Innovation: Four Policies Can Cut U.S. Transport Emissions 45% appeared first on Future Fuel Strategies.
Oct. 23, 2017
Recently I interviewed John DeCicco, Research Professor at the University of Michigan Energy Institute, about a study he and his team completed last year on the Carbon Balance Effects of U.S. Biofuel Production and Use. In August 2017, a team lead by Ford published a commentary on that study which prompted a reply from Professor DeCicco. That prompted me to ask both the Professor and a representative from the Ford team to discuss the study and commentary in a Q&A session for Future Fuels Outlook service clients. Professor DeCicco accepted, but Ford declined. Instead, I did a podcast with the Professor to discuss a range of issues concerning not only the study and commentary and how he sees the issues, but lifecycle analysis (LCA) generally, where next generation biofuels fits in, what the future of biofuels will likely be as he sees it, and what kind of transport policy we should really be thinking about globally. Highlights from the discussion follow below. You can listen or download the podcast below or listen to it in ITunes On the Study and Its Key Findings: “We honed in on this key assumption regarding the balance between the input and output as I like to put it. Again, input is CO2 coming from the atmosphere into the landscape, into cropland as it grows crops, and then output is, of course, the emissions from the tailpipe and any processing emissions at refineries or along the way. So that was really the premise: let’s just take a clean sheet of paper, look at what happened during this period where we had a very rapid expansion of biofuel production and use in the United States [under the Renewable Fuels Standard (RFS) program]. What we found was that the input and output were not in balance. We found when we looked at cropland data and we used standard U.S. Department of Agriculture, USDA, crop harvest data, that there wasn’t enough gain in the amount of carbon being taken up by the crops to fully balance out the CO2 emitted when the biofuels are burned. In the case of ethanol, there’s also CO2 emitted when the ethanol is fermented.” On to the Renewable Fuels Association’s (RFA’s) Comments on the Study, Especially that the Study Is Not Legitimate Because It Was Funded by the American Petroleum Institute (API): “I will fess up to being skeptical of the claims of biofuels for many years, but I make that point in part to then address this other allegation by the Renewable Fuels Association that my work, because it’s funded by the American Petroleum Institute, is not legitimate, that it’s been distorted or something — distorted science for the sake of making a point. Well, my skepticism about biofuels long predates my accepting funding from API. And when we put this contract together, we were very careful. We worked with university lawyers to make sure that the funder had no undue influence on the results, that we were free to come up with what we came up with through our analysis. As I said, the study, while new, builds on several years of critical work that I had published that were increasingly critical about biofuels and scrutinizing this assumption of carbon neutrality, the input versus output balance question. So before the API funding, that study was basically done without any specific external funding, and that was the basis for the analysis.” On “Swimming Upstream” in the Lifecycle Analysis (LCA) Community: “The point I’m making here is that yes, the lifecycle community has really grown up. As you said, it’s become a cottage industry. A lot of people have latched onto that. In fact, policymakers have latched onto that. It’s written into the RFS language by Congress. California has written a lifecycle analysis into the Low Carbon Fuels Standard. It’s the basis for that. Other jurisdictions that are implementing renewable fuel policies all have some form of lifecycle analysis as part of that policy. What happened though, is it’s a case where policymakers latched onto this, I think with good intentions. The lifecycle provisions put into the RFS, which were inserted when the RFS was expanded by the Energy Independence and Security Act of 2007, or EISA, as we like to call it, were advocated by green groups.   A consensus grew up around this paradigm even before the paradigm had actually been validated with field data, with real, say, fundamental empirical scientific work. It was all done on the basis of modeling. So it’s in many ways a tragic situation because lots of well-intended people have embraced this paradigm. At a certain simple level, it sounds good, it seems to make sense, even though in my view, it’s really the wrong way to analyze the situation. And as I said, when I consulted with and talked to lots of structural ecologists, they have no problems with my work. It passed peer review and the Journal of Climatic Change, which is a premier journal on the subject. What we have here is a situation of two different scientific communities that don’t talk to each other that much.” On the Ford Commentary of the Original Study: “But you have to bring it all back to the real world, not just the world that you model. If you compare those two things, [gasoline and ethanol], there’s something wrong with the story. They say well cropland is not part of the gasoline lifecycle, so we’re not looking at it when we analyze petroleum gasoline, but cropland is part of the biofuel lifecycle, so we count the CO2 from photosynthesis when crops are grown. Well, in the real world, the cropland is there whether or not you’re making biofuels. That’s the rub. That’s where my analysis departs…The world always has cropland in it and that cropland is always removing CO2 from the atmosphere whether or not the harvest is being used for fuel. So that is really the crux of the issue. There’s basically a conceptual disagreement about how to look at the world.” On How Next Generation Biofuels, Like Cellulosic Ethanol, Would Fare: “That being said, if we did the kind of analysis that I feel is the correct analysis as I’ve done, what I have been calling ABC, annual basis carbon accounting, which means you’re looking at the actual carbon a year at a time, some of these cellulosic tools would probably come out okay. They would not come out as well as the computer models, the lifecycle models they come out, but they