The transport sector remains a major challenge in Europe’s decarbonisation efforts, with emissions continuing to rise despite policy measures. While electric vehicles alone will not solve the problems, experts highlight the need for a balanced approach combining regulation and incentives.

Between 1990 and 2022, transport emissions grew by 26 per cent, primarily due to road transport, while other sectors saw reductions, according to the World Bank’s latest report, “Enhancing Transport Decarbonisation in the European Union”.

The transport challenge

To reverse this trend, the report argues that the EU must enhance public-private collaboration, leverage financial tools to bridge investment gaps and implement policies that incentivise sustainable transport.

E-mobility has significant potential, but affordability remains a barrier.

The EU, which accounted for a quarter of global EV sales in 2023, must support smaller, energy-efficient EVs, electrify commercial fleets, and develop innovative financing models for zero-emission trucks and buses.

Urban areas, home to 75 per cent of the EU population, are key to reducing emissions. Strengthening governance, diversifying funding, and applying measures like congestion charges and dynamic parking pricing can accelerate progress.

Rail freight, which has declined to a 17 per cent modal share, holds untapped potential for decarbonisation. Investments in cross-border coordination, digitalisation, and multimodal logistics could improve its competitiveness.

The report suggests that the EU explore funding options such as the Emissions Trading System (ETS) and increase private sector participation in infrastructure development. By taking swift and strategic action, the EU can cut transport emissions while enhancing economic resilience.

Sticks and carrots

Luis Martinez, Lead Modeller at the International Transport Forum (ITF), spoke to Euractiv about the importance of integrating transport and land-use planning through Metropolitan Authorities. By merging these areas, cities can promote sustainable urban mobility.

Measures such as restrictive parking policies and car bans in medium-sized cities, like Pontevedra in Spain, demonstrate how urban redesign can enhance public well-being, Martinez argued.

On fleet electrification, Martinez said that strong regulation and financial penalties for non-compliance are now necessary to accelerate adoption, as high-mileage EVs are already cost-competitive.

He also stressed the need for improved intermodal logistics in freight transport, pointing out that rail’s competitiveness is hindered by shipment size constraints and service uncertainties.

“The rail sector needs a third-party service of consolidation, which will change current practices in the sector, and bring rail service constraints to the development of freight demand, especially in developed countries,” Martinez added.

Innovative financing

Meanwhile, Felipe Rodríguez, Programme Director at the International Council on Clean Transportation (ICCT), focused on innovative financing models to accelerate the adoption of zero-emission trucks and buses in the EU.

He emphasised de-risking investments through leasing models with integrated service contracts and credit risk guarantees, which lower costs and improve access to financing. Large companies play a key role in this.

“Amazon’s leasing of 200 eActros trucks to its carriers shows how large firms can accelerate adoption in financed-constrained small companies without exposing them to financial risk,” he told Euractiv.

For electrified bus fleets, Rodríguez highlighted successful models from Latin America, such as Santiago’s payment security guarantees and São Paulo’s low-interest public financing, which reduce costs and encourage adoption.

“While models such as Santiago’s and São Paulo’s need to be tailored to different cases, European cities can learn a lot from their leading counterparts in Latin America,” he said.

On improving urban transport competitiveness, Rodríguez supports policies that integrate public transit, cycling, and walking while curbing car dominance through congestion pricing and land-use planning.

“Cities like Copenhagen and Amsterdam show that reallocating road space improves mobility and liveability – but success hinges on seamless multimodal integration, smart land use, and equitable access to transport,” Rodríguez remarked.

[Edited By Brian Maguire | Euractiv’s Advocacy Lab ]