Executive summary
This edition of the ITF Transport Outlook examines the impacts of different policy measures on global transport demand and carbon dioxide (CO2) emissions to 2050. The analysis covers passenger and freight activity across all transport modes. It places a particular focus on transport policies that make cities more liveable. A second focus is on infrastructure investment decisions and what different policy scenarios mean for them. As a third focus, the report explores regional differences in policy impacts.
The report analyses two policy scenarios for the future of transport, using the ITF’s in-house transport models. The Current Ambition scenario assumes policies to decarbonise transport continue along their current pathway and considers the implications for transport demand, CO2 emissions and further aspects over the next three decades. The High Ambition scenario assumes policies focused on accelerating the decarbonisation of the transport sector and their impact.
Time is running out to meet the Paris Agreement goal to limit global warming to “well below” 2 degrees Celsius above pre-industrial levels. Despite efforts by some regions to decarbonise, transport emissions will not fall fast enough, as transport demand will grow in the years to come. By 2050, passenger demand will increase by 79% under the Current Ambition scenario and freight demand will roughly double. Under the High Ambition scenario, the equivalent increases are 65% and 59%.
Policy makers play a crucial role in breaking the link between transport demand and emissions. They must use the tools at their disposal to ensure zero- and low-carbon technologies and fuels scale up to become cost-competitive. For road and rail transport, low- and no-carbon technologies require large-scale rollout. For the maritime and aviation sectors, developing sustainable and affordable fuels, in sufficient quantities, will be crucial to decarbonising in the long term.
Public transport and mass transit offer great opportunities to advance zero-emission travel. But an integrated mixture of transport modes – including ridesharing, shared vehicles and infrastructure for walking and cycling – will be essential. With bolder policies, mode share for private motorised vehicles in urban areas falls from 49% in 2019 to 36% in 2050, as most passenger travel switches to sustainable modes. Outside urban areas, mode-shift policies will succeed in specific contexts. Rail, in particular, achieves a higher mode share under both the Current and High Ambition scenarios. However, roughly 50% of regional trips will still happen by passenger car in 2050, even with ambitious policies.
International and intercity travel rely on carbon-intensive transport modes. Aviation alone accounts for nearly half (47%) of international and intercity passenger-kilometres. Long-distance trips are particularly hard to decarbonise for both passenger and freight. Making these trips more sustainable without reducing travel will require reducing the carbon intensity of the travel.
Freight mode choice is mostly unresponsive to pricing measures. The exceptions are road and port access modes in multimodal trips. Coherent pricing policies can ensure that the most sustainable of the viable modes are chosen. Carbon pricing can encourage a move away from the most carbon-intensive fleets and make low-carbon fuels more cost-competitive.
Regardless of the pathway chosen, the transport system will require significant investment in the coming decades. Core infrastructure investment needs to meet projected demand are estimated at 1.7% of global GDP annually through to 2050 under the Current Ambition scenario, and marginally less (1.6%) under the High Ambition scenario. However, the rollout of electric vehicle charging networks, which is essential for electric vehicle uptake, will require significant additional investment.
Develop comprehensive strategies for future mobility and infrastructure
To ensure increased transport activity is as sustainable as possible, governments should change their approach to planning. Instead of providing infrastructure as a reaction to predicted demand, the “decide and provide” approach invests in infrastructure in a vision-led way, with a view to achieving certain public policy objectives. This approach is not necessarily costlier: core infrastructure investment needs could be lower if ambitious decarbonisation policies are implemented now.
Accelerate the transition to clean vehicle fleets
New vehicle technologies and alternative fuels are crucial for decarbonising transport. Accelerating the transition towards cleaner vehicles and fuels requires targeted policy support with clear, ambitious objectives and support measures. Incentives to accelerate zero-emission passenger vehicle use should not disadvantage citizens on lower incomes. Alternative fuels and vehicle technologies rely on enabling infrastructure (e.g. electric charging networks and refuelling sites), which will require additional investment.
Implement mode shift and demand-management policies where they are most effective
Measures that reduce trips and travel distances, and encourage the use of more sustainable modes, work well in cities but are not always feasible elsewhere. Some countries can expect to shift regional and short-distance intercity and international travel, to rail, and should pursue this where feasible. Mode-shift policies will make little impact on longer-distance travel, as long-haul air trips are difficult to replace, for instance. Here, transitioning to lower-emitting vehicles and fuels should be the priority.
Consider the additional benefits for urban areas when evaluating policies
Many policies to decarbonise urban mobility have additional positive impacts. Measures that reduce car dependency in cities and improve sustainable transport options, for instance, can make mobility more affordable and improve access. They can also reduce congestion, free up urban space and improve health outcomes by reducing crash risks for cyclists and pedestrians and limiting air pollutants from road traffic.
Reform vehicle taxation to capture external costs of new vehicle fleets
Government revenues from fuel-excise duties will continue to fall as vehicle efficiency improves and the transition to zero-emission vehicles accelerates. This will make them less effective as a policy lever to encourage sustainable behaviours. Efficient road pricing would mitigate the impact of diminishing revenues from fuel duties. Congestion charging can also help capture the external costs of road use more fairly over time and encourage more sustainable transport choices.