Technologies for improving transportation energy efficiency in the developing world

Transport services are a key component of economic development. In many developing countries, however, purchases of imported oil and capital requirements for transport infrastructure strain already overburdened economies, and rapid growth in private vehicle fleets aggravates urban congestion and air quality problems. Energy efficient technologies, many of which are already widely used in the industrialized countries, can moderate these problems while providing needed transport services, and in many cases can offer attractive financial returns as well. This paper provides an overview of these technologies for both freight and passenger transport. Implementation of these technologies and practices is hindered by several factors, including the state of the infrastructure in the developing world, fuel and transport pricing policies, low vehicle scrappage rates, and the increased first costs of these technologies. Numerous policy options are available to address these factors. Financial incentives such as fuel taxes, road and license fees, and area licensing schemes can help promote more economical and energy efficient transport systems. Nonprice options such as information, regulation, and incorporating energy efficiency into infrastructure investment decisions should be considered as well. The industralized countries can assist through their influence over multilateral bank lending and through greater attention to energy efficiency in vehicles exported to developing countries.