Transport is one of the fastest-growing sources of greenhouse gas emissions, accounting for 24% of carbon emissions worldwide, demonstrating the need for global climate finance for a clean energy transition. Nearly three-quarters of those emissions come from road vehicles. Solutions like electrification and increased public transport can reduce the transport sector’s emissions, but they come at a hefty cost — particularly for low- and middle- income countries, which account for 82% of the world’s population.

To reach net-zero emissions by 2050, the International Energy Agency calculates that carbon emissions from the transport sector need to drop 50% by 2035.  For that to happen, not only do we need to boost the percentage of electric cars on the road — from 10% today to more than 85% in just a decade — but we also need a fundamental shift in how people move.

The world needs significantly more public transport, and buses in particular, to reach net zero. By 2035, electric buses need to make up 60% of total bus sales around the world to stay on track, a sharp increase from the current 4%. Reliable and frequent public transport is currently available in only 37% of the world’s urban areas, despite the United Nations Sustainable Development Goals calling for all urban dwellers to have such access by 2030. Reaching net zero will also depend on shifting more travel behavior toward walking and cycling, ensuring these modes are convenient, safe and accessible.

Meeting these goals will require significant investment. As urbanization continues to accelerate — particularly in Africa and Asia — transport demand will grow, increasing the pressure to secure resources and act fast to avoid locking cities into unsustainable development patterns. Because infrastructure and new technologies are expensive and have particularly high upfront costs, low- and middle-income countries, which often face higher interest rates and debt burden than other countries, have unique challenges in transitioning to more sustainable transport systems.

Global climate finance can help ease this burden.

The transport sector currently receives $334 billion a year from public and private sources, but that amount needs to increase to an estimated $2.7 trillion by 2050 to meet the reduction goals for global transport emissions. In developing countries (excluding China), the Independent High-Level Expert Group on Climate Finance estimates that the transport sector will need $575 billion per year by 2030 to reach those goals.

Read the full article about climate finance and sustainable transport by Ben Welle and Yiqian Zhang at World Resources Institute.