Net zero, part 2: transport

$100/ton DAC raises prices a little, clean tech can fix that.

This is part of a series of posts on how to pause climate change using technology and policy:

Net zero, part 1: energy

Net zero, part 2: transport (you are here)

Net zero, part 3: production

Net zero, part 4: agriculture

Net zero, part 5: stopping climate change

In the short term, it’s better to pause climate change than revert to a pre-industrial climate. To pause climate change, it’s sufficient to achieve net zero emissions across the economy. Here we’re going to focus on getting to net zero in transport.

How do we get boats, trains, planes, and cars to stop emitting carbon without undercutting the prosperity they provide?

In the energy sector, switching to green technologies was also good business; renewables are cheap. With transport, fuels are hard to beat. After thinking about e-fuels and batteries and power beaming, I realized: transport will generally get more expensive in a net zero world. Instead of trying to engineer our way out of it, I ask “how much will net zero increase transport costs?” and “is there a way to lessen (or eliminate) that cost?”

For concreteness, I’m going to assume that the world has agreed to tax carbon emissions. We’ll look at how that impacts each transport sector and how those industries might adapt.

Load bearing assumptions

The key unfounded assumption is that carbon capture and sequestration get below $100/ton and the carbon tax is $100/ton. Climeworks is aiming for $300/ton and Terraform industries claims they’re reaching $250/ton on their experimental setup. To get below $100 per ton, we need an aggressively scaled form of enhanced weathering. Austin Vernon thinks this is straightforwardly possible. But without the needed research, it’s still a big if.

Second, I’m assuming carbon capture cancels out CO2 emissions. This has only recently been established by climate science, and new evidence could change the picture somewhat.

Third, I believe we should treat CO2 and other forcing contributions separately. CO2 emissions get carbon capture, other forcing requires (much cheaper) stratospheric aerosol injection. I’m going to focus on the cost cleaning up CO2 emissions. This is mostly of consequence for air travel.

Fourth, capturing carbon necessarily raises prices. We need a benchmark for what an acceptable price increase is. If the tax increases customer prices by less than 10% with clear opportunities to increase efficiency I’ll assume a carbon tax is fine. Defining what customers are really buying gets a little tricky when we talk about commuting.

Fifth, e-fuels and sustainable aviation fuel are silly. Capturing carbon and making fuel is probably more expensive than just capturing carbon. Making e-fuels requires capturing carbon plus making green hydrogen plus using renewable energy plus building reactors plus new fuel pipelines. Capture is simpler and has the same effect of making transport carbon neutral. It’s possible I’m missing something and e-fuels will work out, but I’m going to assume enhanced weathering is our best bet for now.

Let’s look at how different transport sectors would change under a $100/ton CO2 tax.

Source

Cars

Gas costs about $3.20/gallon and emits 8.8 kg of CO2. A carbon tax would add 88 cents per gallon, a 28% increase. Doesn’t this cross my 10% benchmark? No, because gas isn’t the final good people are buying. They buy gas so their car can take them places. Gas costs are only 18.2% of per-mile vehicle costs. The net effect of a carbon tax is a 5% increase in per-mile costs.

There are also substantial opportunities to lower the tax. The $0.88 carbon tax is comparable to the $0.6-$1 per gallon added by gas taxes in the US today, one of the lowest rates in developed countries. Gas taxes bundle congestion taxes, pollution taxes, and road maintenance fees together. As people switch to electric cars, gas tax is no longer appropriate for these purposes. Instead, states should switch to automated tolls to fix congestion and pay for road maintenance¹. A tax on car sales can cover the pollution that all cars produce.

Why this aside? Because using gas taxes to pay for carbon capture while adding congestion pricing effectively fixes car tax policy without raising gas taxes. Though many states would have to increase their gas taxes to fully compensate for CO2 emissions.

There are technological solutions too. People can halve or eliminate their their taxes by switching to a hybrid or electric car. The fact that so few do this is a sign that gas taxes are too low. A host of other opportunities to reduce fuel use include slower driving, washing your car, delivery, micromobility, self-driving cars and redesigning cities around these new technologies.

Capturing commuter CO2 and charging for it is a straightforward solution. With a slow phase-in and appropriate tax policy will make the price impact minimal. Eventually, virtually all commuter miles can switch to electric cars.

Trucking

Trucking was harder to research because it’s more diverse than the other forms of transport². The segment lumps together things like delivery vehicles, dump trucks, and ice-road trucking. Those are very different use cases!

