#ClimateAction

25 ACTIONS on climate
We have compiled a list of 25 climate actions that can get us on track for 2025. These actions
focus on the 5 highest-emitting economic sectors and are organised according to 5 policy levers:
invest, regulate, tax and subsidise, lead by example, and inform and educate.
They are a starting point. Together, we need to transform our economies at an unprecedented
scale. We have the knowledge and the tools to make it happen. We have the financial resources.
It’s time to deliver on climate commitments.

AGRICULTURE
1. Improve productivity sustainably through innovation, to lower emissions
and feed a growing population
2. Reform price-distorting regulations that increase agricultural emissions
3. Use taxes and support payments to reduce emissions and manage
impacts on farmers and consumers
4. Include agriculture in national climate mitigation strategies
5. Inform consumers and producers about food choices and how to reduce
food waste

BUILDINGS
6. Ensure public procurement is climate-friendly and invest in sustainable
buildings
7. Put in place stringent climate-friendly building codes and standards
8. Use tax and financial incentives to renovate existing buildings
9. Mainstream sustainable building within urban and rural planning
10. Educate planners and contractors on how to construct and maintain
green buildings

ELECTRICITY
11. Drive investments in green energy development, deployment and
infrastructure
12. Phase out coal and tap the potential of new sources of energy generation
13. Price carbon and address barriers holding up the transition to
sustainable energy
14. Channel public money into green electricity, leveraging the weight of
sub-national governments
15. Empower investors and consumers with information on sustainable
electricity

INDUSTRY
16. Scale up research and development to create new low-carbon industrial
processes
17. Regulate energy efficiency in plants to lower emissions
18. Price carbon while maintaining competitiveness to lower emissions and
spur innovation
19. Lead the way for other economic sectors in shifting from linear to
circular resource efficiency
20. Educate for energy and resource efficient sustainable industrial practices

TRANSPORT
21. Scale up research, production and use of zero-emission fuels
22. Create conditions that increase accessibility and maximise use of
transport capacity
23. Set prices to encourage sustainable passenger mobility and freight
transport
24. Make low-carbon transport the default for public sector decision making
25. Share knowledge about tested measures that reduce transport emissions

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AGRICULTURE

1 IMPROVE PRODUCTIVITY SUSTAINABLY THROUGH INNOVATION,

TO LOWER EMISSIONS AND FEED A GROWING POPULATION
Improving productivity can help reduce emissions by allowing agriculture to produce
similar or higher amounts of food with fewer inputs. These productivity improvements
will be sustainable if they are backed by regulations and efforts to prevent forest
clearing. Boosting productivity requires both adopting existing technologies and
techniques more widely, and encouraging innovation.

One example is precision agriculture, where digital technologies such as global

positioning systems and sensors are helping lower the amount of fertilisers
contributing to emissions. For cattle, a leading source of agricultural emissions,
improving feed quality and better matching it to the nutritional needs of cattle can
help reduce emissions related to milk and meat production. Other innovations in
breeding and animal health can also help cut emissions from cattle, while no-till
farming can help reduce emissions from crop production.

More government effort is needed to improve agricultural innovation, both nationally

and internationally, and to invest in research and development (R&D). Governments
should improve public agricultural R&D funding, create the conditions to attract
private investment and facilitate public-private partnerships, with the involvement
of farmers and other stakeholders. They should also foster international R&D co-
operation.

2 REFORM PRICE-DISTORTING REGULATIONS THAT INCREASE

AGRICULTURAL EMISSIONS
Agriculture is a heavily protected sector, with support of USD 530 billion provided
directly to producers per year in 2016-18. More than half of this support results from
regulatory measures that keep domestic prices above international levels. These can
take, for example, the form of quantitative import restrictions, tariff rate quotas and
tariffs, to keep cheaper foreign products out of the market, or production quotas that
limit domestic production.

These policies, along with payments linked to production and to unlimited use of
inputs such as fertilisers or fuel, should be overhauled as they help drive up emissions
from farming, by encouraging overproduction and more intense agriculture. They
also lock producers into certain products, stifling innovation and adaptation to climate
change.

