Trucks, vans, buses: cep rejects new CO2 limits as a mistake (cepPolicyBrief)

“In view of politically defined EU climate targets, the foreseeable increase in transport-related CO₂ emissions, the strongly cross-border character of road freight transport and the need for uniform, EU-wide requirements, regulation at EU level is in principle appropriate,” says cep environmental expert Götz Reichert, who analysed the draft regulation with cep transport expert Martin Menner.

Nevertheless, according to the cep researchers, the regulatory approach should be rejected from an ordoliberal point of view. “Mandates and bans are obsolete because there are market-based instruments. With the EU Emissions Trading Scheme for the road transport and buildings sector (EU ETS 2), a much more effective alternative that is less restrictive of market participants' freedom of choice will be available from 2027,” Menner emphasises.

In contrast to limit values, the EU ETS 2 could include not only new but also old vehicles, safely limit CO₂ emissions by capping the amount of allowances (“cap”) and efficiently reduce them through allowance trading (“trade”) where the costs are lowest. On the other hand, the proposed tightening of CO₂ limits for 2030 would in fact only allow to achieve the target through a higher market penetration of CO₂-free vehicles and only marginally through efficiency increases for those with combustion engines or through the use of alternative fuels. “A lack of technology openness prevents producers and users from adapting resiliently to changing circumstances or crises and from using efficiency-enhancing hybrid solutions for decarbonisation," says Menner, who rejects a de facto ban on combustion engines.