EU Ramps Up Climate Ambition, But Risks Undercutting National Action

Originally published on Transport & Environment.
By Eoin Bannon

The -55% climate target, announced this week, makes the EU Green Deal the most ambitious climate initiative in the world, green group Transport & Environment (T&E) has said. But European Commission president Ursual von der Leyen risks undermining her own efforts with a plan that would undercut national action to cut pollution from cars and trucks.

Emissions trading would be “enhanced” President von der Leyen said, meaning car and truck emissions could be included in the bloc’s carbon market. Once included in the EU-controlled emissions trading system (ETS), governments would no longer be responsible for road transport emissions, removing a key driver for green tax reform, investment in public transport, or electromobility at national level.¹ If enacted, the ETS inclusion would lead to fuel price increases of 6–12cts/litre.²

William Todts, executive director at T&E, said:

“The EU is finally getting real on the climate crisis. The key to tackling transport, Europe’s No1 polluter, is CO2 standards that drive car and truck makers to go electric much faster whilst making charging as simple as filling up at gas stations. But the plan to put road transport in the EU carbon market is a mistake. It will undercut the national climate targets whilst jacking up fuel prices for low-income families.”

¹EU climate policy has two pillars. The power sector and industry are included in the EU emissions trading system (ETS). Transport, buildings and agriculture are covered by the Climate Action Regulation which sets nationally binding goals. Sectors are either included in one system or the other.

²Transport CO2 will be included in the ETS by including fuel sales, and making fuel suppliers (oil companies) liable for purchasing corresponding CO2 emissions permits. Since a litre of transport fuel emits around 2.5kg of CO2 when burned, at the current price of €25/tCO2, fuel prices would increase by about €0.06/litre. An aspirational CO2 price of €50/tCO2 would lead to increases of €0.12/litre.

Almost a year has passed since we published this piece on the good news: Europe’s Green Deal: EU Commission President Ursula von der Leyen Announces “Europe’s Man on the Moon Moment.”