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FERC, CFTC, and State Energy Law Developments

The Biden administration released the US National Blueprint for Transportation Decarbonization (Blueprint) on January 10, 2023, setting forth a strategy for decarbonizing the transportation sector in order to achieve the economy-wide 2030 and 2050 emissions reduction goals. The Blueprint was developed by the US Department of Energy, Department of Transportation, Environmental Protection Agency, and Department of Housing and Urban Development and focuses on the major transportation modes, identifies specific decarbonization opportunities and challenges for each mode, and discusses the role of various clean technologies for various applications.

The Blueprint identifies three key strategies to implement immediately to achieve the nation’s 2030 emissions reduction goals:

  1. Increase convenience by improving community design and land use to prioritize access and proximity to work opportunities, community services, and entertainment to reduce commute burdens
  2. Increase options to travel more efficiently by enabling shifts to more efficient vehicles and reducing reliance on energy-intensive modes of transport
  3. Transition to clean options by deploying zero-emission vehicles and fuels for all passenger and freight travel modes

The Blueprint acknowledged that the first two strategies will contribute to reducing greenhouse gas (GHG) emissions and produce significant co-benefits, and noted that the third strategy of transitioning to clean options is expected to drive the majority of emissions reductions.

The third strategy requires the adoption of highly efficient zero-emission electric vehicles (EVs), hydrogen fuel cell vehicles, and sustainable fuels produced from biomass and waste feedstocks to decarbonize hard-to-electrify forms of transportation, including air transport and long-haul shipping. This will require addressing EV charging and clean fuel infrastructure needs as well as continued innovation and development of clean technologies.

Among the milestones to be achieved before 2030 are investing in further research and innovation to develop and demonstrate clean technologies (e.g., achieve battery, hydrogen electrolysis, and sustainable fuel cost targets) and enabling integration with energy systems, expanding funding and market incentives to accelerate the uptake of low- or zero-emission vehicles, and investing in the EV charging infrastructure.

Light-Duty Vehicles

As the primary mode of passenger travel and the source of about 50% of total transportation energy use and emissions, light-duty vehicles are major contributors to air pollution. EV sales have increased, but a rapid acceleration of new EV sales is critical to achieving the administration’s decarbonization goals.

The federal GHG emissions reduction goals include (1) reaching a target of having 50% of new vehicle sales be zero-emission vehicles by 2030 and ensuring that new internal combustion engine vehicles are as efficient as possible; (2) deploying 500,000 EV chargers by 2030 to expand the charging ecosystem; and (3) ensuring 100% of federal fleet procurement is zero emissions by 2027. With the influx of EVs and the expectation that EVs will become one of the largest electricity load categories by 2050, the development and implementation of solutions for effective vehicle-to-grid integration are critical.

Medium and Heavy-Duty Trucks and Buses

Although medium-duty and heavy-duty vehicles make up 5% of the total vehicles on the road, they are responsible for about 21% of transportation emissions. A variety of fuel sources and zero-emission technology solutions continue to be explored for use by medium- and heavy-duty vehicles including hydrogen, EVs, and sustainable fuels.

Among the near-term action items identified for medium- and heavy-duty vehicles is the continued investment in demonstration and deployment to support the build-out of an interoperable EV charging and refueling infrastructure through coordinated planning, policy, and funding opportunities.

Aviation

Aviation contributes to about 11% of transportation emissions. Sustainable aviation fuels, which can be created from renewable or waste materials, have been identified as the most viable pathway to rapid decarbonization of the aviation industry. Battery electrification and hydrogen fuel have also been identified as potential options for replacing petroleum-based aviation fuels for short-distance flights and dedicated regional cargo routes.

Near-term actions include demonstrating aircraft technologies that achieve a 30% improvement in fuel efficiency and reducing aviation emissions by 20%.

Takeaways

Continued innovation, research, development, and demonstration across the transportation industry will be necessary to further efforts to achieve net-zero carbon emissions by 2050. The Blueprint identifies key areas of focus that the agencies will target in the coming years, including EVs and supporting infrastructure, hydrogen and hydrogen refueling networks, and sustainable aviation fuels. Additional funding opportunities and incentives will continue to be made available to promote and further their development and demonstration.