Sam Marks is the Co-Founder of Green Sphere Project and has an extensive background in policy development, more recently at the intersection of transport and climate. Sam has worked with both the Australian Trucking Association and NatRoad.
Prime Mover: In terms of decarbonisation of road transport, is there a sufficient sense of urgency around the 2050 net zero goal?
Sam Marks: I understand why an operator, who might be on next to no margin and still has customers trying to drive down rates, might be less able to tackle the issue with any urgency but there is also no real framework providing them the means to address it.
PM: Where should the responsibilities lie, particularly in relation to the timeline?
SM: Everyone has a role to play, and industry needs to step up and take the lead. This is an opportunity for industry to be the author of its own destiny. If industry doesn’t define that, somebody else, such as governments, will. You might think you can kick the can down the road because government may currently seem to be not doing much, but they have told us what the outcome will be, which is net zero by 2050. It’s not just a slogan or a marketing gimmick, it’s legislated so it would be hard to unwind if anyone ever tried.
PM: Is there an acceptance within the transport industry that climate change needs to be addressed and become a factor in operations and future planning?
SM: There’s an opportunity for industry to lay out what the pathway should look like and what is the most cost-effective way that’s not going to send people out of business. There will come a point when total cost of ownership parity for some alternatives will work out to be better and cheaper in terms of running costs, especially around electrification wherever that’s feasible. Some of these are unknowns, so we’re trying to work out exactly when these points will be reached. It’s an exercise in modelling but we have clear trends already in terms of the fact that batteries over time will get cheaper and better. How far that goes will be a key factor in terms of what the future of the industry looks like because the more capable and cheaper batteries are, the more viable electrification will become. Obviously, if you have the right framework in place to encourage the rollout of charging infrastructure that will actually reduce the reliance upon batteries. You can charge the trucks when you need to charge them and do it fairly quickly and you may not need as big a battery to get a particular task done. You don’t have as many of the negatives in terms of costs and payload reduction.
PM: Is electric or fuel cell electric where the main thrust should be? Are alternative propulsions such as hydrogen as a fuel and CNG, LNG diversionary?
SM: The market should sort this out. I’m a little bit nervous around governments picking a technology winner because I’ve been attending government consultations, workshops and reading their reports for a few years now and not that long ago hydrogen was going to be the answer and seemingly every truck was going to be running on it. Now the answer seems to be low carbon liquid fuels. If you’re a transport operator, electric is not clearly a genuine choice for you at this stage because the policy framework is not in place yet.
PM: What could be the main factors in that?
SM: Electric will become cheaper over time, so in one sense the market will eventually take care of it, but if you want to meet the government’s emission targets on time you need to accelerate the take up, which means spending money on some decently sized incentives to get the market established and getting more electric trucks onto the road. It wouldn’t be incentives for ever, just to get the market started. There’s quite a few in the bigger end of the industry that are now operating and it’s good having projects like Centurion, TGE, Toll, and Linfox, but we need the next rung down and enable the medium-sized operators to determine how this works for them, because it’s not just the case of swapping out a diesel truck for an electric truck.
PM: Do liquid low carbon fuels play a part?
SM: We need a low carbon fuel standard which applies a declining CO₂ target over time. Overseas experience shows that helps to drive investments in low carbon fuels like renewable diesel, and it can also be used to help drive the infrastructure rollout for electrification because it doesn’t tell the fuel company how to decarbonise, it just tells them that over their whole suite of fuels they sell the level of CO₂ needs to decline over time. Some may be more aggressive in pursuing EV infrastructure, and some might invest more strongly in low carbon fuels.
PM: Is that up to the fuel companies?
SM: I guess currently there’s no requirement for them to do anything, and there’s also no certainty around that either. Standards for carbon fuels tackle both of those issues, because it says they have to deal with this issue, and it will provide certainty that the market will indeed shift. It’s a declining CO₂ target over a period of time and it’s not saying you switch from regular diesel to 100 per cent renewable diesel tomorrow. One of the options available to them is they could just slowly increase the blending of renewable diesel into the fuel supply over time.
PM: Is there a risk of unintended consequences?
SM: You’re always going to get that with any sort of change. That reinforces the need to get started because these things can take time to work through. You can’t leave this job to be done in the last decade before 2050. We’ve got to get started and we also need to get the broader market setting right because it might work out that the composition of the market in the future is different to what anyone can project today.
PM: Does fuel security remain an ongoing issue?
SM: Understandably fuel security is a longstanding concern of this industry. The numbers don’t appear to have changed much over the years in terms of the retail consumption stock which is on hand, and a giant risk in uncertain global environments. The ramifications are huge throughout the economy. If we’ve learned one thing in recent years, if we look at the pandemic and at wars in the Middle East and Ukraine, is that the unthinkable can actually happen, so we need to think about the security of our fuel supply. That, if anything, is another argument for the framework around electrification to be better because once the electricity grid transitions, we have a domestic home-grown Australian energy source.
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