Can the United States, Mexico, and Canada partner together to create a continental policy for sustainable freight transportation? During today's OnPoint, Evan Lloyd, executive director of the North American Commission for Environmental Cooperation, makes the case for a cohesive freight transport policy. He discusses CEC's recommendations for each country as they tackle transportation and infrastructure plans.
Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Evan Lloyd, executive director of the North American Commission for Environmental Cooperation. Evan, thanks for coming on the show.
Evan Lloyd: Thanks for having me, Monica.
Monica Trauzzi: Evan, a recent report by the CEC focuses on reducing greenhouse gas emissions from freight transportation in North America and you call on Canada, Mexico and the United States to work together to create a policy for cleaner transport. Why is freight transport such a critical sector to be focusing on right now?
Evan Lloyd: Well very simply freight transportation, transportation in general and freight in particular is one of the most significant sources of greenhouse gas emissions in our economy. It's number two after electricity production in North America, so there's a very real opportunity for people to work together on reducing a significant source of GHG emissions in our environment.
Monica Trauzzi: And up until this point we've really looked at it country by country but why is this sort of continental cooperation so critical? What's the benefit for the individual countries to come and work together?
Evan Lloyd: Well you're right, there's been a lot of attention paid to the opportunities to accomplish GHG mitigation at a domestic level but when you look at it North America is really characterized by a continental supply chain or numerous continental supply chains, and even though in the 1950s the Interstate highway system was a visionary accomplishment we need a new vision today and that's one that recognizes that in North America we have a continental supply chain. It's really, because of the integration of our economies, it's absolutely necessary for the three countries work together to achieve a significant systemic improvement in the way that we manage our transportation system.
Monica Trauzzi: But how does any type of joint plan work if all three countries have a different approach to regulating greenhouse gas emissions?
Evan Lloyd: Well increasingly we're finding that they have a common interest in regulating greenhouse gas emissions. You know the countries have begun a dialog with respect to common standards in areas of emission factors and on standards and regulations in certain industries and sectors, and we think that this is a natural extension. We believe that notwithstanding the differences that exist in each country they share a common interest in regulating and achieving greenhouse gas reductions in transportation because, as I said, it is one of the most prominent sectors in each of the economies.
Monica Trauzzi: Is it a fair deal for the United States considering the size of the three economies involved?
Evan Lloyd: Well, it is. I mean I think you have to recognize, we have a slogan in our business which is that we have three countries but one environment and the fact of the matter is that neither of the countries will be able to achieve their domestic goals without a significant effort to address GHG from the transportation sector, and GHG from the transportation sector is inextricably linked with the fact that we have a continental transportation system. So there's really no escaping it from an environmental perspective.
Monica Trauzzi: Okay. So what are your recommendations for the three countries moving forward in freight transportation?
Evan Lloyd: Well we have a series of six broad recommendations but the number one recommendation was the need to recognize a North American system. You know the number one requirement to avoid the growth of greenhouse gas emissions from the freight transportation in particular is to recognize that in addition to increased fuel efficiency and clean technology we need a continental vision of a North American integrated freight transportation system and, really, it's that system perspective that's necessary to line up all of the other policies and regulations that may be available to them, all three, at a North American level.
Monica Trauzzi: So here in the United States we're talking about a transportation reauthorization bill. How does this fit into that? Where does that discussion need to go?
Evan Lloyd: Well all three countries are looking now in counter-cyclical investments and investments in infrastructure. We think the timing is terrific to get this right, not only from the environment, or not only from the economy, rather from the perspective of the environment. You know 88 percent of all of the value of transportation of goods moved in North America is moved on the surface. You know a majority of that is by truck. This is projected to grow enormously over the next 20 years and that's the horizon that we're looking at in our report, and we've found that fuel standards alone just won't accomplish the objectives that each country is looking for.
Monica Trauzzi: You've rolled this out in the United States, Canada, Mexico at this point. What has the response been like in each country?
Evan Lloyd: Well the response has been very positive from our stakeholders. We worked with a very broad group of advisors on the advisory group for the study including Wal-Mart Mexico, FedEx, Con-way, the American Trucking Association, the Environmental Defense Fund and so forth, and generally I think that all of our stakeholders have found that we've got it about right in terms of pitching this report and the recommendations at the level that's required from a North American perspective. This report I should add is certainly not the opinion or the position of the governments of Canada, Mexico or the United States, rather it's our recommendations to them. It remains to be seen whether they will pick up and adopt any of the recommendations although we are very encouraged by some of the discussions that are now underway as you've mentioned both here in the United States as well as in the other countries.
Monica Trauzzi: What are your recommendations for how all of this gets paid for?
Evan Lloyd: Well we haven't gotten that deep into that and I note that for example here in the United States it's very much an open question. The president has identified some $550 billion worth of infrastructure investments that are necessary but of course the discussion about how exactly that gets paid for is still an ongoing discussion. We have said in the report, and contrary to perhaps the political tenor of the times we have underlined the importance of a carbon price in effect, an effective carbon price in each of the three countries to drive innovation. If there were such a mechanism regardless of whether we're talking about a tax or cap in trade we have talked about dedicating a certain portion of that to transportation infrastructure and improvements in the transportation system itself.
Monica Trauzzi: OK. We'll end it right there. Thank you for coming on the show, nice to see you.
Evan Lloyd: Thank you so much.
Monica Trauzzi: And thanks for watching, we'll see you back here tomorrow.
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