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3 USE TAXES AND SUPPORT PAYMENTS TO REDUCE EMISSIONS

AND MANAGE IMPACTS ON FARMERS AND CONSUMERS
Mitigating greenhouse gas emissions in agriculture cost-effectively will involve using
both carrots and sticks, to encourage better practices among producers to reduce
emissions. This means, for example, pricing emissions, using emissions trading, and
paying farmers for practices that lower emissions and help put carbon back into the
soil through so-called carbon sinks.

These measures all involve different trade-offs and the right mix of measures will
vary by country. For example, policies requiring farmers to pay for emissions are the
most effective and efficient way forward in agriculture in some countries and can
help generate government revenue, but they can also impose relatively high costs
on farmers - not all of whom can bear them - and can lead to higher food prices.
On the other hand, paying farmers to reduce their emissions can ease the impact
on producers and consumers, but will also put pressure on public finances unless
balanced by a reduction in existing agricultural support.

4 INCLUDE AGRICULTURE IN NATIONAL CLIMATE MITIGATION

STRATEGIES
As other sectors begin to decarbonise, notably energy and transport, agriculture is set
to become a leading emitting sector. Policy makers should step up efforts to integrate
agriculture into national mitigation strategies. There has been some progress in
setting mitigation targets for agriculture but the global level of ambition for the
sector falls well short of what is required for it to contribute to limiting the global
temperature increase to below 2oC.

At present, only two countries have introduced legally binding targets for agricultural
emission reductions, and a handful of others have included mitigation targets for
agriculture in their Nationally Determined Contributions under the Paris Climate
Agreement. Clearly, there is a need to step up the global level of policy ambition to be
in line with the agriculture sector’s potential to mitigate climate change.

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5 INFORM CONSUMERS AND PRODUCERS ABOUT FOOD CHOICES

AND HOW TO REDUCE FOOD WASTE
Policies should aim to reduce food waste along supply chains, from farms and
farmers through transport and retail practices, to consumers. Cutting food waste
and loss could help cut emissions, although policy must deal with trade-offs, such as
lost income to farmers. Where access to sufficient protein is not an issue, policies to
promote lower-emission food choices may also help, such as encouraging more plant-
based food choices or shifting to sourcing from lower-emission livestock systems.

Educational measures, such as information campaigns for producers, are important,

along with adequate infrastructure, such as storage facilities, and legal frameworks,
for instance to facilitate collaboration between local entities and charities. Information
campaigns can also help consumers cut waste by encouraging them to choose, store
and prepare food properly.

BUILDINGS

6 ENSURE PUBLIC PROCUREMENT IS CLIMATE FRIENDLY AND

INVEST IN SUSTAINABLE BUILDINGS
Governments can show the way by investing in green public procurement, requiring
contractors to uphold sustainable practices and material use for large infrastructure
projects such as schools, bridges and social housing. This not only addresses climate
change but also encourages contractors, architects and planners to innovate with new
low-carbon materials, methodologies and designs.

The Navarra Social Housing project in Spain, for example, aims to build 524 energy
efficient social homes for rent, in line with their sustainable construction standard,
between 2018 and 2021. These flats will achieve savings of up to 90% with nearly zero
emissions, and create almost 300 jobs.

Setting rules and standards is key, as is the case in the Netherlands where only
sustainable cement is allowed in building projects. To maximise innovation and
sustainability in public procurement, the Netherlands uses the MEAT methodology
– Most Economically Advantageous Tender – which rewards tenders that include
reductions in emissions and a lower overall environmental impact.

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7 PUT IN PLACE STRINGENT CLIMATE-FRIENDLY BUILDING CODES

AND STANDARDS
Rapid urbanisation and a rising population will require more and more new homes
and offices. For new buildings, sustainable certification schemes and standards
can decrease emissions, and at reasonable cost. Such schemes cover sustainable
building materials, integrated sustainable waste and water management systems, and
accessibility to amenities.

Mandatory emissions limits could be considered, such as those used in New York City,
which cap emissions per square metre based on a building’s size, function and shape.
Net-zero and near-zero energy building standards are increasingly used to set high-
energy performance requirements so that buildings consume the same or close to
the same amount of energy as they produce, mostly from on-site or nearby renewable
energy sources. The EU for example requires all new buildings to be compliant with
near-zero building standards by 2021.

