To examine the cost-effectiveness of UK government policy with respect to the mitigation of carbon emissions from the transport sector.

Existing policy as set out by the Department for Transport in Low Carbon Transport: A Greener Future is examined. This document elaborates a Low Carbon Transport Strategy intended to achieve annual emissions savings of 17.7 MtCO2 by 2020. A wide range of policy areas where further action could be taken to reduce carbon emissions are examined and their cost-effectiveness considered.

Measures that influence behaviour including smarter choices, eco-driving across modes, freight best practice and modest price increases are highly cost-effective. More cost-effective routes to saving 17.7 MtCO2 are identified, as are further cost-effective savings.

It appears that government targets could be delivered and indeed exceeded at lower cost than the Low Carbon Transport Strategy. However, policy development is influenced by a wide range of factors which help to explain why cost-effective measures are not always fully exploited.