EUR-Lex Access to European Union law

Back to EUR-Lex homepage

This document is an excerpt from the EUR-Lex website

Document 52020SC0331

COMMISSION STAFF WORKING DOCUMENT Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Sustainable and Smart Mobility Strategy – putting European transport on track for the future

SWD/2020/331 final

Brussels, 9.12.2020

SWD(2020) 331 final

COMMISSION STAFF WORKING DOCUMENT

Accompanying the document

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL
COMMITTEE AND THE COMMITTEE OF THE REGIONS

Sustainable and Smart Mobility Strategy – putting European transport on track for the future

{COM(2020) 789 final}


Contents

1    Introduction    

2    European mobility and transport – where are we heading?    

2.1    Identifying the greenhouse gas emissions gap for transport    

2.2    Developments under current policies    

2.3    Overall economic, social and technological trends    

2.3.1    Economic context    

2.3.2    Demographic trends    

2.3.3    New technologies, changing consumer behaviour and working conditions    

2.4    Impact of the COVID-19 pandemic on the transport sector    

2.4.1    Air transport    

2.4.2    Waterborne transport    

2.4.3    Road transport    

2.4.4    Rail transport    

2.4.5    Urban transport    

3    Key policy developments over the last decade    

3.1    Sustainability    

3.2    Digitalisation    

3.3    Single Market    

3.4    Safety & security    

3.5    Social issues    

3.6    Enforcement of the EU transport acquis    

4    Challenges to sustainable, smart and resilient mobility    

4.1    The sustainability challenge    

4.1.1    Zero- and low-emission vehicles and renewable and low carbon transport fuels    

4.1.1.1    Fuel supply    

4.1.1.2    Fuel infrastructure    

4.1.1.3    Other incentives    

4.1.1.4    Pollutant standards, batteries and roadworthiness    

4.1.2    Clean ports and airports    

4.1.2.1    Ports    

4.1.2.2    Airports    

4.1.3    Sustainable urban mobility    

4.1.3.1    Urban vehicle access regulations    

4.1.3.2    Walking, cycling and micromobility    

4.1.3.3    Public transport, shared mobility and transport on demand    

4.1.3.4    Urban logistics    

4.1.4    Multimodality and modal shift    

4.1.4.1    Improving multimodal freight operations    

4.1.4.2    Rail freight    

4.1.4.3    Inland waterways    

4.1.4.4    Short sea shipping    

4.1.5    Better incentives to users    

4.1.5.1    Pricing and internalisation of external costs    

4.1.5.2    Better information to users    

4.2    The challenge of digitalisation and modernisation    

4.2.1    Smart multimodal transport – challenges for seamless experience    

4.2.1.1    Cross-border multimodal challenges    

4.2.1.2    Multimodal & collaborative economy challenges in urban context    

4.2.2    Intelligent Transport Systems and connected, automated mobility    

4.2.2.1    ITS challenges in road transport    

4.2.2.2    ITS challenges in other modes of transport    

4.2.3    Innovation and mobility of the future    

4.2.4    Digital enablers    

4.2.4.1    Data for smart transport and mobility    

4.2.4.2    Artificial Intelligence, 5G and other key enabling technologies    

4.3    The challenge of making the transport sector more resilient    

4.3.1    Crisis resilience and management    

4.3.1.1    Governance    

4.3.2    Infrastructure and investment    

4.3.2.1    Capacity across modes    

4.3.2.2    Future-proof infrastructure    

4.3.2.3    Access to funding    

4.3.3    Single Market    

4.3.3.1    Single Market for road transport    

4.3.3.2    Single European Railway Area    

4.3.3.3    Aviation Single Market    

4.3.3.4    Waterborne Single Market    

4.3.4    Social aspects    

4.3.4.1    Workers’ rights and transition to automation and sustainability    

4.3.4.2    Skills and attractiveness of transport jobs    

4.3.4.3    Access to transport: affordability, availability and accessibility    

4.3.4.4    Protection of European passengers and consumers    

4.3.5    Safety and security    

4.3.5.1    Ever evolving challenges    

4.3.5.2    Safe and secure infrastructure    

4.3.5.3    Vehicle safety    

4.3.5.4    The human factor    

4.3.5.5    Ensuring a high and equal level of safety and security across modes    

4.4    External dimension    

4.4.1    EU leadership    

4.4.2    EU global competitiveness    

4.4.3    External connectivity    

5    Description of the pathways/scenarios    

5.1    Scenario design    

5.2    Analysis of impacts of the pathways/scenarios    

5.2.1    Impacts on transport activity    

5.2.2    Technology development projections by transport mode    

5.2.2.1    Road transport    

5.2.2.2    Rail    

5.2.2.3    Aviation    

5.2.2.4    Inland waterways and national maritime    

5.2.2.5    International maritime transport    

5.2.3    Energy demand and fuel mix projections    

5.2.4    GHG emissions from transport    

5.2.5    Impacts on noise, NOx and particulate matter emissions    

5.2.6    Impacts on external costs of transport    

5.2.7    Investments    

5.2.8    Social impacts    

5.2.9    Sensitivity analysis on the COVID-19 pandemic    

6    Annex I - Analytical methods    

6.1.1    Description of the modelling tools used    

6.1.1.1    Main modelling suite    

6.1.2    Assumptions on technology, economics and energy prices    

6.1.2.1    Economic assumptions    

6.1.2.2    Energy prices assumptions    

6.1.2.3    Technology assumptions    

6.1.3    Policies in the existing policies scenario (Baseline scenario)    

6.1.4    Policy scenarios    

List of figures

Figure 1: The EU’s pathway to sustained economic prosperity and climate neutrality, 1990-2050    

Figure 2: Passenger and freight transport activity in the Baseline scenario (average growth rate per year)    

Figure 3: Projected evolution of international maritime transport activity in the Baseline scenario    

Figure 4: Projected evolution of energy consumption per transport mode in 2030 and 2050 relative to 2015 (% change) in the Baseline scenario    

Figure 5: Share of alternative fuels used in transport (including international aviation and maritime) in the Baseline scenario    

Figure 6: Fuels use in transport (including international aviation and maritime) in the Baseline scenario    

Figure 7: CO2 emissions from transport (including international aviation but excluding international maritime) in the Baseline scenario    

Figure 8: Passenger transport activity in the Baseline and the COVID-Baseline scenarios (cumulative growth rates for 2015-2030 and 2015-2050)    

Figure 9: Freight transport activity in the Baseline and COVID-Baseline scenarios (cumulative growth rates for 2015-2030 and 2015-2050)    

Figure 10: CO2 emissions from transport (including international aviation but excluding international maritime) in the Baseline and COVID-Baseline scenarios    

Figure 11: Workforce working at home several times per month in 2015    

Figure 12: Market share of all but the principal railway undertakings in 2016    

Figure 13: The use of EU Pilot concerning mobility and transport infringements between 2015-August 2020    

Figure 14: Evolution of transport activity in tonne- and passenger-kilometres in the EU    

Figure 15: Share by mode in total transport GHG emissions, including international bunkers, in the EU-27 in 2018    

Figure 16: Evolution of GHG emissions by transport mode in the EU-27 (1990 = 1)    

Figure 17: Evolution of final energy consumption by sector in the EU (million tonnes of oil equivalent)    

Figure 18: Transport sector consumption of petroleum products & biofuels, 2000-18    

Figure 19: Number of BEV and PHEV passenger cars in 2020    

Figure 20: Number of inland vessels per year of construction in the Belgian and German fleet    

Figure 21: Number of inland vessels per year of construction in the Danube countries    

Figure 22: Situation of the publicly accessible recharging points in 2018 across EU    

Figure 23 Cruise ships docking in Barcelona emit 5 times more sulphur than the city’s 560,000 cars every year    

Figure 24 CO2 emissions per flight phases    

Figure 25 ATM inefficiencies    

Figure 26: Annual mean NO2 concentrations observed at traffic stations, 2017    

Figure 27: Percentile 90.4 of daily mean PM10 concentrations observed at traffic stations, 2017    

Figure 28: Annual mean PM2.5 concentrations observed at traffic stations, 2017    

Figure 29: Main mode of transport on a typical day    

Figure 30: Percentage of road fatalities on urban roads in the EU by transport mode, 2018    

Figure 31: Passenger land transport modal split by country (%, 2018) and change in percentage points for rail (2015-2018)    

Figure 32: Air routes between metropolitan regions where rail travel times are below 2.5 hours by train    

Figure 33: Air routes between metropolitan regions where rail travel times are below 4 hours by train    

Figure 34 Cost level and composition of intermodal transport compared to road-only transport    

Figure 35 Intermodal terminals with rail access occurrence in Europe    

Figure 36 Minimum rates of taxation laid down in the ETD (1 Jan 2010)     

Figure 37 Purchase taxes in the EU in 2016    

Figure 38: Perceived quality of transport infrastructure in the EU countries    

Figure 39: Average peak-hour delay per representative driver (hours per year) in 2018    

Figure 40: Share of different items in household consumption expenditure in the EU    

Figure 41: Conditions to switch to more environmentally friendly modes of transport    

Figure 42: Road fatalities in the EU and current target    

Figure 43: Trend in road deaths per million inhabitants 2010-2019    

Figure 44: Overview of the policy scenarios    

Figure 45: Passenger transport activity in the Baseline and the policy scenarios (cumulative growth rates for 2015-2030 and 2015-2050)    

Figure 46: Freight transport activity in the Baseline and the policy scenarios (cumulative growth rates for 2015-2030 and 2015-2050)    

Figure 47: Shares in the total cars stock by type of drivetrain technology in 2030 and 2050    

Figure 48: Shares in the total vans stock by type of drivetrain technology in 2030 and 2050    

Figure 49: Shares in the total heavy goods vehicle stock by type of drivetrain technology in 2030 and 2050    

Figure 50: Shares in the buses vehicle stock by type of drivetrain technology in 2030 and 2050    

Figure 51: Aviation fuels mix in the Baseline and policy scenarios in 2030 and 2050    

Figure 52: Inland waterways and national maritime fuels mix in the Baseline and policy scenarios in 2030 and 2050    

Figure 53: International maritime fuels mix in the Baseline and policy scenarios in 2030 and 2050    

Figure 54: Change in total energy use in transport and in the final energy consumption in 2030 and 2050 compared to 2015    

Figure 55: Share of alternative fuels in transport (including international aviation and maritime) in 2030    

Figure 56: Share of renewable energy in transport in 2030    

Figure 57: Transport fuel mix (including international aviation and maritime)    

Figure 58: Tank to wheel CO2 emissions from transport (excluding international maritime) in 2030 in the Baseline and policy scenarios    

Figure 59: Well to wheel CO2 emissions from transport (excluding international maritime) in 2030 and 2050 in the Baseline and policy scenarios    

Figure 60: Change in NOx emissions and PM2.5 emissions in 2030 and 2050 compared to 2015    

Figure 61: Change in external costs of air pollution in 2030 and 2050 compared to 2015    

Figure 62: Change in external costs of congestion and accidents in 2030 and 2050 compared to 2015    

Figure 63: Average annual investments in vehicles, rolling stock, vessels, airplanes and alternative fuels infrastructure deployment in the Baseline and policy scenarios    

Figure 64: Additional annual average investments for 2021-2030 under existing policies and to achieve higher GHG emissions reductions - in billions euros (2015)    

Figure 65: Households’ annual transport related expenditures in the Baseline and policy scenarios - in billions euros (2015)    

Figure 66: Impacts of at least 55% GHG emissions reduction on transport sector employment (% change relative to the Baseline scenario)    

Figure 67: Comparison of key indicators in the MIX scenario and COVID-MIX variant    

Figure 68: Interlinkages between models    

Figure 69: Schematic representation of the PRIMES model    

Figure 70: Schematic representation of the GEM-E3 model    

Figure 71: Projected EU GDP (2015 = 100)    

Figure 72: International fuel prices assumptions – non-COVID scenarios    

Figure 73: Oil price projections in 2030 according to various sources    

Figure 74: International fuel prices assumptions – COVID scenarios    

Figure 75: Scenario assumptions description (scenarios developed with the PRIMES-GAINS-GLOBIOM modelling suite)    

Figure 83: Key modelling variables reflecting underlying policy assumptions    



1Introduction

1.This Staff Working Document accompanies the Communication from the Commission on the Sustainable and Smart Mobility Strategy, which sets out the actions needed to ensure that every transport mode plays a role in delivering the European Green Deal, that smart mobility enables seamless, safe and efficient connectivity, and that a more resilient Single European Transport Area provides connectivity for all EU citizens.

2.Sustainable, smart and resilient transport services and infrastructure are vital to make full use of the economic strengths of all regions of the European Union, to support the Single Market, recover from the current crisis and stimulate future growth, and to enable economic, social and territorial cohesion, while preserving our environment and our health. They also underpin our global competitiveness, and our international connectivity. The EU transport system provides safe and secure mobility for Europeans. The transport sector in the EU-27 employs more than 10 million workers and comprises around 1.1 million enterprises, providing services to people and businesses within the EU and globally 1 .

3.Mobility is a critical aspect of social inclusion and an important determinant of human well-being, especially for disadvantaged groups. Transport, recognised as an essential service in the European Pillar of Social Rights fulfils a basic need in enabling citizens to integrate into society and the labour market, but also constitutes a significant part of household expenditure. Enhanced connectivity and market opening has contributed to linking transport networks, bringing the EU together and making it more tangible and accessible for travellers. More needs to be done however.

4.Addressing the climate and environmental crisis is the defining challenge of our time and it is an opportunity to relaunch our economies in a sustainable manner. It requires urgent and sustained action by all actors in our society to preserve the health, prosperity, and well-being of people in Europe and all over the world. Responding to this challenge, the European Green Deal 2 has set a high level of ambition for climate neutrality by 2050. It is also Europe’s growth strategy, which aims to transform the EU into a fair and prosperous society with a resource-efficient and competitive economy. The economic response to the COVID-19 pandemic offers a unique opportunity to accelerate the green transition.

5.Transport is the only economic sector in which greenhouse gas emissions are higher than in 1990 and have started growing again since 2013 despite the mitigation efforts undertaken. This is why the European Green Deal has set the key objective to deliver a 90% reduction in transport-related greenhouse gas emissions by 2050. It also stresses that transport is a significant contributor to air pollution and noise, and has adverse effects on our lands, oceans, rivers and lakes, hence the need to accelerate the shift to sustainable and smart mobility, and delivering zero pollution and a toxic-free environment.

6.In the 2030 Climate Target Plan 3 , on the basis of the analysis carried out in its Impact Assessment, the Commission concluded that achieving 55% greenhouse gas emissions reductions by 2030 is fully achievable, and would not only put the EU firmly on track to achieve climate neutrality, but would also make EU business and industry global trailblazers. Achieving at least 55% greenhouse gas emissions reductions by 2030 would also improve the wellbeing of EU citizens by delivering significant co-benefits for example in terms of health, improved air quality and reduced environmental degradation, and it would strongly support the recovery from the COVID-19 pandemic and the longer-term competitiveness and resilience of the European economy. The European Green Deal is Europe’s growth strategy and to ensure we use it to its full potential, it is essential that Next Generation EU drives our competitive sustainability.

7.The impact assessment accompanying the 2030 Climate Target Plan 4 has also shown that if we only continue with existing policies, the transport sector would fall short in delivering the contribution needed to achieve the economy-wide target of at least 55% greenhouse gas emissions reduction by 2030 and climate neutrality by 2050. Additional policies will thus be needed to close the gap. To achieve this, a three-pronged set of actions must be taken to make each and every transport mode more sustainable, make sustainable alternatives widely available, and put in place the right incentives.

Figure 1: The EU’s pathway to sustained economic prosperity and climate neutrality, 1990-2050

Source: COM(2020) 562 final. Commission Communication “Stepping up Europe’s 2030 climate ambition Investing in a climate-neutral future for the benefit our people

8.Making our mobility and transport smarter and more efficient can greatly help in achieving our health and environmental objectives. Underpinned by the ubiquitous presence of smartphones, and other digital technologies and solutions, ranging from European space data and services to innovative business models, as well as by the emergence of a shared, collaborative economy, smart mobility concepts can help improve the use of infrastructure and resources. By integrating the different transport modes and delivering multimodality, they can transform our travelling and transport experience, making it safer, smoother, health supporting and, above all, more sustainable. There is a need to offer a seamless multimodal experience to all transport users to support sustainable choices, while taking advantage of Intelligent Transport Systems for safer and more sustainable mobility. Research and innovation are key to shape the mobility of the future, and the right enablers for successful digital transformation must also be put in place.

9.The COVID-19 pandemic has had a severe impact on European mobility and the sector. It has shown the importance of making our transport and mobility more resilient. Transport workers have been on the frontline, ensuring that essential services are maintained. They need quality jobs in order to be able to provide a safe, reliable and affordable service for customers. In addition, despite some progress, regulatory, administrative and technical barriers and burdens persist in transport in the majority of Member States, causing inefficiencies and additional costs to users and the fragmentation of the Single Market. There are still major gaps and missing links in our infrastructure. At the same time, it is necessary to modernise fleets in all modes to make them more sustainable.

10.Unless EU policy initiatives towards a Single European Transport Area are thoroughly implemented at national level, the fragmentation of the transport market will inevitably limit the future quality of transport services in the EU, as the sector will miss out on the economies of scale and leave growth opportunities untapped. Moreover, lack of enforcement of social rules, together with divergent national practices have led to social issues, which may in turn worsen the quality of transport services, create distortion in the market and lead to an uneven playing field. Market opening, fair social conditions and quality jobs are thus intrinsically linked.

11.While safety and security of transport in the EU has greatly progressed, and the EU remains the safest transport area in the world, in particular in the most frequently used mode, road transport, a substantial problem remains. In recent years the reduction of fatalities on EU roads has stagnated, and there was still 22,700 lives in 2019.

12.This Staff Working Document provides an overview of the Commission services’ assessment of the aforementioned challenges – sustainability, digitalisation, resilience – that the EU transport sector faces, underpinning the Strategy and the actions put forward within in it. It also briefly describes the expected evolution of European mobility if we were to rely on existing policies, and outlines some of the key elements of the economic, social and technological context, including the impact of the COVID-19 pandemic, and the substantial global dimension of transport. In addition, it gives an overview of the key policy developments in the transport sector since the adoption of the 2011 White Paper on transport 5 . Finally, this Staff Working Document provides a description of the pathways/scenarios for reaching the sustainability objectives for the sector, common to those supporting the 2030 Climate Target Plan 6 .



2European mobility and transport – where are we heading?

Identifying the greenhouse gas emissions gap for transport

13.The European Green Deal has set the key objective to deliver a 90% reduction in transport-related greenhouse gas (GHG) emissions by 2050 relative to 1990. This objective builds on the in-depth analysis accompanying “A Clean Planet for all - A European strategic long-term vision for a prosperous, modern, competitive and climate neutral economy” 7 , 8 . Transport excluding international maritime currently accounts for a quarter of all EU GHG emissions. Road transport alone represents around 20% of the total.