Low-energy houses are becoming more affordable and cost-effective compared with
conventional buildings, and policy should compel contractors and building firms to
produce them whenever possible. For instance, the so-called Passive House standard
is a powerful voluntary certification for buildings, and increasingly used worldwide.
Thanks to sound construction features, Passive House buildings are highly energy
efficient, affordable and comfortable to live in, allowing for substantial energy savings
up to 90% compared to regular existing buildings, and 75% compared to regular new
buildings.

8 USE TAX AND FINANCIAL INCENTIVES TO RENOVATE EXISTING

BUILDINGS
Improving the energy efficiency of buildings in our cities, towns and villages can
sharply reduce emissions. Adding low-carbon roof and wall insulation such as flax
wool, upgrading appliances such as boilers, and double-glazing windows helps reduce
the energy needed to heat, cool and electrify homes, factories and offices. Less
energy means fewer emissions, as well as lower electricity and heating bills, enhanced
comfort, and cleaner air inside homes and offices. Since buildings last for decades if
not centuries, renovations made today can reduce emissions and costs over time.

Good practice examples abound. Energiesprong is an international initiative that

accelerates retrofit solutions to deliver net-zero energy homes at no additional cost for
residents. In partnership with the German Energy Agency, an accelerator programme
was launched in 2019 in Germany to financially support general contractors and
housing providers up to EUR 180 000 to retrofit buildings. In addition, the programme
offers coaching by international Energiesprong experts, workshops and pitch events.
Energiesprong attracts funding through EU funds, national sources and philanthropic
contributions.

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9 INTEGRATE GREEN BUILDINGS WITHIN URBAN AND RURAL

PLANNING
All too often, the location of a new building with respect to other services in a city is
not fully considered. Since 70% of the world’s population will live in cities by 2050,
the necessity of integrated infrastructure and urban planning will only grow in
importance.

Assuring public transport availability near housing, offices, shopping districts and
green spaces, can enhance a city’s vibrancy and economic development, while
reducing greenhouse gas emissions thanks to reduced travel. Numerous cities,
including low density ones, now look at housing optimisation for different types of
location.

Encouraging compact, denser cities can be beneficial, and regulations that provide
for green spaces and water areas can prevent cities from becoming too congested
and overheated. Policies to ensure decent and affordable homes are also essential.
In cities generally, policy makers can foster investment in green transport and online
connectivity, and encourage urban farming.

10 EDUCATE PLANNERS AND CONTRACTORS ON HOW TO

CONSTRUCT, MAINTAIN AND OPERATE GREEN BUILDINGS
Raising awareness and training personnel on green buildings is essential, not just
for construction but for the likes of renewable energy installations, pollution and
waste reduction systems, and assuring air quality. Many of these require rigorous
qualifications and state-of-the-art techniques to ensure a transition to reliable and safe
low-carbon infrastructure.

The World Green Building Council, which started in the United Kingdom and now
has offices worldwide, provides a wide range of studies, seminars and awareness
raising campaigns on the importance and cost-effectiveness of green buildings. It has
launched the Net Zero Carbon Buildings Commitment, which calls on cities, regions,
states and companies to commit to achieving net-zero operating emissions by 2030
and net-zero buildings by 2050. To date, 35 countries use GBC expertise to green their
buildings at local or national level, and 42 stakeholders have signed the Net Zero
Carbon Buildings Commitment, committing to reduce CO2 emissions by 221 million
tonnes of CO2eq, the equivalent to taking 47.3 million cars off the road each year.

The Concrete Centre in the United Kingdom also provides guidance on how to use
concrete and masonry to construct sustainable buildings that are highly energy
efficient, resilient, comfortable and affordable. In support of this, they have created
a package of information and tools to accompany e-learning modules on concrete
materials and design.

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ELECTRICITY

11 DRIVE INVESTMENTS IN GREEN ENERGY DEVELOPMENT,

DEPLOYMENT AND INFRASTRUCTURE
Thanks to enormous cost reductions in recent years, electricity generation from large-
scale renewables (notably wind and solar) is becoming cheaper than the generation
from fossil fuels, and this trend is expected to continue. The world needs to invest
around USD 1.7 trillion between 2015 and 2030 to achieve the Paris Agreement’s
renewables targets. For this, investments and investment incentives in green energy
infrastructure must be expanded to mobilise private investment in low-emission
and climate-resilient infrastructure. Investment and pension funds are showing new
interest, which should be encouraged through improved environmental risk analysis,
clear frameworks for diversified financial instruments and models, and expediting
building permits for clean electricity infrastructure.

