The road to a road ETS: How to design a socially fair and environmentally effective system

December 15, 2021

The decarbonisation of road transport will have an impact on the whole of society and could become an economic burden on the most vulnerable. In a new briefing, Transport and Environment (T&E) proposes a set of criteria to ensure ETS2 and the SCF are socially fair and environmentally integral.

Over the last two years, there has been plenty of debate about the convenience of implementing a new Emissions trading system for road transport and buildings (ETS2).

A new ETS will not be the main tool to decarbonise road transport. However, it can play an important role to both tackle demand but most importantly to generate new revenues to help the most vulnerable to transition away from fossil fuels. To do so, both the ETS2 and the newly proposed Social Climate Fund (SCF) need to follow a number of criteria to ensure the new system is socially fair and environmentally integral. This T&E briefing presents a list of such criteria so policy-makers can incorporate them into both the ETS2 and SCF during the co-decision process. 

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