As part of the EU 2030 climate and energy package discussions, German carmakers and Denmark have been lobbying for the inclusion of road transport emissions in the EU Emissions Trading System (ETS). We think this is a really bad idea for three main reasons: it would delay emissions reductions in transport; undermine more effective climate policies for transport; and weaken the ETS and increase costs. Read the full rationale behind our thinking.
However, we do not argue against much more transport-specific forms of credit trading. Europe can draw lessons from Californian policies that allow trading of low-carbon vehicle and fuel credits between vehicle and energy suppliers respectively that truly encourage low-carbon investment and innovation in transport.