European Commission presents plan on sustainable transport fuels for the maritime and aviation sectors

The European Commission has adopted a Sustainable Transport Investment Plan^[1] (STIP) with a focus on sustainable maritime and aviation fuels. The plan provides a description of the main problems and challenges when it comes to the update of sustainable fuels in the maritime and aviation sectors, in particular the lack of fuel availability, high costs, and significant financing needs. It also makes a few suggestions how the European Commission and Member States can address this.

As regards the production side of sustainable fuels the plan points out that it is urgent to scale-up renewable and low carbon fuel generation capacities in the EU, in order not to run into new dependencies. Furthermore, according to the STIP, e-fuels are not available on a commercial scale in either maritime or aviation at the moment. The plan furthermore deplores the exorbitant price difference between e-fuels and conventional fuels and explains that while more than 40 e-fuels production projects are at a planning stage in the EU, none has been able to reach a final investment decision so far.

Moreover, STIP identifies significant investment needs into sustainable fuels: for aviation and waterborne transport combined, around 20 Mt of renewable and low-carbon fuels will be needed by 2035. To comply with the requirements, around EUR 100 billion in investment is needed by 2035.

When it comes to solutions, some steps can be taken by the maritime sector itself: the STIP suggests that the waterborne transport sector is to make use of different technologies (including wind assisted propulsion) and a broad basket of sustainable maritime fuels (SMF), including LNG as a transitional fuel. LNG, with effective methane slip mitigation technologies, can also reduce GHG emissions, according to the plan.

Regarding the EU’s contribution, the plan refers to the mainstream funding programmes and schemes, in particular the Innovation Fund, Horizon Europe, the European Investment Bank (EIB), and the European Innovation Council. However, it stresses the EU cannot be up to the challenge on its own and calls Member States to top up EU-funding streams, e.g.  by using ETS revenues.

[1] https://transport.ec.europa.eu/document/download/73447373-de2a-4ba4-9371-36d1186035d4_en