615. The transport sector is the largest source of greenhouse gas emissions in the UK. In contrast to other sectors in the UK, greenhouse gas emissions in the transport sector have remained stable, with efficiency gains being absorbed by increasing traffic and bigger vehicles.xxi
616. In 2021, the Government published its Transport Decarbonisation Plan441 setting out commitments to reduce greenhouse gas emissions in the transport sector by 1,300-1,800 MtCO2e between 2020 and 2050.xxii The Plan also highlighted wider co-benefits in terms of growth, jobs, air quality and health benefits. An update on the Transport Decarbonisation Plan was published in summer 2022.442
617. The Government has set ambitious targets to phase-out existing vehicles with internal combustion engines and replace them with zero emission vehicles (ZEV), such as electric vehicles.xxiii For passenger cars and light vehicles, which accounted for more than half of domestic transport emissions in 2020, electrification is considered the most promising technology.443 For heavier, long-distance vehicles as well as maritime and aviation, zero emission technologies are still at an earlier stage of development. These sectors will likely need to rely on a mix of different technologies, including electrification, hydrogen, low carbon fuels as well as maximizing operational efficiencies to reduce greenhouse gas emissions. In contrast, rail already has one of the lowest emission profiles, but more still needs to be done to electrify remaining lines, where possible, and employ other decarbonization technologies as well as shift transport from road to rail.
618. Technological changes alone will not be enough to reach net zero, as highlighted by the Transport Decarbonisation Plan and the Climate Change Committee (CCC). More will also need to be done to break the link between growth and increased congestion and encourage more journeys to be taken by public transport and active travel such as walking and cycling (see Pillar 5).
619. The decarbonisation of the transport sector offers significant economic opportunities, with the potential for thousands of new jobs in manufacturing, infrastructure, and services. Changes in the transport sector also have wider economic impacts as they not only influence how people travel but also how goods and services are delivered. The Review heard that zero emission vehicle manufacturing and infrastructure could create more than 70,000 jobs by 2050.444 The UK also has the opportunity to capture a first mover advantage on decarbonisation of aviation and maritime, including both the production of zero emission technologies and sustainable, low carbon fuels. Building on the UK's role as a central hub for aviation and maritime services and its leading role in developing international standards, there could be significant opportunities to export UK goods, services, and expertise. In the maritime sector alone, 220,000 jobs could be created by 2050.445 Furthermore, the UK could be a first mover on road freight decarbonisation and there could be significant growth opportunities for technologies, infrastructure and services that enable more sustainable travel options.xxiv
620. However, the market is competitive and competitor countries are taking steps to onshore manufacturing capabilities and supply chains. The USA Inflation Reduction Act for example includes a requirement for the final assembly of the vehicle to occur in North America to benefit from tax credits.
__________________________________________________________________________________________________
xxi According to the CCC, efficiency of new cars has been steadily increasing since 1990 but reversed between 2019-19 due to rapid increase in purchases of sport utility vehicles (SUVs) and higher emitting vehicles. Their share increased from 7% in 2007 to 25% in 2019 and more than offset the benefit delivered by the increase in sales of electric vehicles 2017-19. See CCC (2020), 'Sixth Carbon Budget. Surface Transport', https://www.theccc.org.uk/wp-content/uploads/2020/12/Sector-summary-Surface-transport.pdf
xxii The Transport Decarbonisation Plan included commitments in 11 areas: increasing cycling and walking, zero emission buses and coaches, decarbonising railways, zero emission fleet of cars, vans, motorcycles and scooters, accelerating maritime as well as aviation decarbonisation, delivering a zero emission freight and logistics sector, delivering decarbonisation through places, maximising the benefits of sustainable low carbon fuels, hydrogen's role in a decarbonised transport system and supporting UK research and development as a decarbonisation enabler.
xxiii The Government's plans foresee the end of sale for new petrol and diesel cars by 2030 and all new cars and vans to be zero emission by 2035. New heavy goods vehicles weighing under 26 tonnes need to be zero emission by 2035 and all HGVs by 2040. The government has also consulted on phase-out dates for new, non-zero emission buses and coaches (proposed between 2025 and 2032) and L-category vehicles such as mopeds and motorcycles (with 2030 for some and 2035 for all proposed).
xxiv For example, according to the Transport Decarbonisation Plan the manufacturing, distribution and repairs of bikes alone could be associated with 100,000 jobs.