On assessing climate effects of electrifying the transport sector

Shifting transportation to electrified modes, e.g., rail, is a politically attractive way of reducing greenhouse gas (GHG) emissions from the transportation sector. There is a vivid debate about the effects such a shift has on GHG emission and how these should be assessed and appraised. We argue that this debate largely originates from differences in how the debaters characterize the situation at hand, in particular how markets are organized and which policy instruments are in place. To shed light on this, we start by identifying the appropriate assessment approach in a hypothetical situation without any climate or energy policies and then gradually add realistic circumstances into the equation. Our main conclusion is that evaluating the climate impacts from a transportation shift is a highly complex task in the initial situation. The closer we move towards a climate-policy architecture of the current EU-type, the simpler the task becomes. Given a comprehensive global climate treaty, there is no need for any special treatment of the GHG effects since all relevant effects then would be internalized in producer and consumer prices.