UK: The European Commission’s “Greening Transport Package": A Stepped Approach

Last Updated: 31 July 2008
Article by Paul Sheridan and Olivia Quaid

On 8 July 2008 the European Commission (the "Commission") launched a package of proposals to make transport greener and more sustainable. This package breaks down into 5 parts:-

  • a communication regarding greening transport;

  • a greening transport inventory;

  • a strategy to internalise the external costs of transport (aka 'monetisation');

  • a communication on reducing rail noise; and
    a proposal to revise the Directive on infrastructure charging for heavy goods vehicles (otherwise known as the Eurovignette Directive).

The aim is to facilitate more efficient transport, raise funds for new or revised infrastructure and alternative transport, and to encourage behavioural change.

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The European Commission's "Greening Transport Package": A Stepped Approach

On 8 July 2008 the European Commission (the "Commission") launched a package of proposals to make transport greener and more sustainable. This package breaks down into 5 parts:-

  • a communication regarding greening transport;

  • a greening transport inventory;

  • a strategy to internalise the external costs of transport (aka monetisation');

  • a communication on reducing rail noise; and

  • a proposal to revise the Directive on infrastructure charging for heavy goods vehicles (otherwise known as the Eurovignette Directive).

The aim is to facilitate more efficient transport, raise funds for new or revised infrastructure and alternative transport, and to encourage behavioural change.

Infrastructure charging

The Eurovignette Directive is presently the only EU directive on infrastructure charging. It covers the use of certain road infrastructure by heavy goods vehicles and allows distance based charges (tolls) or time based charges. At present it sets requirements for toll and user charge systems where Member States choose to implement them on the trans-European road network. However it currently excludes the ability to include environment and health costs in toll prices. This has been excluded until a common methodology for the calculation and internalisation of external costs can be developed and applied to all modes of transport. The Eurovignette Directive itself calls on the Commission to present a model for the assessment of all external costs arising from the use of the transport infrastructure to act as the basis for future calculations of infrastructure charges. In 2006 the Commission was tasked with proposing a strategy for implementing such a model accompanied by, if necessary, proposals to revise the Eurovignette Directive.

Internalising the external costs of transport

Following research and consultation the Commission has proposed a common framework for estimating the external costs of transport in the EU. This is supplemented by a strategy that identifies how external costs can be internalised in all modes of transport taking into account mode and impact (e.g. depending on the location and the time of day).

The strategy for the internalisation of external costs covers the costs of congestion, air pollution, noise and climate change.

Proposals to amend the Eurovignette Directive

The proposal for a Directive amending the Eurovignette Directive (the "Amending Directive") is intended to enable (not compel) Member States to calculate and vary tolls applied to heavy goods vehicles on the basis of costs of traffic based pollution and peak hour congestion levels. The related proceeds would be used to increase sustainable transport. The Amending Directive sets out formulae and prescribed unit values for the cost of traffic based air pollution, noise pollution and congestion. (The accompanying communication to the proposal notes that private transport is not covered, but Member States are encouraged to implement a charging system for all road transport as an incentive to change behaviour.) The toll amount will be determined by an independent authority in each Member State applying the common calculation method. The charges may vary according to matters such as the EURO emission class, the type of roads and the time period in cases where the charge includes the cost of congestion and/or traffic based noise pollution. It is suggested that the average amount of the external cost charge will be in the range of 4-5 eurocents per kilometre for a 40 tonne vehicle with a EURO IV engine. The proposal also gives Member States the option to pilot schemes to assess the cost/benefit of toll systems on lesser used networks.

For a transitional period until 31 December 2011, a Member State may choose to apply tolls and/or user charges only to vehicles having a maximum permissible laden weight of not less than 12 tonnes. Thereafter, save for certain exceptions, tolls and/or user charges shall be applied to all vehicles or articulated vehicle combination intended or used exclusively for the carriage by road of goods and having a maximum permissible laden weight of over 3.5 tonnes. The Amending Directive does not prevent Member States from applying regulatory charges to urban roads specifically designed to reduce traffic congestion or combat environment impacts in built up areas. The Commission is obliged to report by 2013 to the European Parliament and the Council on the implementation and effects of the Amending Directive and assess the internalisation of external costs which internalisation will be updated in line with scientific developments. Reference is made to the potential of including other external costs such as those relating to harm to biodiversity.

The text of the draft Amending Directive indicates implementation by Member States by 31 December 2010 at the latest. Initial feedback from the European Parliament is that the Eurovignette measures must be compulsory, not voluntary as presently envisaged.

Other sectors

The proposal to revise the Eurovigrette Directive will make it possible to internalise external costs in rail without reference to other forms of transport. (The present Eurovignette Directive restricts this ability unless other modes of transport also internalise certain costs). Activity should be expected in this area, see further below.

Different approaches are to be adopted in respect of inland waterways. Here all external costs are to be internalised. Maritime transport is less advanced in the internalisation of such costs. The Commission proposes to act in 2009 if at that stage the International Maritime Organisation has not agreed concrete measures to reduce GHG emissions from maritime transport including the possibility of inclusion into the European Union Emissions Trading Scheme ("EU ETS").

Complementary measures

There may be some products and services where internalisation of costs is unlikely to lead to a change in behaviour or if action is not taken to kerb negative impacts, growth may be inhibited or restricted. In these instances the Commission aims to introduce complementary measures. For example, a separate communication to reduce rail noise from the existing fleet, sets out measures to introduce low noise brakes. These include a combination of combined noise emissions ceilings, voluntary commitments and financially geared legislation. In respect of the latter, quieter freight wagons will be charged less to allow recoupment of investment and following a retrofitting period higher charges will be applied to noiser wagons in addition to overall noise emission caps for all wagon fleet.

Other measures in the next 18 months

Five other areas are on the Commission's action list:-

1. Climate change

There is proposed legislation on the reduction of emissions of nitrogen oxides (NOx) from aviation. In road transport measures will be proposed to reduce the CO2 emissions from new vans, tyre labelling and the revision of the existing car labelling directive.

2. Local pollution

There is proposed legislation to limit the emission of volatile organic compounds during the refuelling of passenger cars and a proposal to further reduce the sulphur content of liquid fuels.

3. Noise

In addition to legislation on rail noise, there is a possible revision of the existing Directive on aircraft noise and future proposals to revise the Directive on environment noise.

4. Congestion

There are plans to provide funding under the Trans European Network programme for electronic toll systems implemented jointly by at least two Member States.

5. Cross sector measures

A number of measures are envisaged such as legislative proposals on rail freight and revision of the Directive on Rail Infrastructure Charging; a legislative initiative to set out a common approach to facilitate market exposure and implementation of existing intelligent transport systems (ITS) technologies, and the revision of the Energy Taxation Directive to better complement the EU ETS and the EU's climate change goals.

In 2009 the Commission will present a report on long term scenarios for the development of transport policy for the next 20 - 40 years.

A copy of the full proposals is available here.

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 31/07/2008.

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