Support mechanisms should be applied to provide investment incentives while

reducing investment risks in renewable energy projects. Competitive auctions are
more cost-effective than administratively set tariffs. Moreover, support mechanisms
can be broadened to include job creation and local economic development. For
example, South Africa’s Renewable Energy Independent Power Producer Procurement
Program (REIPPPP) assigns 70% of the auction score on the bid price, and the
remaining 30% is allocated based on socio-economic dimensions including job
creation, black ownership and enterprise development. Between 2011 and 2015, the
REIPPPP is estimated to have created more than 100 000 direct full-time jobs.

12 PHASE OUT COAL AND TAP THE POTENTIAL OF NEW

SOURCES OF ENERGY GENERATION
Phasing out coal is challenging. For it to happen, the broad economic, social and
political impacts on regions and communities must form part of the strategy.
In Germany, for example, the Commission on Growth, Structural Change and
Employment is working to achieve a smooth coal phase-out by 2038, by advising on
how to support structural change, retraining, providing early retirement options, and
more.

Distributed energy resources, including rooftop solar, distributed storage, and electric
vehicles, are transforming the current electricity system, and offer vast potential for
addressing the intermittency of renewable generation. So-called “behind the meter”
generation produces power on site and turns customers into “prosumers”, as they can
sell excess energy back to the grid. Uptake of distributed generation can be increased
through net-metering schemes, financial incentives and mandatory deployment of
distributed generation for new buildings. Policy should encourage the deployment of
smart meters to enable real-time pricing and emerging business models to optimise
demand and help integrate variable renewable energy such as wind and solar.

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13 PRICE CARBON AND ADDRESS BARRIERS HOLDING UP THE

TRANSITION TO SUSTAINABLE ENERGY
Pricing carbon emissions and phasing out fossil fuel subsidies are vital to lower the
amount of carbon used in electricity generation. Switching from coal to renewables
(and to a lesser extent to natural gas) will not only reduce greenhouse gas emissions,
but deliver other positive effects, from reducing air pollution to creating jobs in
renewable energy and related sectors.

Carbon pricing will speed up the deployment of clean and renewable energy and
drive investments towards zero-carbon technologies, while generating government
revenue. In 2012-16, a UK carbon tax scheme called the Carbon Price Support (CPS)
led to a 78% reduction of coal use in electricity generation and a 58% decrease in CO2
emissions, with marked improvements in air quality and continued affordability.

Targeted income transfers or dedicated energy-efficiency programmes can also

help affordability. For example, in 2016, France switched from social energy tariffs to
energy cheques to help households pay their energy bills. Depending on income and
building characteristics, 5.8 million eligible households received a cheque of up to EUR
277 in 2019 to go towards utility and electricity bills.

14 CHANNEL PUBLIC MONEY INTO GREEN ELECTRICITY,

LEVERAGING THE WEIGHT OF SUB-NATIONAL GOVERNMENTS
Multilateral and national development banks have broad leverage in shaping
electricity infrastructure and must play a key role in facilitating investments. More
lending money for renewable projects will accelerate the transition towards a
sustainable electricity sector. In 2019, the European Investment Bank, the world’s
largest international public lending institution, announced an end to fossil fuel energy
project financing, beginning in 2022. Similarly, Norway’s Government Pension Fund no
longer invests in companies whose business models are focused on fossil fuels.

Sub-national and city governments can also lead the way towards a low-carbon
economy, with more ambitious targets on greenhouse gas emissions reductions and
higher shares of renewable energy. Copenhagen and Oslo for instance aim to become
carbon neutral by 2025. Cities can leverage the low-carbon transition as owners and
operators of energy infrastructure and public buildings, through direct investment in
biomass plants, encouraging rooftop solar panels, and taking visible action to improve
the energy efficiency of public buildings, for example though energy performance
contracts and public-private partnerships.