14.The Commission has undertaken an analysis exploring the impact of key EU level and Member States policies adopted by the end of 2019, in the so-called Baseline scenario. To ensure consistency, the same Baseline scenario is used as in the Impact assessment accompanying the Commission Communication “Stepping up Europe’s 2030 climate ambition - Investing in a climate-neutral future for the benefit of our people” 9 . The Baseline projections show that EU-27 transport emissions would go down over time, thanks to policies in place driving the roll out of zero- and low-emission vehicles and the recharging/refuelling infrastructure, the uptake of renewable and low carbon fuels and improvements in transport system efficiency. Emissions from transport including intra-EU aviation and intra-EU maritime are projected to be 18% lower by 2030 compared to 2005, and 40% lower by 2050 relative to 2005. Compared to 1990 10 however, this translates into 3% higher emissions by 2030 and only 25% lower emissions by 2050, due to high increases in transport emissions during the 1990s 11 .

15.Building on the Baseline projections, several scenarios have been developed for EU-27 in the context of the Impact Assessment accompanying the 2030 Climate Target Plan for increasing the EU’s GHG emission reductions target for 2030 to at least 55% compared with 1990 levels. By 2030, these scenarios achieve increased climate ambition by intensification of current energy, transport and climate policies or extension of carbon pricing to new sectors of the economy or combination of both 12 (see section 5). They all achieve climate neutrality by 2050. In addition, the scenarios explore different scopes for the emissions reduction target that is particularly relevant for international aviation and maritime transport: intra-EU versus intra- and extra-EU scope. The scenarios achieving economy-wide emissions reductions of at least 55% by 2030, show that transport emissions (including intra-EU aviation and intra-EU maritime) would need to decrease by 21-23% by 2030 relative to 2005 and 96-97% by 2050. This is equivalent in terms of the 1990 comparison to reducing transport emissions by 1-3% by 2030 and by around 94-96% by 2050 13 .

16.Comparing developments under existing policies (i.e. the Baseline scenario, achieving 18% emissions reduction in transport by 2030 and 40% by 2050) with scenarios achieving economy-wide emissions reductions of at least 55% by 2030 and climate neutrality by 2050 (21-23% emissions reduction in transport by 2030 and 96-97% by 2050), shows that additional policies are needed post-2020 in order to close the gap, and provide a cost-effective transport contribution to the European Green Deal. While reducing its environmental footprint, increasing the uptake of renewable and low-carbon fuels and decreasing its GHG emissions, transport also needs under the Green Deal to continue to meet society's needs, and deliver on its zero pollution ambition by reducing its other negative environmental and health impacts. The analysis in section 5 shows how to close this emission gap by 2030 and 2050. Curbing GHG emissions from transport also reduces the EU's dependence on fossil fuels and brings clear co-benefits leading to reductions of costs related to air, water, soil pollution, road crashes, congestion and noise pollution.

Developments under current policies

17.The Baseline scenario is developed building on a set of assumptions, including GDP and population projections, fuel prices projections and technology costs, as well as policies adopted by the end of 2019. It reflects a wealth of policy measures that drive: (i) the uptake of zero- and low-emission vehicles and the roll-out of recharging/refuelling infrastructure 14 ; (ii) the uptake of renewable and low carbon fuels 15 ; (iii) improvements in transport system efficiency - by making the most of digital technologies and smart pricing and further encouraging multi-modal integration and shifts towards more sustainable transport modes 16 . It also includes initiatives addressing road safety 17 , and thus contributing to reducing the external costs of transport.

18.For aviation, it takes account of the implementation of the EU Emission Trading Scheme, the Single European Sky, the deployment of SESAR solutions, the research and development of cleaner aircraft technologies lead by Clean Sky public-private partnership and aircraft CO2 emissions standards, as part of the so-called “basket of measures” that aim to reduce emissions from the sector.

19.For maritime, the Baseline scenario reflects the Energy Efficiency Design Index (EEDI) and the Ship Energy Efficiency Management Plan (SEEMP) adopted by the International Maritime Organisation (IMO), as well as IMO MARPOL Annex VI rules as regards the reduction of nitrogen and sulphur oxides emissions, the latter being transposed into EU legislation by the Sulphur Directive 18 . The baseline also accounts for other initiatives addressing air pollution from inland waterways vessels 19 .

20.The Baseline scenario is a projection of what would happen in the absence of policy change and not a forecast of likely future developments. It builds on pre-COVID-19 assumptions, which can be interpreted as assuming full economic recovery to pre-COVID-19 pandemic levels by 2030. There are large uncertainties related to the lengths of the pandemic and its impacts on economy and transport activity. Alternative growth scenarios could also materialise. A discussion of the impacts of COVID-19 pandemic and an alternative Baseline scenario reflecting the COVID-19 pandemic is provided in the following section. A full description of assumptions, including GDP and population projections, fuel prices projections and technology costs, as well as policies underpinning the Baseline scenario is provided in Annex I.

21.Significantly, even though the Baseline scenario fails to meet the climate challenge, EU transport activity would also only continue to grow, albeit at a slower pace than in the past. Freight transport activity for inland modes (expressed in tonne-kilometres) would increase by just 33% between 2015 and 2030 (1.9% per year) and just 56% for 2015-2050 (1.3% per year). Passenger traffic (expressed in passenger-kilometres) growth would be even lower than for freight with a 19% increase by 2030 (1.2% per year) and 34% by 2050 (0.8% per year). The annual growth rates by mode, for passenger and freight transport, are provided in Figure 2 .

Figure 2: Passenger and freight transport activity in the Baseline scenario (average growth rate per year)

 

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

Note: For aviation, domestic and international intra-EU activity is reported, to maintain the comparability with reported statistics. For freight, inland navigation transport covers inland waterways and national maritime. International maritime is reported separately.

22.Road transport would maintain its dominant role within the EU. The share of road transport in inland freight would remain relatively stable by 2030 at 71% and slightly decrease to 69% by 2050. For passenger transport, road modal share is projected to decrease by 3 percentage points between 2015 and 2030 and by additional 3 percentage points by 2050. Passenger cars would still contribute 70% of passenger traffic by 2030 and about two thirds by 2050, despite growing at lower pace relative to other modes, due to slowdown in car ownership increase which is close to saturation levels in many Western European Member States.

23.Rail transport activity is projected to grow significantly faster than for road, driven in particular by the assumed completion of the TEN-T core network by 2030 and of the comprehensive network by 2050, supported by the CEF, Cohesion Fund and ERDF funding. Passenger rail activity would go up by 32% between 2015 and 2030 (66% for 2015-2050), increasing its modal share by 1 percentage point by 2030 and an additional percentage point by 2050. Rail freight activity would grow by 40% by 2030 and 81% during 2015-2050, resulting in similar increases in modal share as for passenger rail by 2030 and two additional percentage points by 2050.

24.Based on pre-COVID-19 pandemic assumptions, domestic and international intra-EU air transport would grow significantly (by 56% during 2015-2030 and 102% by 2050) and increase its share in overall transport demand (by 2 percentage points by 2030 and by additional 2 percentage points by 2050). Overall, aviation activity including intra-EU and extra-EU flights is projected to go up by 54% by 2030 and 101% by 2050, putting pressure on airports capacity and on air traffic management.

25.Transport activity of freight inland navigation 20 also benefits from the completion of the TEN-T core and comprehensive network and the promotion of inland waterway transport and would grow by 19% during 2015-2030 and by 35% by 2050. The significant growth in freight inland navigation and rail freight activity is also supported by road pricing, the implementation of electronic documentation for freight transport and the European Maritime Single Window environment.

26.International maritime transport activity would grow strongly in the Baseline (by 23% between 2015 and 2030 and 54% by 2050), due to rising demand for primary resources and container shipping.

Figure 3: Projected evolution of international maritime transport activity in the Baseline scenario

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

27.Total energy use in transport, including international aviation and international maritime, is projected to decrease by 3% between 2015 and 2030 and by 13% by 2050, which in the context of growing activity shows the projected progress in terms of energy efficiency. These developments are mainly driven by the implementation of the CO2 emission performance standards for new light duty and heavy duty vehicles post-2020, supported by the roll-out of recharging and refuelling infrastructure and also by the shift towards more energy efficient modes such as rail and waterborne transport.

Figure 4: Projected evolution of energy consumption per transport mode in 2030 and 2050 relative to 2015 (% change) in the Baseline scenario

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

28.Road transport is responsible for more than 70% of total energy use in transport but this share is projected to significantly decline over time, to 68% by 2030 and 59% by 2050 thanks to the progressive electrification of the sector and greater use of more sustainable transport modes. On the other hand, use of bunker fuels for air and maritime transport are projected to increase significantly by 2050. Their respective shares would go up from around 12% to 14% for international maritime and 15% for international air transport in 2030 (19% for international maritime and 18% for international air transport in 2050). Energy use in rail and inland navigation transport would increase during 2015-2050 due to the shift from road towards these modes, and despite their higher energy efficiency. Their respective shares in the total energy use in transport would remain limited to around 2% by 2050.

29.Alternative fuels 21 , including renewable and low carbon fuels, are projected to represent 11.2% of transport energy demand (including international aviation and maritime transport) in the Baseline scenario by 2030 and 22.6% by 2050. Around 5% of all transport fuels in 2030 would be of biological origin, as shown in Figure 5 , driven by policy measures and notably the Renewable Energy Directive.

30.Electricity use in transport would steadily increase over time as a result of uptake of zero and low-emission powertrains in road transport and further electrification of rail. Its share in the total energy use in transport would go up from around 1.2% in 2015 to 3.4% in 2030 and 8.3% in 2050 (see Figure 5 ). The uptake of hydrogen would be facilitated by the increased availability of refuelling infrastructure, and is projected to represent 2.4% of energy use in transport by 2050.

Figure 5: Share of alternative fuels used in transport (including international aviation and maritime) in the Baseline scenario

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

31.Battery electric vehicles would see faster growth beyond 2020, in particular in the segment of light duty vehicles, driven by the CO2 emission performance standards, supported by the rolling-out of recharging infrastructure. The share of battery electric vehicles in the total stock of passenger cars would reach around 11% by 2030 and 30% by 2050. The share of low and zero-emissions cars (including battery electric, fuel cells and plug-in hybrids) is projected to go up to 16% by 2030 and 54% by 2050. For the light commercial vehicles segment, the share of battery electric powertrains is projected at 6% by 2030 and 26% by 2050. Electric buses are projected to represent around 8% of the vehicle stock by 2030, driven by the implementation of the Clean Vehicles Directive and air quality concerns in many cities banning combustion engine buses, while the uptake of electric and fuel cell heavy goods vehicles is projected to be more limited in the Baseline scenario (3% of vehicle stock by 2050) 22 .

32.Liquefied Natural Gas (LNG) is projected to represent around 2.7% of the energy use in transport by 2030 and 7.1% by 2050 in the Baseline scenario, driven by the implementation of the Directive on the deployment of alternative fuels infrastructure and of the Regulation on non-road mobile machinery, the TEN-T Regulation and also by the MARPOL Annex VI rules as regards the reduction of nitrogen and sulphur oxides emissions in the maritime transport. In the Baseline scenario, the share of LNG use in heavy goods vehicles energy demand is projected to go up to 6.8% by 2030 (12.9% by 2050) and for inland navigation to 3.7% by 2030 (8.3 by 2050). LNG would provide about 4.3% of maritime bunker fuels by 2030 and 17.1% by 2050 – especially in the segment of short sea shipping.

33.Oil products would still represent about 89% of the EU transport sector needs in 2030 and 77% in 2050, despite the current renewables policies, CO2 emission performance standards for new light duty and heavy goods vehicles, and the deployment of alternative fuels infrastructure which support some substitution effects towards alternative fuels such as biofuels and biomethane, electricity, hydrogen and natural gas.

Figure 6: Fuels use in transport (including international aviation and maritime) in the Baseline scenario

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

34.CO2 emissions from transport including international aviation but excluding international maritime, in line with the 2030 climate and energy policy framework, are projected to be 14% lower by 2030 compared to 2005, and 36% lower by 2050. Compared to 1990 however, this translates into 9% higher emissions by 2030 and only 18% lower emissions by 2050, due to high increases in transport emissions during the 1990s. When accounting the intra-EU aviation and intra-EU maritime in the transport emissions, the Baseline projections show reductions of 18% by 2030 and 40% by 2050 relative to 2005 23 . This illustrates the significant emissions reduction gap to be closed by 2030 and 2050, to contribute to the 2030 Climate Target Plan and the European Green Deal objectives.

35.The largest contribution to the projected decline in transport emissions between 2005 and 2050 is due to increased fuel efficiency of passenger cars and light commercial vehicles. Conversely, aviation has been one of the fastest growing sectors in terms of CO2 emissions over the past decades. Total CO2 emissions from flights departing from the EU-27 and domestic flights within the territory of a Member State of the EU-27 grew from around 112 million tonnes (Mt) in 2005 to 120 million tonnes in 2015, equal to a 7.6% increase. In the Baseline scenario, significant further growth is projected: 30% by 2050 relative to 2015, equivalent to 41% growth over the 2005-2050 period. Taken together however, the decline in passenger cars and light commercial vehicles emissions over the 2015-2050 horizon (of around 307 Mt) overcompensates the increase in emissions from the aviation sector (of around 36 Mt).

Figure 7: CO2 emissions from transport (including international aviation but excluding international maritime) in the Baseline scenario

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

36.CO2 emissions from passenger transport decline by 39% in the Baseline by 2050 compared to 2005. The largest contribution comes from passenger cars, driven by vehicle efficiency standards, some uptake of renewable and low carbon fuels (mainly biofuels) and public procurement of clean vehicles supported by the recharging/refuelling infrastructure. CO2 emissions from freight transport go down by 27% between 2005 and 2050, driven by vehicle efficiency standards, some uptake of renewable and low carbon fuels and initiatives to improve the efficiency of the transport system - making the most of digital technologies and smart pricing and further encouraging multi-modal integration and shifts towards more sustainable transport modes.

37.CO2 emissions from international maritime have decreased by 17% between 2005 and 2015. In the Baseline scenario they are however projected to go up by 18% by 2030 relative to 2015 and by 39% by 2050. Relative to 2005, this is equivalent to a stabilisation of emissions by 2030 and 16% increase by 2050 which is not in line with the economy-wide climate neutrality objectives.

38.NOx emissions are projected to go down by 53% between 2015 and 2030 (69% by 2050), mainly driven by the electrification of the road transport and in particular of the light duty vehicles segment. The decline in particulate matter (PM2.5) would be slightly lower by 2030 at 49% relative to 2015 (72% by 2050). Air quality issues represent a particular concern in urban areas. In the Baseline scenario NOx and PM2.5 emissions are projected to decrease at higher pace in urban relative to inter-urban areas (69% reduction in NOx emissions by 2030 and 60% for PM2.5 emissions), thanks to the use of more sustainable alternative modes, including active modes, and cleaner vehicles. Overall, external costs related to air pollutants would decrease by about 60% by 2030 (78% by 2050) 24 .

39.Congestion costs from transport are projected to increase by about 19% by 2030 and 33% by 2050, relative to 2015. Congestion on the inter-urban network would be the result of growing freight transport activity along specific corridors, in particular where these corridors cross urban areas with heavy local traffic. Thanks to policies in place, external costs of accidents are projected to go down by about 14% by 2030 (20% for 2015-2050).

Overall economic, social and technological trends

2.1.1Economic context

40.Economic growth plays a central role in the development of transport demand, so the strong economic impact of the COVID-19 pandemic has had, and will continue to have, a major impact. It materialises through three main channels. First, the partial or full shut down of entire sectors, due to the measures enacted to contain contagion, has severely disrupted domestic production in most countries, as well as service sectors like transport and mobility. Second, the propagation of such disruptions along global value chains has impaired the functioning of the EU Single Market and of extra-EU supply chains. Third, the consequent loss of income is generating another sizeable shock, which feeds back through the demand side. If the situation is prolonged, financial strains will emerge and pose further barriers to recovery.

41.According to Eurostat data, compared with the same quarter of the previous year, in Q3 2020 the EU GDP decreased by 4.3 %, which represents a partial recovery after a decrease of 13.9 % in the previous quarter. EU employment increased by 0.9 % compared to the previous quarter, but decreased by 1.8% compared to Q3 2019. 25 The Commission has published its Spring 2020 Economic Forecast for 2020-2021 for the EU-27 and at Member State level on 6 May. 26 The forecast shows that the euro area economy will contract by a record 7.8% in 2020 and grow by 6.3% in 2021. The EU-27 economy is forecast to contract by 7.5% in 2020 and grow by around 6% in 2021. Growth projections for the EU and the euro area have been revised downwards by around nine percentage points compared to the Autumn 2019 Economic Forecast.

42.The Commission‘s Autumn 2020 Economic Forecast for 2020-2022 was published on 5 November. 27 It shows that the EU-27 GDP is forecast to contract by about 7.5% this year before rebounding by 4% in 2021, which is less than previously forecast, and by 3% in 2022. This implies that the output in the European economy would barely return to pre-pandemic levels in 2022.

43.The economic slowdown estimated in the Autumn 2020 Economic Forecast leaves its traces on households too. 28 Despite being protected by government measures, aggregate labour income is set to decrease in 2020 as many companies defer decisions about employing new staff, reduce working hours or staff numbers. Some segments of the workforce are likely to be affected more than others, with the incomes of lower-wage earners and younger cohorts showing larger vulnerability to downturns. All in all, both non-labour and labour incomes are expected to drag disposable incomes to a similar degree in 2020, while turning supportive again in both 2021 and 2022. The rise in unemployment in 2020 will likely be substantial, and the rate only contained to 7.7% thanks to the short-time work schemes that people across the EU have benefitted from, as well as by other support schemes to firms, workers and the self-employed. 29 The International Labour Organization (ILO) estimates the loss of working hours compared to the pre-crisis level in Europe at 11.8%. 30 Finally, a Eurofound survey finds that 38% of Europeans report their financial situation as worse than before the pandemic. 31 Close to half of households indicate they cannot make ends meet, and over half report they cannot maintain their standard of living for more than three months without an income. Just from the narrow perspective of the impact on the sector, this loss in household income is likely to aggravate the drop in tourism and passenger transport demand beyond the pandemic.

44.As a large part of the world went into lockdown, fossil fuel prices collapsed with crude oil spot prices halved compared to last year levels. The oil price is projected to gradually recover over time, reaching USD 80/bbl in 2030 and USD 118/bbl in 2050. It is however projected to remain below the projected pre-COVID-19 pandemic levels. 32 The situation is still evolving, and it is currently not possible to understand the full impact of the unfolding pandemic. These estimates do not include the possibility of more negative outcomes (e.g. due to a second epidemic outbreak).

45.Drawing on Commission’s Spring 2020 Economic Forecast, it is estimated that real GDP could be about 2.3% lower compared to pre-COVID-19 pandemic projections by 2030. Based on the estimates for GDP and the fossil fuel prices projections, an alternative Baseline scenario (so-called COVID-Baseline scenario) has been developed with the PRIMES-GAINS modelling suite, to account for the impacts of the COVID-19 pandemic on transport activity. This shows lasting changes in the mobility trends by 2030 and 2050. The COVID-19 pandemic is projected to lead to lower total passenger transport activity of about 4% by 2030 and 2050 relative to the pre-COVID-19 pandemic situation, despite strong recovery starting in 2021. Air transport would be most affected, driven by the reduced business travel and more domestic tourism relative to the pre-COVID-19 pandemic situation. Less commuting and preference given to individual transport modes would also have an impact on rail and public transport activity. Road transport activity would be the least affected in the medium to long term. A comparison between the growth in transport activity, by transport mode, in the Baseline and the COVID-Baseline scenarios is provided in Figure 8 .

