To meet national climate targets and international climate commitments, Australia is undertaking economy-wide decarbonisation. One of the critical sectors to decarbonise is transport.
In 2021, the sector contributed approximately 20 per cent of Australia’s domestic emissions and is likely to become the largest contributor by 2030.
Freight makes up a considerable share of transport emissions, estimated by Climateworks to be just under 40 per cent of the transport total. This represents approximately 7 per cent of Australia’s total emissions.
Within freight, road transport has a dominant, 83 per cent, share of emissions. This report focuses on opportunities to reduce emissions from road freight with solutions that span the entire freight sector.
There have been efforts to decarbonise freight in Australia for some time. Because reforms were difficult to achieve or technology solutions were not yet available, this has been challenging and freight has been characterised as ‘hard to abate’.
Now, given global momentum, there is an opportunity to build on past efforts and to develop a national approach to freight decarbonisation.
With global shifts in manufacturer interest and increasing regulatory pressure on companies to report on value chain emissions that include freight transport, pioneering freight decarbonisation policies are being formulated in economies similar to Australia.
The time is right to move beyond framing freight transport as being a ‘hard to abate’ sector and take action.
Undoubtedly, important decisions regarding the future of Australia’s freight transport landscape will take time, and there are complex implementation hurdles yet to be overcome in some areas. Long lead times for investment decisions means that planning and action on early priorities must start now. Planning will also help a fragmented industry with a vast array of small businesses and owner–drivers achieve a just and equitable transition.
This report’s recommendations take a two-pronged approach, the first to implement opportunities and solutions that are already available in short-haul road freight, and the second to enable a smoother transition towards existing and emerging solutions in long-haul freight.
The recommendations focus on reducing emissions in road freight, with solutions that go well beyond zeroemissions trucks.
Across both short- and long-haul freight, there are three ways to reduce emissions: reduce the overall distance travelled; shift to lower emissions transport modes and make vehicles and trips less emissions intensive.
Enlisting a suite of solutions in an integrated way can help Australia reach its climate goals in time, improve productivity and urban liveability, and reduce congestion.
By implementing available solutions in short-haul freight, Australia can start reducing 51 per cent of its freight emissions immediately.
Climateworks recommends that freight decarbonisation plans and actions, including government policy, consider the following:
- Set a pathway to freight transport decarbonisation with clear interim targets
Recommendations to decarbonise short-haul freight:
- Build demand for zero-emissions trucks and vehicles by making them competitive assets for business investment
- Offer tax breaks or other credits until required market share is achieved
- Implement emissions-based access and charges
- Formulate incentives to help small operators purchase zero-emissions trucks and vehicles
- Build an environment that supports market innovations and optimisation
- Formulate policies and programs to support market innovations in last-mile deliveries
- Provide reliable data, tools and analysis to support industry decarbonisation
- Support training and skills development to create jobs and ancillary industries
- Collaborate with industry to deploy charging and refuelling infrastructure and efficiency measures
Recommendations to decarbonise long-haul freight transport:
- Undertake a comprehensive cost-benefit analysis to determine optimal roles for different modes, fuels and technologies
- Make rail a competitive mode-choice for long-haul freight
- Prioritise policies that increase operational efficiencies and reduce costs
- Link mode shift subsidies to clear decarbonisation targets
- Invest in rail, port and intermodal infrastructure to facilitate an expanded role for rail freight
- Reduce technological uncertainty by providing guidance, supporting vehicle trials and demonstrating integrated use-cases for long-haul trucks
- Assess the gaps and opportunities for zero-emissions technology in long-haul road freight
- Demonstrate working pilots with industry
- Set a clear role for advanced biofuels