Policy implications of electrifying land freight transport towards carbon-neutral in China

Abstract

Electrification is currently the most promising technology for decarbonizing the land transport sector in China. Economic incentives and regulatory measures have been proposed or adopted to promote electric trucks and trains. However, the policy pathway to carbon neutrality and its costs and benefits remain unclear. An integrated dynamic economic-environmental assessment model for the land freight transport sector is proposed and applied to simulate the impact of different policy pathways during 2021–2060. The results show that China's land freight transport sector could reach carbon peak between 2029 and 2040, while becoming carbon neutral by 2060, with the average carbon abatement cost ranging from 2346 to 61 RMB/t. Due to the high carbon intensity of the current electricity system and the high cost of electric trucks, promoting electrification in the land freight transport sector before 2031 is neither economic nor environmentally friendly. However, from a long-term perspective, the hurry-up electrification could save 5.34 Gt of the total carbon budget at the cost of emitting 0.49 Gt more CO₂ in the first decade (2021–2030) and spending 74.42 trillion RMB more in accumulated investment compared to the delayed electrification scenario. Policymakers should pay attention to such trade-offs between short-term and long-term benefits. The impacts of other key features of the policy pathway towards carbon neutrality of the land freight sector, such as the road-to-tail ratio and the growth rate of freight turnover, were also analyzed.