Fortunately trucks generally run on diesel which costs $3.7/gallon and emits 10 kg of CO2 per gallon. So a carbon tax adds 27% to the price. I’m going to assume that’s the same across all trucks. For segments that aren’t too different from midrange trucking on highways, I’m going to assume that fuel costs are about 24%, a 6.5% price increase.

Different segments have different performance requirements and conditions. Delivery vehicles carry light loads in mild climates with grid infrastructure; adding batteries to them is a lot more feasible than electrifying a logging truck in cold, remote northern Canada.

That said, a lot of solutions apply to multiple segments so rather than repeat them across sections I’ll combine them here:

• More efficient diesel-electric or full electric drivetrains

• Regenerative braking

• Switching to lighter hydrocarbons like LNG, dimethyl ether, or propane

• Remora’s on-truck carbon capture rig

• Driving at fuel-optimal speeds and distances

• Aerodynamic improvements like replacing side mirrors with video feeds

• Tailing other trucks to reduce drag

• Building the truck out of lighter, stronger materials

• Frequent tire inflation

• Shift heavy cargo to rail

• Optimized route planning and packing of vehicles

Delivery and last-mile logistics

This is a very important segment to decarbonize as it contributes 30% of the CO2 emissions from trucking. It’s also the easiest to electrify with short routes, light cargo, and plenty of opportunities to charge.

This segment is also ripe for replacement with a fully automated hyperlogistics system. The fact that a substantial number of delivery trucks are already switching to electric is a sign that they pass the market test.

This segment will come out stronger from having a carbon tax.

Drayage

Drayage involves moving shipping containers to nearby logistics hubs. The distances aren’t super long but cargo containers can be heavy. Switching to diesel electric and/or lighter hydrocarbons seems like an easy win. Since they’re near charging infrastructure, it’s probably feasible to switch these to battery power so long as the battery isn’t too heavy.

This segment seems like it would survive a carbon tax.

Short-haul trucking

This involves ranges of around 100 miles, potentially with a heavy load. Diesel-electric should be fine and as batteries improve these trucks could probably get electrified too.

An efficient electric truck might use 1.5 kWh per mile and the 150 kWh batteries I looked at were like 600 kg which looks like it would take up 6.5% of the payload, remarkably similar to the carbon tax cost.

EDIT: I forgot to include the weight of fuel that the battery is replacing. Semi truck gas tanks hold 120-150 gallons, with each gallon of diesel being 7 lbs. A full tank could be 380 kg. Even though the fuel is burned over the trip, the mass of the full tank subtracts from the possible cargo because the truck can’t go over the weight limit at the beginning of the trip. That means the net mass of the battery is closer to 200 kg, about 2% of the payload. Subtracting gas tanks and switching to a lighter electric engine means this cost falls even more. This factor doesn’t change the math for Long-haul trucking. End EDIT.

With falling electricity prices, this could end up being cheaper and less risky than relying on fuel.

One option to reduce the battery weight is to swap batteries once per day. This would require a build out of battery swapping stations but would halve the payload penalty.

Regardless, 6.5% 2% is below my cutoff for concern.

Long-haul and regional trucking

I’ve seen different definitions for these, but regional and long haul trucking both seem to involve driving 250-1000 miles with regional getting more time at home. For our purposes, they are pretty similar because they involve highway driving with access to grid infrastructure.

Drivers are legally limited to working 10 hours per day so at 55 mph they are only covering 550 miles per day. That would require a 825 kWh battery. Assuming it’s a next-generation LFP battery with energy density of 150 Wh/kg, that would weigh 5500 kg, taking over a third of its payload (15500 kg or 34000 lbs). It’s cheaper to just pay extra for carbon tax in this case.

Truckers refuel once every day or so. A daily battery swap would halve the size of the battery, but it’s not enough to beat diesel. Drivers would need to swap batteries twice a day and add other efficiency measures to make batteries work. This may be feasible depending on the number of required breaks. Austin Vernon took a look at this and concluded that Electric Trucks are Ready for the Road.

EDIT: see here for a good discussion of the Tesla Semi. It seems that the ~5000 pound weight of the diesel drivetrain and fuel go a long way towards making this more feasible. A battery pack that achieved a system density of 150 Wh/kg should be able to pack ~280 miles of range into the same weight as the diesel systems. Truckers would then need to swap batteries once per day and charge at night.

I have a different conclusion. Rather than remake long haul trucking, the 6.5% hit from carbon tax is a safer bet. More conservative options like switching to diesel electric, using lighter hydrocarbons, and improving aerodynamics can reduce the tax incidence further.

This segment will officially be Fine under a carbon tax.

