The importance of carbon accounting in the transport sector

The aim to limit the rise of global temperatures to 1.5 °C above pre-industrial levels means that there is a very limited global CO₂ budget remaining - and this could be used up within the next decade or two. In its Green Deal, the European Commission has increased its ambitions to reduce CO₂ emissions in Europe by 2030, by at least 50% compared to 1990. The transport sector currently accounts for 25% of EU CO₂ emissions and its share has been growing in recent years. Hence, the decarbonisation of the transport sector, and specifically the road transport sector, represents a big challenge and effective use of the remaining CO₂ budget is indispensable.

In a recently published meta-study on behalf of FVV, we prove that a fair comparison of powertrains needs to consider the whole life cycle of a vehicle in order to determine the most effective emission reduction option for road transport. In our latest study we, in cooperation with the Institute for the World Economy Kiel, expand on this work and specifically focus on energy-related CO₂ emissions, the rules and regulations of the power sector and a central instrument in the battle against climate change, the EU Emission Trading System (EU ETS). Some of our main observations are as follows:

• By using detailed modelling of the EU power market and the EU ETS, we conclude that charging needs of electric vehicles will, in the foreseeable future, lead to additional emissions in the power sector.
• The EU ETS, under its current rules, will to a certain extent dampen but not prevent this increase in power-related CO₂

Further, we show that synthetic or renewable fuels of non-biological origin (RFNBO) face much stricter regulation under RED-II related to the effective emission reduction and therefore represent a more effective and more reliable emission reduction option under current regulation. We identify the regulatory treatment of the carbon source required for the production of RFNBO as a field for further research. Click the link below to read our study in full.

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