The EU’s ambitious goals for a decarbonized Europe are fundamentally reshaping industries. However, the journey toward climate neutrality for road transport has encountered a critical obstacle: the lack of technological neutrality in EU regulations for both light- and heavy-duty vehicles. This rigidity is limiting innovation, undermining the EU’s competitiveness, creating new critical dependencies and, ultimately, slowing the decarbonization efforts it is supposed to accelerate.
A defining feature of EU policy, the principle of technological neutrality — allowing all technologies that meet policy goals to compete on equal ground, based on their scientific and economic footprint — has been overlooked (or ignored) in the case of road transport, as Mario Draghi highlights in his recent report. Both light- and heavy-duty carbon dioxide standards focus almost exclusively on electrification as the only path to decarbonization. Such an approach disregards the potential contributions of alternative solutions like renewable fuels, effectively restricting the entire industry and consumers’ choices to a single technology.
For the above, it is misleading to reduce the policy debate to the question of whether banning the internal combustion engine, based on an arbitrary definition that all electric vehicles are net-zero vehicles, regardless of the carbon dioxide footprint of the electricity they use or of their manufacturing and disposal phase. This only results in creating a sterile clash between two ideological factions. But to solve the complex and pressing challenge of transport decarbonization, the EU needs to abandon ideology and refocus on science, technology and the socio-economic assessment of all possible solutions.
Why exclude renewable fuels? Let’s go back to science
FuelsEurope strongly supports a transition to a decarbonized road transport system. But to achieve this, we need policies that leverage all available technologies. The question of whether to ban or allow specific technologies detracts from the real challenge and the ultimate goal of real carbon dioxide reduction. In order to be efficient and pragmatic, we need to go back to science again, to assess and prove the real carbon dioxide reduction benefit of all available technologies over their lifecycle. Focusing solely on electrification, EU regulations are missing an opportunity to accelerate carbon reductions across the vast majority of the hundreds of millions of vehicles on the EU roads, not just new electric vehicles. Other strategic parameters such as the security of supply and critical infrastructure, competitiveness challenges, strategic dependencies, the resilience of economies and societies, and affordable access to mobility for all should not be ignored either.
Unfortunately, Europe has recently been experiencing the consequences of this narrow approach as alarm signals are multiplying. The car industry’s increasing struggle to meet carbon targets for 2025 and onwards, solely through the electrification pathway, reveals international competitiveness challenges and customers’ reluctance to embark on the full electrification vision. A robust technical and economic reassessment of critical legislative pieces, such as the vehicles carbon dioxide standards regulations, is imperative and more than urgent. We must readjust the pathway to climate neutrality and open the doors to all carbon reduction technologies, not just one. There is no time to lose.
The immediate benefits to climate, consumers and the car industry
Renewable fuels offer a unique advantage: they work seamlessly within existing infrastructures and can fuel the entire fleet, old and new, as of today, at no additional fleet or infrastructure cost. This means that all vehicle owners, not just those who can afford new electric cars, could contribute to reducing carbon emissions.
As the automotive industry faces looming carbon reduction mandates and significant, disproportionate financial penalties, recognizing the decarbonization potential of renewable and low-carbon fuels can help the industry’s compliance with its reduction targets. In turn, this will help with safeguarding thousands of jobs, maintaining the industry’s competitiveness and making a decarbonized transport system more accessible to citizens across Europe, regardless of their ability to purchase new electric vehicles. Establishing the right policy framework would also provide a clear signal to investors in renewable fuels, encouraging the transformation of existing assets and enabling substantial contributions toward climate neutrality by 2050. This would also ensure a reliable supply of sustainable and affordable energy while fostering an innovative, globally competitive EU-based industry. Such measures would pave the way for a thriving market for advanced biofuels and e-fuels, driving economic growth, creating jobs and delivering significant environmental benefits.
Building synergies, not silos
Importantly, embracing renewable fuels will not compromise efforts in other sectors. Road transport’s use of renewable fuels will not compete with aviation and maritime. On the contrary, it would strengthen them. By increasing the renewable fuels market size and scaling up production, Europe can foster cost reductions that benefit all transport sectors, from cars and trucks to planes and ships. This would break silos of different decarbonization approaches across transport sectors and create a cohesive market, enabling Europe to globally lead in multiple decarbonization technologies.
A false dichotomy
FuelsEurope calls upon the EU’s new leadership to abandon the notion that the electrification of road transport must come at the expense of other technologies. An inclusive approach would place Europe in a stronger competitive position and allow multiple sectors to thrive through innovation and flexibility. By fostering collaboration rather than artificial competition among industries, we can accelerate progress on the climate front while strengthening Europe’s industrial backbone.
Renewable fuels and electrification are not competitors — they are complementary in the journey to decarbonization. A balanced policy approach would reduce emissions faster, ensure that citizens have access to affordable clean mobility and maintain Europe’s global leadership in low-carbon technologies.
Urgent action is needed
Now is the moment to act, drawing lessons from the economy, the market and consumers. With the new legislative cycle already underway, we call for urgent action to address these pressing issues through a comprehensive review of existing legislation. This process must be grounded in robust scientific assessments and evidence-based decision-making to ensure effective and sustainable outcomes.
Our sector stands ready to support legislators, offering our scientific knowledge and technical expertise to guide and inform their efforts in crafting solutions that truly make a difference for the climate, EU industries and citizens.
Discover more in our More than a Manifesto: An Offer for Europe.
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