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Fit for 55 an opportunity for the road transport industry
Europe | Brussels

Fit for 55: an opportunity for the road transport industry

13 Dec 2021 · Environment
  • Fit for 55 alternative fuels infrastructure proposal: is it enough?

  • Fit for 55 energy taxation: harmful or smart?

  • Fit for 55 emission trading scheme (ETS) for road: burden or opportunity?

Last week the IRU EU Conference brought together EU decision makers, mobility and logistics leaders, and representatives from industry and non-governmental organisations to discuss three key questions on the European Commission’s Fit for 55 package. 

The package is meant to pave the way to a reduction in CO₂ emissions by 55% by 2030, accelerating the EU’s plan to fully decarbonise by 2050. The Conference was, in essence, a reality check of the package’s ambitions in relation to commercial road transport. 

The first panel debated synchronicity in the basic three conditions for a green transformation of road transport: availability of alternative fuelled vehicles in sufficient numbers; availability of infrastructure for these vehicles; and availability of alternative fuels/power. The second panel looked into the need for incentives to support the industry’s transition, including the design of taxation and charges.   

In her opening speech, EU Commissioner for Transport Adina Valean acknowledged the sector’s concerns that Fit for 55 proposals introduce a radical transformation which will inevitably impact road transport. “Transition towards sustainable mobility will require solid efforts and important financial investment, and while there are challenges ahead, EU actions, including Fit for 55, will provide regulatory certainty, support and opportunities,” she added.

Synchronising Fit for 55 implementation 

On the synchronicity of Fit for 55 implementation plans, participants were evenly split when polled on whether Fit for 55 deadlines and expectations to deploy alternative fuels infrastructures and vehicles were realistic. 

“Industry should be given enough time to plan, and identify where and what to invest in”, said Ismail Ertug, European Parliament Rapporteur for the Alternative Fuels Infrastructure proposal. He also called the replacement of the current alternative fuels Directive with a Regulation as “a needed step”.

Mathieu Soulas, TotalEnergies’ Vice President of Strategy and Supply for Marketing and Services, emphasised how the switch to alternative fuels technology will be complex due to the different alternatives available and their corresponding infrastructure needs and required investments. Manufacturers are investing in different technologies such as advanced and sustainable renewable fuels, battery electric and hydrogen. 

“Technology neutrality and the absence of a unique solution for transport operators, especially for the heavy-duty vehicle segment, remain two important issues,” said Annalisa Stupenengo, Designated Chief Operations Officer at Iveco Group.

Agnė Vaiciukevičiūtė, Lithuania’s Deputy Minister of Transport and Communications, echoed the need for technology neutrality. “Alternatives for diesel remain distant, with hauliers looking towards hydrogen for long-distance transport,” she said. 

The construction of new infrastructure can be a long process, and the issuance of new permits should also be accounted for. “Two issues are most common: identifying space to build infrastructure and grid capacity for heavy-duty vehicles,” said Alexander Hoekman from the Dutch Ministry of Infrastructure.

Incentivising the switch to alternative fuels

“Incentivise the transition with targeted financing and revenues spent for specific purposes,” said Peter Liese, the European Parliament’s Rapporteur for the Emissions Trading System (ETS) for road. He also called on the need to embrace new technologies immediately and for the emission trading system for road as a necessary push to enable the change. 

In response, Alexander Klacska, CEO of the Klacska Group and Chair of the transport section of the Austrian Chamber of Commerce, said that, while keeping an eye on the future, it is important to decarbonise vehicles that are already on the road. “The business environment should be placed in the right conditions for alternative fuels to provide solutions,” he added. 

The panel also looked at emerging solutions such as battery electric trucks for urban and regional transport in Europe. “In order to ensure a further uptake of battery-electric vehicles, smart regulation, coupled with incentives such as supporting companies to switch to alternatives, as well as ensuring affordable solutions are necessary,” said Julia Poliscanova, Senior Director at Transport & Environment (T&E).

“The transition over the coming decade will require a huge collective effort: more than 900,000 transport companies in the EU, running over 35 million vehicles, of which 7 million are heavy-duty vehicles, are affected.”

Despite this, while battery-electric is serving some segments of the commercial goods transport sector, the long distance coach segment does not yet have alternatives. “No long-distance coach technology is currently available on the market, while public transport is already ahead in this transition,” said Jos Sales, Associate Partner at Sales-Lentz Group and Vice President of the Luxembourg Federation of Bus and Coach Operators (FLEAA).

Moderator Raluca Marian, IRU Director for EU Advocacy and General Delegate to the EU, reminded participants that, “The transition over the coming decade will require a huge collective effort: more than 900,000 transport companies in the EU, running over 35 million vehicles, of which 7 million are heavy-duty vehicles, are affected. And more than 80% of these companies are small and medium-sized firms.” 

Putting the EU experience in a global context, IRU Secretary General, Umberto de Pretto, concluded that, “A pragmatic solution, as well as targeted incentives allowing businesses to thrive, are necessary. It is paramount to not penalise those transport operators who are not in possession of the right alternatives”.

New IRU positions on Fit for 55

The IRU EU Conference followed IRU member adoption of three new positions on Fit for 55 proposals earlier this month. 

IRU’s position on alternative fuels infrastructure calls, inter alia, for the same deadlines for electric and hydrogen charging infrastructure; for traffic based targets for electric and hydrogen infrastructure on TEN-T and comprehensive networks; for setting precise targets for light commercial vehicles; and for refining targets for heavy duty vehicles in urban nodes.

IRU’s position on energy taxation and ETS (Emissions Trading System) for road argue that the timely deployment of infrastructure should be a precondition for increasing the level of taxation and charges on traditional fuels in order to avoid punishing road transport firms without alternative solutions. The adequate transition to higher taxation and new ETS charging, as well as the avoidance of multiple taxation and charging for energy content and carbon emissions, are key pillars in IRU’s positions. 

“IRU supports the European Union’s green transition. Commercial goods and passenger road transport operators will require a wide range of alternative fuels and sufficiently available vehicles for different types of operations. An adequate transition and flexibility in the choice of fuels are essential for the sector, given its very wide operational scope” said Raluca Marian, IRU Director for EU Advocacy and General Delegate to the EU.