The fuel economy of the world’s cars and vans needs to improve massively in the coming years for the automotive industry to do its part to support global efforts to reduce greenhouse gas emissions, according to a new report by the International Energy Agency and key partners.
According to the latest edition of the Global Fuel Economy Initiative’s (GFEI) report on light-duty vehicle sales, global average fuel consumption has improved very slowly or even increased over the last few years in some major car markets such as the European Union and the United States. Globally, average fuel consumption declined just 0.9% over the past two years, helped by China where it fell on the back of stricter standards.
Given this slow overall global progress, achieving the GFEI’s target of halving fuel consumption of new cars and vans by 2030 relative to 2005 will require a near tripling of the average annual pace of improvement seen over the past 15 years. Fuel economy measures the distance a vehicle can travel per unit of a particular fuel, such as kilometres per litre, and is a key indicator of the greenhouse gas and pollutant emissions from the use of cars.
The GFEI report on light-duty vehicle sales is published by the IEA and its partners every two years. This year’s edition extends the scope to include for the first time a “well to wheel” analysis, which looks at emissions produced from the extraction, refining and processing of a fuel up to the point when it is consumed in a vehicle engine. For internal combustion engine cars, most emissions occur at their tailpipe (“tank to wheel”), while less than 20% of overall emissions are related to the production of their fuels (“well to tank”). By contrast, for battery electric and fuel cell electric vehicles, almost all the emissions are incurred in producing and delivering the electricity or hydrogen on which they run.
Countries around the world have historically set fuel economy standards with the aim of reducing the fuel consumption of vehicles over time. The slowing pace of improvement between 2017 and 2019 results from a number of factors. These include stagnating fuel economy standards in the US and the EU up to 2019; the rising market share of SUVs, which can use almost one-third more fuel than a medium-sized car; the rising cost of squeezing out further efficiency gains from mature technologies; and the slow adoption of more efficient alternative powertrains such as electric cars to compensate for larger vehicles.
The analysis in the new report shows that in practically all countries in 2019, battery electric vehicles had the lowest emissions, followed by plug-in hybrids and hydrogen fuel cell electric vehicles. Hybrid vehicles have the lowest well-to-wheel emissions among vehicles with internal combustion engines using gasoline, diesel or compressed natural gas. By 2030, the difference is set to be even starker because the production of electricity and hydrogen becomes less emissions-intensive as low-carbon sources increasingly displace fossil fuels.
The new report includes several recommendations to improve fuel consumption trends, such as stronger policies to increase the market share of efficient zero emissions cars, to foster technological advances in vehicles using mainly gasoline or diesel, and to discourage the trend of ever-increasing vehicle size and power.
GFEI is a partnership between the IEA, the United Nations Environmental Programme (UNEP) the International Transport Forum of the OECD (ITF), the International Council on Clean Transportation (ICCT), the University of California-Davis and the FIA Foundation. It runs projects and produces research to support government policies aimed at cleaner and more efficient vehicles.
Accelerating private sector investment in large-scale Renewable Energy
Following its 2020 edition, the Economic Policy Dialogue series (EPD) is back with six new sessions that will run until June 2023. Organized by the United Nations Development Programme (UNDP) and the World Bank Group in Tunisia through TERI Trust Fund, these monthly meetings aim to bring together relevant key stakeholders to create a space for constructive, inclusive, and transparent debate, allowing to collectively address the challenges of economic and social reforms facing the country.
The six EPD sessions are organized to foster dialogue on structural reforms and collectively identify practical and operational solutions to facilitate the implementation of reforms needed to address economic and social challenges as well as economic and development priorities.
The first session will be held on Thursday, 24 November 2022, and will focus on “Accelerating private sector investment in large-scale renewable energy.” Through a frank and direct debate, this dialogue session will aim to propose solutions to accelerate the realization of large-scale renewable energy projects, find ways to overcome the identified barriers and propose innovative mechanisms for a win-win partnership to regain investor confidence and catalyze the development of these projects. Accelerating the implementation of these projects is the only way to reduce the energy deficit and contribute to achieving energy transition objectives: energy security, economic competitiveness, social equity, and climate action.
Tunisia’s interests in the energy transition are evident given the country’s increasing energy demand (1.5% per year) and the worsening of the energy deficit. All the while, the country remains, despite the adoption of several forward-looking laws, far from the objectives it had set itself – namely, 30% of renewable energy in the energy mix in 2030.
