Average fuel economy and new vehicles registrations, 2005 and 2008. Source: Technology roadmap. Click to enlarge.

The policy package includes a new fuel economy readiness index, which measures the extent to which countries have implemented steps that will fully exploit the potential of existing fuel economy technologies and maximise their use in vehicles. The index is built from the four key policies needed to improve fuel economy: fuel tax, CO₂-based vehicle tax, fuel economy standards and labeling.

The transport sector currently accounts for a fifth of global final energy consumption, and increased demand from this sector is expected to make up all future growth in oil use worldwide. The two reports show how the world could stabilize demand for oil even if the number of road vehicles (passenger cars, two-wheelers and freight trucks) doubled by 2050.

Tackling road transport energy use is vital to enhancing energy security and reducing carbon dioxide emissions globally. Conventional combustion engine vehicles are set to be around for a long time and without the right policy mixes, like the ones described in these publications, the demand for energy from road vehicles will be unsustainable.

—IEA Deputy Executive Director Richard Jones

But governments need to act quickly, the IEA said. The new IEA “fuel-economy readiness” index measures the extent to which countries have implemented steps that will fully exploit the potential of existing fuel economy technologies and maximize their use in vehicles. It reveals that very few have all the pieces in place to capitalize on the full potential of fuel economy improvements that could be achieved in the coming two decades.

Technology Roadmap. The IEA roadmap on fuel economy of internal combustion engines is part of the IEA series Technology Roadmaps. The roadmap explores the potential improvement of existing technologies to enhance the average fuel economy of motorized vehicles—the vision is to achieve a 30% to 50% reduction in fuel use per kilometer from new road vehicles (including 2-wheelers, LDV s and HDV s) around the world in 2030, and from the stock of all vehicles on the road by 2050.

This achievement would contribute to significant reductions in GHG emissions and oil use, compared to a baseline projection. The report treats different motorized modes separately, with a focus on light-duty vehicles (LDVs), heavy-duty vehicles (HDVs) and powered two-wheelers. A section on in-use fuel economy also addresses technical and nontechnical parameters that could allow fuel economy to drastically improve over the next decades.

Among the key findings of this report are:

• Most technologies for improving the fuel economy of two-wheelers, light-duty vehicles (LDV) and heavy-duty vehicles (HDV) are already commercially available and cost-effective. Compared with 2005 levels, the potential for improving the fuel economy of all vehicle types within the 2030 time frame ranges from 30% to 50%.

• Although many fuel-saving technologies are already commercially available and cost-effective, particularly when considered over the lifetime of vehicles, their market penetration is often low because of a range of barriers explained in the roadmap. Strong policies are needed to ensure that the full potential of these technologies is achieved over the next 10 to 20 years.

• Some technologies need additional research to become commercially viable, including waste heat recovery devices, electromechanical valve actuation, low-friction lubricants and some lightweight materials.

• There is often a gap between the fuel economy measured in vehicle tests and in-use vehicle performance. This gap can be up to 20% and must be reduced to minimize actual fuel use. Strategies to close this gap include better design of fuel economy test cycles, improved traffic flow and better road surface conditions. “Eco-driving”, which includes a suite of technologies and actions to improve driving styles and vehicle operating characteristics, also has significant potential to improve fuel economy.

• Policies that promote fuel economy technologies and improve tested and in-use fuel economy, including fuel economy standards, fiscal measures and information/ education programs, will play a critical role in maximizing fuel economy improvements in all countries over the coming decades.

• Fuel economy standards are in place in most OECD member countries and China, and are helping to make important progress in these countries. These can be used as guides for other countries seeking to improve fuel economy. Most major economies should aim to implement fuel economy standards, as part of a comprehensive fuel economy policy package, by 2015, with strong fuel economy improvement targets for 2020 and even out to 2030. Important complementary policies include fuel economy labeling, fuel economy or CO2-adjusted vehicle tax systems (such as “feebates”), and fuel taxes.

• In countries that already have strong policies, these policies and their targets should be tightened to maintain progress, and by 2015, extended to 2030 and expanded to cover all road vehicle types, particularly heavy-duty vehicles.