would be potentially beneficial. If you look at this from an economic point of view, cost benefit analysis, the cost benefit equation does not look very good. The bottom line is that these cellulosic fuels are likely to remain for the reasonably foreseeable future a very economically poor way to address CO2 emissions. I say the outlook for these cellulosic fuels is not very optimistic. Again, I’m not denying that they couldn’t be beneficial, but we simply don’t even have anywhere near the scale of real-world experience to actually measure how beneficial they turn out to be and as I said, if we measured correctly, they’re not going to look as wonderful as they’ve looked on paper.” If Not Biofuels, Then What to Reduce Transport CO2?: “My analysis actually implies that instead of trying to make biofuels, we should be doing a lot more forest protection, regrowing forests, grassland protection, building up carbon stocks in the atmosphere on land and protecting the atmosphere by building up carbon stock from land rather than taking that land, increasing the pressure on it by putting fuel demands on top of food demands, which ends up releasing carbon from the land as opposed to building it. In short, we should be using what good land we have for a lot more reforestation rather than converting it to biofuel production…   …I’m obviously very critical of biofuels from the environmental perspective. I know I should never say never, okay? I’m not saying there never will be a role for biofuels as part of the climate solution. What I am saying is that for that to happen, we first better get the modeling analysis right. We’ve got it badly wrong, so there’s a lot of work to do there. When it’s done right, the scale and scope is going to look a lot less ambitious than what people thought it was based on the lifecycle model that was part of the premise for the expansion of EISA. It’s really a question of getting realistic about the extent and timing for biofuel use. The real missing link here goes back to what I said: we need to reforest.”   Note: I mentioned in the context of the discussion about the Professor’s collaboration with Tim Searchinger that the two had completed a paper. I want to clarify that it wasn’t a paper, but a policy statement issued in 2002 and that can be accessed here. The post John DeCicco: The LCA Is the Wrong Way to Look at Biofuels & CO2 appeared first on Future Fuel Strategies.
Oct. 3, 2017
Recently, I spoke with Adam Gustafson who represents the Urban Air Initiative (UAI) and is also a partner at Boyden Gray & Associates. UAI, as Adam noted, “exists to remove regulatory barriers to improving fuel quality for the purpose of cleaning the air and improving human health. And Urban Air Initiative believes that the best way to do that is by reducing the harmful components of fuel by increasing the ethanol portion of the gasoline.” We talked about EPA’s REGS rule, its modeling of vehicle emissions, the Coordinating Research Council (CRC’s) recent emissions studies and how they impact ethanol, the new Administration and what that means for ethanol, and other topics. You can listen or download the podcast below or listen to it in ITunes. On UAI’s Comments to EPA’s REGS Rule: “It may be what the agency intended [to increase ethanol blending] but unfortunately, the proposal that EPA issued would actually substantially limit ethanol use in motor vehicle fuel. It does that by a misinterpretation of something called the ‘Sub-Sim’ law. This is a piece of the Clean Air Act, section 211f that EPA has traditionally interpreted to limit the ethanol content of fuel. The Sub-Sim law simply says, and I should quote from the statute because it is important, ‘that it is unlawful to first introduce into commerce, or to increase the concentration and use of any fuel, or fuel additive, for use by any person in motor vehicles, which is not substantially similar to any fuel or fuel additive utilized in the certification of new motor vehicles.’   So, when an auto manufacturer produces a new vehicle, they have to demonstrate to EPA that it is going to comply with EPA’s emissions standards, and to do that, they run the vehicle on a dynamometer, measuring the outputs from the tailpipe and using a test fuel with specifically set parameters. EPA has interpreted the Sub-Sim law to mean that the fuel used in the market cannot have a higher ethanol concentration than the fuel used in certification testing without a waiver of the Sub-Sim law. The problem with EPA’s interpretation is that that is not what the law says at all. The law only limits the use of fuels or fuel additives that are not substantially similar to fuels or fuel additives used in certification. And as of this year, 2017, the gasoline certification test fuel contains 10 percent ethanol.   After the Tier 3 rule, which introduced this E10 gasoline certification fuel, ethanol is clearly a fuel additive used in certification. And so, we argue in our comments that because ethanol is a fuel additive used in certification, EPA cannot control the concentration of ethanol in market fuel through the Sub-Sim law. Instead, if EPA wants to control the ethanol concentration of gasoline, it has to do so through its ordinary authority to control gasoline components, and that is in a different provision of the Clean Air Act, section 211c. And these two provisions of the law are different in an important way. Ordinarily when EPA wants to impose a limit on a market fuel, it has to find one of two things: either that the fuel or fuel additive that is controlling is bad for human health or that it impairs emissions control devices.   That is very different from the Sub-Sim law. If a fuel manufacturer wants to sell a fuel that is not substantially similar to one used in certification testing, the manufacturer has to show EPA that the fuel will not result in any impairment of emissions control devices. So, by relying on the Sub-Sim law to do the work that should be done under a different provision of law, EPA is basically shifting its burden to the fuel manufacturer, who now has to get a waiver of the Sub-Sim law by showing that the fuel will not impair emissions control devices, essentially proving a negative. We filed comments explaining that EPA’s interpretation of this law is inconsistent with the plain meaning of the statute, and improperly shifts EPA’s legal burden to fuel manufacturers. Those comments were filed in February I believe, and EPA has not yet taken any action to finalize the rule, and we do not know if EPA will do so. It is possible that since this rule was issued under the prior administration, the current EPA may decide not to finalize the rule as proposed and withdraw or substantially revise it.” On EPA’s Lifecycle Analyses of Ethanol: “On the issue of lifecycle analysis, EPA is woefully behind in keeping up with the science. EPA continues to rely on a 2010 analysis of ethanol’s lifecycle carbon intensity.  