Technology innovation and environmental outcomes of road transportation policy instruments

Road transportation policies can drive innovation in more environmentally sustainable vehicle and fuel technologies but may have unintended consequences. To assess their impacts on technology innovation, greenhouse gas emissions, air pollution, and land use, we systematically review and analyze evidence on the outcomes of 14 road transportation policy instruments, including fuel economy and low-carbon fuel standards, biofuel and zero-emission vehicle mandates, and fuel and vehicle taxes. We find that the effects of these policy instruments depend on their interactions, design, choice, and sequencing. We identify six types of relationships between policy instruments and highlight design features that have inadvertently increased vehicle emissions. We trace the evolution of electric vehicles through policy milestones shaped by experimentation and competition among influential jurisdictions based on their domestic priorities, industrial structure, and incumbent industry resistance. We show that policy instruments promoting first-generation biofuels have in some cases inhibited innovation in advanced biofuels.