Heavy-duty zero-emission vehicles: Pace and opportunities for a rapid global transition
This paper reviews and summarizes the latest information on the pace of transition required for the HDV fleet to align with climate targets, the feasibility of such a transition given the latest data on technology availability and cost, potential pathways for adoption in various HDV segments, and high-priority policies and measures that governments would ideally adopt.
Key takeaways are as follows:
An accelerated global transition to ZEVs could reduce road transport CO2 emissions 73% by 2050 compared to 2020 levels. Transitions to HD ZEVs represent approximately half of this emissions reduction potential. Achieving this level of ambition for the HDV sector would yield cumulative CO2 emission reductions of 47.5 billion tonnes between 2020 and 2050.
The ZEV share of global HDV sales needs to rise to 45% by 2030, and to nearly 100% no later than 2040, if the transportation sector is to fulfil its emission reduction responsibilities in line with Paris Agreement goals. The needed pace of transition varies across individual HDV segments; greater ambition is required for segments, like buses, where zero-emission technology is commercially available and cost-effective.
A rapid transition to zero-emission HDVs will have significant global health benefits. Among G20 economies, actions to ensure that all new HDVs are either ultra-low or zero-emission could avoid 3 million premature deaths through 2050, equivalent to 5 trillion USD in health benefits. The magnitude of these benefits would be greater with an accelerated transition to HD ZEVs.
Commercial availability and cost of ownership projections demonstrate that 45% zero-emission HDV sales in 2030 and 100% sales in 2040 are feasible goals for ZEVTC countries. Urban buses, urban delivery vehicles and short-haul tractor trailers are three HDV segments poised for early HD ZEV adoption. HD ZEVs in these segments are, or are projected to become, cost-competitive and commercially mature, and can reach 100% sales as early as 2030 and no later than 2035 in ZEVTC countries. Effective design of national policy in five key areas—target-setting, regulations, incentives, infrastructure, and fleet purchases—is needed to accelerate the transition to HD ZEVs.
Target setting. Overarching political statements should be used to set HD ZEV sales targets that align with climate goals, are legally binding, are unambiguous, and drive greater ambition for vehicle segments whose ZEV market is more advanced. For ZEVTC members, HD ZEV sales share targets of 45% by 2030 and 100% no later than 2040 would align with Paris Agreement goals.
Regulations. Legally-binding vehicle regulations should drive the adoption of zero-emission technology; require, through the use of long-term targets, that manufacturers produce an increasing number or percentage of HD ZEVs each year; recognize differences in cost, emission footprints, and technology readiness among vehicle segments; and use allowances judiciously, to minimize their dilution of a regulation’s impact. HD ZEV regulations should align sales requirements for individual vehicle segments with phase-out targets.
Incentives. Fiscal incentives such as purchase subsidies and tax deductions bring forward the parity date for total cost of ownership. Incentive programs should be tailored to close segment-specific gaps in cost parity, have a revenue-neutral source of funding, and undergo regular review and revision to reflect technology development and cost changes.
Infrastructure. Governments are well-positioned to coordinate among stakeholders and to lead the development of infrastructure roadmaps, ensuring that build-outs align with vehicle electrification targets. Governments should set policies to incentivize private sector investment while targeting public sector investment strategically where it is most needed in the early stages of market development.
Fleet purchase requirements. Fleet purchase requirements create market demand for zero-emission products that can further drive the supply of HD ZEVs, and should be applied to public fleets of buses and trucks as well as large private fleets, to spur the transition to HD ZEVs. Purchase requirements should be aligned with targets and regulations for individual HDV segments.