Figure 8: Passenger transport activity in the Baseline and the COVID-Baseline scenarios (cumulative growth rates for 2015-2030 and 2015-2050)

 

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

46.The growth of freight transport volumes tends to follow the rhythm of GDP growth. As a result of the economic crisis 2008-2009, the volume of freight transport in tonnes-kilometres in the EU-27 has dropped close to the level of 2000. Since 2010 it’s been recovering slowly and only reached pre-crisis levels in 2017. The volume of passenger-kilometres travelled in the EU-27 has grown quite steadily over the last ten years and picked up notably since 2014. 33 The recovery after the extreme drop of activity due to the COVID-19 pandemic is projected to take a longer period of time, until pre-pandemic transport volumes are reached again.

47.The COVID-Baseline scenario projects lower contraction in the freight transport activity relative to the passenger transport activity. In the medium to long term, it also shows higher convergence to the pre-COVID-19 pandemic pace of growth compared to the passenger transport activity. By 2030 and 2050, total freight transport activity would be less than 3% below its projected pre-COVID-19 pandemic levels. Furthermore, the projections show that the pandemic would not induce significant changes in the modal shares relative to the pre-COVID-19 pandemic. A comparison between the growth in transport activity, by transport mode, in the Baseline and the COVID-Baseline scenarios is provided in Figure 9 .

Figure 9: Freight transport activity in the Baseline and COVID-Baseline scenarios (cumulative growth rates for 2015-2030 and 2015-2050)

 

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

48.The COVID-Baseline projections show that emissions from transport including international aviation but excluding international maritime would be 16% lower by 2030 compared to 2005, and 38% lower by 2050. Compared to 1990 however, this translates into 7% higher emissions by 2030 and only 21% lower emissions by 2050, due to high increases in transport emissions during the 1990s. A comparison between the changes in the CO2 emissions from transport relative to 2005 and to 1990, in the Baseline and the COVID-Baseline scenarios is provided in Figure 10 . When accounting the intra-EU aviation and intra-EU maritime in the transport emissions, the COVID-Baseline projections show reductions of 19% by 2030 and 42% by 2050 relative to 2005. This shows that after the sharp decline in CO2 emissions during the COVID-19 pandemic, existing policies fall well short in delivering the transport contribution to CO2 reductions under the European Green Deal and the 2030 Climate Target Plan.

Figure 10: CO2 emissions from transport (including international aviation but excluding international maritime) in the Baseline and COVID-Baseline scenarios

Source: Baseline scenario, PRIMES-TREMOVE transport model (E3Modelling)

49.Trade is a main determinant for freight demand. The WTO estimates world trade volumes to fall by 13-32% in 2020. Almost all world regions are projected to suffer double-digit declines, but exports from Asia and North America may be hit the hardest. The WTO also considers that trade in services may be most directly impacted. A recovery in 2021 is expected, depending on the duration of the COVID-19 pandemic. Globally, road fuel use was down 11% for the year, jet fuel down 33% and all other fuels down 7% in April compared to the previous year, according to Rystad Energy.

50.Before the COVID-19 pandemic, the OECD projected international trade to grow by 3.4% annually through 2030 and 3.2% annually through 2050. 34 After the previous economic crisis, though, international trade has grown modestly compared to growth rates prior to the 2008 economic downturn. This trend can be partly explained by cyclical factors in the wake of the downturn, but structural factors also play a role. Trade in services, for instance, increased from 23% to 30% between 2005 and 2017, the elasticity of trade to GDP has declined and the expansion of global value chains has begun to slow. 35 Therefore, it is difficult to compare the effects of the previous economic crisis on international trade to the likely effects of the crisis following the COVID-19 pandemic. The structural economic consequences of the latter are yet to be seen, also because international supply chains may be shortened in order to render them more robust against disruptions.

51.Politically, the environment for international trade development has become more uncertain with the rise of political movements in several countries that question trade liberalisation and advocate more protectionist trade policy measures. The widespread call for shorter supply chains and re-patriating value chains in the context of the COVID-19 pandemic might constitute another significant challenge for international trade flows in the near future.

52.The WTO estimates that the direct economic effects of more protectionist trade policies have been modest to date but the uncertainty they generate may already be having an impact through reduced investment spending. 36

53.Other risks identified by the WTO include developing and emerging economies experiencing capital outflows and financial contagion as interest rates may start to rise in developed countries, with negative consequences for trade. Geopolitical tensions could threaten resource supplies and upset production networks in certain regions. Finally, structural factors such as the rebalancing of the Chinese economy away from investment and toward consumption are still present and could weigh on import demand due to the high import content of investment. 37

54.Commercial shipping could intensify in in light of the decrease of the extent of ice cover in the Artic Sea, which would shorten distances considerably from Asia to both Europe and North America. 38 Large transcontinental infrastructure projects may establish alternative routes between major trade partners in East Asia and Europe, while also increasing access to markets in Central Asia and other regions including Africa. This can have an impact on port activity and the way surface transport infrastructure is used. Some parts of current road, rail and river networks could experience major reductions in traffic while others would see sharp increases.

55.E-commerce has been steadily growing and is predicted to increase further, in particular now that under the lockdown a larger share of consumers got acquainted with buying online, and households re-assign some of their budgets away from holidays and towards home goods (e.g. home entertainment and home exercise). 39 Greater ease of purchase and returns can increase demand and foster a trend towards more individualised, small-scale deliveries, leading to more freight transport. To seize these the opportunities created by increase in demand for home deliveries, e-commerce and carriers have to adapt delivery scheduling systems, optimizing routing and managing in real time delivery volumes.

56.As regards long distance travel, the tourism sector 40 is one of the hardest-hit by the COVID-19 pandemic, with impacts on both travel supply and demand. Travel restrictions, flight cancellations and frequency reduction have significantly diminished the supply of travel services (both domestic and international), while demand continues to retract due to fears of contagion.

57.OECD data shows that the EU-27 recorded USD 430,481 million in travel receipts (exports) in 2018, representing almost 30% of worldwide figures. 41  Passenger transport was estimated at 17% of tourism exports in Europe in 2018, international tourism receipts (hotels, restaurants etc.) making up the other 83% according to UNWTO data. 42  According to the same source, 53% of international tourism trips in Europe were made by air transport, 40% by road, 4% by water and 3% by rail. It is expected that, depending on de-confinement strategies of each Member State, the share of each mode in tourism may substantively change in 2020 and possibly also in the near future.

58.The OECD estimates a 60% decline in international tourism in 2020, possibly up to 80% if the recovery is delayed until December. 43 The organisation expects domestic tourism – which represents over 75% of the sector in OECD countries, as well as EU tourism to be the first to register a rebound.

59.In May 2020, the UNWTO estimated that international tourism could decline by 60% to 80% in 2020 globally, depending on the speed of containment and the duration of travel restrictions as well as borders shutdown. The first quarter of 2020 experienced a decrease of 22% and USD 80 billion at global level, while Europe experienced a -19% of international tourist arrivals. Globally, this would translate into an estimated loss of USD 910 to 1,200 billion in international tourism receipts (exports) and 100 to 120 million jobs directly at risk. Recovery estimates remain mixed.

60.Finally, economic activity is also closely interrelated with the dynamics of energy demand and the price of crude oil. The world oil price is not only an important cost factor for the transport sector, but it can also have an effect on the choice of transport mode (depending on the oil dependency of different modes) and innovation, for example by affecting the economic attractiveness of alternative fuels or energy efficiency measures.

61.Oil markets are going through a period of extraordinary change, in the short term because demand has vanished in the context of the COVID-19 pandemic. In the longer term, demand is shifting from developed economies and transport fuels to Asia and petrochemicals.

62.The International Energy Agency (IEA) projects that, taking into account adopted and planned policies, world-wide oil use in passenger cars will peak in the late 2020s and during the 2030s demand will increase by only 0.1 million barrels/day on average each year. However there will be no definitive peak in oil use overall, as there are continued increases in petrochemicals, lorries and the shipping and aviation sectors. For Europe, IEA expects the total demand for crude oil to be 4 million barrel/day lower in 2040 than in 2018. 44

63.However, the evolution of both oil demand and oil price will to a great extent depend on the economic growth cycles of the world economy and on the level of ambition with which more sustainable energy, climate and transport policies will be pursued.

2.1.2Demographic trends

Urbanisation

64.Freight and passenger mobility demand also grows as global population expands, particularly in cities. Today in Europe, 74.9% of the population live in urban areas, compared to just over 50% in 1950, making Europe one of the most urbanised regions in the world. The growth of the urbanisation rate in Europe is expected to continue, with the proportion of the population residing in urban areas projected to reach 83.7% in 2050. 45 It remains to be seen, whether the economic and social impacts of the COVID-19 pandemic on our societies will slow down this dominant long trend.

65.Single person households without children increased by 18.7 % between 2010 and 2019 in the EU, so if this trend continues, the pattern of transport demand, particularly in urban areas, will change. During the last decade i.e. 2010-2019, the total number of households in the EU increased by 7.0 %. In 2019, the EU-27 recorded 195 million households with on average 2.3 members per household. 46

66.Steady urbanisation means that the problems affecting many urban areas, such as congestion, air pollution, road crashes, noise and saturation of transport hubs are likely to get worse. Transport represents an important source of air pollution and is responsible for growing road congestion in cities. A growing number of cities implement vehicle access restriction in the urban areas (most often in the centres) to tackle increased noise, congestion and pollution, and improve safety (vulnerable road users such as pedestrians, cyclists and users of powered two-wheelers now account for 70% of road deaths in cities).

67.At the same time, passenger and freight transport volumes on the comprehensive and core TEN-T network are growing. However, missing links and poor connections, including between public transport and active modes of transport, remain the main challenges for integrating the urban nodes on the TEN-T network. They can also lead to bottlenecks and congestion at peak hour due to a lack of connectivity, and to a high degree of dependence on personal motorised transportation.

68.Indeed, the capacity, availability, accessibility and affordability of public transport is an important overall issue for urban development, especially if the coverage and frequency of public transport network are insufficient, or if there are barriers to multi-modal solutions, such as the combination of private bike or car and public transport.

69.Walking and cycling, often referred to as active modes of transport, are certainly not new phenomena, but their importance in urban mobility has gained prominence in recent years as stand-alone transport mode and as part of a multi-modal transport solution. Given that almost half of all car trips in cities are of less than five kilometres, there is high potential for further expansion of active mobility, including in new fields, e.g. for freight transport via cargo-bikes and to connect cities with their surrounding areas via e-bikes. The importance of walking and cycling is gaining wider recognition, even more so since the COVID-19 pandemic. Pedestrian zones are being created or extended in various cities across Europe. Likewise, bike lanes are being rapidly developed and made permanent. Alternative low and zero solutions for freight and parcel delivery in urban areas are coming on stream. In addition, we observe a growing interest by employers to (financially) support and motivate their staff to walk or cycle to work.

Ageing

70.Besides the relative growth of the share of the population living in urban areas, ageing societies in Europe represent another demographic trend that is likely to shape mobility patterns in the future. The demographic old-age dependency ratio (people aged 65 or above relative to those aged 15-64) is projected to increase significantly in the EU as a whole in the coming decades. From about 25% in 2010, it has risen to 29.6% in 2016 and it is projected to rise further, eventually reaching 51.2% in 2070. This implies that the EU would move from four working-age people for every person aged over 65 years in 2010 to around two working-age persons over the projection horizon. 47

71.The ageing of the population has a strong correlation with the number of persons with disabilities and reduced mobility. It is estimated that in the EU there are around 100 million persons with disabilities. Many of them have reduced mobility.

72.The ageing society will require more emphasis on accessibility, the provision of safe, secure, reliable and adaptable transport services featuring appropriate solutions for users with disabilities and reduced mobility. For instance, one can expect higher demand for door-to-door mobility and driver assistance solutions. Public transport providers will have to adapt to an increasing amount of passengers with disabilities and reduced mobility, requiring investments in barrier-free infrastructure and rolling stock. At the same time, for public expenditure a higher ratio of older people will imply that more public resources will have to be devoted to pension payments, health care and long-term care, which may lead to pressure on the amount of funding available to public transport and maintenance of transport infrastructure. This structural pressure on transport infrastructure investments can be aggravated by cyclical factors. In the wake of the financial crisis of 2008/09, the European Investment Bank (EIB) noted that infrastructure investment had been disproportionally hit as fiscal consolidation had been biased against capital expenditure, with prioritisation given to current expenditure such as social transfers to mitigate the immediate effects of the crisis. 48 This does not mean that social transfers would not have been concerned by fiscal consolidation measures, but fiscal consolidation after the crisis of 2008/09 has significantly reduced room for public investments.

73.The picture of the demographic development in the EU can vary considerably from one region to another. Over the past 25 years, some of the Eastern European Member States have lost a large share of their population through a combination of low fertility and, most notably, sizeable emigration. Pre-existing economic disparities between Member States have encouraged many citizens to search for work in places other than their country of origin. These developments have likely been to the economic benefit of the EU as a whole, but not necessarily for all sending Member States. This contributes to slowing the convergence between Member States, and impacts areas such as transport infrastructure, education and even population ageing. 49  Intra-EU mobility has the biggest impact on the past and projected population change in the eastern Member States, where it exacerbates their population decline.

74.Our ageing society has not only an effect on the ‘demand’ side of transport, but also on the ‘supply’ side. For instance, in inland waterway transport, where – especially on the Rhine – most enterprises are family owned and family operated SMEs, the aging of the entrepreneur/crew is a major challenge, as young people seem to be less interested to pursue this profession, which requires living on the barge.

75.New forms of electric mobility, such as electric bicycles are already contributing to satisfying older people’s mobility needs in a flexible manner, allowing them to use an active and healthy mode for ways where they would otherwise rely on private cars or public transport. However, the new forms of e-mobility also bring about a specific safety challenge 50 and older people tend to be more vulnerable than younger population groups.

2.1.3New technologies, changing consumer behaviour and working conditions

76.There are several socio-economic and technological developments 51 that have emerged or become more prominent in the last ten years.

Collaborative economy

77.Firstly, the collaborative economy increasingly affects the way transport services are organised with various bike and car sharing schemes, but also ride-sharing and ride-hailing being deployed across the EU. Some of these schemes generate new forms of work characterised by more flexible arrangements. These flexible work arrangements should be implemented in accordance with EU labour law and social protection.

78.Continuous digitalisation has made it possible to develop the concept of mobility as a service (MaaS) – a mobility distribution model in which a customer’s major transport needs are met by services integrating transport infrastructure, transport services, information and payment services, and more. This approach is also possible due to the removal of barriers between different transport modes and their users, as well as the emergence of new collaborative economy solutions. The focus in this approach is not on personal ownership of transport modes, but on mobility per se, which is seen as service.

79.Data sharing and collaborative decision-making enabled by digital technologies propose new solutions to old challenges. Businesses are interacting in ways previously unimagined, new business models and services appear, based on collaboration and sharing economy principles and enabled by data and advanced IT technologies. For instance, in freight transport and logistics there is generally a shift towards collaborative solutions, where partnerships are formed for the purpose of optimization of operations by sharing equipment, vehicles and information. Digital solutions should lead to synchro-mobility, a step change in multimodal transport which will synchronise intermodal services between modes as well as with shippers for optimal resource use and delivery times.

Teleworking

80.Telework has become much more widespread since the COVID-19 pandemic and newly introduced arrangements could, at least partially, remain in place in the longer term 52 . Learning effects of remote working and improvements in technology are likely to produce various ranges of effects on mobility and transport behaviours.

81.The pandemic has revealed large differences in the prevalence of telework across EU Member States, sectors and occupations. The preparedness for telework at a large scale is higher in ICT- and knowledge-intensive sectors, and generally for high-skilled workers, although with big differences across EU countries. In many EU countries, more than half of the workers who have started working from home since the pandemic had no prior experience with teleworking. If past trends are a guide, the uneven ability to scale up telework could result in widening inequalities across countries, firms, genders and workers 53 , e.g. if there is uneven access to broadband, barriers for persons with disabilities or IT illiteracy to telework or use other ICT based applications. White-collar workers tend to have jobs that can be better adapted to telework requirements than blue-collar workers.

82.Telework can have an impact particularly on urban passenger transport demand, mainly during peak hours and hence also alleviate congestion as well as other environmental externalities. Another sector expected to be affected is business travel with the rise of web based meeting arrangements during the pandemic. With more developed ICT equipment in modern office workplaces and more widespread availability of fast internet, at least in urban areas, the technical preconditions for telework arrangements have become easier to meet.

83.To date, large variations in the prevalence of telework exist. In the EU, before the COVID-19 pandemic, the share of employees performing regular or occasional telework (in urban and non-urban areas) was highest in Denmark (37%), Finland (33%) and the Netherlands (30%). Relatively low shares of teleworking employees were found in Central and Eastern Europe and in the Mediterranean countries. 54  

Figure 11: Workforce working at home several times per month in 2015

Source: OECD calculations based on Eurofound-ILO research 2017.

84.At the same time, asked how much time they spend every day travelling to and from work, 47% of the employees in the EU indicate a commuting time of more than 30 minutes one way and 11% travel more than 60 minutes. The highest shares of employees travelling more than 60 minutes from or to work are found in Sweden (24%), Denmark (22%) and Belgium (22%). 55

Digitalisation and automation

85.The increasing automation and digitalisation of transport offers a huge potential in terms of safety, efficiency and sustainability and thus also new opportunities for women in transport jobs, since new job profiles imply less heavy physical labour and more digital skills. We are already seeing how new digital automotive technologies can help reduce the number of deaths and serious injuries, enable better organising and executing of travel and transport operations, lower energy consumption and pollution, and optimise the use of resources and existing infrastructure. It is also a powerful tool to overcome the disadvantages - complexity, higher costs and risks of multimodal transport, and to facilitate the better integration of the different modes of transport.

86.Based on existing policies for urban passenger transport and assuming an increased uptake of teleworking, the OECD estimates that the share of urban passenger-kilometres travelled in privately owned vehicles could decline from around 70% in 2015 to 40% by 2050 in the world. Shared modes that include shared vehicles systems (e.g. free-floating or non-free-floating shared cars, bikes or scooters) and optimised shared mobility services (e.g. a shared taxi, van or minibus with a driver) represented only 1.5% of the urban passenger-kilometres travelled world-wide in 2015. However, they are expected to grow to over 20% of the total passenger transport demand in cities by 2050 globally. The share of more traditional public transport (bus, rail, metro) should grow modestly from 30% in 2015 to over 35% of all urban passenger-kilometres travelled worldwide by 2050. 56

87.Though opportunities are huge, at the same time there is still a lack of solid framework conditions (e.g. legal and social aspects, required interoperable infrastructure and interfaces). Alongside, technological challenges remain in this fast-evolving field.

88.All transport modes are taking advantage of digital technologies, Internet of Things, and automation. Furthermore, digital technologies also enable or accelerate the emergence of new transportation solutions, ranging from progress towards automated road vehicles, connected and automated lorries (platooning), driverless goods delivery vehicles, or self-driving trains to unmanned aircraft and ships that can offer taxi services over short distances, and other potential innovations. Moreover, mobility intertwines with other sectors such as automotive, environmental or digital, where new players take a more relevant, or even dominant, position through the provision of new transport services based on digitalisation.