This is a measure of all of the carbon emissions of the fuel starting with agriculture to actually combusting the fuel in the vehicle. Back in 2010, when EPA did its first RFS [Renewable Fuels Standard] rule, EPA estimated that corn ethanol was 21 percent less carbon intensive than petroleum than ordinary gasoline. That was the best estimate EPA could come up with then, but it has proven to be entirely false because it was based on assumptions that have proven to be inaccurate. Back in 2010, there were gross overestimations of the land use change that would result from increasing corn ethanol production. We know, empirically, that those estimates have not come to pass.   Corn ethanol has increased in volume primarily by increasing in intensity of agriculture through double cropping and increasing yield. And, the EPA’s 2010 analysis also failed to account for the soil carbon sequestration of corn ethanol, we know now that the corn plant takes carbon out of the atmosphere and buries it much deeper in the soil than had previously been measured. So, while EPA relies on an old model, the Department of Agriculture [USDA] and the Department of Energy have both invested in updated modeling of carbon intensity. USDA just came out with an estimate of corn ethanol as currently being 43 percent less carbon intensive than gasoline, with estimates that that number will continue to increase. We think that EPA should either improve its own analysis, based on the best available science, or simply adopt one of these other models, like the GREET model that the Department of Energy is continually updating.”   The post Adam Gustafson: Taking Down the Barriers to Ethanol Blending appeared first on Future Fuel Strategies.
Aug. 16, 2017
I met Jeff Wood at the Fuels Institute’s annual meeting, where we shared the stage and a panel to discuss the impact of urbanization and what it could mean for the fuels industry. Jeff is an urban planning specialist who runs his own consultancy, The Overhead Wire. On the panel, Jeff discussed comprehensive planning strategies that would take advantage of existing city structures and employ diverse mobility options to reduce the impact of transportation. I focused on different measures cities are taking to reduce pollution and mitigate traffic and climate change and the impacts we can expect on fuels. Read a post on the conference here. Jeff and I hit it off and I appreciated his insights on mobility, so I asked whether he would be interviewed for the podcast, and lucky for us all, he agreed.  You can listen to or download the podcast below or listen to it in ITunes. On How Autonomous Shared Electric Vehicles Could Evolve in Different Types of Cities: “What will happen is that cities like Tokyo or Vienna or San Francisco or New York City or those types of places will have urban cores and the surrounding areas where the vehicles are autonomous and they’re able to get around places and you can share. You’ll have automated buses and trains and all these great things, which is great, but it’s not going to happen everywhere. There’s two other cities types as well. The second city type is going to be a place where there’s an urban core and then there’s the suburbs, which are a bit different and lower density, which means that you’re going to have vehicles that are shared and electric.   Outside of downtowns, you’ll have people who own their own autonomous vehicles because they need to get around and the density is less. Then you’ll have a third type of city, which is basically those in the developing world that have traffic chaos on a daily basis where the vehicles aren’t necessarily going to be able to tell all this chaos of humanity that’s running around. You’re going to have electric vehicles and they’re probably going to be shared, but they probably won’t be autonomous because of the just pure competing power that will take place to get through thousands of motor scooters in Vietnam or wherever else.   You’re going to have those three different types of city. I think it is an interesting way to look at it. I don’t know if it is actually true or not. Whether this is going to happen, I think it is a good typology or a way to think about these things because not every place is going to be the same and places are going to be much different based on how many rules and laws they implement.   I think there’s going to be a transition period as well and take longer than we expect. I don’t think this is anywhere near coming to fruition. I want to make that abundantly clear that [this kind of shared electric autonomous mobility] is not going to be here tomorrow. Maybe within 20 or 25 years. I know that the car companies are very optimistic about the next 5 years, we’re going to have an autonomous vehicle on the road. Well, maybe you’ll have 1 or 2 and they’ll be testing and all that stuff. The technology is probably going to be there at some point in the next 10 years, but at the same time, people aren’t going to just openly adopt this kind of vehicle that drives you around. It’s a little scary for them.” On City Efforts to Ban Cars and Eliminate Parking to Mitigate Traffic Congestion & Reduce Pollution: “They’re going to try to ban parking because it does mean that when you do put up a parking space in a city, you’re bringing another car into the city. This is something that I always get on my old adopted home town of Austin about. They complain incessantly about traffic, but then nobody talks about all the parking spaces they’re building downtown. They might have a four-story parking garage underneath a new building. They have plenty of parking for all cars that are needed downtown, but everybody wants to drive their individual car and park outside of their individual office. If we can figure out a smarter way to allocate spaces, then you’d have less vehicles on the road because then you have better transit and you have better bike access, etc.   