At the end of each session, proposed in a participatory format, recommendations will be formulated to initiate and fuel reflection on possible national socio-economic reforms. These reforms aim to improve access to regional development, youth employability, and economic and financial inclusion within the Sustainable Development Goals (SDGs) framework.
World Bank Group Announces International Low-Carbon Hydrogen Partnership
Today, on Energy Day at COP27, the World Bank Group announced the creation of the Hydrogen for Development Partnership (H4D), a new global initiative to boost the deployment of low-carbon hydrogen in developing countries.
H4D will help catalyze significant financing for hydrogen investments in the next few years, both from public and private sources. The partnership will foster capacity building and regulatory solutions, business models, and technologies toward the roll out of low-carbon hydrogen in developing countries. Through H4D, developing countries will gain further access to concessional financing and technical assistance to scale up hydrogen projects.
“Low-carbon hydrogen can have a significant role in countries seeking to accelerate their clean energy transition,” said David Malpass, President of the World Bank Group. “Our new hydrogen partnership will enable developing countries to prepare low-carbon hydrogen projects and boost energy security and resilience for their people while lowering emissions.”
Low-carbon hydrogen offers a solution to decarbonize heavy industries that produce more than 25 percent of global CO2 emissions, for which there is presently no viable alternative to fossil fuels. Low-cost, low-carbon hydrogen fuel can become a viable replacement for diesel in transportation. Hydrogen also has the potential to provide long-term energy storage options and bolster the reliability of renewable energies with variable outputs, like solar photovoltaics and wind.
For low- and middle-income countries, low-carbon hydrogen has the potential to generate export revenues, creating a value-added export sector that generates jobs for skilled labor and helps promote food security, since hydrogen can be used to produce ammonia, a key component of fertilizers. It can also generate energy capacity to meet local needs, including decarbonizing in-country manufacturing and smelting sectors, and provide energy access to remote populations.
The main activities of the H4D partnership, to be hosted in the Energy Sector Management Assistance Program (ESMAP) of the World Bank, will include:
- Convening international cooperation to increase the knowledge base in low-carbon hydrogen technologies for developing countries.
- Building capacities by following a global public goods approach.
- Understanding requirements from emerging markets and the private sector for the deployment of low-carbon hydrogen and its derivatives.
- Creating opportunities to inform innovation and for new technologies to gain visibility.
- Generating policy dialogue on enabling the deployment of low-carbon hydrogen across countries.
- Fostering collaboration with private sector partners for clean hydrogen projects.
EU leaders accuse US natural gas producers of profiteering
European leaders are unhappy with natural gas prices. Some leaders are insisting that the EU impose a price cap on all natural gas imports, regardless of origin, – notes Oilprice.com.
France’s president Emmanuel Macron accused the United States of a “double standard” because of the difference between the price at which liquefied natural gas produced in the U.S. sells in Europe and the price at which natural gas sells within the U.S.
“The North American economy is making choices for the sake of attractiveness, which I respect, but they create a double standard,” Macron said, also adding that “they allow state aid going to up to 80% on some sectors while it’s banned here – you get a double standard.”
He wasn’t alone among European national leaders in being unhappy about gas prices. In fact, as many as 15 leaders were unhappy, and they insisted that the EU imposes a price cap on all natural gas imports, regardless of origin.
Now, the U.S. is striking back at the accusations.
“What’s happening is the companies that hold those long-term contracts with US LNG producers, they’re marking that up and earning that margin in the European market,” Brian Crabtree, an assistant secretary at the Department of Energy, – told the Financial Times. “It’s not the US LNG company, it’s basically European-headquartered international oil companies and traders.”
Indeed, producers of liquefied natural gas do not invariably sell their product directly to the consumer, in the face of a country in Europe, for instance, They work with commodity majors such as Vitol and Trafigura, or the supermajors, including BP and Shell.
This is not to say that LNG producers are not benefiting from the much stronger demand for LNG from Europe. And this is exactly the reason they have been benefiting, in the form of higher profits: demand has surged, and when demand surges, prices follow, especially if supply is not growing as fast as demand.
In other words, Europe seems to want businesses to not act as businesses and take every opportunity to make a profit, which is what businesses are all about.
Be that as it may, a Ministry of Energy analyst, told the FT that the U.S. was committed to helping Europe get enough gas “at a price that is affordable to the continent.” It’s hardly a surprise he did not go into detail on how this affordable price would be achieved.
…This is a free market, isn’t it?
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