Op-Ed: U.S. Climate Policy Must Support Low-Carbon Liquid Transportation Fuels


Several months ago, I noted that as the world starts to seriously address the challenges of climate change and the immediate need to reduce carbon emissions, there are many roads forward. As we all know, roads tend to be paved with good intentions. Ambitious new pledges set the stage as countries determine the best approaches to achieve net-zero 2050 targets. Those targets are further supported and enabled by environmental accountability standards as a part of the growing Environmental, Social, and Governance – ESG – principles, climate rules, and regulations. These add to the focus and action taken in the U.S. and across the world, that all play important roles as they contribute to global climate solutions.

However, the time has come to reflect and assess the efficacy of our plans to achieve those climate goals. One road that literally paves the way to attain carbon emission reduction targets is the transportation sector. In the U.S., transportation accounts for close to 30% of U.S. greenhouse gas emissions. If we’re going to achieve our carbon reduction targets we must recognize that addressing and solving the problems associated with transportation sector-based carbon emissions is imperative.

Let’s start with an irrefutable fact: Americans love to travel. Transportation is a part of our lives and the freedom we enjoy. Transportation is also the key to conducting the commerce that supports our lives and livelihoods and sustains economic growth. As our transportation modes evolve to reduce carbon emissions, we are already seeing more electric vehicles (EVs) hitting the road. Yet, as the growth of EVs continues, there is another irrefutable fact: Motorists will continue to drive today’s internal combustion engine vehicles (ICEVs) for decades to come, including sedans, SUVs, and medium and heavy duty vehicles.

Automakers clearly understand the climate goals. Accordingly, they design, build, and introduce new vehicle powertrains which are helping to drive toward zero-emission solutions. The newest designs include EVs which, while they represent only about 2% of the U.S. vehicle fleet today, will certainly grow substantially. The administration’s just announced EPA tailpipe proposed regulations may also help to accelerate EV growth, along with numerous state mandates being issued to curtail the sale of ICEVs. While automakers will continue to factor regulations and mandates into their production planning transition, ICEVs, including both personal and commercial vehicles, will continue to be driven and will require the ongoing availability of liquid fuels. Given the objective to reduce carbon emissions, especially in the transportation sector, it is critical to address the carbon intensity associated with the production and use of these fuels.

This underscores the importance of exploring policy alternatives that aim to improve existing fleets and lower the lifecycle carbon intensity of the fuels those fleets will continue to rely upon.  Tailpipe emissions are only part of vehicle and fuel emissions.  We need to have a more transparent apples-to-apples comparison of total emissions for vehicles powered by different energy sources.  Standards that improve the efficiency of vehicles and lower the carbon intensity of fuels by accounting for GHG emissions during the sourcing, production, and use of all fuels, could ultimately help society reduce emissions faster, at a lower cost, and in a technology-neutral way.

Simply put, the average life span of today’s ICEV is about 12 years. Many drivers, however, keep their cars beyond that life span. Given many of the ICEV sales bans take place between 2030-2035, it is conceivable that ICEVs will be on the road until 2050 and beyond. We must determine how quickly EV consumer acceptance and market penetration will grow and realistically address a range of complex issues such as the level of consumer acceptance, convenience, charging infrastructure, tax contributions for highway and road use, vehicle price points, and government intervention, including existing or new financial incentives.

All of these factors will determine the long term production pace, availability, and acceptance of EVs. Even with all the uncertainties in play, automakers continue to work on advanced ICEV technologies and systems, including advanced hybrid vehicle technology, combining both EV and ICE powertrains, along with the introduction of variable high compression engines, sophisticated fuel injection systems.  Complementing their work, fuel producers are actively developing lower-emission fuels, including advanced biofuels and renewable, lower-carbon eFuels for both gasoline and diesel ICEVs.  The combination of engine and low carbon fuel technology will all result in even more efficient vehicles that will ensure the long term viability of the ICEV which will provide a necessary transportation bridge while EVs and future transportation models evolve.

The road to net-zero is not one lane; it is more like a multi-lane highway where EVs and ICEVs must share the responsibility for efficient transportation for decades to come. Exit ramps for the ICEs are a long way down that highway, and in the meantime, both automotive technologies will continue to advance along with the lower carbon fuels which will be needed, and help in our drive to lower emission, net-zero solutions.

Michael J. Roman is a Senior Fellow at the American Council for Capital Formation, and he is on the Board of Advisors at The Fuels Institute.