Cities are going to do congestion pricing as well, which is basically charging to get into the center of the city. They do this in London and they do this in other cities around the world. Singapore is another example where they’re just not going to allow as many vehicles in the center anymore because it is a mobility issue to have people stuck. You don’t want to have a 50-person bus stuck behind a one-person car because the vehicle that you’re driving is getting in the way of 50 other people’s trips. It’s making everybody slower. That’s something that’s going to happen a lot. Restrictions downtown.   At the same time, cities and urban areas are going to have to figure out ways to get people around faster because people’s time is important and the speed at which they get places is important. Everybody should be treated equally in that sense. That’s kind of where I’m coming at it from because I know here in San Francisco, we just actually released a new study about Lyft and Uber that stated that 20 percent of VMT [vehicle miles traveled] in the city is from Lyft and Uber. That’s a huge change I imagine from just 5, 10 years ago when Lyft and Uber didn’t exist. Taxis were somewhat limited. People used private automobiles or they used the buses more frequently. Those are things that are going to be changing as the mobility environment changes, as autonomous vehicles come and even as new mobility changes.” On the Most Challenging Issues City Planners Face When It Comes to Mobility: “Well, I think you can probably throw climate change in there and pollution and particulate matter that causes asthma and cancer and other things, but mobility is such a big issue because it is an equity issue for the economy as a whole. I recently did a YouTube show for Google where we talked about the equity issue of people not able to get to school or work because they can’t afford transportation or they can’t get to where they need to go in a timely manner. If you’re late to your clock in, clock out job, your boss is going to be really upset. Even if you left at 3 am and your bus broke down, they’re not going to care. They’re just going to try to find somebody else. This is actually an equity issue and an issue for folks that really need access to places. We don’t think about that as much if we have a car or if we have access to really good transportation or we know that our boss might let us off the hook if we’re late a couple times, but there’s people that actually have to face this all the time. The same thing with education as well.”   The post Jeff Wood: Shared, Electric Autonomous Mobility Coming, but Not as Quick as Some Think appeared first on Future Fuel Strategies.
July 26, 2017
Recently, I spoke with Astrid Sonneveld, Head of Marine and International, for GoodFuels a developer and supplier of advanced biofuels targeting the road, rail, aviation and marine sectors. We spoke about the promise of marine biofuels to help decarbonize the sector. You can listen to or download the podcast below or listen to it in ITunes. On Governments and the IMO Taking More Action on Bunker Fuels: “If you look around toward sustainability topics being on the rise and the political agenda, I think maritime pollution is very clearly one of them. They see that apart from having a target in place, measures and simulations to get the solutions actually implemented is clearly there. At a national level, particularly in Europe and North America, it’s clearly there, but at the same time. At the IMO level, of course, it’s been an ongoing discussion on what to do with pollution for the maritime industry. You see that the pressure is building up. They were always pretty much the early ones to participate in the discussions. It’s already two decades that they have been discussing the pollution of coals in maritime fuels.   Today, there isn’t still a very clear plan for action being introduced, but ultimately the greenhouse gas reduction strategy is not yet determined. That causes a lot of external pressure as well. The current agreement is there. The shipping industry at the moment is the only big player in the world that doesn’t have a clear strategy moving forward in terms of emissions reduction. If the IMO wouldn’t continue to pressure the maritime industry to clean up the fuel mix, it would be very detrimental to the overall achievement globally.” On the Different Fuel Options for Ships Beyond Bunker Fuel Moving Forward: “I think if you look into, for example LNG and methanol, these are wonderful fuels to cut back on air pollutants, emissions, improve local air quality, but usually by default, you are opting for a cheaper option. This means that you still are opting for just another fossil fuel. In terms of decarbonization, there is still a big challenge that remains. You see some of the first mover countries as it comes to low carbon technology about to qualify some of these options as maybe outdated fuel choices in the sense that they are wonderful technologies, but it doesn’t really help a lot in terms of climate change.   In that sense, it would be a first half from the current fossil fuel to either LNG or methanol and then onwards, you would need to switch from LNG to bio-LNG, from methanol to bio-methanol and so on. It’s only a temporary solution. Marine biofuels are very quick and very easy answer to decarbonization if you choose the right feedstock and at the same time, they don’t require modification to the engines or  infrastructure. They can be made to just replace on a one to one basis replacing fossil fuels.” On the Biggest Market Potential for Marine Biofuels: “I think the biggest market potential for marine biofuels is on the territorial waters of those countries, the IMO member countries, that are pushing for decarbonization. They want to prove and showcase that it actually can be done and for example, start off with procured shipping services in their own territorial waters. That is a very clear sweet spot in the market from our point of view, but at the same time, you see if it comes to ships operating international waters, that part of maritime industry, there’s a pretty clear drive coming from cargo owners.” The post Astrid Sonneveld: Huge Potential for Sustainable Biofuels to Decarbonize the Marine Sector appeared first on Future Fuel Strategies.
