The Liquid Carbon Challenge: Clarifying the Problem Statement for Transportation Fuels and Climate

Presenter
John M. DeCicco University of Michigan

Abstract
Petroleum is the world's largest source of primary energy and is projected to remain so through at least the 20-year horizon of the latest World Energy Outlook. After coal, oil is the world's second largest source of anthropogenic carbon emissions. Its significance is assured because of its value for producing liquid fuels well suited for transportation. Motivated by energy security concerns, policymakers have sought to foster alternative (non-petroleum) transportation fuels such as biofuels, electricity, hydrogen and natural gas, which are also assumed to be important for mitigating the sector's climate impact. However, now nearly 40 years after the oil embargo that spurred a generation's worth of effort, alternative fuels have seen little market success and still face major hurdles. Given that climate concerns are of rising importance while the world is entering a new period of petroleum supply, it is worth examining how climate policy might look if it were decoupled from policies premised on petroleum displacement.

This talk explores that question through a fundamental analysis of the factors that underpin transportation greenhouse gas emissions, summarizing a new paper on "Factoring the Car-Climate Challenge" and previewing a paper now under review on "Biofuels Carbon Balance." Using recent data and growth projections for the very different markets of the United States and China, analysis shows that promoting alternative fuels downstream in the transportation sector is less important than addressing net carbon impacts upstream in the energy and natural resources sectors that supply transportation fuels of any form. For biofuels, which are seen as crucial liquid fuel replacements, a corollary first-principles analysis emphasizes the need for an upstream focus on net additional removal of carbon from the atmosphere as a precondition for climatic benefits from any downstream substitution of biofuels. Although not based on economic analysis, these findings suggest a need to rethink transportation climate policies in a manner likely to be better aligned with economic principles. The results also imply new areas of research need.

Date
Tuesday, July 9, 2013
2:30 - 3:30 p.m.

Location
Room 563 C
1616 P St. NW
Washington, DC 20036 All seminars will be in the 7th Floor Conference Room at RFF, 1616 P Street NW. Attendance is open, but involves pre-registration no later than two days prior to the event. For questions and to register to an event, please contact Khadija Hill at [email protected] (tel. 202-328-5174). Updates to our academic seminars schedule will be posted at www.rff.org/academicseminarseries.