89.Concerning drones, they can make a significant contribution to the development of greener and cheaper local transport solutions in urban, peri-urban and inter-urban contexts. The technology is already there, fully functional and offering a multitude of applications, such as precision agriculture, infrastructure inspection, transport of medical supplies, environmental compliance, atmospheric research, media and entertainment, sport photos, filming, wildlife protection and research, disaster relief, etc. The global drones market is forecast to increase from USD 4.9 billion in 2019 to USD 14.3 billion in 2028. Out of total, Europe’s drone start-up investments is expected to represent only 9%, indicating a clear lag behind US and Chinese firms’ investments in this technology. Commercial use will surpass the consumer drone market in 2023, becoming the largest segment. It might grow more than eightfold to reach USD 9.5 billion in 2028. 57 In terms of jobs, for Europe, employment is estimated to increase to about 150,000 jobs by 2050 in manufacturing with additional jobs created in drone operator services. 58

90.Air traffic management (ATM) is also a sector with increased use of digital technologies, notably solutions brought by the SESAR project. Innovative infrastructure projects can lead to substantial efficiency gains in the aviation sector and a reduction of emissions resulting from aviation activities. It is the aim that ATM system infrastructure progressively evolves with the adoption of advanced digital technologies, allowing civil and military air navigation service providers (ANSPs), airports and the network manager to provide their services in a cost-efficient and effective way irrespective of national borders, supported by secure information services. Moreover, ATM progressively needs to evolve into a data ecosystem supported by a service-oriented architecture to enable the virtual defragmentation of European skies.

91.With respect to automated road vehicles, similar developments can be observed. Automated driving will, in the future, play a key role on the transformation of mobility, and also on the automotive sector. Ultimately, safety is one of the crucial underlying justifications for automated and connected vehicles. However, in the forthcoming transitional phase, where we will see mixed traffic of highly automated and “traditional” vehicles as well as other road users like pedestrians and cyclists, new safety risks require proper consideration. The driverless freight delivery vehicles and connected and automated lorries hold a promise of significant reductions in operational costs to make the freight delivery services cheaper. The deployment of self-driving technologies should be well prepared to prevent undesired social effects.

92.Besides, the large amount of generated data will significantly impact the complete value chain, mainly on the digital and automotive sectors. The whole industrial sector will need to evolve and adapt in a fast pace to stay ahead in global competitiveness, while including all stakeholders and addressing societal needs. 59  

93.As new technologies have allowed for driver assistance and ever more advanced active safety systems for vehicles, in the future they could lead to the emergence of new mobility services based on highly or fully automated vehicles. Cooperative intelligent transport services now being deployed in vehicles and on road infrastructure will support the transition to automation. Highly automated road vehicles function in certain areas (i.e. highways, ports and shuttles) and could already be operational in the near future. Several large-scale EU demonstration projects 60 are already ongoing for both passenger cars, freight vehicles and public transport in anticipation of this substantial change.

94.On the other hand, automation and digitalisation offers new mobility opportunities and more comfort, which could lead to an increase in road transport demand, which might increase for instance congestion.

95.Automation is also important for rail transport. It is already in widespread use on metro systems and is now being extended to heavy rail too. It will bring very significant energy savings due to more efficient driving, and (combined with the latest versions of ERTMS) can allow capacity increases of more than 30% even on the most congested infrastructure provided rail operations are adequately adapted to benefit from digital innovation. Technologically it is far simpler than equivalent road technologies, so with strong coordination between the rail infrastructure and the operations on the rail network, it can and should be rapidly deployed. Combined with increased automation of rail traffic management and timetabling, it should lead to much greater flexibility in service provision.

Changes in industry and logistics in the EU

96.Further changes in the way the world economy and industry operates (e.g. increasingly complex business structures and supply chains, growing importance of software, 3D printing or shift to circular economy) will require further optimisation of transport services, mainly in freight transport, and changes in design of transport vehicles and infrastructure. The aforementioned elements have also an impact on the employment in the transport sector, in terms of opportunities, required skills and working conditions.

97.Great uncertainty surrounds the extent to which re-shoring and 3D printing will dampen future growth of freight transport. If adopted extensively, both can affect the type of goods moved, decrease the distances between production and consumption centres and thus fundamentally alter today’s long and complex supply chains. A significant decrease in the total value of internationally traded goods can greatly reduce sea and air transport volumes.

98.Nonetheless, freight volumes are expected to continue to grow strongly. Before the outbreak of the COVID-19 pandemic, global freight demand was projected to triple between 2015 and 2050. 61 Currently, the outlook for international trade is more fragile although volumes are recovering. At the same time, freight transport and logistics are undergoing major transformations, and these will likely be even more disruptive in the future. Technology, business models, consumer behaviour, shifts in trade patterns, and other factors all contribute to a changing transport landscape, and how they play out can have a substantial impact on the projected growth. New technologies and smart digital solutions supported by effective modernised regulation are needed to accommodate this major increase in transport demand sustainably – i.e. with only limited increase in assets and energy consumption. Increased productivity and efficiency of the logistics and supply chains remains in this context a key challenge. In container shipping, ship sizes and total capacity have increased by a factor of 2.5 between 2004 and 2018 while the number of companies has almost halved over the same period. 62 E-commerce and last-mile logistics are equally increasing significantly, a trend further accelerated as a consequence of COVID-19 pandemic.

99.Digitalisation and automation of transport services also raise new challenges for service providers, especially in terms of personal data protection, data sovereignty, interoperability, cyber security and user acceptance. Cyber-attacks may lead to delays of services, damage to physical systems, data theft, or even passenger injuries. There are also concerns that remotely controlled aircraft and automated rail and road vehicles may be subject to hacking or hi-jacking from distance. Similar concerns arise in the maritime area, because of the growing digitalisation of sea navigation.

Impact of the COVID-19 pandemic on the transport sector 63

100.Although not reflecting a long-term trend, the COVID-19 pandemic is having significant effects on the transport sector, which have the potential to shape the sector for years to come.

101.Transport is one of the most severely affected sectors by the COVID-19 pandemic, along with sectors such as tourism and hospitality. The impact was driven in the short term by lockdown measures (including travel restrictions, tele-working and home-schooling), other restrictions and voluntary avoidance efforts. This has led to steep reductions in manufacturing and transport activity, as well as reduced activity in service sectors such as retail stores, hotels and restaurants, etc. In addition it had a huge impact on reduced levels of physical activity and general fitness among children. The crisis has also highlighted the strategic importance of transport for the supply of essential goods such as food, medicines and supply of essential materials, particularly pronounced in certain remote regions such as the outermost regions 64 . The resilience of the transport and logistics system in Europe has been a key contributing factor to managing the crisis effectively.

102.The pandemic’s short-term impact on the transport sector, in particular on passenger transport, as well as on global supply chains is dramatic and unprecedented on this scale in the post-war period. Lockdown measures led to a prolonged standstill in production across many sectors creating supply chain disruptions across the EU. This has led to a general fall in freight transport demand. On the other hand, increased on-line shopping, including of essential goods such as groceries and pantry items, have almost doubled the usual home delivery rates. This increase of demand revealed limitations in last-mile delivery capacity, also due to the lack of drivers, at least in the short run.

103.The long-term effects on transport activity will only become clear after the pandemic has come to an end and will largely depend on the pace of the economic recovery. Preliminary transport activity projections, reflecting the impacts of the COVID-19 pandemic at EU-27 level, have been presented in section 2.3.

104.Behavioural changes already seen before the COVID-19 pandemic (e.g. urban mobility) may affect certain transport modes as economies re-open, with long term effects for some. Web-based meeting arrangements which have grown in use during the pandemic are likely to become more frequent even beyond the pandemic, thus adversely affecting business travel. Global supply chains may be reorganised with a view of rendering them more robust against the fall-out due to interruptions in freight distribution, affecting transport volume and patterns. The growth in e-commerce may become a long term trend with a new level of customers’ expectations for faster, contactless (safer in terms of contagion risk) home deliveries, requiring the modernisation of corresponding delivery and transport channels.

105.However this is clearly an ongoing and developing situation, and more time will be needed to gather and analyse data in order to grasp the full impact of the current crisis on the behaviour of passengers and transport users.

2.1.4Air transport

106.Aviation is one of the EU transport sectors whose activity has been the hardest hit by the COVID-19 pandemic, due to supressed demand following containment measures taken by governments – including travel restrictions, lockdowns and quarantine zones, as well as customers’ fear of contagion. Widespread flight cancellations for consecutive months have caused major disruptions for passengers, the aviation industry, the tourism sector and the EU economy as a whole.

107.After a positive evolution of the traffic situation following the removal of border and travel restrictions in June, recovery dramatically slowed down following the reintroduction of travel restrictions across Europe. Traffic in November 2020 was 59% below 2019 levels in terms of flights 65 . In 2020, until mid-November there was a loss of 1.5 billion passengers at European airports 66 across the network compared to 2019 levels. International passenger transport is likely to continue to be severely reduced due to lower demand and government restrictions in the next years following the COVID-19 pandemic. Experiences from earlier network disruptions, such as the 9/11 terrorist attack in 2001 and the Icelandic volcanic ash incident in 2010, indicate that rebuilding may take a long time.

108.It must be underlined that there is a strong link between temporary border and travel restrictions and the resumption of traffic. In particular quarantine requirements led to a sharp drop in passenger bookings, although some other factors such as squeezed household budgets, uncertainty over ticket refunds, and fears of infection while travelling also contributed. Travel demand does therefore in general tend to reflect the existence or the severity of travel restrictions in place at national level, in particular if they are not co-ordinated between Member States. Ensuring a co-ordinated approach at European level of national measures to contain the COVID-19 pandemic is therefore likely to substantially improve growth. The same applies for intercontinental travel where closed borders or travel restrictions hamper travel.

109.This has affected every branch of the wide aviation value network, also resulting e.g. in numerous delays and cancellations of aircraft orders, leading to a severe decrease in the aeronautics industry’s order books.

110.According to Eurocontrol projections, air traffic growth volume in 2020 and 2021 will depend on the ability of European countries to coordinate their health and sanitary measures. 67  Overall, the Current Status Scenario by Eurocontrol envisaged a loss of 55% of flights (6 million) in 2020. According to IATA recovery to 2019 level will not take place until 2024.

111.Taking all of the above into account, there will be a total industry loss in revenues of approximately EUR 140 billion during 2020 for airlines, airports and air navigation service providers. As a result, more than 7 million jobs supported by aviation (including tourism) in Europe are now at risk, as estimated by IATA. 68 The pressure on the sector has also resulted in raising the precariousness of work in the aviation sector. 

112.In response to this unprecedented decline in passenger air travel, the European associations collectively representing the entire European aviation sector called for measures to restore the public’s confidence in air travel. To this end, they stressed the need for an effective coordination of national travel restrictions measures, based on a common set of criteria, data and guidelines provided by the European Centre for Disease Prevention and Control (ECDC) and the European Union Aviation Safety Agency (EASA), and further improvements to the effective enforcement of passenger rights to ensure legal certainty in travel. 69  

2.1.5Waterborne transport

113.International freight transport is affected by both demand and supply of goods effects related to the pandemic. Continued and uninterrupted maritime services are of key strategic importance for the whole EU, with 75% of goods arriving to the EU by sea. About 30% of all goods internally in the EU are transported by ships. The COVID-19 pandemic has had a major impact on global shipping, affecting all its segments from passenger ships to container ships and oil tankers. While some ports have restricted passenger services, EU ports have remained open for cargo transport. After an early effect of Chinese lockdown measures on global supply chains, factory output has been picking-up after the relaxation of containment measures.

114.EMSA reported 70 that the number of ship calls at EU ports declined by 12.5% in the first 39 weeks of 2020 compared to the same period in the previous year. The most significantly affected sectors have been the cruises, passenger ships, roll-on-roll-off-passenger and vehicle carriers. Meanwhile, the number of chemical tankers ship calls increased in comparison with 2019 and the numbers for bulk carriers, containerships, general cargo and oil tankers saw a limited decrease (up to 10%).

115.The impact of the inland navigation sector is estimated to a total loss of turnover between EUR 2.2 and 4.4 billion considering a 90% reduction in passenger transport and 25-30% reduction in freight transport during the crisis. Inland ports have observed a decline in traffic due to the decrease of activity in seaports (e.g. container trade with China).

116.Travel restrictions have also significantly reduced the number of passengers carried by ferries, leading to financial difficulties for companies that provide essential connections, in particular to islands and other remote regions. In order to ensure basic connectivity across the territories of the EU and ensure continuity of services, Member States have, apart from other support measures, also put in place temporary public services obligations (“PSO”) and/or public service contracts (“PSC”) to replace or support services that become commercially unviable due to a sudden drop in passenger numbers.

117.Severe decrease in the sea transport of passengers impacted also the flows of goods transported on ro-ro-passenger ships and on ferries, whose traffic is heavily dependent on the revenues derived from passenger services. If demand for passenger and personal vehicles’ transport remains low in a longer term, freight transport business by these ships may not be possible without public support.

118.The cruise ship sector has also experienced severe operational losses. The capital value of the cruise ship industry reportedly dropped by more than 70%. The majority of cruise companies stopped operations, at the same time looking for means to increase their credit capacity to manage the economic impact. The re-uptake of activities has been limited, both as regards passengers and vessels, as well as in geographical scope. The negative image of tourists and crew quarantined on cruise ships during the pandemic will likely have a longer-lasting impact on demand for this service, as well as for demand for new cruise ships, of which around 90% are built in Europe.

119.In the maritime sector, the impact of the COVID-19 pandemic has reduced not only the demand for transport and cargo services, but also the ability to supply such services. It highlighted in particular the substantial consequences for seafarers, whose working conditions severely deteriorated. Due to travel restrictions and fewer connections, many ship-owners were unable to conduct sufficient crew changes and repatriate maritime workers.

120.For all shipping segments with crew and passengers or persons on board, the issue of crew changes, repatriation, medical care and other preventive and protective measures are key to allow as uninterrupted operations as possible. Notable COVID-19 outbreaks associated with shipping crews and passengers have focussed attention on this issue. The social partners, ECSA and ETF issued separate public statements urging authorities to facilitate swift and safe crew changes, safe berthing places, exemptions from levies during prolonged lay-off period, guarantee safe passage, as well as, of course, the provision of personal protective equipment (PPE) to all working in the sector.

121.The majority of seafarers employed on ships, regardless of the flag of the ships, are nationals from a limited number of labour-supplying countries; and certain traffic routes and coastal States globally receive a disproportionately large volume of incoming and outgoing vessels. In this context, the measures adopted by some third countries have had an impact on European operations. At IMO and ILO level, efforts are ongoing to provide a baseline of information sharing and respect for the basic needs of crew changing and repatriation.

122.There have been cases of social unrest on board ships where maritime workers have been stranded or had their contracts extended beyond the limit set by the Maritime Labour Convention, 2006 71 , with no possibility to repatriate. The European Commission and the High Representative have undertaken extensive efforts to ensure maritime workers are recognised, globally, as essential or “key” workers, can travel for work and repatriate after their contracts end. With COVID-19 cases rebounding, variations in the pandemic situation locally and globally is proving difficult to reach a stable arrangement on this front.

2.1.6Road transport

123.The most affected segment of road passenger transport has been international traffic, particularly coach tourism. After a period of partial reopening between July and November, some international coach operators have been recently scaling back again their services in some EU countries due to the second wave.

124.Road freight transport gradually picked-up starting in the second half of May, according to real time indicators, such as German truck toll activity and pollution levels. By mid-July, German truck toll activity was already tracking closely its level over the same period of 2019, but has since failed to gain further momentum. Road traffic in France, Italy and Spain broadly flattened over July and September, stopping short of a full recovery. More recently, however, road traffic in both France and Italy has increased somewhat and now stands around 10% below its values for the same period of last year.

125.After major disruptions in road freight transport within the EU in the beginning of March, the Commission’s Green Lanes initiative has improved the situation at most internal borders. In November, the vast majority of borders continued to comply with the 15 minutes waiting time mandated by the Green Lanes 72 . Border crossing points with Romania and Bulgaria continue to be impacted by long queues. Others show occasional peaks in waiting time (Romania-Hungary, Croatia). On the external borders of the EU, there continue to be long queues at borders with Switzerland (which seem to be not COVID-related but due to customs checks). There is a continued long waiting time at the Bulgaria-Serbia, Hungary-Serbia, Greece-Albania borders. In particular, Röszke-Horgoš (Hungary-Serbia) has experienced the highest waiting times since commencing monitoring of waiting times.

126.Compared to pre-crisis levels, most Member States are still seeing important decreases in demand for road freight transport. The IRU estimates the goods transport losses to exceed EUR 800 billion globally 73 .

127.Based on preliminary data from Member States, the Commission estimates that the number of road fatalities during lockdown measures decreased across the EU in March (-29%), April (-41%), May (-27%), June (-27%), July (-16%), August (-16%) and September (-14%) compared to the average of the same month in the previous three years 74 . This means that around 3 000 lives fewer have been lost. This is an unprecedented and of course welcome development, although the number of deaths did not fall significantly in all Member States and not by the same degree as the drop in traffic volumes.

128.As a result of lower traffic volumes compared to previous expectations, ratings agencies have re-assessed negatively the outlook of a number of Europe’s privately-owned toll road concessionaires.

2.1.7Rail transport

129.Railways have experienced significant and unexpected disruption due to the COVID-19 pandemic, with a huge drop in passenger mobility. During the peak of the crisis ridership went down by more than 90% in several countries and many international connections were stopped. After the drop of turnover by 35% observed during the first semester, there has been a significant improvement of the situation in July and August but pre-crisis levels are still far from having been reached (July: -28% compared to same month of previous year; August: -27%). However, the trend is not maintained as demonstrated by the figures of turnover losses in September with -29%, due to the second wave of the pandemic hitting countries across the EU and the expected impact on rail passenger travel. Smaller independent operators are particularly badly hit and, according to their association ALLRAIL, have so far not benefited from State aid to the same extent as incumbent operators.

130.Rail freight continued to run reliably throughout the pandemic, ensuring supply chains and suffering from much less disruption than other modes. Nonetheless, the impact of the COVID-19 pandemic caused an approximate average decline in rail freight revenues of 15% across the EU-27 during the first half of 2020 and lost revenues of about EUR 48 million per week with a total estimated loss of EUR 1.25 billion accumulated over the first semester 2020. Rail infrastructure managers are impacted by the COVID-19 pandemic due to the reduction in traffic and the revenues it generates. 75  

131.Intermodal transport suffered from lower demand from its traditional markets. At the same time, it gained some new clients by demonstrating its potential for long distance, Europe-wide transport of goods, with the local (usually around 50 km) distribution organised by lorries or vans from the terminals to distribution centres or factories, with a limited human interaction. Adequate network of multimodal terminals, reliable rail (in particular the Rail Freight Corridors 76 ), but also inland navigation and short sea shipping services are in this context essential.

2.1.8Urban transport

132.Public transport operators have been severely hit by the COVID-19 pandemic: they were required to maintain essential services in operation during the lockdown period and to restore services as movement restrictions eased.