July 10, 2017
Recently I spoke with Henry Kamau, Director of Sustainable Transport Africa about a range of topics concerning the future of fuels, vehicles and transport in Africa, including improving fuel quality, future emissions and fuel economy standards, electric mobility, public transport and biofuels. Highlights from the interview follow below. You can listen to or download the podcast below or listen to it in ITunes. About Sustainable Transport Africa: “Sustainable Transport Africa is an NGO, a nongovernmental organization, a not for profit that was registered in Nairobi in 2013. It is focused on the transport sector. As the Director of Sustainable Transport Africa, I am involved in identifying initiatives for the NGO to pursue. This has led to partnerships in transport-related activities for Africa with international organizations like UNEP, the Partnership for Clean Fuels and Vehicles. That’s within UNEP and the Electrical Mobility Program within UNEP. In addition, we have worked with the GFEI. That’s the Global Fuel Economy Initiative of the FIA Foundation. Sustainable Transport Africa worked on the initiative to phase out led in petrol in Africa and then moved on to reducing sulfur levels in diesel in Africa. We’re now working on improving fuel economy and reducing emissions, testing and introducing electric mobility. We’re also working on the introduction to BRT [bus rapid transit] systems in African cities.” On the Biggest Issue Facing African Countries When It Comes to Transport: “I think the biggest issue in Africa is that the cities in Africa that have the highest urbanization rates in the world. The population of those cities is really growing at unprecedented rates and ownership of vehicles ranks very high on the aspiration index for Africans. The first thing they want to do when they get a job after university, the first thing they’ll do with their salaries is buy a car. Not even a house. This has led to the unsustainable influx of imported used vehicles. Those are affordable. And new motorcycles, mainly used for public taxis. This results in heavily congested cities, causing air pollution and many are above minimum standards for air quality, resulting in increased health effects, such as respiratory diseases, various cancers, premature death, etc. The adverse health impacts impacted many on the non-motorized public, the majority of whom can’t afford medical treatment and even worse is the effect on urban children who are poisoned in much higher doses when exposed to poor air.   Several initiatives have been undertaken, primary improving fuel quality, to both reduce direct pollution and also to enable emissions control mechanisms in vehicles to function properly. This will be followed by the introduction of emission testing of vehicles later on. We’re also advocating for African governments to limit the age and mileage of used vehicles that are imported to the continent and we also attended meetings in London last year and in Geneva this year on this issue. Basically this was to seek support from the auto industry on used vehicles that are shipped to the African continent to allow for proper inspection and maintenance equipment to be available to us, as well as support in terms of supplies for this vehicles. We’re also involved in promoting ownership from private vehicles to public transport through the introduction of bus rapid transit systems, integrated with numerous transport facilities. On the technology front, we have been working on enhancing electric mobility of the continent which we can do because of abundant resources of renewable energy.” On the Practicality of EVs for the Continent: “To start off, Africa has an abundance of renewable energy supply that are providing over 70 percent of power in some African countries and over 50 percent in many African countries. Decarbonization through electric mobility therefore is a natural choice for Africa; however, the benefits of electric mobility are greater to sell to African governments, such as reduced urban air pollution, reduced fuel imports, reduced vehicle imports, exports, etc. These would all be beneficial to the government and African economies and it would be easier to sell electric mobility that way. We are currently involved in advocating for the introduction of battery electric motorcycles. Those prices have fallen to competitive levels. Motorcycle imports outnumber used vehicle imports, so this would have a significant impact for improving air quality in our urban centers.   We also participated in the development of Kenya’s transport plan on battery electric BRT buses for Nairobi, which was presented in Paris COP21 and succeeded in attracting funding. Also, in Cape Town, South Africa and Marrakech and Morocco, they are trying out battery electric buses in their BRT routes. Uganda has also developed a solar-powered, battery-electric bus, which was featured on CNN and the BBC. A number of Nissan Leafs are already in use on the continent and even a few BMW I8s. The interest is there on the continent for electric mobility. A lot of support is needed to develop vehicle charging infrastructure, both on grid and off grid.” On the Tension Between the Need for Fuel Tax Revenues for African Governments and Electric Mobility: “It will definitely be an issue because with the governments, their priority is on revenue generation for the development agenda. Anything that impacts on the revenue that they’re collecting will have a very small chance of being supported by governments. It needs to be packaged intelligently. If they’re not going to get the revenues from the fuel, then they need to be shown where the savings will come from on reduced fuel imports and be convinced that will be the case as well as if they can also get more revenue from electric vehicles if the volumes start to go up. Maybe they can switch tactics to electric vehicles. That’s the challenge and we need innovation in how that will be addressed, but definitely there’s not a government that will want to lose that revenue that’s coming in from taxation despite the fact that it is depleting foreign exchange reserves.” The post Henry Kamau: Urbanization & Motorization Biggest Challenge for Africa appeared first on Future Fuel Strategies.
