Trans Info — 2023-12-07
Land transportation
In a timely discussion at the recent PPLNG Conference in Gdynia on 29 and 30 November2023, industry experts raised concerns and offered insights regarding the quick implementation of higher road tolls in Germany driven by the EU Eurovignette Directive.
The focus of the debate was on the potential impact of the aforementioned directive on the transportation sector, with a specific emphasis on decarbonisation efforts, biofuels, and European haulage operations.
Those who gathered at the event left with a number of fascinating takeaways, including predictions on how EU legislation could evolve, and why the EU Eurovignette may not be active in full until 2027.
The conference hosted numerous figures in the energy and transportation sectors, including Eva Tzoneva from Shell, David Halasz from fuel card service provider EUROWAG, NGVA Secretary General Matthias Maedge, and Paweł Węcłowski from Sobanscy Energy. Marek Loos, a Transport Manager, moderated the event.
In the piece, we summarise the key points raised by all the guests who spoke in English during the event, namely the former three of the five aforementioned persons; Eva Tzoneva, David Halasz and Matthias Maedge.
Shell’s Eva Tzoneva’s analysis of the EU Eurovignette and its timeline for implementation
Opening the debate, Eva Tzoneva, Shell’s Development Manager for Global Services on the road, emphasised the challenges faced by European member states in implementing the EU Eurovignette Directive, which requires compliance within a tight timeframe.
Tzoneva shed light on the lobbying efforts in Germany to exempt LNG trucks from tolling, citing the positive impact of LNG on CO2 reduction. However, time constraints led most member states, including Germany, to proceed with the directive’s implementation regardless.
Highlighting the unrealistic timeline, Tzoneva pointed out that Germany adopted legislation just weeks before the December 1st deadline. She criticised the decision, stating that authorities were aware of the impracticality but pressed anyway ahead due to political determination.“Germany decided to go first, even ahead of the timeline in March,” said Tzoneva. “So they’re going ahead on Friday [December 1st] and they knew very well that there isn’t enough time to implement that directive.”
Tzoneva than highlighted the disparity between the time Member States have to implement the directive, and the time transport companies have to adapt to it:“If we look at the directive, Member States have two years to transpose a European directive into local legislation. The rest of us; transport companies and service providers in the case of Germany, had between the 20 October and the 1 December – less than two months. This is unrealistic.”
Addressing the tolling classification for LNG vehicles, Tzoneva explained the parameters for assigning classes based on registration dates, vehicle subcategories, and CO2 emissions.
Unfortunately, Tzoneva pointed out the hard truth that companies will need to prove their LNG trucks meet certain criteria in order to avoid automatically being assigned to the highest category.
“On the 1st of December, it is partially true that LNG trucks will fall into the worst category, CO2 one. It was mentioned that there are 5 [categories]. Category 5 is reserved only for electricity and hydrogen. Category 4 is only for vehicles which contribute more than 50% reduction via the engine of CO2 emissions, and most manufacturers have confirmed such vehicles don’t exist yet. Therefore, we are talking about categories 1 to 3, the most expensive one [category 1] or [categories] 2-3,” said Tzoneva.
Explaining further, Tzoneva added:
“Everyone who is able to provide the parameters to determine the CO2 class will be eligible for a better class, but those who are not will be automatically assigned to Class 1,” said Shell’s Development Manager for Global Services on the road.
What are those parameters then? One that is easy to determine, as explained by Tzoneva, is that all vehicles which have been registered before July 1st 2019 will go to Class 1. On top of that, cabin size and engine power also play a role. The next parameter is the vehicle subcategory, which is determined by several factors like axle configuration. Finally, the third one is the actual amount of the CO2 emissions from a particular vehicle, which is found in the vehicle’s registration documents.
This naturally sounds rather daunting, however Tzoneva did offer some hope. As she explained during the conference, companies who can prove a truck belongs in a different category at a later stage, can then retrospectively receive their money back from the German authorities.
Another key point raised by Tzoneva is that the disparity in toll rates between the categories is not as large as one might expect.