133.Public transport is likely to continue to be affected, especially in regions where quarantine measures have reappeared. As of 15 November, the mobility trends for public transport hubs (subway, bus and train stations) are -46 % in Netherlands, -45% in Italy, -28% in Spain, Germany and -46% in France compared to the pre-pandemic baseline. 77

134.Nevertheless, most public transport companies – whether public or private – maintained a high level of service where possible (between 70 and 100 percent of the normal offer). Many of those who must continue commuting rely on public transport systems, which are uniquely positioned to carry large volumes of passengers through busy urban areas. Even during the pandemic, public transport has remained the backbone of sustainable mobility and essential to economic recovery. Although there is new and growing evidence that public transport riders do not face higher infection risk than non-riders 78 , public transport authorities have had to take supplementary measures for disinfection and mask provision to reduce risk for workers and passengers alike, incurring extra costs.

135.In addition, the need to ensure physical distancing severely reduced capacity, which led the public authorities in several countries to appeal to citizens not to use public transport (for instance to keep it free for essential workers and those without alternatives). This appears to have contributed to a general public concern about the safety of using public transport during the pandemic, and continued stagnation in its use in many cities.

136.At the same time, the COVID-19 pandemic has led to a shift to individual modes of transport, with walking and cycling often being the preferred mode in many cities, combining the ‘active’ element (physical exercise) with the travel objective. This has resulted in additional health benefits thanks to increased physical activity, reducing a key risk factor of non-communicable diseases, such as cancer and cardiovascular diseases. Cities have also been struggling to accommodate the necessary distancing rules due to insufficient space for pedestrians and cyclists 79 and many of them have therefore taken action to implement temporary measures, such as the widening of pavements and the roll-out of temporary cycle lanes. Many cities are also now making these temporary lanes permanent to try to maintain or further improve active mobility flows, also to help improve public health and reduce mortality caused by non-communicable diseases. However, new individual solutions accessible for those with disabilities and reduced mobility have not yet materialised and existing ones are expensive and limited in offer.

137.A drop in air pollution in cities during the first period of lockdown measures is confirmed by data published by the European Environment Agency 80 . As first round of lockdown measures eased, there were increasing indications that more people are using private cars, partly because of continued concerns about the safety of public transport. This led to a return to congestion, poorer air quality and increased road safety risks. Therefore some cities in Europe, e.g. Milan or Brussels, are re-thinking their sustainable urban mobility plans in order to discourage the use of private cars. In addition, the EU High Level Group on Road Safety has agreed on common principles to address road safety concerns, including strengthened enforcement, measures to restore confidence in public transport, and continued investment in road safety, including in order to make temporary safety measures (adopted during lockdown) permanent, such as “pop-up bike lanes” 81 .

138.New shared mobility services, such as e-bikes, e-scooters, shared cars, experienced drastic reductions of service in quarantine areas and in several cities have been slow to re-emerge even as movement restrictions were raised. The business models of many companies offering shared mobility services already involved long periods of loss-making and some of them may be driven (close) to bankruptcy or to change their business model.


3Key policy developments over the last decade 

139.The 2011 White Paper for transport 82 defined a vision for a competitive and sustainable transport system, the implementation of which required an efficient framework for transport users and operators, an early deployment of new technologies and the development of adequate infrastructure. It set the paramount goal of European transport policy as helping establish a system that underpins European economic progress, enhances competitiveness and offers high quality mobility services while using resources more efficiently.

140.This section highlights some of the additional measures that have been put in place in the key policy areas over the last decade. Nevertheless, it needs to be recognised that significant challenges remain, as described in the subsequent sections, particularly in relation to meeting the need for sharper CO2 reductions from transport in order to reach economy-wide climate neutrality by 2050 and the increased ambition for 2030 of at least 55% GHG emission reduction.

Sustainability

141.On 28 November 2018, the Commission adopted a strategic long-term vision for climate-neutral economy by 2050 83 , engaging all sectors of the economy and society, to achieve the transition to a climate-neutral economy. The transport sector, being one of the main sources of GHG emissions in the economy was identified as playing an important role in this transition. The climate neutrality objective was endorsed by the European Parliament 84 and subsequently the European Council 85 .

142.The European Green Deal of December 2019 sets a strategic framework for a climate-neutral EU economy by 2050. It sets a high level of ambition for climate neutrality and healthy environment, accelerating the shift to sustainable and smart mobility, and delivering a zero pollution ambition for a toxic-free environment and the transition to a circular economy while leaving no one behind. To this end, it calls for a 90% reduction in transport emissions by 2050. Priority actions of the Green Deal for a shift to sustainable and smart mobility include boosting multimodal transport, support the deployment of automated and connected mobility solutions across modes, better addressing external costs of transport activities through pricing, ramping up the production and deployment of sustainable alternative transport fuels and reducing pollution from transport, especially in cities 86 , through for instance stricter air pollutant standards.

143.In March 2020 the Commission adopted a Communication on a new Circular Economy Action Plan 87 setting a future-oriented agenda for achieving a cleaner and more competitive Europe. The development of transport infrastructures and the production of different types of transport vehicles (airplanes, cars, trains, ships etc.) require the use of substantial volumes of materials. The treatment of the end-of-life stage of these vehicles also raises important environmental challenges, while representing opportunities for the recovery of precious resources, notably critical raw materials. There is a need for the transport sector to move to more circular models, notably through business models for mobility, green public procurement, changes in the design of vehicles and improvements in their recycling.

144.In May 2020, the Commission adopted its Biodiversity Strategy for 2030. 88 The strategy introduces general goals on protection and restoration of nature and biodiversity such legal protection of a minimum of 30% of the EU’s land area and 30% of the EU’s sea area, including 10% under strict protection, as well as adoption of a legally binding instrument on restoration. Additionally, the Strategy introduces specific goals such as restoration of freshwater ecosystems through recreation of at least 25,000 km free-flowing rivers by 2030, reduction of nitrogen pollution, reduction of impacts from invasive alien species and integration of ecological corridors as part of a true Trans-European Nature Network. Achievement of all of these goals will require close involvement of the transport sector at the stage of planning, operation or upgrading of transport infrastructure.

145.In September 2020 the Commission adopted the Communication on Critical Raw Materials Resilience 89 setting out an action plan to ensure a secure and sustainable supply of raw materials for a wide range of industrial ecosystems. Low and zero-emission vehicles will increase demand for critical raw materials like lithium and cobalt in batteries and rare earths for electric motors. Improved circular use of materials, developing EU sourcing and diversifying sourcing from third countries is a necessity for achieving resilient value chains in the transport sector.

146.The 2030 Climate Target Plan of September 2020 set out that all transport sectors - road, rail, aviation and waterborne transport - will have to contribute to the economy-wide at least 55% GHG reduction effort. A smart combination of vehicle/vessels/aircraft efficiency improvements, fuel mix changes notably through increased uptake of renewable and low-carbon fuels, greater use of sustainable transport modes and multi-modal solutions, digitalisation for smart traffic and mobility management, infrastructure pricing and other incentives can reduce GHG emissions and at the same time significantly address noise pollution and improve air quality. In addition, more use of sustainable options, such as an increased use of existing urban bus and rail services can reduce emissions, congestion and pollution while improving road safety, especially in urban areas.

147.In fact, the shift towards low-emission mobility was already an objective in the Transport White Paper of 2011 ‘Roadmap to a Single European Transport Area’ 90 and was supported by various initiatives. As shown in the evaluation report, the White Paper and its implementation has contributed effectively to putting European transport on the path of reducing in GHG emissions by 2030 and beyond. However, this is no longer sufficient. Given the climate emergency and the revised emission reduction target for 2030 as well as the objective of carbon neutrality in 2050, significantly increased mitigation efforts will be needed.

148.The European Strategy for Low-Emission Mobility 91 was adopted in July 2016 to respond to increasing mobility needs of people and goods, while remaining competitive and shifting towards low-emission mobility. The Strategy reconfirmed and strengthened the 2011 White Paper goals and proposed an action plan: by mid-century, GHG emissions from transport need to be at least 60% lower than in 1990 and be firmly on the path towards zero. Harmful emissions of air pollutants need to be drastically reduced without delay.

149.The European Commission swiftly adopted proposals in the Action Plan of the Strategy, notably the “Clean Energy for all Europeans” package in November 2016, and three Mobility Packages in May 2017, November 2017 and May 2018 92 . Elements of the first Mobility Package aimed to improve competition and working conditions in the road freight sector, contribute to better road safety and reduction of environmental impacts has been adopted and entered into force on 20 August 2020.

150.The second Mobility Package, focussing on clean mobility, included the proposal for amending the Combined Transport Directive (92/106/EEC) 93 which is a key EU measure to directly support modal shift from road-only transport to rail, inland waterways and short sea transport. However, the negotiations in the European Parliament and the Council led to draft amendments which, if adopted, would significantly reduce the effectiveness of the Commission proposal. Therefore the Commission decided to withdraw the 2017 proposal.

151.The second Mobility Package further responded to the challenge of making mobility clean, competitive and connected through a combination of demand- and supply-side measures on low-emission mobility. In concrete terms, it encompassed a number of measures with the aim to enable a transition towards low and zero emission mobility, such as a reform of the Clean Vehicles Directive, new CO2 standards for cars and vans, or a follow-up to the Action Plan related to the Alternative Fuels Directive.

152.The third Mobility Package put forward an integrated policy for the future of road safety. It included a Strategic Action Plan on Road Safety and proposals on vehicle and infrastructure safety. The package also contained the first ever CO2 standards for heavy-duty vehicles, a strategic Action Plan for the development and manufacturing of batteries in Europe and a strategy on connected and automated mobility.

153.The Commission also adopted an Urban Mobility Package in 2013, to help cities in their transition towards sustainable urban mobility by reinforced support at European, national and regional levels. It has the concept of sustainable urban mobility planning (SUMP) at its centre, with dedicated European guidelines adopted later on. It has proven an effective and increasingly popular tool, implemented in cities in a large number of countries, and not only in the EU.

154.Key European legislation has been adopted to support the uptake of alternative fuels, including electricity, over the last decade. This includes the directive on the deployment of alternative fuels infrastructure 94 , which requires Member States to set up long-term National Policy Frameworks (NPFs) for the development of markets for alternative fuels and the deployment of alternative fuels infrastructure. It also requires the rollout of alternative fuels infrastructure along the core network of the Trans-European Transport Network (TEN-T) and its urban nodes - with milestones for 2020, 2025 and 2030 for different alternative fuels infrastructure for roads and ports. The Directive sets common technical specifications for recharging and refuelling stations to ensure interoperability and adequate consumer information. In parallel, financial instruments have been established to support the uptake of alternatively fuelled vehicles/vessels and their infrastructure, most notably through the Connection Europe Facility.

155.The Commission also adopted an action plan on alternative fuels infrastructure 95 to support the implementation of the Alternative Fuels Infrastructure Directive and mobilised considerable investment of public and private market actors through the Connecting Europe Facility (CEF), the CEF blending facility and the CEF debt instrument. Since 2014, more than EUR 6.8 billion of investments were thereby supported for alternative fuels infrastructure and mobile assets, the vast majority being for infrastructure. In particular the Blending Call for proposals launched in 2017/2018 aimed at combining grants with bank lending. Moreover, considerable investment has been made in research and development to support progress with technological and non-technological innovation. In this context, an important role is played by transport-related research and innovation partnerships. These are supported by and coordinated with European research and innovation on more sustainable alternative fuels.

156.In 2019 the co-legislators adopted the Clean Energy for All Europeans package that contained a number of legislative acts supporting the uptake of alternative fuels, including renewable and low-carbon fuels. The revised renewables energy directive (RED II) sets a 14% target for 2030 for the use of renewable transport fuels. The Energy Performance of Buildings Directive (EPBD) requires the installation of charging points or related pre-cabling in all new office and apartment buildings and in those going through major renovations. Finally, the electricity directive 96 requires Member States to provide a framework to facilitate the connection of recharging points to the distribution network and Distribution System Operators to cooperate with the undertakings that own, develop, operate of manage recharging points for electric vehicles. It also supports the cost-efficient integration of electric vehicles into the electricity system by laying the basis for enabling smart charging and setting a framework for the development of bi-directional charging (car batteries feeding electricity into the grid).

157.As part of the Mobility Packages, emission reduction of GHG and air pollutants from road transport have been strengthened by the CO2 standards for new cars, vans and heavy goods vehicles, by the Clean Vehicles Directive 97 which relies on public procurement rules; and by the deployment of recharging infrastructure for electric vehicles and refuelling stations for fuel-cell vehicles and multimodal travel information services supported by digital tools and data sharing.

158.In 2019, legislation was adopted with stricter CO2 emission performance standards for cars as well as for light and heavy duty vehicles from 2025 and 2030.

159.The weights and dimensions directive 98 was revised in 2015 and provides for derogations on the maximal lengths to make heavy goods vehicles greener by improving their aerodynamic performance. Derogations on weights are also allowed for vehicles powered by alternative fuels. The directive was modified again in 2019 to allow manufacturers to commercialise such vehicles already from September 2020. This package was completed by implementing rules on the vehicle approval legislation.

160.The revision of the Eurovignette Directive proposed by the Commission in 2017 aims at further implementing the “user and polluter pay” principles, by providing that all road charging schemes applied to heavy duty vehicles reflect the level of CO2 emissions. These revised rules should serve as an incentive for users to invest in less polluting vehicles.

161.In the past decade, the EU has adopted a number of essential policy instruments to address the environmental footprint of aviation. These instruments, are grouped in a so-called “basket of measures”, namely market-based measures such as emissions trading, research and development for greener aircraft design and technology (CO2 standards, Clean Sky), more efficient air traffic management operations (Single European Sky and SESAR), and the use of sustainable aviation fuels.

162.CO2 emissions from aviation in the EU have been included in the EU emissions trading system (EU ETS) since 2012. Under the EU ETS, all airlines operating in Europe, European and non-European alike, are required to monitor, report and verify their emissions, and to surrender allowances against those emissions. Aircraft operators receive tradeable allowances covering on average, almost half of emissions from their flights. It is estimated that between 2013 and 2019, a net saving of more than 160 Mt CO2 has been achieved through the inclusion of aviation in the EU ETS. The auctioning of allowances to the aviation sector has moreover generated revenues which have been used in part for climate- and energy-related purposes including the Innovation Fund for demonstration of innovative low-carbon technologies. The EU ETS also contains incentives to promote the use of Sustainable Aviation Fuels (SAF). For the time being, the scope is limited to intra-EEA flights, with a “stop-the-clock” provision, as regards outbound to and incoming flights from non-EEA countries, in the EU ETS Directive which is valid until the end of 2023. This provision was intended to provide momentum for a global market-based mechanism.

163.In 2016, the EU played a leading role in the adoption by the International Civil Aviation Organization (ICAO) of the first ever sectoral scheme regulating CO2, the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). All EU Member States will participate in the pilot-phase of the scheme, which will start in 2021, with the aim to offset growth in emissions beyond 2020 levels 99 , without prejudice to the upcoming revision of the EU ETS Directive as regards aviation. Depending on participation and quality of offsets used, at global level, the ICAO CORSIA scheme could mitigate up to 2.5 billion tonnes of CO2 and generate up to approximately USD 40 billion of climate financing by 2035. The Commission is assessing different policy options for a legislative proposal to implement further aspects of CORSIA in the EU, through amending the EU ETS Directive.

164.The EU has also adopted new standards for aircraft CO2 emissions, which entered into force in 2019 100 . These standards, which follow the global standards adopted by ICAO in 2017, provide additional requirements into the design process to focus on fuel efficiency. Also the adoption of new aircraft engine non-volatile Particulate Matter (nvPM) standards in ICAO was supported by the EU.

165.To develop the green and cutting-edge aircraft technology of the future, the EU relies on the Clean Sky Joint Undertaking. With a budget of EUR 4 billion and composed of over 600 entities from 27 countries, the Clean Sky 2 initiative (2014-2024) was designed to build on the Clean Sky 1, which aimed to develop technologies with reduced CO2, NOx and noise emissions.

166.The Single European Sky framework aims to make European skies more efficient, and can deliver important environmental benefits. The SESAR project, sponsored by the EU and the aeronautical industry, contributes to develop and deploy innovative ATM solutions with a potential to further reduce emissions. In 2013, the Commission proposed to complete the SES through amendments that could allow to decrease emissions up to 10%. However, with no progress on this proposal, the Commission presented an amended proposal on 22 September 2020 101 , which is expected to facilitate discussions between the co-legislators.

167.Recognising the need for long-term sustainability of aviation and the commitment to continue efforts to reduce aviation sector’s negative environmental impacts, the European associations collectively representing the entire European aviation called for an EU Pact for Sustainable Aviation. Through collaboration between all stakeholders in the aviation eco-system and policy-makers, the Pact is to contribute to the implementation of the European Green Deal, by reaching the objectives of significant CO2 emission reductions by 2030 and net-zero CO2 emissions by 2050 from all flights within and departing from the EU. The Pact will also consider the feasibility of making 2019 the peak year for CO2 emissions from European aviation while enabling the sector to continue delivering its social and economic benefits. 102  

168.Tackling maritime emissions is of key importance to reach the goals of the Paris Agreement as the share of shipping emissions in global anthropogenic emissions has increased from 2.8% in 2012 to 2.9% in 2018. In addition, international shipping emissions are expected to grow quickly without the implementation of appropriate policies at all levels. 

169.At EU level, following up on the 2011 EU White Paper on Transport, the Commission adopted a strategy on the decarbonisation of shipping in 2013, calling for a gradual approach in the EU, starting with an EU monitoring, reporting and verification (MRV) scheme, which was implemented through Regulation (EU) 2015/757 on the monitoring, reporting and verification of CO2 emissions from maritime transport. In 2018, the revised Emission Trading System Directive (EU) 2018/410 calls for “action from the IMO or the Union to start from 2023, including preparatory work on adoption and implementation and due consideration being given by all stakeholders”. In 2019, the European Green Deal has outlined measures to be developed, including a proposal to extend European emissions trading to the maritime sector and legislative options to boost the production and uptake of sustainable alternative fuels for the different transport modes. In 2020, the Commission published its first annual report on the monitoring, reporting and verification of CO2 emissions from ships, which confirmed that maritime transport is a substantial CO2 emitter. In addition, the Climate Target Plan communication confirmed that, in accordance with its international commitment to economy-wide action under the Paris Agreement, the EU should include at least intra-EU maritime transport in the EU ETS.

170.At the international level, the International Maritime Organization (IMO) agreed in 2018 to a first quantitative target: to peak GHG emissions from international shipping as soon as possible and to reduce total annual GHG emissions by at least 50% by 2050 compared to 2008 (to be reviewed in 2023), while pursuing efforts to achieve full decarbonisation as soon as possible in this century and following a pathway of CO2 emissions reduction consistent with the Paris Agreement temperature goals. It also sets the target to reduce the carbon intensity of international shipping by at least 40% by 2030, pursuing efforts towards 70% by 2050, compared to 2008. The EU is closely involved in work to develop measures for reaching these objectives at IMO level as shipping remains a fundamentally global business.

171.Previously, the IMO's Marine Environment Protection Committee (MEPC) adopted in 2011 a package of technical measures for new ships and operational reduction measures for all ships. This package was composed of two main measures: the Energy Efficiency Design Index (EEDI), which requires new ships to comply with minimum mandatory energy efficiency performance levels, increasing over time through different phases; and the Ship Energy Efficiency Plan (SEEMP), which establishes a mechanism for shipowners to improve the energy efficiency of both new and existing ships using operational measures such as weather routing, trim and draught optimization, speed optimization, just-in-time arrival in ports, etc. The regulations entered into force on 1 January 2013 and apply to all ships of 400 gross tonnage and above, irrespective of flag and ownership. These measures are the first ever mandatory global GHG reduction regime for an entire industry sector 103 .