The technology roadmap recommends a number of actions:

• Establish fuel economy and/or CO₂ emission targets for light-duty vehicles and trucks, and use a mix of policies that provide a clear framework and balance stakeholder interests. To give automakers and other interested parties a clear view, governments should establish policy frameworks for the period at least to 2025. As far as possible, policies should not favor particular technologies but rather promote improved fuel economy in general, encouraging good practice and performance. Policy goals should be grounded in societal goals such as energy security and low CO₂ emissions.

• Address policy and industry needs at a national level. Governments should work diligently to enact policies that support the necessary technology development and dissemination. The policy recommendations in this document are a good place to start. National roadmaps can be developed that set national targets and help interested parties to set their own appropriate targets, guide market introduction, understand consumer behavior, craft supportive policy and collaborate.

• Research, development, demonstration and deployment (RDD&D) of advanced fuel economy technologies is still needed. Even though most of the key fuel economy technologies are available today, additional breakthroughs and cost reductions would help, including lighter materials, advanced combustion systems and better lubricants. Internationally co-ordinated programmes involving governments and automobile manufacturers will help trigger a faster development and uptake of new technologies in the 2020 time frame and beyond.

• Increase international collaboration on fuel economy. Countries should increase collaboration, for example by aligning targets and policy designs, wherever possible – particularly countries in the same region with interconnected markets (e.g. Europe, South Asia, South America, etc.). By providing broadly consistent signals to consumers and automakers, countries can increase the strength of their combined efforts, while helping manufacturers to sell more of their fuel-efficient models, potentially lowering the cost of compliance. Lower costs are ultimately passed on to consumers and reduce the overall cost of achieving energy security and climate change goals.

Policy package. The scope of this policy pathway is on policies to improve the tested fuel efficiency rather than the in-use operation of the new LDV and HDV fleets. Although fuel-efficient technologies are commercially available, they are not yet widely enough deployed. Policies are needed to encourage the deployment of efficient technologies in new vehicles, the IEA says.

This report complements the technology roadmap which outlines the technical options, potentials, and costs to improve fuel economy in the near-, medium- and long-term. The policy pathway describes the implementation steps of the policies needed to deploy the technologies identified there.

Among the findings and recommendations are:

• Policies to improve road vehicle fuel economy should encourage transformation of the new vehicle market by addressing market failures, information gaps and the higher upfront costs associated with more innovative technologies.

• The provision of high-quality information on vehicle fuel economy to prospective vehicle purchasers should be central to any strategy to encourage improvements in fleet average fuel economy.

• Vehicle fuel economy standards are an important policy element to overcome market failures for most countries.

• Fiscal measures can have a strong influence on vehicle-purchasing behavior.

The publication proposes a policy pathway in four phases to support the development of policies to improve fuel efficiency of road vehicles:

1. Plan: this is the longest phase in developing fuel economy policies. In this phase, the public authority collects information on the status quo prior to policy making; selects the mix and scope of the fuel economy policies; secures resources; establishes the measurement method, target values and form of the fuel economy standards; and determines the design of the fuel economy labeling and fiscal measures.

2. Implement: public authority certifies and oversees vehicle fuel economy test values; vehicle manufacturers publish fuel economy results as labels and in other media; the public authority informs the public about fuel economy and the fiscal measures in place.

3. Monitor: public authority monitors the data from certification and conducts audits to check for compliance with the fuel economy labeling and standards measures. The production vehicles are also checked to ensure the fuel economy matches that of the test vehicles.

4. Evaluate: public authority analyses and assesses the compliance test data to check whether any enforcement proceedings are required; evaluates the impacts of the fuel economy policies; and if necessary, revises the policies to take account of developing technologies and policy design flaws or gaps.

Policy pathway checklist for fuel efficiency policies. Click to enlarge.

Resources

• Technology Roadmap: Fuel Economy of Road Vehicles

• Policy Pathways: Improving the Fuel Economy of Road Vehicles - A policy package