June 20, 2017
Last week REN21 released its annual Global Status Report on the state of renewable energy, which includes renewable energy for transport. Future Fuels Outlook service members can read an analysis here. In summary, REN21 found that additions in installed renewable power capacity is at a all-time high, increasing total global capacity by almost 9% over 2015. Solar accounted for 47% of the total capacity added, followed by wind and hydropower. Moreover, REN21 says renewables are becoming the “least cost option” with some countries at US$0.05 per kilowatt hour or less, below equivalent costs for fossil fuel and nuclear. Still, this transition is not happening fast enough to meet Paris Agreement goals and investments are down 23% since 2015. However, a lot more needs to happen to decarbonize transport, despite the growth in EV sales and biofuels production and consumption. I spoke to REN21 Executive Secretary Christine Lins about the report, the outlook for renewable energy and why the share of renewable energy in transport is so low and the transition so slow. We also talked about the future of the biofuels and EV markets, as well as renewable energy for shipping and aviation. In the latter context, another REN21 report on feasibility of achieving a 100% renewable energy future was discussed as well. (See Apr. 4, 2017 post) In that report, it was found that R&D for aviation and shipping was urgently needed, and during the interview we discussed what that was and what needs to happen. Finally, we also talked about the U.S. announcement to withdraw from the Paris. On the Mission of REN21: REN 21 was founded in 2004 at the first international conference on renewable energies in Bonn, Germany. I’m always calling it a coalition of the willing, bringing together experts from the private and the public sector that want to advance renewable forms of energy transition. We are based at the United Nations Environment Program. We have a small secretariat here and from here we coordinate a network of over 2,000 experts in the field of renewable energy, energy efficiency, and energy access. We are really bringing together industry, government, international organizations, and NGOs. On the Global Status Report: If I summarize 2016, it’s really that we see investors were able to acquire more renewable energy capacity for less money. So we had new records of installed power capacity in 2016 with 161 Gigawatts added, which represents an increase of around 9 percent relative to 2015. We see that for the fifth consecutive year, investment in renewable power generating capacity was roughly double the investment in fossil fuels, reaching about US$250 billion. We have also seen that compared to the previous year 2015, investment went down globally by around 23 percent, that on the one hand a result of significant price and cost reduction and that’s why more capacity was added for less money. It is, however, also due to the delay in the auctions in some countries, like South Africa, for example.   We see that renewable energy has now become a global phenomenon. We now have 176 countries around the world with renewable energy targets, and that’s shared with our power policies, but we also see that there is still a gap with countries having policies to support transport. On a positive note, 2016 was the third year in a row where greenhouse gas emissions from the energy sector remain stable, despite a 3 percent growth in the global economy and an increased demand for energy. So basically, what it shows is that we managed to decouple emissions from growth, which I think is really promising.   However, we see that when we look at overall figures at the renewable energy share in final energy consumption, progress is slow. We have about currently 19.3 percent global energy, final energy consumption from renewables that is slowly growing because on the one hand the energy demand is continuing to grow and also most of the progress we are making is in the electricity sector and in heating and cooling and in transport progress is really relatively slow. This is also the key where further action is needed in order to upscale activities in these areas. So when you look for example at the transport sector we see that liquid biofuels provided about 4 percent of the world’s road transport fuels. We also see that we made progress in the electrification of the transport sector. However not all of the electric transport policies are connected to renewable support and this is something which, of course, is something that is important and needs to happen more. On Why Progress in Transport Is So Slow: First of all, I think it’s a complex sector in the sense that you need to really change the behavior of people. A modal shift needs to happen, away from individual mobility in parts of the world to more public transport. It requires a system-thinking integration of transport policies in regional planning. On electric vehicles, battery costs have come down substantially. So we see that global development of EVs of all transport, particularly passenger vehicles, has grown rapidly. In 2016, global sales have reached an estimated 775,000 units and that brings the total passenger EVs that are on the world’s roads at the end of the year to 2 million. So we see a rapid acceleration which is really exciting. The top 5 countries for passenger EV development in 2016 were China, United States, Japan, Norway, and the Netherlands. Those five countries together account for about 78 percent of the year’s global sales. Norway is well ahead of all of the countries in terms of market penetration.   It, of course, also requires a roll out of charging infrastructure. What we see is there is relatively little linking of renewable energy support and electric mobility and this is something which should be considered more in the future because what we see in 2016 the majority, the lion’s share of investments was in solar and wind. So what we see is a move toward a system of integrating high shares of renewables. We have situations in countries by now to integrate between 20 and 40 percent of their electricity from these sources. In this situation, base load is becoming less important and flexibility is becoming important. There is a linkage between the electricity sector and the transport sector and ultimately probably also the heating and cooling sector. I think we will see much more sector coupling in the years to come and really a convergence of these different sectors which will enable integration of prior shares of renewables because then the electric vehicles can serve as storage for electricity when it is generated by the reliable sources, but when it is not consumed at the same time. I think lots of opportunities but still, the linking is slow. The post Christine Lins of REN21: Further Progress Needed to Increase Renewable Energy in Transport appeared first on Future Fuel Strategies.