172.As regards air quality, in 2016 the IMO confirmed the entry into force of the stricter 0.5% global sulphur limit (down from 3.5%) in marine fuels from 1 January 2020. EU action was decisive in securing this decision. This framework is anticipated in the EU Sulphur Directive of 2012, which also contains tighter limits in the emission control areas established in the Baltic, North Sea and English Channel. The fuel standards successfully reduced sulphur oxides in these protected areas established by the IMO, and are instrumental in further reducing emission pollutants across all EU waters as of January 2020. Similar low emission areas are currently envisaged by the Mediterranean Countries under the Barcelona Convention. The Commission will continue to engage with Mediterranean coastal states 104 to push for the creation of new Emission Control Areas to protect the health of coastal citizens, their environment as well as sea-related economic activities from NOx and other air shipping emissions.

173. Regulation 2016/1628 105 on non-road mobile machinery was adopted in 2016 under which new engines for inland waterway vessels have to meet stricter pollutant emission limits from 2019 for engines smaller than 300 KW, and 2020 for engine bigger than 300 KW, respectively.

Since 2017, the Commission (DG REFORM) manages the Structural Reform Support Programme (SRSP) for technical support projects in EU Member States, with a budget of EUR 222.8 million until 2020. Under the SRSP, Member States can request support to implement reforms in a wide range of areas, including for building sustainable and competitive economies. In the area of sustainable and smart mobility, Member States have received technical support, among others, for preparing regulations on sustainable mobility; performing gap analyses of a national policy frameworks for alternative fuel infrastructure in transport; improving inland navigations and traffic conditions in a major port area; and supporting new transport and mobility masterplans. The Commission has proposed a new Technical Support Instrument as part of the 2021-2027 Multiannual Financial Framework so as to continue provide its support to improve Member States’ administrative capacity to design, develop and implement reforms, including in the area of sustainable and smart mobility.

In 2018, the Commission also issued a Communication on the principles of subsidiarity and proportionality 106 . It noted that “it is essential that the 41 national Parliament chambers, 74 regional legislative assemblies, the 280 regions and the 80 000 local authorities, who are at the forefront of implementing EU laws, are more fully engaged in the policy process. Active subsidiarity and a new way of working with these entities will help deliver policies that work while strengthening the understanding and ownership of what the Union does.”

Digitalisation

174.As explained in section 2.3.3, digitalisation in transport can bring huge improvements in efficiency, safety and sustainability. This includes a better organisation and integration of transport modes towards efficient multimodal door-to-door transport and by progressively introducing new technology, which has the potential to reduce safety risks caused by human error in the longer term.

175.Research and innovation programmes (especially Horizon 2020 107 and the European Regional Development Fund) have been essential to test and validate new technologies and solutions and prepare them for market deployment.

176.The EU has developed legislative and non-legislative digitalisation initiatives in all transport modes, such as the Intelligent Transport Systems Directive, the Electronic Freight Transport Information Regulation and a new Regulation on a European Maritime Single Window environment. The Commission has also established a dedicated expert group, the Digital Transport and Logistics Forum (DTLF), where public and private stakeholders work together to support digitalisation in freight transport and logistics; as well as the High level Steering Group for the Governance of the of the Digital Maritime System and Services.

177.Similarly, a key element towards making maritime transport smarter is the implementation of the EU Vessel Traffic Monitoring and Information System (VTMIS) – the EU-wide interoperable and safe system that provides the digital maritime picture for enhanced traffic and transport at sea. The main objective of the VTMIS Directive 108 is to: “establish in the [Union] Community a vessel traffic monitoring and information system with a view to enhancing the safety and efficiency of maritime traffic, improving the response of authorities to incidents, accidents or potentially dangerous situations at sea, including search and rescue operations, and contributing to a better prevention and detection of pollution by ships.”

178.Better sharing of data between transport operators can be ensured by horizontal initiatives or transport-specific ones, for example the Delegated Regulation on EU-wide multi-modal travel information services 109 and the Implementing Regulation requiring freight rail undertakings to provide dynamic data to multimodal terminals 110 .

179.In this regard, the European Strategy for Data 111 aims at creating a single market for data that will ensure Europe’s global competitiveness and data autonomy, where data can flow within the EU and across sectors, for the benefit of all. In particular, it highlights the need for cross-sectoral actions towards a European data space through the development of sectoral data spaces in strategic areas such as manufacturing, agriculture, health, and mobility. In the field of mobility, such data spaces will facilitate access, pooling and sharing of data from existing and future transport and mobility databases.

180.Based on the Commission's Intelligent Transport Systems (ITS) action plan of 2008, a dedicated legal framework was established with the entry into force of the ITS Directive 112  in 2010. This framework supports the harmonised deployment in the EU of ITS solutions in road transport. It provides in particular for EU wide specifications in different domains, such as multimodal travel, real-time traffic and safety-related information services 113 . It supports both the deployment of services, in particular through the financial support from the CEF programme 114 , and the organisation of the access to transport data through the creation of National (data) Access Points 115 .

181.Also in the remit of the ITS Directive, the interoperable EU-wide eCall system, which automatically dials Europe's single emergency number 112 in the event of a serious road crash and communicates the vehicle's location to the emergency services, benefitted from the development of a specific legal framework 116 (see also the section on Safety). 117

182.In 2016, the Commission presented a European strategy for the coordinated deployment of cooperative intelligent transport systems (C-ITS) 118 to avoid a fragmented Single Market for cooperative transport. The strategy emphasises the need for interoperability, established a list of mature Day 1 services and the need to adopt a hybrid approach to communication technologies. It also addresses other critical issues, including cyber-security and data protection. More recently, the "Europe on the Move" Communication in 2018 highlighted the role of C-ITS in enabling cooperative and in the future connected and automated mobility.

183.In line with the C-ITS Strategy, 14 Member States plus several associated countries have started the large-scale deployment of interoperable C-ITS services through the C-ROADS platform, a Member State driven harmonisation platform supported through the Connecting Europe Facility. Since 2019, C-ITS based on ITS-G5 has also been introduced at large scale in series-produced vehicles, enabling safety critical information services increasing the road safety for every equipped vehicle.

184.With the Communication “On the road to automated mobility: An EU strategy for mobility of the future” 119 , the Commission proposed in May 2018 a comprehensive EU approach towards connected and automated mobility setting out a clear, forward looking and ambitious European agenda. This agenda provides a common vision and identifies supporting actions for developing and deploying key technologies, services and infrastructure. In June 2019, the European Commission has created a single EU wide platform grouping all relevant public and private stakeholders to coordinate open road testing of connected and automated mobility and making the link with pre-deployment activities. In addition, the European Commission has proposed to establish a European Partnership under Horizon Europe to give a clear long-term framework to the strategic planning of research and pre-deployment programmes on connected, cooperative and automated mobility at EU and national levels.

185.In support of the introduction and deployment of connected and automated mobility), both the Gigabit Society Communication and the 5G Action Plan (2016) 120 established the goal of having uninterrupted 5G coverage in European major terrestrial transport paths by 2025. Consequently, some Member States set relevant cross-border corridors, in which new 5G based mobility services are being tested in order to leverage their full potential.

186.In this regard, the recently published 5G Strategic Deployment Agenda presents a common vision for investing in 5G-ecosystems in the field of Connected and Automated Mobility and identifies the key drivers for accelerating infrastructure roll-out. It will serve as a basis for the upcoming privately as well as publicly supported deployment projects in this field with a particular focus on the upcoming Connecting Europe Facility 2 Digital programme. It complements existing deployment and provides an alternative for allowing connected vehicles to access mission-critical information in real time, which will significantly contribute to road safety, to a lower carbon footprint, and to a broad range of digital services for drivers and passengers.

187.This agenda is complemented by the 5G Strategic Deployment Agenda for Rail, looking at synergies between the dedicated rail radio network and Mobile Network Operators (public networks), and to maximise the connectivity for Rail users. In parallel, the upgrade of the Rail Radio System for safety-critical functions to 5G (FRMCS) is developed in terms of standardisation and will be supported by Connecting Europe Facility 2 Transport Programme, potentially by Connecting Europe Facility 2 Digital and Synergic projects, as well as by the Cohesion Policy.

188.The Artificial Intelligence White Paper of 2020 deals with technological, ethical, legal and socio-economic aspects to boost the EU's research and industrial capacity and to put artificial intelligence (AI) at the service of European citizens and economy. AI has become an area of strategic importance and a key driver of economic development. It can bring solutions to many societal challenges, especially those affecting the environment and sustainability. It also offers a large potential for accessibility, provided that data and algorithms are inclusive of persons with disabilities. Mobility applications, such as autonomous driving, are identified as one key sector in which focus is needed.

189.The Commission adopted its strategy on Automated and connected mobility as part of the third mobility package in May 2018 together with a legislative proposal on the approval of automated/connected vehicles. Regulation (EU) 2144/2019 121 , was subsequently adopted by the legislator and will provide the EU industry with a strong internal market to be able to compete globally.

190.A key element of making rail transport smart is the implementation of the European Railway Traffic Management System (ERTMS) – the interoperable and safe EU Signalling system that replaces 21 national systems. ERTMS is now a global standard for train control and communication. Its development has provided excellent opportunities for developing high value business and expertise within Europe and for export around the world. And it is being deployed in almost 50 countries around the world, with over 21,000 km deployed.

191.For inland navigation 122 , significant steps have been taken to support the deployment of harmonised River Information Services (RIS) in order to enable seamless transport and traffic management on the European inland waterways. The evolution of RIS needs to take into consideration new requirements stemming from the digital transformation happening in the sector (e.g. digital ship operator platforms, port information systems, synchromodality, corridor management, Smart Shipping and Inland Waterways Autonomous Ships), including potential adaptions and extensions of the legal framework on RIS. The legislative framework on the River Information Services 123 is currently being evaluated.

192.In order to facilitate the collection, exchange and maintenance of reference data that forms the basis for many technical and operational services of RIS, the Commission introduced the European Reference Data Management System (ERDMS) and took over its operation. To improve the functioning of the ERDMS and its compliance with evolving technical specifications and regulations, the Commission is working on improvement of the system and its service levels to ensure its fitness for the digital transformation in inland waterway transport.

193.The Directive (EU) 2017/2397 on the recognition of personal qualifications in inland navigation requires Members States to keep electronic registers of such qualifications, and the EC to set up an IT platform (the so called ECDB 124 ) for exchanging information on crew certificates. This platform should be operational by January 2022.

194.The Commission services are preparing a support study on a smart tachograph for IWT. The general objective of the initiative is to contribute to a smooth and fairer functioning of the IWT market, through the use of digital technologies, so that this low carbon sector can play its role as a competitive actor in the logistic chain. More specifically, the initiative aims at: 1) minimising the administrative burden; 2) improving enforcement; 3) increasing the uptake and acceptance of electronic documents/solutions167. In order to facilitate collection and exchange of data on inland waterway vessels the Commission introduced the European Hull database (EHDB). To improve the functioning of the EHDB and to ensure security of vessels’ data the Commission is working on improvement of the system.

195.The 2017 Digital Inland Waterway Area (DINA) study 125 identified three key challenges that hamper the IWT sector’s competitiveness: inefficient navigation and traffic management, inefficient integration of IWT in logistics processes and high administrative burden for complying with legislation. In order to tackle these challenges and recognising that ‘digitalisation helps reduce the administrative burden and simplify procedure for authorities and businesses’, the 2018 DINA Staff Working Document 126 initiated an examination of synergies with other transport modes, which resulted the so called Digital Synergy Study 127 .

196.The final report of the Digital Synergy Study was published 128 in July 2020. The study aimed at identifying informatics solutions and/or legislative frameworks with digital aspect in other transport modes to assess their potential re-use in the IWT sector. The study outcomes can be used by different actors in the IWT sector as a useful source of information and potential guidance for current project activities or the development of new initiatives ranging from pilot projects to cross border systems. Digitalisation can act as accelerator to achieve the overall ambition to improve IWT sector’s competitiveness and integration with other modes.

197.To support the digital transformation process in strategic transport sectors, dedicated research and innovation partnerships have already been established for rail (the Shift2Rail joint undertaking) and air traffic management (the SESAR Joint Undertaking). These partnerships reflect requirements across the European network, and also allow close alignment with regulatory bodies, aiding early adoption of successful projects.

Single Market

198.In the last ten years, the Commission has taken several initiatives to further foster the development of the Single European Transport Area. Progress towards this goal has been made for all transport modes, for instance with the Fourth Railway Package, the Blue Belt initiatives and efforts to build a Union information system for maritime transport, the EU Aviation Strategy, urban mobility package and the NAIADES Programme for inland waterways.

199.The successive railway packages have now created the conditions for a genuine Single European Rail Area with open markets and technical interoperability, to ensure that trains are able to operate with ease across national borders, and the same rolling stock be used all across Europe but full implementation is still required to reap the benefits..

200.Whilst the rail freight and international passenger services markets have been open for competition for some time, rail domestic passenger markets are only being opened by the Fourth Railway Package, which is currently being implemented: European railway undertakings are allowed to offer rail services in any Member State since 3 December 2019, subject to specific safeguards and transitional provisions. Where services are economically not viable, the public service contracts through which they are funded will have to be tendered from 2023 onwards at the latest. Experience from countries where such contracts are already tendered shows that this leads to an improved offer and lower costs to the authorities. Joint enforcement of sectorial and competition rules has been stepped up, but those efforts are still much needed to ensure an effective market opening and to remove the remaining market access barriers such as ticketing and access to rolling stock will require attention, among several other issues. Rail market issues are discussed in more detail in section 4 below.

201.EU legislation as now implemented via the Technical Pillar of the Fourth Railway Package provides a harmonised set of technical standards for the European Railway network, and provides EU wide single vehicle authorisation and safety certification for railway undertakings based on EU specifications and standards, which the European Union Agency for Railways (ERA) issues for the Single European Rail Area since June 2019 129 . The Commission and ERA, together with Member States, are identifying and eliminating national rules made redundant by this new regime. Collectively, these measures will promote cross-border services, enhance interoperability and permit the development of rolling stock and other rail equipment standardised at EU level.

202.The EU has established 11 rail freight corridors, to enhance coordination between infrastructure managers on issues linked to capacity allocation and management. Regulation (EU) 913/2010 130 on the rail freight corridors is currently under review.

Figure 12: Market share of all but the principal railway undertakings in 2016

Source: European Commission (2018): Rail Market Monitoring Survey 2018. IRG Rail Annual Reports. Greece, Ireland, Lithuania, Luxembourg and Finland score 0 in both indicators. Passenger data: due to a methodological change in reporting, values are mostly estimated by DG MOVE. Not applicable to Cyprus and Malta.

203.In the road transport sector, the market for international (intra-EU) freight and passenger services has been entirely opened to competition, but domestic transport remains largely protected. On the freight side, "cabotage", i.e. domestic transport performed by foreign hauliers, is subject to the EU rules which were revised under the first Mobility Package (adopted in July 2020), together with social rules for road transport sector. One of the objectives of the revision was to improve the working conditions of drivers, by clarifying the driving and rest time rules, by establishing specific rules for posting of road transport workers and by improving enforcement of those rules with the aid of smart tachograph and other digital systems (e.g. IMI – Internal Market Information system). The other objective was to eliminate distortions of competition on the internal road transport market by clarifying the existing rules on the access to the haulage market and to the profession of road transport operator and strengthening their enforcement. Limitations to cabotage operations are part of the newly adopted rules.

204.Since the early 1990s the aviation market has been gradually liberalised. The creation of the aviation single market has produced significant socio-economic benefits for passengers, businesses and regions. Air traffic has more than doubled since 1990 and in 2018 more than a billion passengers travelled through some 500 European airports. More than 3,500 intra-EU routes provided access to both large cities as well as peripheral regions. The fostering of competition in the market 131 has contributed to making air travel affordable, to creating jobs and to stimulate business.

205.While the Single Market for aviation has been a success, there remain challenges and room for improvement in some areas of its functioning, in addition to the need to make aviation more sustainable. In particular, the Single European Sky remains incomplete. The current fragmentation of the airspace leads to inefficiencies, additional fuel burn and extra costs for the whole aviation value chain.

206.In 2015, the Commission adopted the EU Aviation Strategy 132 which pursued three key priorities:

·Tapping into growth markets, by improving services, market access and investment opportunities with third countries, whilst guaranteeing a level playing field;

·Tackling limits to growth in the air and on the ground, by reducing capacity constraints and improving efficiency and connectivity;

·Maintaining high EU safety and security standards, by shifting to a risk and performance based mind-set. Creating high quality jobs and maintaining a strong social agenda.

207.The Single Market for aviation has delivered key achievements for European citizens, regions and businesses. The over 1.1 billion passengers – an average yearly growth of 6.9% between 2015 and 2018 – that travelled through European airports in 2018 meant that the global share of EU traffic in terms of passengers carried has remained stable at around 26% 133 . Since 2015 close to 700 new routes (city to city) have been opened within EU, representing an increase of 15% 134 and contributing to increasing connectivity. Over the same period, nearly 200 additional routes (+30%) 135 have seen a third airline as an operator, contributing to increase in competition and affordability within EU.

208.In the area of waterborne transport the Commission, in the policy framework of the 2011 White Paper, has taken initiatives to consolidate the internal market for sea shipping services and better connect EU ports to create an EU maritime transport space without barriers. In this context measures were adopted to improve maritime surveillance capabilities for safe and efficient maritime transport and traffic, to simplify procedures for regular shipping services and reporting formalities during port calls, review restrictions of port services and improve transparency of ports’ financing.

209.As regards international multimodal transport, the range of legal instruments shippers and transport operators have to consider for each transport operation, is very broad. This includes the rules applicable to vehicles (technical, safety and environmental norms and standards), workers (e.g. professional qualifications, working time), services (access to market) and goods (e.g. customs, rules applicable to dangerous goods). Each operation is accompanied by a large amount of information, which in vast majority of cases still involves paper documents at one stage or another. Technical systems for the electronic exchange of transport information vary between and within countries and transport modes. Some of these problems will be tackled by the implementation of the eFTI Regulation 136 which establishes the conditions under which certain information relevant under the acquis for intra-EU movements of freight is accepted by the authorities in electronic form and which provides for common rules for processing the data for intra-EU cargo movements.

210.Passengers in the EU are protected by a full set of passenger rights, whether they travel by air, rail, ship, bus and coach. This framework provides a minimum level of protection for people using transport services, including the most vulnerable, i.e. persons with disabilities and reduced mobility. It recognises that passengers, as the weaker party to the transport service contract, need to be treated fairly when the service has not been provided as expected.

211.As a consequence, the framework addresses the three steps of the journey (prior, during and after the journey) to facilitate mobility and social inclusion. It contributes to reducing the negative impact of travel disruptions on users of collective transport modes and to improving service quality for passengers. This also contributes to the creation of a level playing field for transport operators within and across modes in the EU and a European standard of passenger protection, which is essential in the context of the single market. Today passenger rights apply to a growing market of over 400 million citizens performing several billions of journeys every year for private or business purpose. In this context, passenger protection has become a cornerstone of EU transport policy 137 , building on international conventions and the general consumer protection framework of the Union.