“Guess what? The difference is minimal. A truck of more than 18 tons is Euro emission class current 6. If they are attributed in class one, they will pay 34.8 cents per kilometre. Class 2 will pay 34, while class 3 will pay 33.2,” stressed Tzoneva, who added: “If you look at the difference of the tolling payment, it is just a fraction.”
Tzenova also highlighted Germany as the precursor to tolling changes and discussed Austria’s more reasonable approach with gradual CO2 component increases over three years.
Moreover, she emphasised the need for countries to follow directives, but cautioned against blindly replicating the German system.
“Austria has decided to go for an increase of the CO2 component, but in a much more reasonable way. So it will be done in consecutive steps, three steps over three years. So there will not be such a shock,” said Tzenova.
The Shell representative nonetheless pointed out that Austrian road tolls are already very expensive:
“Austria is already the most expensive if you look at the rate per kilometre. So interestingly enough, everybody talks about how big the increase in Germany is, but after the 70% increase [in Germany], the roads in Austria will still be more expensive than German ones.”
Another significant point raised by Tzenova relates to how the Euro Vignette Directive is set to be implemented in different countries according to disparate timelines:
“The special thing about the Euro Vignette Directive is that it is mandatory for all member states where the road networks are owned by the state, and where there is a kilometre based system. So if we take the example of the Netherlands, yes, the network is state owned, but they have a time based euro vignette system. So the Euro Vignette CO2 component does not apply until the time when they switch to a kilometre-based system, which as we know it will be 2026 or 2027.”
Moreover, Tzoneva added that Belgium will not implement CO2 tolling until 2027, while the likes of France, Spain, Portugal and Italy are countries where the roads are given to operate to concessionaires, or in other words, private companies.
“A European directive cannot overrule the stipulations of a concession, and concessions typically take 10 years, 15 years, or longer. So in those countries we will see CO2 tolling, but concession by concession. It will be a very interesting journey, maybe it won’t be until 2027 or even 2030 when we see the effects of CO2 tolling in Europe,” concluded the Shell representative.
David Halasz of EUROWAG expands on the complexity and challenges in European tolling systems
Next to speak was David Halasz from EUROWAG, who elaborated on the complexity and challenges faced by different European countries in implementing the EU Eurovignette Directive.
He provided examples from Central Europe, including Hungary, where the environmental element is fixed into the final toll price, and Slovakia, which is yet to finalise its toll system.
He also touched on the Czech Republic, whose road authority is set to follow in the footsteps of Austria:
“They [the state roads authority of the Czech Republic] want to go down the Austrian road. When asked about LNG and CNG, since the recovery plan they’re only subsidising hydrogen and e-mobility, they basically don’t want to even talk about it.”
When quizzed on whether the Visegrad countries may wish to go down their own route as far as CO2 road tolls are concerned, Halasz added:
“I think a lot of countries would like to come up with a very different CO2 tolling system, but I think it would benefit everyone If there was one system. It would be smoother, easier, more user friendly. It would be only one process, so basically we wouldn’t have to register for each toll.”
NGVA Secretary General Matthias Maedge offers frank critique of EU regulations
Finally, one of the more outspoken participants at the event was Matthias Maedge of the NGVA, an industry body for biofuel-powered transport. Maedge bluntly criticised the German government’s strategy, calling it “completely stupid behaviour.”
He also alleged that the fast implementation of tolls was politically motivated to fund railway projects.
“This [the road toll legislation] is a political game that has been played between the parties. And the speed of adoption of the regulation serves one single purpose. And that’s taking your money from the transport industry on the road in order to invest and subsidise the rail,” said Maedge.
Maedge was nonetheless positive about changes in EU regulation forcing Germany’s hand when it comes to the tolling of biofuel-powered vehicles. He referred to recent European Parliament legislation on HGV vehicle categorisations as an “interesting” development.
Keen to end the discussion on a positive note, Maedge also maintained that despite the legal and political challenges, biofuel lorries will remain a fixture well into the future:
“You can never change the laws of physics, and that’s why I’m convinced there is a future for gas and for LNG; if it’s renewable, there is no reason to not to. It is simply the closest to diesel in terms of energy content and energy density. No other energy vector will be able to meet that requirement,” said the Secretary General of NGVA Europe.