The EUR 3 billion ETS2 Frontloading Facility is a welcome development. However, without explicit prioritisation, commercial road transport risks being left without the predictable support it needs to decarbonise.

The European Investment Bank and the European Commission announced this week an agreement on a EUR 3 billion ETS2 Frontloading Facility to accelerate investments in the sectors covered by the new emissions trading system for buildings and road transport.

The facility will allow funds to be allocated to Member States that have transposed ETS2, enabling them to pre-finance measures ahead of 2028, when revenues from the system are expected to start being collected.

At this stage, however, the announcement does not include the actual European Investment Bank facility set-up or guidance to Member States. As a result, it remains unclear how the mechanism will function in practice. While the communication broadly states that the facility will help ramp up clean investments in buildings and road transport, it only provides high-level examples for transport and no indication of how support will be targeted or prioritised.

IRU EU Director Raluca Marian said, "The EUR 3 billion ETS2 Frontloading Facility is a welcome development. But unless the European Commission and European Investment Bank set a clear direction on where financial support should flow, there is no guarantee that road transport operators will have effective access to the investment instruments linked to the system, with very divergent practices expected across Member States."

"For investment predictability, our sector needs explicit conditions attached to this facility that ensure support for commercial road transport decarbonisation," she added.

The same uncertainty risks persisting once ETS2 is fully operational from 2028.

Under ETS2, a carbon price will apply to fuels used in road transport, with costs expected to be reflected in diesel and petrol prices, generating substantial revenues. While the system is designed to accelerate decarbonisation and these revenues are intended to support the green transition, it will also increase operating costs for transport operators - without any guarantee that a meaningful share of the proceeds will be reinvested into greening road transport.

IRU has consistently underlined that ETS2 can only deliver a socially fair and economically workable transition if carbon cost exposure is matched by accessible, predictable investment support for zero-emission vehicles, depot charging, grid connections and infrastructure deployment - particularly for SMEs.

Zero-emission heavy-duty vehicles are entering the market and infrastructure deployment is progressing, but the transition remains highly capital-intensive, with significant upfront costs for vehicles, depot charging and grid upgrades. Earlier this month, IRU, ACEA and T&E highlighted the importance of continuity in EU-level infrastructure support as existing funding instruments approach exhaustion.

Ensuring predictability of support and alignment between vehicle rollout and infrastructure deployment will be critical to maintaining momentum.

IRU therefore calls on the European Commission to work closely with Member States to ensure that commercial road transport is appropriately reflected in national Social Climate Plans and ETS2-related funding measures.

"Aligning cost exposure with accessible investment pathways will be key to delivering a successful effective and socially fair transition," concluded Raluca Marian.