Implications for GHG emissions and local pollutants

Direct CO2 emissions

In the Base Scenario, looking at all forms of transport, direct carbon dioxide (CO2) emissions at Page | 86 the tailpipe resulting from the combustion of fossil fuels increase by 32% in 2050 relative to 2015 (Figure 2.16). The majority of this increase in emissions, about 1.2 gigatonnes (Gt) of CO2, comes from heavy-duty vehicles (buses and trucks). Tailpipe emissions from fossil fuel combustion by light-duty road vehicles increase in absolute terms by less than half as much (0.5 Gt CO2), followed by increases in shipping (0.43 Gt CO2) and aviation (0.32 Gt CO2). Direct combustion emissions from rail are roughly constant between 2015 and 2050, even with

increased rail activity, as the sector continues to electrify.

Figure 2.16 Direct CO2 emissions from fuel combustion in the Base Scenario, 2017-50

Levels of GHG emissions from freight rail remain nearly twice as high as those from passenger rail throughout the outlook period, rising by 27% by 2050 to reach 0.2 Gt CO2-eq. Again, this compares favourably with the almost 60% growth of freight rail energy demand.

As in the case of energy demand, GHG emissions from passenger rail decline in Japan (down about two-thirds between 2017 and 2050), Europe (-54%) and North America Page | 88 (about -30%). The trend is reversed in emerging economies, because of their much stronger growth in rail activity. In China, GHG emissions from passenger rail peak in 2030 and then decouple from increasing energy demand as a result of electrification and decreasing carbon

intensity of electricity production.

Annual freight rail emissions fall in Japan (-66%) and Europe (about -50%) by 2050. In all remaining regions, emissions increase, although at slower rates than the growth in energy consumption, due to growing share of electric traction and decarbonising of power generation. In North America, freight rail remains reliant on diesel traction, as long distances with low utilisation do not support installation of OLE given the costs and logistical challenges.

Emissions of local pollutants

As discussed, growing demand for personal travel will lead to more activity in cars and trucks in the Base Scenario. Across all modes, passenger transport activity in 2050 more than doubles from 2017 levels and freight activity triples. At the same time, the adoption of emission control technologies in cars and trucks and broad application of emissions standards, reduces specific (per kilometre) fine particulate (PM2.5) emissions from cars and trucks. However, noncombustion PM2.5 emissions, which come from the abrasion and corrosion of vehicle parts (e.g. tyres, brakes) and road surfaces, are still relevant. By 2050, the average PM2.5 combustion emissions per vehicle-kilometre of a passenger car are one-third the current level, and those of the average heavy freight truck are 40% the current level (IEA, 2016). By 2050, declining combustion emissions intensity more than offsets growing activity and the net effect is 10% decrease in PM2.5 emissions from road transport modes.

Despite these improvements, air quality continues to be a pressing challenge, particularly in cities, affecting the health and life expectancy of billions of urban inhabitants. Rail makes a positive contribution to the reduction of atmospheric pollutant emissions, with a resulting positive impact on air quality in urban areas. In the Base Scenario, urban rail activity is expected to increase in all regions, though with a limited increase in developed economies and Russia, and a strong increase in emerging economies. Air quality is an issue in all countries, but the cities with the heaviest pollution problems are in Asia. The growth in urban rail transport in the Base Scenario alleviates some of the problem: China has the strongest growth in urban transport activity in absolute volumes, and India experiences the fastest growth in urban rail infrastructure deployment. In the Base Scenario, by 2050, urban rail avoids 0.7 million tonnes of PM2.5 emissions in urban environments compared with a situation in which rail activity was covered by road vehicles.26

Investment requirements

Transport infrastructure in general, and rail infrastructure in particular, is extremely capital intensive to build. Over the period 2010-15, average annual investment in road infrastructure in the group of major countries listed below27 totalled USD 540 billion (2015 USD on purchasing

power parity [PPP] basis), 2.7-times higher than the USD 200 billion investment in the same Page | 89 group of countries in rail infrastructure (OECD, 2017). Combined investments in airports and

seaports over the same period and in the same countries were USD 43 billion, about one-fifth of those in rail (OECD, 2017).28

In total, average annual investment in road and rail infrastructure worldwide in the Base Scenario amounts to about USD 1.9 trillion. At USD 315 billion, annual investment in rail infrastructure to mid-century is estimated at around one-fifth of investment in road infrastructure. Moreover, where rail is able to provide competitive mobility services, (particularly in high throughput corridors), investment in rail can offset investment in other transport modes, such as airports, roads and parking spaces for cars, and, importantly, consumer expenditures on personal vehicles and fuel. Other benefits include reduced air pollution in urban areas and lower GHG emissions, though these are difficult to monetise.

Rail construction costs depend on a number of factors, including the costs of land acquisition, labour and materials, the number of tracks per line, track electrification, the need for tunnels or bridges and the intended operating speed. These and other factors give rise to large differences in costs which, per line-kilometre for conventional rail, can range from USD 0.5 to 20 million (Gattuso and Restuccia, 2014; Von Brown, 2011). For urban light rail the costs range from USD 10 to 25 million (Rode et al., 2014). High-speed rail lines are even more expensive, with costs of USD 20 - 80 million per line-kilometre, with elevated or tunnelled track raising costs further (Campos and de Rus, 2009; Wu, Nash and Wang, 2014; ETSAP, 2011; UIC, 2018). Metro is more expensive still: costs typically range USD 50 - 350 million per line-kilometre (Lepeska, 2011; Pedestrian Observations, 2013; Davies, 2012) and tend to be higher for underground metro construction in densely populated urban centres.

Besides investment in rail infrastructure, there are numerous other investment requirements in the rail sector, first and foremost for the rolling stock. Comprehensive global annualised average investment needs in the Base Scenario amount to around USD 475 billion (2015 USD PPP), of which expenditure on infrastructure – building the networks, including electrifying new and existing conventional rail networks – amounts to USD 315 billion. This figure is no surprise, given the high capital costs of rail infrastructure (Figure 3.23). The remaining third of the investment in rail goes to renewing and expanding train fleets. Most investment in trains over the coming decades involves renewing and updating the fleet of conventional, freight and high-speed trains, and a very small share goes to the metro and light rail train stock.

Figure 2.19 Annual average investment costs in the Base Scenario, 2018 to 2050