- Student Dissertation or Thesis
Vehicle sales and road travel volume in China have grown rapidly in recent years, and with them energy demand, greenhouse gas emissions and local air pollution. Aviation and rail travel have also grown, while ceding a large share to private vehicles. What path will household transport demand in China take in the future? How might it interact with policies which limit greenhouse gases, and what are the implications for energy use, the environment and the economy? To contribute policy insights and a foundation for future study in this area, I undertake a new calibration of the Chinese household transport sector in the MIT Emissions Prediction & Policy Analysis (EPPA) computable general equilibrium (CGE) model, implementing income elasticities of demand for vehicle travel and vehicle stock growth based on historical data. To bracket uncertainty in the literature, I impose three scenarios of future growth in demand for purchased (air, rail and marine) and vehicle modes. These are explored under a no-policy baseline, a climate-stabilization policy, and with a policy that extends the emissions-intensity goal of China’s Twelfth Five-Year Plan—both policies are modelled as caps creating prices on carbon. Examining the results, I find that trends in growth are only modesty affected by policy continuing present energy-intensity goals, with small decreases in travel activity and energy intensity of vehicles combining for a reduction in refined oil use; such a policy has modest cost and affects household transport less than other sectors. In contrast, my results show that a stringent emissions cap has large impacts on vehicle efficiency, limits vehicle ownership and general travel activity levels. Compared to the no-policy baseline, a smaller vehicle fleet (250 million total, or 200 per 1000 capita). Sixteen percent of the fleet is new energy vehicles (plug-in hybrid-electrics), while total refined oil use increases by 2050 to nearly three times its 2010 level. However, these effects come with a reduction in total primary energy as the policy is introduced, and large costs economy-wide. Chinese national and municipal policies include objectives of promoting vehicle ownership and mobility on the one hand, and of reducing dependence on carbon-intensive refined oil on the other. My findings illustrate that 3 these goals are at odds, and offer inputs to policy design related to vehicle sales, public transit, congestion, pollution and energy security.