Vocational trucking

This category groups all sorts of trucks that are used for particular roles like logging, dump trucks, garbage trucks, etc. They often need to operate in remote places and have high performance requirements. This seems like the hardest segment to decarbonize. I don’t have good numbers for fuel costs as a percent of operating cost, but even if it was 40% the price impact would be about 11%.

Edison motors logger

The only innovation that might benefit this segment is diesel electric drive trains. Fortunately, startup Edison motors is leading the charge here by building kits to convert all sorts of vocational trucks to diesel electric. This can have substantial performance benefits for the trucks themselves since they can use the electric motor to generate a lot of torque and use regenerative braking to save on brake wear.

I doubt the price impact would be over 10% in this segment, but I’ll put it in the Mildly Concerning category due to it’s challenging requirements.

Lumber

Logging isn’t really a “transport” sector per se and is also a subset of vocational trucking, but deserves it’s own treatment.

Logging requires hauling large loads in cold and remote places. Logging equipment will need to burn fuel for the forseeable future. This article estimates that fuel is up to 20% of the final price of lumber. With our 27% increase in diesel prices, that’s going to increase lumber costs by 6%, which seems fine.

The story gets better when we consider that lumber can be carbon negative. If society continues to use a certain amount of wood for houses, an equivalent amount of CO2 has been removed from the biosphere. Good carbon tax policy will credit the lumber industry for this contribution, meaning 6% is an upper bound on the price increase. Properly assessing the forcing contribution depends on how long wood lasts, lifetime emissions, and how much spent lumber can be repurposed³.

Besides the tech mentioned in the vocational trucking section, an increased price for lumber can be compensated with better or cheaper wood. Glulam, fiber reinforced composites, wood-plastic composites, or other engineered wood tricks can lower the amount of lumber needed for a given amount of strength. Along with more productive trees, recycling, and automation, the future of wood is bright.

Due to the low price impact, I think this segment will be fine.

Rail

Fuel is about 25% of operating expenses for trains. Most locomotives run on diesel electric drivetrains so using our previous diesel price bump, a carbon tax would add 7% to costs. Amortizing fuel over heavier loads and longer routes should reduce the tax incidence. Remora’s carbon capture should work too. Apparently most of the world has already electrified a substantial fraction of their trains.

The lower tax incidence and ease of electrification compared to other transport modes might shift more demand to rail for shipping.

Passenger flights

Airplanes have a bunch of different forcing contributions. In fact, the forcing from the contrails alone is larger than the CO2 emissions. But these other forcing contributions should be addressed with solar radiation management (SRM). I’m going to focus on the cost of CO2 because it will be more expensive than SRM.

Each ton of jet fuel produces 3.16 tons of CO2 and costs about $750. DAC would add $316 to that. Fuel costs are 25% of airline operating costs, so raising the cost of fuel should raise ticket prices by 11%.

That price increase is significant but manageable. There are many ways for airlines to increase fuel efficiency and thus lessen the effect of the tax. Indeed, per-passenger efficiency has increased rapidly over the last 75 years.

Source

There’s no end in sight for airline innovation. Some ideas for increasing fuel efficiency further:

• Longer routes are more efficient per mile because it amortizes the inefficient parts of taxi, takeoff, and landing.

• No luggage or moving luggage to cargo planes. Luggage uses about a third of the payload on flights and is cheaper to ship other ways.

• Switching to slower more efficient engines like turboprops.

• Flying closer to the fuel-optimal distance for a particular plane.

• Bigger planes can be more efficient per passenger.

• Flying closer to fuel optimal speed.

• Washing the plane.

• Optimized wing and propeller designs.

• Blended wing bodies can offer 50% efficiency gains.

• The Otto Celera 500L can offer better fuel economy for 6 passenger flights. Though it doesn’t beat big planes, switching to point-to-point travel might lower total travel emissions.

• New engine designs⁴.

• Switching to a lighter hydrocarbon with a higher fraction of its energy from hydrogen⁵.

• Switching to eVTOL planes for short trips.

• Getting towed by an electric plane.

• Flying in formation can reduce fuel use of the trailing plane by up to 10%.

Like other sectors, slowly phasing in a carbon tax and while subsidizing research will give airlines plenty of opportunity to adapt.

Air freight

Fuel is 30-40% of operating costs, with the price increase for Jet-A from the last section, a carbon tax would increase prices by 13-17%. This would likely shift heavier cargo to trucks and rail. In the future, blimps could eat a substantial fraction of air freight.

Almost all of the suggestions from the last section would apply here. Air carriers can more readily accommodate slower, more efficient turboprops and make up for lost time by accelerating ground logistics.

