Greenhouse gas emissions projections: phase 1 and phase 2 modelling results

8. Transport sector

8.1 Sector Overview

8.1.1 Sector Background

Transport was the largest emitting sector in Scotland in 2019, with around 13.95 million tonnes of CO₂e (including international bunkers)^[46]. The National Transport Strategy 2, published in 2020, defines climate change as one of the four priorities in the transport sector for the next two decades. The deployment of sustainable and low carbon energy sources in the transport sector is a key focus area with deployment paces tailored to the varying level of technological maturity across transport modes. In addition, travel behaviour and transport demand management measures are also seen as necessary steps towards the net zero pathway by 2045. Transport infrastructure investment will also be planned consistently to limit traffic increases generated by any capacity expansion. A recent study commissioned by Transport Scotland in 2021, Decarbonising the Scottish Transport Sector, assessed several policy scenarios and their capacity to meet Scotland´s emission targets.

The climate change plan update (CCPu) sets the following key commitments by 2032:

• No new petrol and diesel cars and vans.
• Work to decarbonise challenging transport modes, such as HGVs, ferries and aviation will have started.
• Car kilometres will have reduced by 20%.
• Research into biofuels and hydrogen will have stimulated private investment and innovation.
• Almost complete decarbonisation of passenger railways.

8.1.2 Subsectors Considered

The transport sector was disaggregated into the following subsectors:

• Road transport – Cars
• Road transport – Light goods vehicles (LGVs)
• Road transport – Heavy goods vehicles (HGVs)
• Road transport – Buses and coaches
• Road transport – Public transport fleet
• Road transport – Motorcycles
• Rail transport
• Aviation – Domestic
• Aviation – International
• Shipping – Domestic
• Shipping – International

Road transport has been divided into the main vehicle types to acknowledge their different contribution to overall GHG emissions and their different decarbonisation paces. In addition, we distinguished the public sector fleet, which includes all vehicle types, to model specific policies within this segment. For aviation and maritime transport, domestic and international transport emissions have been distinguished.

8.1.3 Data Sources

The main data sources used to undertake the assessment of the transport sector are detailed in Table 8‑1 below.

8.1.4 Underlying Drivers of Energy & Emissions

Table 8‑3 presents the underlying drivers for each sub-sector, which constitute the baseline scenario to be compared against policy scenarios in the following sections.

8.2 Policy Measures and Outcomes Modelled

8.2.1 Phase 1 – Policy Measures

For the transport sector there were a total of 49 policies which were reviewed and grouped into 8 themes, to allow policies with similar objectives to be assessed together and thus ensure interactions between similar policies/proposals were captured. All 49 policies are captured in the packages, but with many included in a supporting role, rather than a quantifiable role.

Policies under the first theme are related to transport demand management and aim to reduce car use by reducing the need to travel (or reducing travel distances), promoting a shift to more sustainable transport modes and promoting shared journeys. These policies are part of the route map to achieve a 20 per cent reduction in car kilometres by 2030.^[47]

Policies under the following themes aim to promote the update of ultra-low emission vehicles (ULEVs) for road vehicles, with different paces, reflecting variations in technology maturity.

Policies to decarbonise the aviation and maritime sector with a focus on domestic operations were also screened. For aviation the focus is on flights in the HIAL region while maritime decarbonisation efforts will focus on ferry services. Low carbon traction options are more limited for these sectors (at least in the short term), which means that they may significantly rely on the use of sustainable drop-in fuels (sustainable aviation fuels (SAF) in the case of aviation).

The roadmap to decarbonise passenger rail services is well developed in the Rail Services Decarbonisation Action Plan in line with the UK-wide Traction Decarbonisation Network Strategy developed by National Rail.

The result of this grouping was the packaging of the 49 policies into 12 packages. These 12 packages, mapped against the policy outcomes for the transport sector, are presented below.

Travel demand management

Transport Scotland forecasts show that traffic numbers are expected to increase during 2022 as COVID-19 restrictions further relax across the country and a return to work and other previously restricted activities occur. Nonetheless, it is expected, and building on the momentum shown during the pandemic, that digital connectivity will continue to enable people to work and connect with others remotely. Given a working from home element is, however, likely to remain in place during 2022, traffic levels are expected to increase to around 95% of those seen pre-pandemic. Traffic is then expected to further increase over the next 2-3 years as the country and economy recover but before interventions to deliver reductions in car traffic really start to make an impact.

Traffic levels are therefore expected to reach those recorded pre-pandemic during the short-term period. Notwithstanding this, the travel demand management measures put in place should show the capability, opportunity and motivation to choose an alternative to the car and support the foundation for achieving the longer-term goal to reduce car kilometres by 20%, by 2030.

