Emissions from the road transport sector of New Zealand: key drivers and challenges

The transport sector is the fastest growing greenhouse gas-emitting sector in the world and it is also a major source of emissions in New Zealand. Greenhouse gas (GHG) emissions from road transport increased by 84.3% between 1990 and 2016. This increase in GHG emissions was the highest among the different energy sub-sectors of New Zealand. Increasing energy consumption and GHG emissions are due to the gradual increase in population, car-dependent low-density development, lack of integrated public transport networks, inappropriate policy interventions and so on. These factors are making it difficult to reduce emissions from this sector. This study investigates (i) major drivers of transport sector emissions, including how drivers differ from those affecting other developed countries; (ii) a mitigation policy roadmap to achieve future emissions reduction targets; and (iii) mitigation policy initiatives by the government, and policy gaps. To identify the key drivers from a set of drivers, this study uses a vector error correction model (VECM). The Granger causality test reveals that the fuel economy of the New Zealand passenger vehicle fleet has a significant causal relationship with transport emissions. Introduction of a number of policies such as a feebate scheme and/or a high minimum fuel economy standard could effectively alter this causal relationship in the short term, along with other measures such as urban planning changes for medium-term impact. This study aims to help policy makers identify the most tractable factors driving transport emissions and alternative policy options suitable for emissions mitigation.