All solutions will be needed to reduce transport emissions

Unlike most other sectors, transport emissions have continued to rise. Between 1990 and 2023, transport emissions increased by 25.3%, followed by a further 0.7% increase between 2023 and 2024.

Today, transport accounts for almost 30% of the EU's total CO₂ emissions, with road transport responsible for around 72% of the sector's emissions.

Growing transport demand has more than outweighed gains in energy efficiency and the adoption of alternative energy sources.

Renewable fuels, such as renewable diesel and sustainable aviation fuel (SAF), are already actively being used across road and air transport today and recognized as solutions helping replace fossil fuel.

At the same time, electrification has also made major strides and, when powered by renewable electricity, electric vehicles will play a key role in reducing reliance on fossil fuels.  

In 2025, battery-electric vehicles represented 17.4% of new passenger car registrations, while electric heavy trucks accounted for 3.6% of registrations. 

Given the sheer size and growth of the transport sector, no single technology can achieve a full transition away from fossil fuels on its own. 

Europe needs a diversified approach

Transport is a highly diverse sector. Each mode and type of transport has distinct operational requirements and therefore requires different solutions to reduce emissions. This diversity must continue to be reflected in EU policies, including the post-2030 renewable energy framework.

Frank Breust, Senior Director Government Affairs EU of the BMW Group points to the need for a pragmatic approach:

In addition to the already mentioned electrification and renewable liquid fuels, also green hydrogen is a promising solution, particularly for hard-to-electrify sectors. But producing it requires vast amounts of renewable electricity as well as entirely new vehicles, aircraft and distribution infrastructure.

Renewable gases, such as biomethane, help reduce reliance on fossil fuels across gas-powered road transport (such as CNG and LNG vehicles) and existing gas supply networks, leveraging established infrastructure, while e-fuels could become an important additional alternative in sectors where electrification is difficult. However, these technologies are still at an earlier stage of development and will take time to scale.

Renewable liquid fuels, drop-in replacement for fossil fuel 

Among the available pathways, renewable liquid fuels represent a critical, ready-to-deploy pillar for contributing to the phasing out of fossil fuels across European transport. 

Renewable diesel can be used in existing diesel-powered vehicles without modifications to engines, investments into new vehicles or dedicated fuel distribution systems. It can be distributed through existing fuel infrastructure and service stations, enabling rapid deployment at scale.

This makes renewable diesel particularly well suited for long-distance, high-utilization and heavy-duty transport, as well as regions where EV charging or hydrogen infrastructure remains limited.

By 2030, internal combustion engine (ICE) vehicles are expected to still account for around 80–85% of the European passenger car fleet. Even by 2040, more than half of all vehicle-kilometers traveled in Europe are projected to be powered by internal combustion engines. The 250 millions cars already on the European roads will remain in service for many years, while a share of new vehicles sold after 2030 is still expected to be powered by internal combustion engines, including hybrids. In addition, ICE vehicles, particularly those used in rural areas and for long-distance travel, are expected to continue covering higher annual mileage than electric vehicles. As a result, they will account for a disproportionately large share of total vehicle kilometers even as the number of EVs continues to grow. 

For commercial and cargo aviation, sustainable aviation fuel (SAF) is currently the only viable lower-GHG-emission alternative* to fossil jet fuel. SAF can be used in existing aircraft and infrastructure today, helping the aviation industry reduce its GHG emissions*.

*) When verified to fulfill the mandatory sustainability criteria in accordance with e.g. ReFuelEU, CORSIA, neat i.e. unblended SAF, provides greenhouse gas emission savings over its life cycle when compared to fossil fuel. While SAF and fossil jet fuel release similar amounts of CO2 during flight, SAF’s life cycle climate impact is smaller than fossil jet fuel’s. SAF is certified for commercial use and can currently be blended up to 50% with conventional jet fuel.

What is needed for all solutions to work together

Europe is home to an innovative and expanding renewable fuels industry, as well as many of the world's leading technology providers in electromobility. This industrial base has been built through significant investments made possible by a stable and supportive EU policy framework. Preserving and strengthening this framework will be essential if Europe is to create the conditions needed to achieve its 2040 climate target of a 90% reduction in greenhouse gas emissions.

The EU Clean Industrial Deal provides the right direction by recognizing that climate ambition and industrial competitiveness must advance together. These twin objectives should underpin future policy decisions, including the post-2030 energy and climate framework and the ongoing review of CO₂ emission standards for vehicles.

Europe's diversified clean technology and renewable fuels ecosystem is not only essential for delivering the EU's climate and transport emission reduction objectives, but also a strategic asset for energy security and resilience. Each technology relies on distinct supply chains, raw materials, components and industrial capabilities. Together, they create a more robust and resilient transport energy system, reducing Europe's vulnerability to supply disruptions and its continued dependence on imported fossil fuels.

To ensure sustained GHG emissions reductions while strengthening Europe’s strategic autonomy and energy resilience, Europe must deploy all available solutions.