Our assessment concluded, however, that policies promoting a mode shift (triggered by investments in active mobility and bus infrastructure/services) could only deliver a small fraction of the targeted car use reduction. The bulk of the reduction will have to be achieved with travel demand measures effectively reducing the need for travel (e.g. increase in homeworking).

It should be noted that travel behaviour is extremely complex, which makes it very difficult to isolate specific factors triggering a behavioural change. Because of this, effects of the travel demand policies were assessed in an aggregate manner based on scenarios agreed with the Scottish Government technical leads. The following scenarios were considered:

Uptake of ULEV for road vehicles

For policies promoting an uptake of ULEV for road transport, we considered that phase-out targets and UK- In line with the Scottish Transport Statistics, ULEVs are defined as vehicles that are reported to emit less than 75g of CO₂ from the tailpipe for every kilometre travelled. In practice, the term typically refers to battery electric, plug-in hybrid electric and fuel cell electric vehicles.

wide bans for new diesel and petrol vehicles will effectively induce a transition to ULEV, with a progressive increase in ULEV sales from 2019 to the phase-out year. This uptake in ULEV will also be supported by policies in place to offer financial and technical support to ULEV users.

In general, we assumed that both the fleet size and the current fleet replacement rate per sub-sector would remain constant throughout the evaluated period.

The main assumption regarding ULEV uptake for the different sub-sectors are described below in Table 8‑9. The uptake assumptions largely follow the forecasts elaborated by the Scottish Government.

The low growth and high growth scenarios are assumed to decrease and increase, respectively, the number of ULEV in the market. The main driver in this case would be the effect that economic growth may have on the number of vehicles being sold each year.

In the model we have assumed two different phases for the uptake of ULEVs: one from 2020-2030 and another from 2030-2040. This captures the fact that the uptake is expected to be higher from 2030, particularly for vehicle types that are more difficult to decarbonise (e.g. HGVs). Phase 2 modelling acknowledges that the uptake of ULEVs is likely to be less linear than this, by introducing additional 5-year time step between 2020-2025 and 2025-2030. This means that in some years the Phase 1 modelling results estimate a greater emissions reduction potential from policies to promote ULEV uptake than under Phase 2 modelling with full policy ambition.

Decarbonisation of aviation, shipping and railways

Low carbon fuel technologies for aviation and shipping are still at the early stages, which means that the policy landscape is also less well developed. For aviation, we have considered the UK jet zero strategy as the main driver for GHG emission reductions in domestic air transport operations. For shipping, our assessment focused on the targeted decarbonisation of the Scottish ferry fleet.

In rail transport, electrification is expected to be the main driver of decarbonisation. We assumed that the network will be fully electrified (or hydrogen and battery supply infrastructure will be in place) by 2035 in line with the current commitments in Rail Services Decarbonisation Action Plan.

Our assessment build on the following assumptions:

8.2.2 Phase 2 – Outcomes

A workshop was held to discuss options for modelling additional targets as part of Phase 2 of the Provision of Emissions Projections project. Agreements on modelling assumptions for each policy outcome are summarised in the table below. The workshop was also used to validate modelling assumptions for policy measures in Phase 1.

Following up on the workshop, Transport Scotland shared further data for Phase 2 modelling, notably emissions from air transport within Scotland and recent work on HGV decarbonisation strategy.

As a result of the workshop, the following modelling assumptions per policy outcome were included in the additional modelling under Phase 2.

8.2.3 Summary of Policy Packages

The table below indicates which policies were found to have the biggest potential impact within each package, which policies overlap with (or reinforce) each other, and which policies act as supporting measures.^[48]

Within the Transport sector, many policies interact with each other, as there may be multiple initiatives (including infrastructure investment) aimed at achieving the same goal. In broad terms, the policies that are likely to deliver the biggest reductions in emissions in this sector will be those that either reduce demand for private transport, or promote a phase-out of fossil fuel road vehicles, ferries and aircraft.

8.2.4 Variation across scenarios

Higher economic growth is assumed to increase traffic, as evidence suggests that there is a correlation between passenger transport and GDP growth.^[49] So, while all scenarios assume that there is some level of reduction in travel demand, in the high growth scenario the GHG reduction from Policy T2: travel demand management is smaller.

On the other hand, higher economic growth is assumed to result in greater affordability of EVs; it also increases the amount of public funding available to support the transition. So, in the high growth scenario, we have assumed that ULEV uptake, network electrification, use of SAF and low emission ferries will all increase.