May 9, 2017
Recently, I spoke with Sam Wade, Chief of the Transportation Fuel Branch of the California Air Resources Board (CARB) about the status and outlook for the Low Carbon Fuels Standard (LCFS) program. A couple of highlights from the interview follow below, and in addition, we talked about the continuing decline of corn ethanol carbon intensity (CI) and the future of advanced biofuels. You can listen to or download the podcast below or listen to it in ITunes. On How the LCFS Has Diversified the State’s Fuel Pool: “Let me start with some of the success that we have seen because I think that helps frame where we see things going. From 2011 to 2016 we have seen really strong growth in liquid diesel substitutes especially in renewable diesel and biodiesel with renewable diesel growing from 2 million gallons in 2011 to over 200 million in 2016 and biodiesel growing from about 13 million to over 100 million. And so that has been very significant. We have also seen renewable natural gas really making some strong inroads in the CNG and the LNG space where renewable natural gas now makes up over half of all of the gaseous fuels used in California vehicles.   We have also seen significant growth in the number of electric vehicles on the road and even more of that is coming along with vehicle manufacturers set up to offer over 80 electric and hydrogen vehicles in the next 5 model years. We have seen moderate but important growth in the use of E85 and ethanol and flex fuel vehicles and really across all of those fuels we have seen continued decline in the carbon intensity of each of those fuels. So we are pretty excited about the progress that we’ve made using the Low Carbon Fuel Standard so far.” On Plans to Decrease the Carbon Intensity of Fuels Further under the LCFS: “In the scoping plan process that you mentioned we will be recommending to our board that we build on the success of the [LCFS] program and we use the framework that we have in place to further decarbonize the fuel mix out of 2030. The plan would require a decline of 18 percent in carbon intensity below 2010 levels. That is an additional significant push that we need to make but as to what fuels might help us get there we have run a wide variety of scenarios as part of this scoping plan analysis. Most of those scenarios involve one of the following two things or a combination. First, we think there is still more opportunity for continued incremental improvement from the first generation of fuels that provides the majority of credits so far. If we see continued volume growth and carbon intensity decline across biodiesel and ethanol and, to some extent, renewable diesel, we would be very excited about that.   On top of that we also do expect to see some penetration of second generation biofuels or fuels like electricity and hydrogen that have a much bigger greenhouse gas benefit per unit of fuel sold. But on top of that, one of the nice things about the LCFS we don’t have to have a perfect crystal ball because the program doesn’t pick winners. It basically sets up this system of tradable credits and provides value to the lowest carbon fuels that can come to market. So the framework really does facilitate us to look across a wide variety of options and to hopefully drive the best option to market.” On CARB’s Priorities under the LCFS This Year: “We are going to be starting a rule making which is sort of our formal process to change the program. And that will really commence after the scoping plan process concludes. We have a little bit of preliminary workshops and engagement with stakeholders on a few items. The most significant really being the addition of a mandatory third party verification system for checking the carbon intensity crediting on the program. And hopefully what that will look like is something very similar to what you see under the California mandatory reporting program under the cap-and-trade system here or some of the schemes in the European biofuel systems.   What that involves is third parties becoming an additional check on the information in the program and supplementing the work of ARB staff to make sure that we get all the numbers right and the very high value of these LCFS credits is backed by the most credible data that we can impose. On top of that, another big priority that we have is the addition of alternative jet fuels and the reason that we are so focused on alternative jet fuels is that we see the airlines emerging as important long-term purchasers that help get new advanced biofuel facilities constructed by providing long term off tank agreements for those fuels. So we want to recognize that and encourage that.”   Tammy Klein is a consultant and strategic advisor providing market and policy intelligence and analysis on transportation fuels to the auto and oil industries, governments, and NGOs. She writes and advises on petroleum fuels, biofuels, alternative fuels, automotive fuels, and fuels policy. The post Sam Wade of CARB: We’re Excited about the Progress We’ve Made with the LCFS appeared first on Future Fuel Strategies.
