Are vehicle lifespan caps an effective and efficient method for reducing US light-duty vehicle fleet GHG emissions?

Abstract

With light duty vehicles (LDVs) responsible for 17% of annual US greenhouse gas (GHG) emissions, integrating emerging GHG-reducing technologies into the fleet is essential. However, the slow rate of vehicle turnover presents a significant barrier to the market penetration of new technologies, with adoption delayed by the low number of vehicles needing replacement each year. A strategy of accelerated vehicle turnover through a vehicle lifespan cap could potentially mitigate this limit. While older studies reach differing conclusions on their effectiveness, two newer studies that incorporate life cycle assessment find that accelerated turnover strategies can be effective if coupled with high levels of electric vehicle deployment. We seek to determine whether a vehicle lifespan cap strategy can be an effective and efficient (cost-effective) method for reducing US LDV fleet GHG emissions. We augment the capabilities of the Fleet Life Cycle Assessment and Material Flow Estimation (FLAME) fleet life cycle assessment model, integrating vehicle lifespan caps and comprehensive calculations of cost along with sensitivity analysis for electric vehicle survival curves and battery degradation. The augmented FLAME model is used to analyse the impact of vehicle lifespan caps of varying lengths on a suite of scenarios, including a business as usual (BAU) scenario and eight scenarios modelling different technology improvement assumptions. This work confirms that vehicle lifespan caps have limited effectiveness in reducing GHG emissions under a BAU scenario but show potential to meaningfully reduce GHG emissions in a scenario with accelerated deployment of electric vehicles. However, abatement costs are high, exceeding 2020 USD 1000/tCO2eq under baseline assumptions, but falling within the range of current estimates of the social cost of carbon under more optimistic assumptions. Overall, vehicle lifespan caps must be carefully considered as they accelerate both the benefits and costs of new vehicle technologies, and are best positioned as part of a larger integrated strategy for tackling transportation GHG emissions.