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15 EMPOWER INVESTORS AND CONSUMERS WITH

INFORMATION ON SUSTAINABLE ELECTRICITY
Policy makers should provide investors with information on the environmental
sustainability of their investments, using taxonomies for instance. The European
Commission has included a proposed voluntary-based taxonomy in its 2018 Action
Plan on Financing Sustainable Growth. Once implemented, this proposal could provide
more visibility to decarbonised electricity generation in financial market portfolios.
This, in turn, can influence corporate and investor decision making, and support the
achievement of the Paris Agreement goals.

While minimum energy performance standards are the most effective means to
improving energy efficiency, broad and frequent feedback to consumers on energy
usage can also reduce consumption, and spur investment in energy-efficient practices
and products, as well as the adoption of renewable energy sources. These can include
more salient energy efficiency framing, such as clear and visual energy efficiency
labels, green defaults and communications campaigning for renewable energy
uptake, as well as direct feedback to consumers, such as clearer energy bills. Real-time
information on the carbon content of electricity consumption can steer consumers
towards less carbon-intense hours.

INDUSTRY

16 SCALE UP RESEARCH AND DEVELOPMENT TO CREATE NEW

LOW-CARBON INDUSTRIAL PROCESSES
The high temperatures needed for transforming raw materials into primary materials
cannot be easily electrified and current alternatives are all expensive or technically
difficult. Entirely new processes will need to be created to decarbonise heavy industry.
The challenge for the industry is to scale up promising technologies so they can be
widely used and commercially viable. Discovering these new low-carbon processes will
take time, but governments can help by investing in R&D to catalyse innovation.

Sweden is leading the way with two promising projects in cement and steel – the
highest emitting sub-sectors in industry. The Swedish CemZero project is a pilot
study on electrified cement production (which would be close to zero emissions if the
electricity is fossil fuel free), and aims for zero carbon dioxide emissions by 2030. This
would equal a 5% reduction of Sweden’s total CO2 emissions. Likewise, the Swedish
HYBRIT aims to create zero carbon steel across the supply chain – from the mining of
iron ore to the fabrication of steel using hydrogen technologies.

The European Union is also investing heavily to push the innovation frontier. One of
the missions for the Horizon 2020 funding is to strengthen the European value chain
for low-carbon hydrogen and fuel cells for energy- and carbon-intensive industry, in
particular the steel industry and in the chemicals sector.

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17 REGULATE ENERGY EFFICIENCY IN PLANTS TO LOWER

EMISSIONS
Heavy industry is highly energy-intensive. Transforming raw materials from the earth
into primary materials – like steel, cement, aluminium, glass – requires very high
temperatures. More effort is needed to find ways of reaching these temperatures
without relying on fossil fuels like coal, but a good short-term alternative is to improve
the energy efficiency of plants with strong or mandatory goals.

Since 2009, Japan sets mandatory performance benchmarks for energy use from
heavy industry plants to improve energy efficiency by 1% per year. Russia has several
laws in place which set federal and regional energy efficiency standards for industrial
consumers, such as steel, aluminium, paper. These firms are required to submit
energy efficiency and thermal efficiency performance certificates annually. Any plants
that cannot meet these benchmarks are phased out.

Alongside standards, the use of Energy Management Systems, can also improve the
overall efficiency of plants, thereby lowering energy consumption. Projections show
that implementing ISO 50001, a standard to encourage continual improvement, can
lead to deep reductions in CO2 emissions.

18 PRICE CARBON WHILE MAINTAINING COMPETITIVENESS TO

LOWER EMISSIONS AND SPUR INNOVATION
The extraction and processing of materials and chemicals used in heavy industry -
steel, cement, aluminium, glass, pulp and paper, and petrochemicals – generate high
emissions that must be addressed. Carbon prices are often kept very low in order to
maintain competitiveness, but carbon prices must rise, which means putting in place
effective emissions trading schemes or carbon taxes, amongst others.

There are a number of ways to implement carbon pricing, so that it does not hurt
firms’ competitiveness and, in turn, catalyses innovation. These include: setting a
carbon price floor (preventing the carbon price from going too low to guarantee
certain returns), international co-operation on carbon pricing for all countries or even
co-operating globally to set a carbon price within a given industry – such as creating a
carbon price for all cement firms globally.

