Why Renewable Fuels should be Considered in the CO2 Standards of New Cars, Vans and Trucks

Within the European Union’s Green Deal, the climate protection strategy for the transport sector is under review in 2021.This paper assesses that the current regulatory scheme of fleet target values is not suitable to reach the new climate goals – regardless of its ambition level. In order to reach the EU Green Deals’ goals, new regulatory options are inevitable. We focus on one of those possible new options, a crediting system for renewable fuels and describe it´s general mode of operation, it´s advantages and possible challenges. Building on previous research, we establish that the cost of CO2 mitigation can be significantly lowered if renewable fuels were allowed to play an additional role in the regulation and that the overall climate protection contribution of the transport sector could be improved. We also touch on secondary effects like cost–benefit for other sectors or the societal advantage that individual mobility would not have to be curbed unnecessarily in the name of climate protection. We end with a recommendation of which political actions would have to be taken in order to stimulate the market to invest in the innovative technology of renewable fuels.