The transport industry has long been one of the biggest sources of pollution and greenhouse gas emissions in the EU and currently makes up 1/4 of total EU emissions1. In recent years, it is one of few activities that has seen an increase in emissions levels2, with drops in emissions witnessed over the course of the COVID-19 pandemic fast-returning to their pre-pandemic levels. As a result, the EU's 'Fit for 55' proposals in relation to the transport sector are seen by some as being the most transformational.
The EU is proposing an effective ban on the sale of new petrol and diesel (including hybrid) vehicles by 2035, with a new focus on zero-emission cars, such as electric and hydrogen-powered vehicles. Previous targets to reduce emissions from 37.5%, compared to 1990 levels, within the automotive industry, will also be increased to 55%. Going forward, there will clearly be a need to focus on rolling out enough charging points and hydrogen refuelling stations across the EU to meet the demands of the increased numbers of zero-emissions vehicles.
In the aviation and maritime sector, the EU's revised proposals are seen as critical. A number of stakeholders have long been calling for an aviation and shipping fuel tax, for the reason that it did not make sense to tax fuel in respect of cars and electricity used by trains but not in connection with aviation and shipping.
A full phase-out of free allowances in aviation is expected by 2026 and under the ReFuelEU Aviation Initiative and the EU aims to have 80% of intra-EU flights run on sustainable fuel by 2035. In respect of the maritime industry, vessels arriving at EU ports would need to use 80% low-carbon fuels by 2050 and new legislation is expected to enter into force which would introduce greenhouse gas intensity targets in the shipping industry.
There are also plans to introduce the EU ETS in aviation and maritime in order to encourage the uptake of sustainable fuels such as ammonia. However, there are concerns that this will only encourage a shift away from fossil fuels towards an uptake of unsustainable fuels and liquified natural gas, with the Executive Director of clean mobility NGO Transport & Environment, William Todts, noting that 'by pushing them to use gas and biofuels, the cure will be worse than the disease', although this view is not held by all within the industry.