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19 LEAD THE WAY FOR OTHER ECONOMIC SECTORS IN SHIFTING

FROM LINEAR TO CIRCULAR RESOURCE EFFICIENCY
Our economies need to shift from being linear to circular. A linear economy is one that
extracts resources, produces products, consumes them, and then disposes of them,
creating a system of emissions and resource use. A circular economy creates a system
that aims to keep products, components and materials in the economy for as long
as possible, trying to eliminate waste and virgin resource inputs. This kind of system
change requires using recycled secondary materials instead of virgin raw materials,
designing products to be robust and repairable so they last longer, and using
materials more efficiently, for example, through increased material productivity.

There are different tools for countries to incentivise this change – such as facilitating
the trade of scrap materials, removing import bans in addition to Extended Producer
Responsibility requirements, holding producers responsible for products at the end
of life, product take-back requirements, and advanced disposal fees. Product take-
back requirements typically set recycling or collection targets for a given product or
material, e.g. the European Union’s Waste Directive for Electronic Waste. Likewise,
advance disposal fees (ADFs) are charged at the time of purchase, ideally, to cover the
costs of collection and treatment of the product. When the ADF is transparent to the
consumer, it may influence both consumer and manufacturer behaviour.

20 EDUCATE FOR ENERGY AND RESOURCE EFFICIENT

SUSTAINABLE INDUSTRIAL PRACTICES
Educating actors across supply chains is fundamental for the transition to energy and
resource efficiency. It helps unearth solutions, such as using waste from one industry
as input in another. The UK’s Internal Synergies programme promotes such industrial
symbiosis. Between 2005 and 2013, the UK’s National Industrial Symbiosis Programme
was rolled out across all nine English regions and reduced CO2 by 42 million tonnes,
diverted 47 million tonnes of industrial waste from landfill, created over 10 000 jobs,
and saved 60 million tonnes of virgin material, including 73 million tonnes of industrial
water. The UK is now spreading its expertise, reaching 30 countries so far.

The EU runs a European Resource Efficiency Knowledge Centre that offers a free self-
assessment tool for small and medium sized firms working in 12 industries. SMEs
answer questions on their consumption of energy, materials, water and waste, and
the platform creates a personalised report with a set of actions for firms to be more
efficient in these areas.

Other countries provide a consultancy. For example, France has a programme called
Winning on All Counts led by an environmental and energy agency, the ADEME, for
SMEs in industry to improve their resource efficiency, particularly targeting those with
high energy and material consumption, with limited time and knowledge to undertake
efficiency improvements. To fill this gap, the ADEME offers a coaching service to any
SME willing to sign up.

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TRANSPORT

21 SCALE UP RESEARCH, PRODUCTION AND USE OF ZERO-

EMISSION FUELS
Alternative fuels are the key to emissions-free transport, with electric mobility
being the most advanced. In Norway, 46% of all new cars sold in 2018 were electric.
Worldwide, 5.1 million electric cars were sold in 2018, up from 3.1 million in 2017.
Still, they only make up about 0.5% of the global vehicle stock. Future uptake depends
fundamentally on progress with battery technology to increase range, availability of
charging infrastructure to reassure users, and ultimately on the price. The extent to
which governments invest, and the range of incentives they put in place, will matter.

It is unlikely that one single new energy source can replace oil for energy intensity.
Government policy should act according to different technologies and uses. Electric
mobility should be boosted to decarbonise urban traffic, for instance, which would
slash emissions and improve air quality. Also, if flights under 1 000 kilometres used
electric aircraft, this could save 15% of jet fuel. Hydrogen has advantages for longer
ranges and where fast refuelling is necessary, for trucks or maritime transport for
instance. Ships are also rediscovering wind power. The use of biofuels and synthetic
fuels should be stepped up as they allow conventional engines to run virtually carbon
free, if sustainably produced. To boost this sector, Sweden now requires conventional
fuels to be blended with biofuels to reduce the greenhouse gas emissions of diesel by
21% and of petrol by 4.2% by 2020.