212.Attention is being paid to accessibility of transport service information for persons with disabilities in the European Accessibility Act, 138 complementing existing passenger rights legislation which covers also the assistance to be provided to passengers with disabilities and reduced mobility when travelling by air, rail, waterborne or bus and coach transport. Accessibility is a key component of social sustainability and inclusiveness, contributing to usability and durability.

213.In its Communication ‘A stronger and renewed strategic partnership with the EU's outermost regions’ 139 , the Commission committed itself to reducing the outermost regions' "accessibility gap" caused by remoteness from continental Europe, insularity (in most cases) and difficult topography and to testing low-carbon transport and energy efficient solutions.

Infrastructure developments

214.To develop the Trans-European Transport Network (TEN-T Network), the EU adopted a Regulation in 2013 140 providing Union guidelines for transport investment. The Regulation establishes a legally binding obligation to develop the so-called "core" and "comprehensive" TEN-T Networks. The TEN-T covers all transport modes and connections between them (ports, airports and other transport terminals), they set standards and requirements to be met along the whole network, and they include smart and innovative components to facilitate efficient infrastructure use and high-quality services.

215.The core network is strategically the most important part of the TEN-T and must be completed by 2030. The core network has been designed to connect the main urban areas of the EU with the different transport modes and to ensure multimodal connections to the most important ports. It includes about 67,000 km of railway lines, 50,000 km of roads and 15,700 km of inland waterways. Motorways of the Sea are the maritime dimension of the network. At this stage, about 8,500 km of railway lines, 1,600 km of roads and some major inland waterway projects remain to be newly constructed or substantially upgraded until 2030. The TEN-T network serves also as basis for the deployment of alternative fuel infrastructure and digital infrastructure.

216.Along the existing part of the TEN-T, efforts are still needed to fully comply with the standards set out in the Regulation. However, significant progress has already been made. Along the nine core network corridors, for example: 89% of the rail infrastructure is electrified. 85 % of the inland waterways infrastructure meets the requirements of a minimum draught of 2.5 m and of a minimum height of 5.25 m under bridges. 89% of the TEN-T ports on the core network corridors are connected to the railway network.

217.Projects of common interest, identified in accordance with the TEN-T Regulation, can be supported under the Connecting Europe Facility (CEF). The CEF Regulation 141 , adopted in 2013, allocated a seven-year budget (2014-2020) of EUR 23.3 billion for investment projects in the transport sector.

218.Cohesion policy provides substantial support to develop a multi-modal, door-to-door European transport system which addresses the needs of commercial actors and citizens for long-distance, cross-border transport, as well as for regional and local mobility. In the period 2014-2020 around EUR 70 billion have been programmed to support transport investments from Cohesion Fund and ERDF. Around EUR 33.4 billion for TEN-T have been programmed and around EUR 36.6 billion for other national, regional and local infrastructure. This support is delivered through over 200 national, regional, and Interreg programmes, tailored to the particular situation in the Member States and regions (in line with relevant national and regional transport plans). During the period 2014-2019, CEF Transport has awarded EUR 23.3 billion in grants to co-finance projects of common interest, out of which EUR 11.3 billion was transferred from the Cohesion Fund. These funds are dedicated to completing the TEN-T Network, building cross-border links to better integrate national networks and to foster digitalisation and improved performance of the existing network.

Safety & security

Safety

219.For road safety, the Commission adopted in 2010 Road Safety Policy Orientations 142 that set a target of halving the number of road fatalities by 50% by 2020 and that included a mix of initiatives, focusing on improving vehicle safety, the safety of infrastructure and road users' behaviour. Faced with stagnation in the reduction of EU-wide fatality figures in the second half of the last decade, the Commission received a strong mandate for a new road safety programme from the EU Transport Ministers in the “Valletta Declaration” of 2017 143 . The Commission in 2018 adopted the Road Safety Policy Framework 2021-2030 as part of the Third Mobility Package, along with a Strategic Action Plan on Road Safety, which set a new target for 2021-30 to reduce deaths and – for the first time – serious injuries by 50%. It also set out how the Safe System could be implemented at EU level – i.e., focusing holistically on the different elements, such as vehicle safety, infrastructure, road user behaviour such as speed, governance aspects and post-crash care, with Key Performance Indicators to benchmark progress. 144  

220.In terms of vehicle safety, safety technologies and type-approval requirements have been significantly upgraded for all vehicle categories in recent years. Lane departure warning and advanced emergency braking for lorries were required as from 2015 in the General Safety Regulation 145 and anti-lock braking systems are mandatory for motorcycles in the EU since 2016 146 , eCall for emergencies in cars and vans is required for new models since 2018 147 . In 2019, the General Safety Regulation was reviewed again 148 , requiring cars, lorries and buses to be fitted with a range of important new safety technologies such as Intelligent Speed Assistance, Lane Keeping Assistance and Automated Emergency Braking. A number of the most significant new safety systems will be mandatory from 2022 in new models and by 2024 for all new cars.

221.The Directive on Road Infrastructure Safety Management was also upgraded in 2019 149 . The Directive, which prescribes safety assessments at all stages of the lifecycle of a road (design, construction, operation), now applies not only to TEN-T roads, but also to all motorways as well as primary roads. The upgrade also introduced a network-wide pro-active risk assessment and the obligation to take the needs of vulnerable road users into account systematically in all safety assessments.

222.In addition, the legal framework for the training of professional drivers was upgraded in 2018 150 , a package of measures on roadworthiness testing was adopted in 2014 151 and rules on the cross-border pursuit of road traffic offences were introduced in 2011 (re-published in 2015) 152 .

223.Aviation safety has been a great success story, not least because fatal accidents for commercial air transport involving EU operators have fallen to zero since 2016 153 . Work in this area is influenced by the inherently international nature of the aviation industry and most standards adopted at global level are implemented into EU aviation safety legal framework. International cooperation is thus essential to ensure aviation safety and development of globally agreed standards. The EU is actively engaged in strengthening aviation safety at the international level, notably through its work with the International Civil Aviation Organization (ICAO).

224.The European aviation safety system is based on a comprehensive set of common safety rules, which are overseen by the European Commission, the European Union Aviation Safety Agency (EASA) and the National Aviation Authorities. In the context of the 2015 Aviation Strategy, a new Aviation Safety Regulation 154 replacing Regulation 216/2008, has been elaborated and adopted. The aim is to prepare the EU aviation safety system for the challenges of the future, including a new era of innovation and digital technologies. It consists of a shift towards a risk and performance-based approach, measures to increase efficiency of the system and promotion of cooperative safety management between the EU and its Member States. Furthermore, the 2015 Aviation Strategy recommended the adoption of a basic legal framework for the safe development of drone operations in the EU, as part of the new Aviation Safety Regulation. The new Aviation Safety Regulation extended the EU safety rules to all drones and the recently adopted Implementing Rules 155 covering drone technical requirements and drone operations should help opening the EU drone services and foster the development of the manufacturing market.

225.As part of the 2015 Aviation Strategy, the Commission also presented a revised European Aviation Safety Programme, laying out, through an integrated set of regulations, processes and activities at Union level how aviation safety is managed in the EU, and thus providing Member States a reference for the elaboration of their own State Safety Programmes in the context of the ICAO.

226.The set of common safety rules is complemented with legislation on accident investigation and on the reporting, analysis and follow-up of occurrences in civil aviation which have been revised respectively in 2010 156 and 2014 157 .

227.Finally, the EU has concluded over the past years bilateral aviation safety agreements with the United States of America, Canada, Brazil, China and Japan and the Commission is undertaking technical cooperation projects with third countries in the area of safety.

228.The legislative framework for maritime safety was thoroughly assessed by way of the 2018 Maritime Transport Fitness Check. The maritime safety situation today is one characterised by a limited amount of accidents and very few fatalities. Whilst it remains hard to pinpoint ultimate safety outcomes to individual legislative acts, it was concluded that overall EU maritime legislation has contributed to decisively improve the safety situation at sea. The added value of EU intervention is shown both by the swift adoption of international safety rules, as well as the harmonised enforcement and implementation of such rules across the EU Member States and for ships under an EU Member State flag.

229.The Directive (EU) 2016/1629 on technical standards for inland navigation vessels was adopted by the European Parliament and the Council in October 2016. This Directive strengthens the Internal Market ensuring technical harmonisation throughout the Union's inland waterways while providing flexibility for taking into account the particular features of each inland waterway section in the EU and to ensure safety of inland navigation vessels.

230.Rail safety in the EU is assured via stringent safety requirements for the technical specifications of rail vehicles and infrastructure as well as safety management tools for rail operators and infrastructure providers set out in the Railway Safety and Railway Interoperability Directives (2016/798 and 2016/797). These rules also require the various elements of the Union rail system to be supervised by national safety authorities, while authorisations to place rail vehicles on the market and to operate as a railway operator are, in most of the cases, given by the European Union Agency for Railways (ERA). The level of safety on EU railways is by far the highest for surface mobility (0.1 fatality per billion passenger km), though it can vary between Member States. The Commission and ERA work with Member States to maintain these high levels of safety and share best practice to increase safety levels where needed. Particular focus is put on the promotion of safety culture and will come through the roll-out of the new versions of the European railway signalling and train protection system. ERTMS ensures trains cannot over speed or pass red signals.

Security

231.There is currently no EU legislation addressing land transport security (apart for dangerous goods where there is some overlap of safety and security requirements). Though theft of cargo from road and rail is estimated to cost some EUR 8 billion per year, EU Transport Ministers, to date, have not called upon the Commission to bring forward any legislation for EU security requirements for either road or rail transport. The Commission has pursued efforts to implement an Action Plan to improve rail passenger security, notably via the establishment of the EU Rail Security Platform. The outcome of its work could potentially form the basis of a regulatory initiative.

232.On road transport the Commission published a study in 2019 which concludes that 400 000 safe and secure parking places for lorries are lacking in the EU. Cargo crimes are more frequent than ever, and about 75% of these incidents are happening when lorries are parked in unsecure parking places. As a response to this critical situation, both for drivers and cargo owners, the Commission is promoting safe and secure parking areas and information provision about them, making available CEF-funding and has set up an expert group to implement common standards and certification procedures for safe and secure parking places.

233.Since 2002, the Commission has established common rules in the field of civil aviation security aimed at protecting persons and goods from unlawful interference with civil aircraft.

234.Regulation (EC) 300/2008 158 lays down common rules and basic standards on aviation security and procedures to monitor the implementation of the common rules and standards. Since then, it has been supplemented through implementing legislation as regards, among other, liquids, aerosols and gels, the use of security scanners, the adoption of alternative security measures, controls of air cargo internally as well as internationally and the specifications of national quality control programmes. The Commission has powers to carry-out inspections to verify compliance with the EU legislation.

235.In the maritime security domain, the Union benefits from a Regulation (EC) 725/2004 159 covering security measures on board ships and the immediate interface between ships and ports. Directive 2005/65/EC 160 addressing elements of port security not covered by the Regulation complemented it in 2005. The Commission was also given powers to conduct inspections.

236.The Council in 2014 adopted a Maritime Security Strategy for the global maritime domain to coordinate national policies and give a European response to maritime threats and risks, cooperation within the EU and international bodies, such as the International Maritime Organisation is progressing only slowly.

237.Various initiatives are on-going to tackle cyber security and the EU established a dedicated agency – the EU Agency for Network and Information Security – for this purpose. The Directive on Security of Network and Information Systems (NIS Directive) constitutes a common baseline to enhance cyber-resilience, also in transport.

238.The legislator also adopted Regulation (EU) 2144/2019 161 which provides for the Commission to adopt type approval rules on cars regarding their protection about cyberattacks. These implementing rules are under development and are intended to be applicable from July 2022.

Social issues

239.In 2018, the transport and storage services sector (including postal and courier activities) in the EU-27 employed around 10.3 million persons 162 , some 5.3 % of the total workforce 163 . Around 52% of them worked in land transport (road, rail and pipelines), 3 % in water transport (sea and inland waterways), 4 % in air transport and 27 % in warehousing and supporting and transport activities (such as cargo handling, storage and warehousing) and the remaining 14 % in postal and courier activities.

240.A third of transport workers are above 50 years old 164 . Only 22% of transport workers are women (most of which work in administrative positions). Less than 5% work as pilots, seafarers and truck or train drivers. While the labour markets per transport mode may be separate, they may nevertheless have similar characteristics 165 : male-dominated, ageing, in need of highly mobile skilled workers, labour shortages, fatigue and stress, work-life balance, skills mismatch, global competition, law application and enforcement.

241.A well-functioning Single Market needs to be based on fair working conditions ensuring a level playing field. Every EU worker has certain minimum rights relating to health and safety at work, equal opportunities for women and men, protection against discrimination, labour law. The EU Member States must make sure that their national laws protect these rights, in particular those laid down by EU law.

242.Many transport companies operate across borders. As outlined in the recent Commission Communication on ‘A strong social Europe for just transitions 166 , EU rules need to be fit for purpose to guarantee that this happens in a fair and transparent way and ensure fair competition among businesses, protect workers’ rights, and avoid double contributions and social dumping. To this end in the EU adopted the set of social rules in road transport, including sector-specific rules on posting of highly mobile road transport workers. The newly created European Labour Authority (ELA) will be a key tool to facilitate the application and enforcement of EU rules in this area, improving the functioning of the Single Market. It will provide to individuals and employers information on working or operating in another EU country, and support cooperation between national authorities, including on strengthening inspections, tackling undeclared work and fighting fraud.

243.The transport sector often suffer from a negative image in terms of working conditions, which may discourage in particular young people and women to look for transport jobs. In a sector that has been largely liberalised and where the mobility of workers is high, social protection and labour law rules remain primarily a responsibility of the Member States. This can lead to a different implementation and different levels of enforcement across the Member States. This brings challenges in particular a lack of clarity on applicable social rules for some workers and a low level of enforcement and the risk of unfair employment practices. Social dialogue and the involvement of workers is one of the principles of the European Pillar of Social Rights 167 . At European level, employers’ and workers’ organisations (the social partners) regularly meet within sectoral social dialogue committees 168 established in the various segments of the transport sector: civil aviation, inland waterways, maritime transport, ports, railways, road transport, including urban public transport. The Commission supports these committees, which are intended as representative bodies for consultation, joint initiatives and negotiation and were established with due regard for the autonomy of the social partners. The Commission has regular exchanges with the European social partners in the transport sector.

244.There is a risk of skills mismatch for certain transport workers and the need to keep pace with changing skill requirements. Changes in skills requirements are most visible in sectors that are strongly influenced by the green transition, notably in transport. The “European Skills Agenda for sustainable competitiveness, social fairness and resilience” is the EU’s response to these challenges, in transport and in other sectors. A flagship action of the Skills Agenda is the “Pact for Skills”, which will bring together stakeholders, private and public, and will, among others, set up large-scale partnerships, including at regional level, in strategic industrial ecosystems and priority areas identified in the European Green Deal. These partnerships can build on the “Blueprint for sectoral cooperation on skills” 169 for gathering sectoral skills intelligence, mapping key occupation needs, defining occupational profiles and developing training programmes. Three Blueprint Alliances are relevant to sustainable transport: one for automotive 170 , one for maritime shipping 171 and one for rail supply and transport industries. To be able to comply with EU accessibility legislation and provide better service for persons with disabilities and those with reduced mobility, training to enhance skills on these areas is needed.

245.Another flagship action of the Skills Agenda is the Commission Proposal for a Council Recommendation on VET for sustainable competitiveness, social fairness and resilience 172 . It proposes that by 2025, 8% of learners in vocational education and training benefit from a learning mobility abroad. Learning and working placements abroad teach young people not only job-specific technical but also soft skills, such as adaptability, resilience, intercultural or language skills - skills that are very sought after, and not only in the transport sector.

246.Digitalisation and automation are already affecting employment in certain sectors, including transport. The Commission is looking how to address associated social impacts, through cooperation with interested parties, including social partners, and by supporting research in the field. The 2017 Digital Transport Days addressed the social impact of digitalisation and automation and concluded that the social dimension should be at the heart of the transition (technical standards are not enough). A Commission conference in 2018 confirmed that stakeholders expect public authorities to be active in accompanying the transition. This was also addressed during the 2019 Digital Transport Days in a dedicated session on ‘Managing the transition towards digitalisation and automation – social aspects’.

Women in transport

247.With the setting-up of the ‘Women in Transport – EU Platform for change’ 173 in 2017, first steps were taken to address the sector’s gender gap and lack of attractiveness. Meanwhile, all important EU associations covering all transport modes, including social partners, have joined this action-oriented platform that aims at increasing the number of women employed in the sector by putting forward and exchanging good practices. Until now companies have brought 18 different actions to the platform. Another tool is the Declaration on equal opportunities for women and men in the transport sector. In 2019 the Commission published 174 a list of measures that companies can take to improve their gender balance (based on real case studies) and powerful messages on what a gender policy can bring about for companies. In rail for example, social partners are negotiating an agreement to promote the employment of women in the railway sector.

Persons with disabilities 175 and reduced mobility

248.The EU and all Member States are parties to the UN Convention on the Rights of Persons with Disabilities. According to the Convention, States parties shall take appropriate measures to ensure access to persons with disabilities, on an equal basis with others to transportation. These measures include the identification and elimination of obstacles and barriers to accessibility inter alia in buildings, road and transportation. Appropriate measures to be adopted also concern services open or provided to the public. Moreover States parties are to take appropriate measures inter alia to develop, promulgate and monitor the implementation of minimum standards and guidelines for the accessibility, to ensure that private entities offering facilities and services which are open or provided to the public take into account all aspects of accessibility for persons with disabilities, to provide training for stakeholders and forms of live assistance and intermediaries and to promote other appropriate forms of assistance and support to persons with disabilities to ensure their access to information. State Parties shall take effective measures to ensure personal mobility with the greatest possible independence for persons with disabilities, including by facilitating the personal mobility of persons with disabilities in the manner and at the time of their choice, and at affordable cost.

249.Attention is being paid to accessibility of transport for persons with disabilities in the European Accessibility Act 176 , complementing existing passenger rights legislation. Accessibility is a key component of social sustainability contributing to usability and durability. The Technical Specifications for the accessibility of the railway system for persons with reduced mobility (PRM TSI) have been amended in 2019, to ensure inventories of assets, including a website providing practical information about the accessibility of railway stations.

Road transport

250.The revision of the road transport social legislation adopted under the first Mobility Package provides urgent solutions to the current social and employment challenges in the sector. These include: revised rules on driving and rest times – to improve working conditions by giving more flexibility for drivers to organise their activities and by obliging employers to ensure adequate accommodation for drivers and enable them to return home at regular intervals; revised enforcement requirements, in particular for the rules on the tachograph which controls the driving and rest time of drivers - to improve the efficiency and consistency of enforcement practices; and the sector specific rules on the posting of drivers - to adapt the application of posting rules to the highly mobile nature of the road transport workforce and ensure more uniform and lighter administrative and control measures.

Rail transport

251.The Commission is engaged in dialogue with stakeholders to promote young people and especially young women, who can help replace an ageing workforce. With a budget of EUR 4 million, “Rail supply and transport industries” (including both manufacturers of trains and train equipment and provision of services) is one of the sectors included in the fourth wave of the Blueprint initiative, starting in 2021 177 .

