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FIA | European Bureau

Inclusion of road transport into
the EU Emissions Trading System

How and with which impact?


Road transport needs to contribute to the European Union’s endeavour to achieve a 55% greenhouse gas emission reduction by 2030 and climate neutrality by 2050.

Decarbonisation measures in road transport need to make the desired change reliable and affordable for consumers.

Consumer acceptance is particularly important for the success of the transformation to greenhouse gas neutral mobility.

Emissions trading can be an appropriate instrument to curb emissions in road transport under certain conditions.

The European Commission is about to propose applying emissions trading to road transport.

The FIA European Bureau has commissioned an expert study on the conditions and impacts of such an inclusion.

Following the study findings, the FIA European Bureau recommends to include road transport
into the EU Emissions Trading System under the following conditions:

Reducing CO2 emissions at lowest costs

A wider scope of the EU ETS with full integration of road transport and the tradability of certificates guarantee that CO2 reduction happens at lowest costs.

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Making the reform financially neutral
for consumers

As road transport already pays higher implicit carbon taxes than any other sector, a tax reform is needed to progressively lower existing fuel taxes so that carbon permit prices can really play their role.

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Avoiding multiple pricing
An extension of the EU ETS would give a uniform, transparent and reliable price signal to all sectors. Additional CO2 pricing elements should not be included in any other policies, to avoid distorting this price signal.

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Rebalancing distributional

Flanking policies are necessary (at national level) to compensate those who are impacted disproportionally.

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Boosting innovation with complementary policies
Vehicle CO2 emission standards and the Renewable Energy Directive with sustainability criteria for low carbon and alternative fuels help to boost innovation in road transport and contribute to reaching the climate goals.

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The expert study sketches the European climate context and the existing policy instruments addressing the CO2 emissions from road transport.

After describing how emissions trading for road transport can be set up, the main system options and the interactions with the existing policy instruments, it goes on analysing the impact of the most relevant policy options on CO2 emissions, abatement costs and on the incentives for technological innovation.

It eventually analyses the economic and social impact on road transport users, fuel suppliers, the other EU ETS sectors and governments.