22 CREATE CONDITIONS THAT ENCOURAGE THE MAXIMUM USE

OF TRANSPORT CAPACITY
The average private car is used for just 50 minutes a day and carries 1.4 passengers.
Studies show that car sharing can provide the same flexibility as private cars, but
with just 10% fewer vehicles. That would reduce CO2 emissions from cars by one
third without introducing new technology. Because shared vehicles clock more miles,
they are replaced more quickly and new low-carbon technologies hit the road faster.
Public parking becomes redundant and the space can be used in more eco-friendly
ways – for walking and cycling, or less polluting delivery of goods. Importantly, shared
mobility services can act as feeders for public transport. The largest CO2 reductions in
the transport sector would come from shared electric vehicles.

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Moving goods is an ever more important part of transport. The share of freight will
grow to nearly 50% of all transport activity by 2050, from just over a third today.
Keeping down the associated CO2 emissions will require better use of trucks and ships.
Smart logistics solutions can help maximise capacity use – more efficient use of data,
for instance, or sharing depots and delivery vans. Also, larger trucks or ships can
move more freight with comparatively less energy. Still, care is needed to improve CO2
efficiency along the entire supply chain.

Governments should also strive to bring the costs of rail down make it more
competitive, modern and attractive for passengers, particularly on shorter national
and transcontinental journeys, in Europe for instance. More investment should be
channelled into new railways in developing countries and remote regions.

23 SET PRICES TO ENCOURAGE SUSTAINABLE PASSENGER

MOBILITY AND FREIGHT TRANSPORT
Transport relies on fossil fuels for over 94% of its energy. Zero- and low-carbon
transport solutions will scale up only if they can compete on price. Road fuels
are taxed relatively heavily - but not nearly to an extent that covers the cost of
environmental harm. Preferential rates exist, too, for example for fuels used by trucks.
Meanwhile international aviation and maritime fuels are not taxed at all.

Price signals are a powerful mechanism to steer citizens and businesses to choose
less emitting forms of transport. Carbon prices can be set with different tools, notably
direct taxes or emissions trading schemes. Purchase taxes on polluting vehicles
and targeted subsidies can also help citizens and businesses buy into sustainable
transport. Emissions and congestion charges on vehicles in cities have proved
effective. Some have reduced local CO2 emissions by around 15%. But road pricing
should be fair and equitable. Revenues should be used in a transparent way and
contribute to measures that effectively reduce CO2 emissions Stockholm, for instance,
introduced a congestion charge and invested the proceeds to expand its metro
network.

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24 MAKE LOW-CARBON TRANSPORT THE DEFAULT FOR PUBLIC

SECTOR DECISION MAKING
Governments should champion low- and zero-carbon transport and set an example
for citizens and businesses. Investing in public transport, promoting walking and
cycling, and providing good charging infrastructure are examples where public policy
can make low-carbon transport the default and environmental sustainability the
benchmark. Integrating transport planning with land-use policy and promoting urban
densification will bring jobs, goods and services closer to people and reduce the need
for commuting.

Public procurement provides another lever. Awarding contracts should take into
account the carbon footprint of the bids. For instance, in Sweden, the tender for
a ferry between Stockholm and the island of Gotland included greenhouse gas
emissions as a criterion. The winning bid uses Liquefied Natural Gas (LNG), resulting in
20% lower CO2 emissions.

Governments operate large vehicle fleets. They should make the purchase of low- or
zero-emission vehicles their default policy, which would send a strong political signal,
not least to businesses that also have large fleets.

25 SHARE KNOWLEDGE ABOUT TESTED MEASURES THAT

REDUCE TRANSPORT EMISSIONS
A single invention to stop global heating is unlikely to be found. Doing what is already
possible, on all fronts, by everyone, will be the most effective policy approach. More
public-private co-operation, nationally and internationally, is necessary to create the
conditions for the introduction and scaling up of decarbonisation measures as rapidly
as possible.

Effective interventions should be further deployed. These include operational

measures like the “slow steaming” of freight ships, which reduces greenhouse gas
emissions by 19% for a 10% reduction in speed, but can yield reduction up to 60%.
Educational measures also work, for instance “eco-driving” training for truck drivers
- fuel-efficient driving styles reduce trucks carbon emissions by up to 15%. Design
improvements like air lubrication of ship hulls or weight optimisation in aircraft also
save CO2. Streamlined customs procedures cut carbon, as trucks no longer have to
inch forward for hours or even days at border points while emitting diesel fumes.
Governments and businesses should intensify their collaboration to create pilot
projects and test decarbonisation opportunities.

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