Despite the dozens of opportunities to reduce carbon taxes, the price increase is higher than my benchmark. So the impact on air freight is mildly concerning.

Shipping

A couple of estimates:

1. Fuel is about 50-60% of operating costs for shipping. Shipping also uses dirty bunker fuel, but I didn’t find emissions estimates. Let’s round up the diesel number and assume DAC adds 30% to the price. The end result is a 15-18% price increase

2. Eli Dourado estimated that shipping costs ~1 cent per ton-km. Shipping emits 11-16g of CO2 per ton-km (bigger ships are more fuel efficient). So we get 0.11-16 cents per ton-km of carbon tax or a 11-16% price increase.

I’m going to stick to 15% for now. Fortunately there are over a dozen ways shipping could reduce carbon emissions:

• Battery ships

• Slow steaming to increase fuel efficiency

• Towing from battery powered tugboats at the beginning and end of the journey.

• More efficient diesel-electric engines.

• Lighter hydrocarbon fuels such as LNG or LPG.

• Flettner rotors or sails.

• Bubble shields.

• Optimized hull designs.

• Hydrofoils

• Routes optimized for ocean currents and wind.

• Bubbling ship exhaust

• Onboard CO2 capture (EDIT: this is more viable than I thought, see footnote⁶)

• Nuclear powered cargo ships

• Larger cargo ships

• Beaming microwave power

• Trailing other ships

Despite these opportunities, the initial cost increase is greater than my benchmark, so this is Officially Concerning.

EDIT: reading this paper has made me more optimistic about battery ships for short trips and battery tugs. Transpacific voyages still need a rest-stop in the middle of the Pacific. I also expect bulk shipping demand to fall somewhat as coal and oil demand fall. See also.

Conclusion

Most transport segments looked like they would be fine under a carbon tax. The exceptions were Air Freight (15%) and Shipping (15%) with vocational trucking having an uncertain price impact. Fortunately air freight and shipping have plenty of opportunities to increase fuel efficiency. Each sector can see carbon taxes phase in at a rate that makes it feasible to deploy new technology.

Is it somehow bad to tax these sectors? No, I think it’s important that emitters pay to clean up their emissions, especially when the cost is so low. This will induce innovation that makes these sectors cheaper and more resilient overall.

Is is somehow bad to keep using fossil fuels? As long as their harms are countered, it seems fine. The reduction in fuel use from a carbon tax means we will have centuries of oil left. Worst case we can make more out of other fuels or switch to e-fuels.

Green technology isn’t a slam-dunk in most transport segments. But a carbon tax can eliminate the negative effects of burning fuel while minimally impacting these industries.

EDIT: One technology that would revolutionize all transport modes is Lightcell’s system. It would more than double the electricity out per unit of fuel while using an electrical system that’s much lighter than diesel drivetrains. That’s a big mass saving with half the emissions. Use natural gas and you can halve emissions again while reducing fuel weight. Even with a carbon tax, the net effect on costs would be negative. Godspeed to the Lightcell team.

1. And congestion pricing encourages traffic to flow at a more efficient speed, reducing emissions.

2. I probably missed some weird transport segment with odd requirements. It will probably be fine.

3. See the first section of this post for more.

4. I wonder if the benefits of hybrid electric turbines or rotating detonation engines can improve traditional airplane engines. EDIT: the Electra Ultra Short looks promising for this. A design that optimized for fuel efficiency over noise and short runways could be even better.

5. In the limit, LPG or LNG could be used, but would require a substantial redesign. There’s some interesting opportunities here, taking inspiration from Astro Mechanica or using the pressure of the gas to stabilize the wing. Low temperature fuels can help cool the fresh air drawn from the outside to refresh the cabin.

6. Extrapolating from Remora mentioning in a video that they need 5000 lbs to put a carbon capture unit on a semi, that should be 227 tonnes (~9 TEU’s) on a cargo ship (because cargo ships emit about 50-100x faster than a semi). In practice the weight scaling will be much better. At 90% of the CO2 captured, on a 10,000 TEU ship, on a 20 day voyage, the weight of the CO2 (net of fuel) is 5-10% of the payload capacity.

Ships often make a few stops and can periodically unload the CO2, reducing cost further. The loss in fuel efficiency from the added weight makes the numbers a little worse, but bigger container ships make the numbers better. Transpacific voyages may still be unworkable unless there’s a fuel and CO2 stop in the middle. Maybe in Hawaii or the Aleutian islands.

It’s tempting to consider converting the CO2 at port back into fuel, but even with free CO2 and $1/kg hydrogen, it’s not competitive with marine fuel. Simply sequestering the CO2 and charging a carbon tax is a better move.