Aviation or trains?

– High-speed train and renewable fuels in aircraft

The main reason for developing high-speed train services in the world has been to facilitate for leisure and business travellers to make day trips between large cities. This is a local need and its starting point is to create infrastructure that connects the regions of the labour market together. There are some examples of less successful high-speed train investments that have not been based on local needs but on an overly simplified picture. One common feature of these less successful ventures is that needs were defined by the government and not by the regions.

Lessons learned from other countries show that travel time should not exceed 3 hours and the number of travellers should be at least around 10 million per year.

An expansion of high-speed trains would not solve the problem of aircraft emissions of greenhouse gases since such emissions come primarily from trips that are longer than 1,500 kilometres. The reason why certain investments in high-speed trains have been successful is because there has been a local need to connect urban labour market regions where distances are no greater than 1,000 kilometres.

Many international investments in aircraft biofuel

Today, it is primarily airlines, airports and aircraft manufacturers that are engaged in innovation as regards biofuels for aircraft. A number of countries, such as Finland, China and Japan, have drawn up government strategies for this development. This is seen as a quick way of reducing the emissions of greenhouse gases from aircraft over the coming decades before alternative technology has been developed.

Swedish Fly Green Fund is a successful example of a system that creates a demand for biofuel for aircraft without any government policy instruments. This fund is a non-profit economic association founded by Dutch SkyNRG, Karlstad airport and NISA (Nordic Initiative Sustainable Aviation). Fly Green Fund’s business customers pay a fee for all or part of their business travel. The fund buys biofuel for 75 percent of the money it receives while the remaining 25 percent goes to biofuel development projects. This concept can be likened to the source labelling of electricity but without any government supervision. Private individuals can also pay money into the fund.

Complex challenge since the alternatives do not compete on equal terms

Long-distance passenger trips constitute a major social challenge, not least because the state handles market obstacles differently when it comes to air, train or road vehicles. For example, road vehicles pay the general carbon dioxide tax in Sweden which is more than 100 times higher than the amount paid by trains and aircraft for their carbon dioxide emissions. Moreover, the state funds the infrastructure differently, for instance, through how users are to pay for their use.

One consequence of the great complexity of this area is that the questions tend to be visionary and based on political prestige.

Lessons learned from other countries speak against high-speed trains in Sweden

Even this simple outlook at the rest of the world shows it can be questioned whether it is rational to have high-speed trains between metropolis regions in Sweden, particularly Stockholm-Malmö/Copenhagen. Above all, the potential number of travellers is low. There are indications that Sweden would go through the same experiences as Spain did, that is, large deficits as a result of too few travellers.

However, in the absence of high-speed trains, day trips by air will increase between Sweden’s metropolis regions. In order to reduce greenhouse gas emissions, it could therefore be more relevant in the short term to promote the use of biofuel in air traffic rather than build high-speed train railways which are to be completed in 20 years’ time.

Biofuels for aircraft are expensive compared with kerosene

Because there is a tradition of air traffic not paying as much for its encumbrance on society as other forms of transport do, it is especially difficult for biofuels to compete with fossil alternatives for aircraft. However, government policy instruments to promote biofuel for aircraft are an alternative to expanding high-speed train services if the aim is to reduce greenhouse gas emissions. This is primarily a question of domestic trips where the government has control over policy instruments. It could be a matter of a quota obligation system for biofuel in aircraft flying between Swedish airports. Some negative competition would be created with regard to airports that are close to airports in neighbouring countries. However, this effect should be rather small because travel times would increase.

Aviation or trains? – High-speed train and renewable fuels in aircraft

Serial number: Direct response 2016:13

Reference number: 2016/016


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