ITF Round Tables
International Transport Forum
- ECMT Round Tables
A series of conference proceedings from the International Transport Forum (formerly the European Conference of Ministers of Transport). They generally cover economic and regulatory aspects of transport in ITF countries. Recent Round Tables have covered such topics as biofuels, transport costs, transport infrastructure investment, and taxi regulation.
Stimulating Low-Carbon Vehicle Technologies
- Publication Date :
- 16 Dec 2010
- Pages :
- ISBN :
- 9789282102978 (PDF) ; 9789282102916 (print)
- DOI :
Show Abstract /
Governments around the world are increasingly intervening in automobile markets to improve fuel economy and reduce emissions of CO2 from new vehicles. This report reviews the rationale for such intervention and examines measures for maximum effectiveness and minimum cost.
The Round Table brought together economists, policy makers and auto engineers with the aim of advancing understanding of why car markets currently fail to deliver sufficient fuel economy. It started by questioning whether any additional measures would be necessary once an appropriate price for carbon dioxide is established via fuel taxes. It confirmed that there are indeed market imperfections that merit additional government intervention. Fuel economy and CO2 regulations are an essential part of the package. The key to maximising the benefits of such regulations is long-term planning. The longer the timeframe, the less industry investment is handicapped by uncertainty.
Subsidies to electric vehicles are more problematic because of the risks of prematurely picking winning technologies and creating subsidy dependence. And electricity production has yet to be decarbonised. However, intervention to steer innovation in this direction is merited so long as the risks of not attaining climate policy targets are seen as higher than the risks of intervention.