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A r lee T. Re n o, J oa n n e R . P o tte r , a n d W illi a m A . C owa r t Transportation
Research shows that very significant reductions
in greenhouse gases can be achieved through
mobility-related measures that also save
money and support strong economic growth.
Global climate change has moved to
center stage as a key issue affecting the future
well-being of the United States and the world.
Over the last year, poor economic performance
also has emerged as a central concern. Yet,
there has been little public recognition in
the United States that these issues have
been building for decades, that the causes
of the problems in each of these areas are
inter­related, and that economic and climate
change solutions need to work together.
In no other sector of the world’s society
are the particulars of economic well-being
and global climate change more strongly and
directly interrelated than in transportation.
Yet, the field of transportation still needs to
be better understood within the broadest
picture of the economy and global climate
change so that transportation solutions can
play the most effective role in the country’s
future economic and environmental health.
There are several primary premises that
should be acknowledged:
l The supposed conflict between economic
performance and emissions reductions is false;
l Most of the U.S. population has already
been experiencing a recession since 2000—
and the dream of a better economic future
for most Americans ended in 1980;
l The lack of strong U.S. policies to address
global climate change is integral to the economic decline or stagnation that has been
experienced by most Americans;
l Major reductions in greenhouse gases can
be accomplished while saving money, and
most levels of greenhouse gas reduction
goals can be met before any net economic
cost is incurred;
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l Although Europe and, in particular, the United
Kingdom already offer positive lessons on how
to achieve economic growth while reducing
green­­house gas (GHG) emissions, even the
European Union (EU) intends to do better than
it has done to date and it behooves the United
States to do so as well; and
l Transportation sector greenhouse gas emission reductions can be accomplished as an
important part of positive economic growth
and overall GHG reductions.
The Economic Picture
A recession has now officially been declared to
have been in place since the beginning of 2008.
Yet, for the majority of U.S. households—other
than the wealthiest—a recession has been in
existence since 2000; the American dream
of continuous steady growth in real incomes
ended in 1980, with only a brief period of respite
from 1992 to 2000. Figure 1 shows the average
annual changes in real per-capita income, as
reported by the U.S. Census Bureau for different
quintiles of the population and for those who
are at the 95th percentile, during similar periods
of economic performance from 1967 to just
before the official onset of the current recession.
Incomes for most of the groups were fairly
stagnant from 1980 to 1992 and grew nicely
from 1992 to 2000. Between 2000 and 2007,
however, the lowest three quintiles all lost
real income, and the next-highest quintile
gained almost nothing.
Not shown in Figure 1 is the income performance of the highest income group, which
since 1980 has been of major proportions.
The top 5 percent, the top 1 percent, and particularly the top one-tenth of 1 percent have
registered huge gains in their share of personal
income. During this period, not only did the
United States experience one of the most
dramatic income redistributions ever, but also
federal tax policies substantially lowered the
tax burdens on the wealthy. The tax reductions
on the very wealthy from 1980 to 1992 and
then after 2000 have had other consequences.
For instance, about 90 percent of the federal
government’s current total debt was accrued
between 1980 and 1992 and between 2000
and 2008.
The Energy Picture
The consequences of the extreme income redistribution have actually been somewhat beneficial in
terms of the energy used for transportation, particularly in the past decade. Because of the lack
of income growth for those in the lower income
categories, who would travel more if they had
more income, the growth of vehicle miles traveled (VMTs) slowed in the 2000-to-2007 period,
with actual declines in annual VMTs occurring
in 2007 and 2008. Figure 2 illustrates historical
growth rates of VMTs by decade. Through 2007,
the growth rate of VMTs for the decade of the
2000s was down to around 1.4 percent per year;
through 2008, the rate is even lower.
FIGURE 1: Average aNNUAL PERCENTAGE CHANGES IN PER-CAPITA
INCOME IN THE UNITED STATES BY INCOME LEVEL
Period
Lowest
Quintile
Second
Quintile
Third Quintile Fourth
Quintile
NinetyFifth Percent
2000 to 2007
−0.9%
−0.3%
−0.2%
+0.2%
+0.2%
1992 to 2000
+2.3%
+1.7%
+1.8%
+2.2%
+2.7%
1980 to 1992
+0.2%
+0.4%
+0.6%
+1.0%
+1.6%
1967 to 1980
+1.0%
+0.7%
+1.3%
+1.6%
+1.6%
Source: U.S. Census Bureau.
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Solutions
However, until 2008, energy and carbon use
in transportation—and therefore greenhouse
gas emissions levels—increased even as carbon
and petroleum use in some other sectors of
the economy had been somewhat curtailed.
The result, as shown in the U.S. Department of
Energy’s Energy Data Book, is that transportation by 2007 accounted for 68 percent of all the
petroleum used in the United States.