8.3 Emissions Projections

8.3.1 Phase 1 results

Total CO₂ emissions from the transport sector are expected to drop from around 13.8 MtCO₂ in 2019 to around 6.4 MtCO₂ by 2040. The remaining emissions by 2040 would be mostly coming from aviation and shipping. The existing policy measures to decarbonise domestic aviation and shipping would only deliver a limited reduction in CO₂ emissions.

The transport sector is expected to reduce its reliance on petroleum products as it transitions to low and zero carbon technologies. The expected electrification of road transport by 2040 would increase the electricity consumption of this sector. Since electric powertrains tend to be more energy efficient than internal combustion engines, the overall energy consumption is expected to drop substantially.

8.3.2 Phase 2 results

It is important to note that the main difference with the Phase 1 modelling assumptions is the increased car traffic reduction by 2030 (outcome 1), which captures a full achievement of the traffic reduction target. The full decarbonisation of internal flights within Scotland (outcome 5), which was not included in Phase 1, represents a small proportion of overall emissions from aviation and, hence, it is not expected to alter emission projections significantly.

The resulting emission projection by 2050 under Phase 2 modelling assumptions is displayed below. Total CO₂ emissions from the transport sector are expected to drop from around 13.8 MtCO₂ in 2019 to around 6.2 MtCO₂ by 2040. This projection is very similar to that of Phase 1.

8.3.3 Comparison of Phases 1 & 2

The table below provides a comparison of the projected emissions for Phase 1 and Phase 2 (in ktCO₂e) and by scenario. Emissions in 2030 and 2035 are lower under Phase 2 modelling assumptions due to the effect of the higher car traffic reduction by 2030. Differences in 2020 and 2025 between Phase 1 and Phase 2 assumption are mostly due to the additional time granularity to describe the uptake of ULEV in Phase 2. Similarly, higher emissions in 2040 and 2045 under Phase 2 relate to the more refined time granularity in Phase 2 modelling.^[50] This is a limitation of the Phase 1 modelling approach and should be considered when comparing projections from Phase 1 and Phase 2.

Note: The results from Phases 1 and 2 are visibly almost indistinguishable from each other because of the small magnitude of differences between them.

8.3.4 Emissions reduction by policy package (2032) – Phase 1 & 2

This section presents results on the contribution of each policy package (as described in Table 8‑7) to emission reductions of each policy outcome considered in the model.

Results presented in Table 8‑23 indicate that the promotion of ULEV for cars and vans (policy package T5) contribute the most to the overall emission reduction by 2032 across all scenarios (with 64% of total emission reduction). Travel demand policies (policy packages T1, T2, T3 and T4) and the promotion of ULEV for heavy duty vehicles (policy package T7) also represent a significant proportion of overall emissions reduction, with 9% and 12% of the total reduction, respectively. Other policy packages have more limited contributions to the overall reduction of GHG emissions in the transport sector by 2032.

The total reduction of GHG emissions by 2032 is slightly higher under Phase 2 assumptions, compared to Phase 1. As above mentioned, the main difference between Phase 1 and Phase 2 relates to the achievement of the 20% car traffic reduction target by 2030 (i.e. full achievement in Phase 2 and 10% reduction in Phase 1). This means that the difference of around 200 ktCO₂e between the central scenario in Phase 2 and Phase 2 can be attributed to the effect of the more pronounced car traffic reduction in Phase 2.

8.4 Uncertainties

Due to the number of assumptions used, we suggest that the energy use and GHG emission projections are indicative but are sufficient to allow an informed debate about the future trajectory of emissions in the sector, and, to identify policies which are likely to deliver meaningful GHG reductions. There is a high level of uncertainty associated with the technical and economic characteristics of fuel-switching technologies, particularly for aviation and shipping sectors. In addition, there is a large uncertainty around transport activity levels in the years following the Covid-19 pandemic.

Overall, the level of uncertainty was estimated at 15% for road and rail transport and 20% for aviation and shipping.

8.5 Sensitivities

In the model, the uptake of zero emission technologies for road transport is conditioned by phase-out targets for internal combustion engine vehicles. As such, projections for road transport will be mostly affected by changes in road transport demand in the following years. Phase 2 modelling assumes the 20% traffic reduction target by 2030 is fully achieved, while the modelling of policies assumes only a partial reduction by 2030. The difference between Phase 1 and Phase 2 can be used to assess the sensitivity around car traffic trends. For aviation and maritime, the uptake of sustainable drop-in fuels (e.g. SAF for aviation or ammonia for maritime transport) is expected to be the main sensitivity parameter.