U.S. fuel economy regulations for heavy trucks could drive changes in the shipping industry that make the regulations up to 20% less effective than policymakers expected, according to a new analysis. The findings illustrate how making fast shipping methods cheaper could set back climate progress.
“While the results weren’t surprising, theoretically, we didn’t anticipate effects of this magnitude,” says Jonathan Hughes, an economist at the University of Colorado in Boulder, who conducted the study with economist James Bushnell of the University of California in Davis.
The freight sector moves large quantities of basic goods such as chemicals, coal, fertilizers, fuel, grain, and machinery long distances via truck, train, ship, or airplane. It’s a key intermediate link between farmers, miners, manufacturers, and consumers.
Freight is responsible for 10% of total U.S. energy consumption and 27% of greenhouse gas emissions from the transportation sector. The majority of freight sector emissions come from trucking: trucks and railroads move about the same percentage of ton-miles, but rail is about five times more energy efficient than trucking.
In a bid to reduce greenhouse gas emissions from the freight sector, the U.S. Environmental Protection Agency has put forth regulations to improve heavy duty trucks’ energy efficiency. These regulations are predicted to increase the average fuel efficiency across the fleet on the order of 5% by 2025.
In the new study, researchers used recent U.S. Census Bureau data on movement of goods around the country to calculate that, if all else about the freight industry remains the same, this 5% increase in average fuel efficiency would save 674 million gallons of gas yearly.
But shippers don’t make decisions in a vacuum. Greater fuel efficiency makes shipping by truck cheaper, so some shippers are likely to switch from rail transport to truck transport, which is faster and enables shippers to sell their products more quickly.
The researchers modeled how fuel efficiency standards would change these shipping mode choices. Factoring in the shifts from rail to trucking, the fuel efficiency regulations would save just 497 million gallons of gasoline, about 26% less than policymakers had estimated, the researchers report in the journal Nature Energy.
“Policies that focus on particular technological solutions rather than the end goal we are trying to achieve can lead to unintended consequences,” says Hughes. “In this case, we find focusing on improving efficiency of one technology leads consumers to switch to other less efficient technologies, making it more difficult to achieve our climate goals.”
The findings illustrate a twist on the rebound effect, a well-known phenomenon in which efficiency improvements lead to reduced costs and wind up increasing consumption. In this case people aren’t consuming more, they’re consuming differently – a form of the rebound effect that researchers and policymakers have paid less attention to, the researchers point out.
The rebound effect would likely affect the transportation of chemicals, animal feed, alcohol, and petroleum products the most.
With increased fuel efficiency of heavy trucks, some shipments would also shift from air to truck, for example, as the lower cost would outweigh the slower shipping speed. Overall, the rebound effect in the freight sector would reduce the total fuel savings from federal fuel-efficiency regulations by 20%, making the total fuel savings about 538 million gallons per year.
The results suggest fuel efficiency regulations might not be the best way to reduce greenhouse gas emissions in the freight industry, Hughes says. “Instead, it would be better to adopt policies such as carbon taxes or carbon abatement subsidies that provide the correct incentives across all technologies consumers and producers may adopt.
Source: Bushnell J.B.B. and J.E.Hughes. The role of modal substitution in rebound effects within US freight transportation. Nature Energy 2024.
Image: ©Anthropocene Magazine