The argument is frequently made that
tech­­nology will solve GHG problems—and
technology is indeed an important potential
strategy, but only if it is actually used for GHG
emissions reductions. Technological changes
vastly increased the mileage efficiency of the
U.S. light-duty vehicular fleet from 1975, when
corporate average fuel economy (CAFE) standards were first adopted, until 1980, after which
the use of technology to curtail GHG emissions
stopped. Figure 3 shows that in each model
year since 1981, the U.S. light-duty vehicle fleet
has achieved higher horsepower for about the
same average amount of fuel consumed per
mile. However, none of the technology improve-
ments since that year has significantly increased
the average fuel efficiency of the light-duty fleet.
As a consequence, the United States now buys
much more foreign petroleum than it would
with a more efficient fleet, and borrows money
to pay for these imports due to the enormous
resulting trade imbalance.
As shown in Figure 4, the U.S. Department
of Energy’s Alternative Energy Outlook forecasts
much greater fuel efficiency in the future—a
near doubling by 2050—based partly on new
CAFE standards. That fuel efficiency will more
than double by 2050 is the baseline assumption made in Moving Cooler, a study currently
being conducted by Cambridge Systematics,
Inc., on behalf of a wide range of sponsoring
organizations and to be published by Urban
Land Institute. All assumptions about the future
have included technological improvements, and
some assump­­tions even assert that the fleet
can and will be completely decarbonized.
The U.S. vehicle fleet uses much more
energy per mile of travel than the vehicle
fleets of other major countries, as shown in
Figure 5, which focuses on new vehicles entering the fleet. This is largely due to different
national policies. For example, European countries have set high energy prices and implemented graduated taxes on engine sizes. The
technology measures, such as those examined
in the 2009 McKinsey & Company report titled
Pathways to a Low-Carbon Economy, have few
trade-offs in terms of impacts on lifestyles and
behavior. For example, fuel efficiency improvements attributable to technology can reduce
both energy usage and total costs to users.
Opportunities for Economic and
Environmental Well-Being
A wide range of previous studies of the costs of
measures to reduce greenhouse gases, including most notably the 2009 McKinsey report, has
shown that there are many opportunities for cost
savings. This means that very large reductions
in greenhouse gases are possible before there
is any “net” economic cost to society. Moving
Cooler research shows that very large savings
in greenhouse gases can be achieved through
Figure 2: Growth rates of Average Annual Vehicle Miles traveled in the United States
10%
8%
4.8%*
3.8%*
Growth Rate per Year
4.3%*
6%
3.2%*
2.5%*
1.4%*
4%
2%
0%
−2%
−4%
1951
1961
1971
1981
1991
2001
*Decade averages, which are also indicated by dashed lines on graph.
Source: U.S. Federal Highway Administration.
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FIGURE 3: DIFFERENCES IN HORSEPOWER AND FUEL EFFICIENCY OF
NEW LIGHT-DUTY VEHICLES FOR MODEL YEARS 1975–2006
230...............................................................................................................................................................................................
2006
210................................................................................................................................................................................................
2005
2004
60 percent more
2003
2002
190................................................................................................................................................................................................
energy performance
2001
2000
170................................................................................................................................................................................................
1999
Horsepower
mobility-related measures that also save money
and support strong economic growth.
European countries and other advanced
industrial nations have historically followed
consistent policies that have resulted in lower
GHG emissions than in the United States.230
The
primary differences stem from energy pricing
policies, which put high charges on fuel and
210
use the proceeds for both infrastructure and
investments in other programs. Higher fuel
190
prices have led to fleets with greater fuel efficiency; less travel in terms of distance per year
170
per vehicle or per driver; and more compact
development, which is consistent with shorter
vehicle trips and more use of public transpor150
tation and nonmotorized transportation. Analysis indicates that European levels of motor
fuel
130
taxes would have the greatest impact on GHG
emission reductions of any of the individual
110
measures addressing travel behavior.
However, higher taxes have to be spent
wisely if they are to result in net benefits to 90
the environment and economy. These revenues must be reinvested into infrastructure0to
improve mobility and to mitigate any negative 0
mobility impacts, and reinvestments should
also be made into programs that help offset the
impacts of the fees on low- and middle-income
users. Equity analysis shows that it is critical
that any pricing actions be coupled with spending revenues to benefit users; otherwise, users
are not necessarily better off just because pricing reduced congestion. While transit and operations investments are cited as ways to provide
future mobility while reducing overall GHG emissions, the Moving Cooler analysis indicates that
targeted highway capacity investments can also
save fuel by reducing congestion-related delays.
Recent analyses conducted on future U.S. highway needs for the forthcoming American Association of State Highway and Transportation Officials
report titled Transportation: Invest in America,
The Bottom Line illustrate that there are major
economic payoffs to be achieved by funding
improvements that pass a benefit/cost test.
Europe and, in particular, the U.K. are
now the leaders in developing and applying
programs to improve both the environment
and economy. The U.K. Ministry of Transport
has adopted policies to make transportation
investments that both enhance the economy
and reduce GHG emissions, and has established multimodal economic benefit/cost
1998
1997
60 percent more output
1996
150................................................................................................................................................................................................
1995
1994
1993
1992
130................................................................................................................................................................................................
1975
1976
1977
1991
1990
1989
1978
1979
110................................................................................................................................................................................................