April 12, 2017
Recently, I spoke with Ian Adams of the R Street Institute about the Institute’s work on fuel economy and especially autonomous mobility. I was inspired to contact Ian after I read a thought-provoking op-ed in The Hill about fuel economy, which I asked him about in the interview. He also wrote another interesting op-ed in the same publication about autonomous mobility. You can listen or download the podcast below or listen to it in ITunes. The R Street Institute will be hosting a forum on April 14 from 12-1:30 p.m. EDT on “Trump’s Approach to the Future of the Fuel Economy and Emissions Regulation– And Some Alternatives,” which will include speakers from the Alliance of Automobile Manufacturers, Competitive Enterprise Institute, Grace Richardson Institute and the Pacific Research Institute. On Ian’s Proposal to Deal with Fuel Economy: “The idea for the op-ed really came from sort of a place of relative naiveté, as listeners can pick up from my bio. It’s not as though I have a deep background in this. I’ve just always been interested in cars, so I’ve followed CAFE [corporate average fuel economy]. I’ve followed the one national program. I’ve followed just this increasingly labyrinth approach to both emissions and fuel economy regulation. The program just seemed to me to really overcomplicate things because if you’re a free marketer, what you want to see are incentives aligned correctly. The idea with a supply side solution is to not punish those who pollute or fail to hit a standard. You could base this on fuel economy efficiency or you could base this on emissions. It doesn’t really matter how you set the target. What matters is how regulated entities interact with that target because when the target is used to punish entities, the target begins to act as both a floor and a ceiling, right? There are no economic incentives, few economic incentives to really do better than that target, whereas if you move to a supply-side solution that allows companies and regulated entities to be rewarded for over compliance with a given target, then they really have a business reason to make more efficient vehicles.” On the Clean Tax Cut: “The R Street Institute has been working with this organization, the Grace Richardson Fund to look at an idea called Clean Tax Cut. The thought is, be it in the automotive sector, be it in energy production, even in finance with bonds, you can add tax cut supply side drivers to encourage more efficient behavior. Some prefer to call it greener behavior, but at the end of the day, what we’re seeking here is efficiency to drive down costs for consumers and the economy as a whole. It is new and it is revolutionary and we haven’t run all the numbers yet, but it is something where it just seemed like it was time to start having this discussion because we’re at a really interesting point with the Trump Administration addressing these issues to have the conversation. That was the idea.” On Autonomous Mobility: “I think ultimately the winners of the [autonomous mobility] race will be those of us who actually have an opportunity to operate and ride in the vehicles. That was sort of my starting point in coming to this. Here we are, the wealthiest country in the world and we’ve just sort of accepted roughly 40,000 deaths a year on our roads, that that number is somehow acceptable. The number collisions, the number of accidents is far higher and the cost in terms of civil liability on top of it all is greater still. This just struck me as an area where there is a straightforward technological solution that is waiting in the wings to be deployed and yet, there are some legacy regulatory barriers standing in its way. That’s how R Street got engaged in the project, how I got engaged in the project.   I worked in the California legislature at a time when the state decided to pass legislation to give the California DMV authority to begin regulating this technology. The folks backing the legislation at the time thought it was necessary to allow these vehicles on the road. There’s some question about that, but that’s ancient history because now we’ve got states off to the races in attempting to regulate these vehicles and we’ve got the federal government, the NHTSA [National Highway Traffic Safety Administration], on the other side also looking to regulate these vehicles.   It’s been a really very interesting road to travel down as NHTSA has opted to offer non-binding guidance and the states have, since its start, over regulated, as California proposed to do in drafting regulations saying these vehicles have to have a steering wheel. Other states have gone other directions to be very, very permissive, like for instance, Nevada. Our work has been focused on trying to ensure that regulators don’t inadvertently quash the development and deployment of the technology. For instance, in Massachusetts right now, there’s a bill pending that would tax autonomous vehicles on a per-mile basis. Now, I can’t think of a much worse incentive for the deployment of the technology.” On the Environmental Benefits of Autonomous Mobility: “You’ll have autonomous vehicles that are following within inches of one another, so they don’t have the same drag coefficient as they’re going down the road and we’re not going to have to use as much power to move those vehicles as a result. There will be net efficiency benefits that we enjoy almost right off of the bat, to say nothing of the fact that with ride sharing, vehicles will be utilized more fully. More of the time, they’ll be on the road. They’ll be picking people up and they’ll just be used a lot more. As a result, you won’t have a bunch of metal sitting around unused, which will also have a positive impact on the environment. It is a huge part of it and as you say, with electric vehicles, autonomous vehicles are really well positioned to take advantage of electric vehicle technology.   GM is obviously a big believer in that as a big time investor in Lyft and their new Chevy Bolts that are coming out with the 230 odd miles of range. There’s a reason that they’re using that vehicle as their autonomous vehicle platform because once these vehicles have exhausted their charge, they’re able to go seek another charge and get back on the road as soon as possible. They can do it on their own. All right? They don’t have to worry about any of the logistical challenges associated with autonomous fueling involving liquid. It is really exciting and I think you’re right. Obviously, the death toll is attention grabbing, but we shouldn’t lose track of the environmental benefits either.”   Tammy Klein is a consultant and strategic advisor providing market and policy intelligence and analysis on transportation fuels to the auto and oil industries, governments, and NGOs. She writes and advises on petroleum fuels, biofuels, alternative fuels, automotive fuels, and fuels policy. The post Ian Adams: Let’s Remove the Barriers to Autonomous Mobility appeared first on Future Fuel Strategies.