Future scenarios and strategic choices - Transport Policy and Planning in Great Britain - page 408

action is based on the application of a discount rate of only 0.1%, i.e. adopting an
ethical stance of almost complete inter-generational equity. Some critics query this
exceptional assumption and also maintain that the advantages of early action are
exaggerated by the 'unreal' supposition in the modelling that nothing would otherwise
be done to curb carbon use or counter its adverse effects in the meantime (LTT 456).
Stern proposes three main policy instruments:

1 carbon pricing (through taxation, emissions trading or regulation, or a combination

of all three)

2 support for developing a range of low-carbon technologies

3 action to promote behavioural change (through information, promotion and

regulation).

On pricing he envisages there being a common global carbon price across all
economic sectors over the next 10-20 years, but during the meantime emphasises the
importance of governments avoiding becoming locked into high-carbon infrastructure.
In fact, as far as transport is concerned, DfT responded immediately by publishing
guidance on incorporating the social cost of carbon into scheme appraisal (WebTAG
Unit 3.3.5 The Greenhouse Gas sub-objective).
The UK Energy White Paper published at the same time reiterated Stern's
observation that transport was likely to be one of the last sectors in which major CO 2
reductions are achieved (DTI 2007) . The reason given for this is because the low
carbon technologies tend to be expensive and the demand for transport is relatively
inelastic so that the welfare costs of reducing it are high.
The White Paper forecasts that CO 2 emissions from domestic transport will
continue to rise until about 2015 and decline thereafter because improvements in
vehicle efficiency and increased use of biofuels begin to overtake the effect of (reducing)
growth in demand. By 2020 transport emissions are expected to have returned to
near 2007 levels but, because emissions from other sectors are falling more quickly,
transport's share of the national total will be higher than today. The contribution of
the individual transport measures included in the Government's Climate Change
Programme (CCP) is shown in Table 24.1.
Emissions from all sectors are expected to be cut by 16-22% by 2020 as a result
of planned policies. Performance towards the top end of this range would be needed
in order to fulfil the 26-32% target relative to a 1990 baseline that the Government
included in a draft Climate Change Bill published in 2007. When passed as the Climate
Change Act in November 2008, a commitment was given to review this intermediate
target given the Government's acceptance of a more demanding long term target of an
80% reduction relative to the 1990 baseline by 2050.
The Act was hailed as the 'the world's first long term legally binding framework to
tackle the dangers of climate change'. Its aims are:

• to improve carbon management and help the transition towards a low carbon
economy in the UK
• to demonstrate strong leadership internationally in the context of developing
negotiations on a post-2012 global agreement at Copenhagen in 2009.

In addition to setting legally binding targets the Act introduces a carbon budgeting
system which caps emissions over five-year periods for three periods at a time (the first