1988
1984
1985
1987
1986
1983
90................................................................................................................................................................................................
1980
1981
1982
0................................................................................................................................................................................................
0
12
14
16
18
20
22
24
Miles per Gallon
12Environmental Protection
14 Agency, Light-Duty
16 Automotive Technology
18 and Fuel Economy20
222006.
Source:
Trends: 1975–2006, July
24
FIGURE 4: HISTORIC AND FORECASTED FUEL EFFICIENCY FOR
PASSENGER VEHICLES in miles per gallon
Historic
Forecasts for 2050 by various organizations
1965: 14.4
38–base case from DOE’s Alternative Energy Outlook
1975:
13.2
43–base case from Moving Cooler*
1985: 16.5
60–high case from Moving Cooler*
1995: 19.6
100–sustainable high case from American Association
2005: 20.2
of State Highway and Transportation Officials
*A report to be published by ULI.
and environmental analysis procedures to
guide their investments.
However, the European Environment
Agency (EEA) recognizes that not enough has
been done in EU countries, particularly on the
demand side. In recent years, the EU’s reductions in transportation greenhouse gas emissions have lagged far behind the EU’s GHG
emissions reductions in other sectors. The
EU as a whole is ahead of the United States
by 60 to 80 percent in fuel efficiency, and
aspires to further improvements in average
fuel consumption. The EEA’s 2007 Climate for
a Transport Change report states, with regard
to the highest 2020 emissions reduction
target set in the UN Framework Convention on
Climate Change in Bali, 2007, that “present
knowledge indicates that it will not be possible to achieve ambitious targets comparable
to the Bali roadmap without limiting transport
demand.” The EEA lists potential additional
strategies such as behavioral measures (i.e.,
eco-driving) within each mode, limits on
increases in transport volumes, shifts among
modes, construction and maintenance of
infrastructure, and pricing. An illustrative
estimate of how a 60 to 80 percent reduction
in GHG emissions might be accomplished is
shown in Figure 6. In this example, reductions come from a blend of various types
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Tr a n s p o r t a t i o n S o l u t i o n s
FIGURE 5: COMPARISON OF AVERAGE FUEL ECONOMY STANDARDS FOR NEW-SALE LIGHT-DUTY VEHICLES AMONG THE STATE OF CALIFORNIA, THE ENTIRE UNITED STATES, AND OTHER COUNTRIES
55
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
50
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EU
Miles per Gallon
Japan
45
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
China
California
35
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Australia
30
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canada
U.S.
20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Source: UC Berkeley
2002
2004
2006
2008
2010
2012
2014
2016
Figure 6: Sample combination of strategies to achieve a 60 to 80 percent reduction in Transportation-related GHG Emissions by 2050
180 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
160 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
VMT reduction
140 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Percentage
120 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Double fuel
100 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . efficiency
80 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
of fleet
60 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Alternative fuels
40 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
displacement
Aggressive
20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . operations
0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2005 GHG
2040 GHG
2040 GHG
2040 GHG
with trend
after reduction
reduction
strategies
strategies
Year
Source: I-95 Corridor Coalition, 2040 Vision Study, Cambridge Systematics, 2008.
of actions: miles per gallon (MPG) improvements, alternative fuels, reductions in VMTs,
etc. This is the type of analysis that both the
United States and Europe need to undertake.
Stagnant or declining incomes and increasing poverty and inequality—with resulting reductions in mobility and energy usage—certainly do
not constitute a preferred approach to reducing
greenhouse gas emissions. American economic
progress has not been stymied because the
United States has taken any actions to limit
greenhouse gas emissions. Rather, progress
has been stymied because of policies that,
among other attributes, have not curtailed
greenhouse gas emissions. Restoring American economic progress can take place in
ULGApr09 p54 b-ftr .indd 57
tandem with progress on reducing greenhouse gas emissions.
The United Kingdom has already shown
the way, with reports and policies that will
both achieve economic growth and reduce
greenhouse gas emissions. Opponents of
climate change action in the United States are
also those who assert that economic progress and reductions of greenhouse gases are
in conflict. Both the McKinsey report in the
United States and other analyses in the EU
demonstrate that GHG emissions reductions
and economic well-being are highly compatible and mutually supportive. ULG
is a senior vice president and both
and W illiam A . Cowart
are senior associates of Cambridge Systematics, Inc.,
in Bethesda, Maryland. All three are coauthors of the
forthcoming book Moving Cooler: An Analysis of Transportation Strategies for Reducing Greenhouse Gas
Emission, to be published by ULI.
Arlee T. Ren o
Joan n e R. Potter
Growing Cooler: The Evidence on Urban Development
and Climate Change is now available and Moving
Cooler: An Analysis of Transportation Strategies for
Reducing Greenhouse Gas Emission will be available
at www.uli.org/bookstore, or by calling 800-521-5011.
Moving Cooler is designed to fill the current gap in the
analysis of global climate change strategies by evaluating mobility-related measures that could potentially
reduce greenhouse gas emissions.
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