252.Language requirements for train drivers were revised in 2016, to allow the exemption from the B1 level language requirement for train drivers if they only reach the border station of a neighbouring Member State, while ensuring that safety is not be negatively impacted. The sector is currently exploring options such as rail-specific communication terminology, or a lower general language level combined with alternative, electronic means to support effective communication without the stringent language requirements. The European legal framework for train driver licensing and training has been evaluated in 2019, modernisation to meet digital challenges and for creating a level playing field for new rail service operators seems necessary.

253.The Commission has been supporting the sectoral social dialogue committee on railways, which promotes the dialogue between the social partners in the sectors at European level. The committee has put the social impact of automation/digitalisation on its work programme, and carries out activities to anticipate and manage change. The Shift2Rail Joint Undertaking has contracted a study to identify what skills will be most important in the future for different categories of railway staff.

Aviation

254.Maintaining and promoting high social standards was highlighted as a priority in the 2015 Aviation Strategy for Europe ensuring worker protection and a level playing field for airlines. The work done so far in this context lays the ground for any further action necessary to: improve legal certainty for mobile aircrew and airlines; support better enforcement of applicable social and employment law acquis for aircrew; develop and enhance competency-based training; pursue efforts to address social issues in aviation at the international level, including ICAO and the ILO, as well as including relevant provisions in comprehensive air transport agreements with partners worldwide; to establish, in coordination with stakeholders, a human dimension roadmap to accompany the digital transformation in air traffic management.

255.Since the 2000s the EU has also sought to include ambitious social and labour clauses in its aviation agreements with third countries. In some cases, the EU has secured the application of the EU social acquis of relevance to aviation, in particular among those neighbourhood countries with which aviation agreements are in force.

256.To support better enforcement of applicable social and employment law acquis for aircrew, a practice guide was published in 2016 on applicable labour law and competent courts, which is also relevant for the transport sector.

257.In the context of the evaluation of the Air Services Regulation, the Commission services assessed possible unintended social impacts of the legislation, notably on working conditions of aircrews.

258.In March 2019, the Commission published a Report focusing on aircrew which took stock of progress on the social agenda in aviation, also drawing on the findings of a study on aircrew’s employment and working conditions in today's EU aviation market. It outlined concrete actions for a stronger social agenda to be implemented in the short term. It concluded that better enforcement is key to improve the situation for aircrew. The Commission renewed its commitment to support Member States in this. An expert group with Member State experts both from the aviation and employment side of the administration was set up. The conclusions of the expert group will be taken into account when assessing possible options for future action at EU level. In February 2020, the European Platform Tackling Undeclared Work which promotes collaboration between competent authorities organised a seminar to tackle undeclared work in the air transport sector, with a special focus on bogus self-employment of aircrews 178 .

259.As regards ATM, in June 2017, the Commission adopted a Communication on Aviation: Open and Connected Europe accompanied by a Staff Working Document on practises favouring service continuity. An expert group with representatives of the ATM industry and social partners was set up to assess the impact of the Single European Sky in 2019 on staff working practices. A study was launched on the working conditions in the air traffic management sector, the issues air traffic controllers are facing and how things will evolve in the next 15 years or more.

260.The European associations collectively representing the entire European aviation recognised in their report the importance of the social dimension in the EU Pact for Sustainable Aviation. They called for ensuring that social and employment rights enshrined in European and national legislation are applied effectively for all workers and highlighted the particular importance of effective oversight and enforcement of the social acquis. Moreover they called on the industry to ensure secure and fair working conditions, and stressed the need to ensure that the social dialogue structures are used effectively. 179  

Waterborne transport

261.Working and living conditions for seafarers are regulated mainly at international level through the Maritime Labour Convention of ILO (which entered into force in 2013), and are further implemented at EU level through various Directives 180 . Directive 2008/106 181 on the minimum level of training of seafarers, as amended, incorporates into EU law the International Maritime Organisation’s Convention on Standards of Training, Certification and Watchkeeping (STCW) for Seafarers. The Directive applies to seafarers serving on board seagoing ships flying the flag of a Member State. Following a REFIT exercise, it was amended in 2019 in order to legally clarify the scope of seafarers’ certificates mutually recognized by EU Member States, and to raise the efficiency of the EU centralized mechanism to recognize third countries at EU level. Furthermore, Council Directive 1999/63/EC concerning the Agreement on the organisation of working time of seafarers sets out minimum standards for the working conditions of seafarers. In inland waterway transport, Directive 2014/112/EU was adopted to lay down more specific requirements relating to the organisation of the working time taking into account the specificities of this transport mode, in particular that certain categories of workers have not only their place of work but also their accommodation or living quarters on board the vessel 182 .

262.There are also a number of non-legislative initiatives and projects 183 to enhance the attractiveness of the seafarer profession and improve working and living conditions.

263.Directive (EU) 2017/2397, on the recognition of professional qualifications in inland navigation and repealing Council Directives 91/672/EEC and 96/50/EC, was adopted by the European Parliament and the Council. With this Directive, crew members can find work more easily in a cross-border environment as the EU certificates of qualification will be valid on all EU inland waterways. At the same time, the new rules will be built on a modern competence based system that will provide new career prospects and contribute to safety.

264.Within the sectoral social dialogue committee for inland waterways transport, social partners exchange views on issues relevant to the sector, such as the application of horizontal social legislation (e.g. working time and social security) in the IWT sector, as well as developments stemming from EU inland waterways legislation and policies, e.g. development of databases and digital tools for the implementation of legislation concerning professional qualifications.

265.The EU sectoral social dialogue committee in the port sector provides the social partners with a framework to develop a joint approach to the social challenges related to port labour relations, including working conditions, health and safety questions, digitalisation, training requirements and professional qualifications.

Enforcement of the EU transport acquis

Background

266.The Treaties entrust the Commission with the task of ensuring that EU law is properly applied. The Commission’s monitoring/infringement work takes place in the context of the major policy overhaul that was introduced by the 2016 Communication from the Commission on EU law: Better results through better application 184 , which underlines the need for a more strategic approach to enforcement actions.

267.Such enforcement is one of the means to assist Member States in their efforts to implement EU law, and to ensure that they live up to their responsibilities in correctly applying EU legislation. According to the Communication, moreover, the Commission will prioritise its enforcement efforts on the most important breaches of EU law affecting the interests of its citizens and business. The Communication also encourages good cooperation and communication between the Commission and the Member States as a method conducive to reaching compliance at an early stage, rather than having to resort to infringement procedures. The Communication further recalls that the work done to ensure the effective enforcement of existing Union law should be recognised as being of equivalent importance to the work devoted to developing new legislation.

268.The importance of the Commission’s work on monitoring the implementation of EU legislation in the field of mobility and transport was emphasised by President von der Leyen in her mission letter to the Commissioner Vălean, where the need to focus on the application and enforcement of EU law in the field of transport, and the need to take swift action if EU law is breached, were underlined as key objectives 185 . Co-operation with Member States is also encouraged by the President, in particular to support their efforts when implementing EU legislation.

Enforcement of the transport acquis

269.The importance of the transport area translates both into the large number of relevant legislative and non-legislative acts (25% of the EU legislative corpus, including over 70 Directives and 200 Regulations) and the sensitivity of a number of transport issues (such as safety, security, technical standards, social rules and environmental protection).

270.The Commission’s commitment to and proactivity in monitoring the implementation of the transport acquis, often with the support of dedicated Safety Agencies, led over the last decade to its managing of an infringement portfolio of circa 1,800 cases accounting for the Directorate-General for Mobility and Transport (DG MOVE). A large proportion of these cases arises from Member States’ failure to timely notify the Commission of their national implementing measures of Directives (1,000 cases). Complaints by citizens and businesses over the application of the transport acquis also play an increasingly significant role.

271.The Commission’s monitoring initiatives in the area cover notably the non-communication of national measures transposing Directives and non-conformity cases (i.e. cases of incorrect transposition of Directives), as well as the implementation of decisions from the Court of Justice but also address the need to pursue persistent failures in correctly applying EU law and breaches of the fundamental freedoms. In the area of transport, particular attention has been devoted to cases falling under EU policy priorities in this area, such as safety and security, digitalisation and decarbonisation, sustainable/intelligent transport, and the completion of the single market.

272.In recent years, the Commission monitored in particular the national implementing measures aimed at creating a single European rail area. This concerns aspects relevant to competition 186 in this field the regulatory oversight and financial architecture of the railway sector, the power of national regulators, the improved framework for investment in rail, and the fair and non-discriminatory access to rail infrastructure and rail-related services. The Commission has also been very active in monitoring safety rules in road transport (particularly regarding the training of drivers, roadworthiness inspections and safety requirements for tunnels), maritime transport issues (training of seafarers, accident investigations and marine equipment) and aviation (Single European Sky, airport charges, groundhandling and aviation safety technical requirements and administrative procedures).

273.To better monitor the compliance of transposition measures by Member States, the Commission has developed a number of tools to assist Member States transposing and implementing EU law correctly and on time, which include guidance documents, implementation plans, expert groups, explanatory documents, training, organising workshops and holding package meetings.

274.To facilitate the implementation of the transport acquis, the Commission has relied among others on the organisation of workshops in Member States, for instance, with representatives of national and regional competent authorities for the award of public service contracts. In these workshops ex ante interpretative guidance is provided of the relevant provisions of EU law applied to concrete practical questions, thus enhancing legal certainty and administrative capacity.

275.The Commission also organised transport infringement package meetings with Member States (20 meetings in the period 2017-2019) which allowed for dedicated discussions of infringements/EU Pilots and of general infringement policies. By establishing strong communication channels with the Member States, the Commission is able to engage in ex ante and ex post assessments of infringement procedures, to improve its knowledge of national administrations’ transposition and implementation constraints, thus contributing to the swift correction of shortcomings.

State of play regarding mobility and transport

276.At the end of 2019, 1,564 infringement cases remained open at Commission level, of which 203 concerned mobility and transport. Of these infringement cases, 44 concerned the rail sector, 43 road safety, 24 road transport, and the remaining 92 concerned other policy areas (digitalisation, maritime, aviation, sustainable transport, passenger rights):

277.As far as the types of infringements handled by DG MOVE are concerned, between 2015-2019, in broad terms, two-thirds of the infringement cases in the field of transport were opened for non-communication of national implementing measures of Directives (while they account for more than 80% for the Commission as a whole). The remaining cases were opened as own-initiative cases for non-conformity or incorrect application. They are most often the result of a breach of legal obligations (such as absence of reporting, absence of connection to a network, etc.) rather than the operational conclusions arising from a comprehensive overview of the enforcement of the EU transport legislation within the Member States.

278.More than half of the infringement cases (297) handled between 2015 and 2019 by DG MOVE involve safety and security issues. The achievement of the single market and the development of new technologies (digitalisation and alternative fuels) are the other main targets of DG MOVE’s monitoring efforts.

279.The number of contacts established with Member States through the structured problem-solving dialogue tool known as EU Pilot decreased substantially over the 2015-2018 period. The EU Pilot tool was set up as a means to quickly resolve potential breaches of EU law at an early stage without resorting to an infringement procedure. However, in 2019-2020, DG MOVE restarted contacting Member States through EU Pilot, which has a proven record of flexibility and effectiveness.

Figure 13: The use of EU Pilot concerning mobility and transport infringements between 2015-August 2020

280.Finally, DG MOVE receives and handles over one hundred complaints per year (2019: DG MOVE, 161; Commission: 3525) regarding legislation in the field of transport, mostly on incorrect implementation issues relating to passenger rights, public service obligations, recognition of driving licences, market and professional access, port services, and independence and powers of air regulatory bodies.

281.Of the 161 complaints received in 2019, 53 concerned road safety, 28 road transport, 22 passenger rights and 58 concerned other areas.



4Challenges to sustainable, smart and resilient mobility 

The sustainability challenge

282.Transport currently accounts for almost a quarter of all EU GHG emissions (road transport alone is 20% of total) and it is also a major contributor to air pollution, a problem particularly acute in urban areas. Noise pollution remains a major health problem in Europe, with the transport sector being the main cause. Illegal discharges of oily waste, hazardous substances, sewage and garbage as well as underwater noise from ships harm and disturb the marine and river environment. Transport infrastructure also exerts pressure on terrestrial and aquatic ecosystems, in particular from habitats loss, degradation and fragmentation. In total, the external costs of transport related to GHG emissions (direct and indirect, from power generation and well-to-tank emissions), air and noise pollution, and habitat loss due to the transport infrastructure has been recently estimated to amount to about EUR 388 billion/year in the EU-27 187 .

283.Transport is the only economic sector whose GHG emissions are higher than in 1990 and have been growing again since 2013 despite the mitigation efforts already undertaken. On the one hand, this reflects the close link between economic activity and transport as well as the important role that mobility plays in the life of citizens: between 1995 and 2018, the number of tonne-kilometres and passenger-kilometres transported in the EU-27 has increased by more than 30 %.

Figure 14: Evolution of transport activity in tonne- and passenger-kilometres in the EU

Source: EU Transport in Figures. Statistical Pocketbook 2020. Index values based on 1995 = 100.

(1) : passenger cars, powered two-wheelers, buses & coaches, tram & metro, railways, intra-EU air, intra-EU sea

(2) : road, rail, inland waterways, oil pipelines, intra-EU air, intra-EU sea

GDP: at constant year 2005 prices and exchange rates    

                   

284.On the other hand, it also shows that the sector remains overly dependent on oil due to insufficient progress in overcoming technological constraints, in developing and deploying cost-effective clean alternatives, as well as in switching to more sustainable transport modes. This is due to the combined effect of market failures, inadequate market signals, regulatory shortcomings and insufficient policy alignment at various governmental levels, in addition to weak international cooperation. Furthermore, transport is not a uniform industrial sector, but covers various modes operating under very different conditions, which in turn influences their decarbonisation potential.

285.Based on the analysis underlying the 2030 Climate Target Plan and in line with Communication on the European Green Deal, in order to reach the objective of a climate-neutral economy by 2050, a reduction of 90% in transport CO2 emissions must be achieved, relative to 1990 levels. This raises the ambition of the existing target of 60% (from 2011 White Paper) and requires significant efforts compared to developments under current trends and policies (i.e. projected to deliver around 18% emissions reductions by 2050 relative to 1990).

286.All transport modes need to become more sustainable as all are indispensable for our interconnected transport system (see below sections 4.1.1 and 4.1.2). In the meantime, as each mode is in the process of decarbonising, more sustainable alternatives need to be made available now (see below section 4.1.3 and 4.1.4), and there is a need to rethink the incentives for transport users to make more sustainable choices (see below section 4.1.5).

287.This will lead to a transport system in which people and businesses have the freedom to choose their preferred ways of moving or doing business, while making all transport modes cleaner in a technologically neutral manner, and providing the right mix of incentives to support sustainable choices.

Key externalities of transport 188

288.Transport is a key enabling service to the whole economy contributing to economic growth and to satisfy the mobility needs of people. Efficient and accessible transport services are crucial to ensure the connectivity of our societies, from remote areas such as the outermost regions to our largest cities. Yet, transport activities also produce negative externalities to the environment and to society. In the context of pressing environment and climate challenges, updated and comprehensive assessment of the external costs of transport activities are an important aspect to be taken into account by EU transport policy. According to the “Handbook on the External Costs of Transport”, commissioned by the Commission, the external environmental costs of transport (linked to GHG emissions, local air pollution, noise, energy production, habitat damage 189 ), together with the costs of congestion and crashes sum up in the EU-27 to almost EUR 900 billion annually 190 .

289.Road transport causes more than 80% of such external costs (approximately EUR 550 billion in passenger transport and EUR 170 billion for freight). These costs include road crash costs (almost EUR 250 billion), congestion costs (some EUR 230 billion) and environmental costs (almost EUR 250 billion).

290.Other modes cause smaller total external costs than road 191 192 , namely:

·Maritime: almost EUR 90 billion (mostly air pollution)

·Aviation: almost EUR 40 billion (mostly climate change)

·Rail: less than EUR 20 billion (the biggest being noise)

·Inland waterways: around EUR 3 billion (mostly air pollution).

291.The high modal share of road is clearly an important reason for this, but road also shows the highest average external costs across modes (costs per passenger-kilometre and ton-kilometre). Looking at passenger transport, cars show the highest average 193 costs 194 . Buses and coaches, trains and aviation have similar magnitude of average external costs, three to four times less than cars. The lowest external costs are shown by rail: the average costs of aviation and buses and coaches is 10% higher than in rail.

292.As far as freight is concerned, lorries show the highest average costs, followed by inland waterways (roughly 50% less than lorries), rail (roughly two third less than lorries) and maritime (80% less than lorries).

293.The above includes all external costs of individual transport modes, i.e. environmental costs as well as crashes and congestion, with the exception of walking and cycling where data at EU level is not available.

294.It should be noted that road users, while producing the highest costs to the society, are also those who “pay back” the most, in terms of transport related taxes and charges 195 . Overall, road is the mode paying the highest share of its total costs, nearly 50%. However, there are good economic reasons to exclude fixed infrastructure costs from the cost coverage indicators, therefore charging only the marginal infrastructure costs. Excluding them leads to the rail sector showing the highest cost coverage of 80% (with high-speed rail paying even more than it costs to society).

Environmental costs

295.Looking at just the environmental costs 196 , cars and aviation are the passenger modes with the highest external costs. Rail and collective road transport (all buses and coaches) produce the smallest environmental external costs, both in total and per passenger kilometre, with the exception of active modes. Compared with cars and aviation, the level of environmental costs in euro per kilometre is about 30% lower for rail, and 50% lower for collective road transport 197 . On the freight side, lorries have the highest environmental footprint, closely followed by inland waterway transport. On average, rail environmental costs are almost half and maritime almost one third of those of lorries.

296.In 2018, the transport sector contributed 30.5% of the EU-27 final energy consumption 198 . 24.6% of GHG emissions (31.8% above the 1990 levels) in the EU stemmed from transport, excluding international maritime. Including international maritime, the share of GHG emissions was 27.2% in 2018.

297.The share of GHG emissions from transport (including international aviation and maritime) in EU-27 total GHG emissions has increased from 16.5 % in 1990 to 27.2% in 2018. The level of GHG emissions from road transport alone have increased by 26.8% between 1990 and 2018 and accounts for 71.8% of the transport GHG emissions. 199

Figure 15: Share by mode in total transport GHG emissions, including international bunkers, in the EU-27 in 2018 200

Source: Transport in the EU. Statistical Pocketbook 2020. For railways, indirect emissions from electricity consumption are excluded.

298.When looking at GHG emissions from individual modes of transport in the EU, and including international bunkers, the rise in emissions from aviation since 1990 stands out, whereas the railway sector has been the only transport mode to consistently reduce GHG emissions since 1990.

Figure 16: Evolution of GHG emissions by transport mode in the EU-27 (1990 = 1)

Source: European Commission (2020) : EU Transport in Figures. Statistical Pocketbook 2020. For railways, indirect emissions from electricity consumption are excluded.

299.Road transport is by far the mode with the highest total GHG emissions, accounting for around 72% of the total transport emissions. After a decrease mainly caused by the 2008-2009 economic crisis and high oil prices, emissions from road transport started growing again in 2014, at an average yearly pace of 1.5%.

300.Aviation has a much lower share in GHG emission than road transport, but emissions would increase as air traffic is projected to increase in Europe and worldwide. 201 According to the data reported by Members States to the United Nations Framework Convention on Climate Change, the CO2 emissions of all flights departing from EU and EFTA increased from 88 to 171 million tonnes (+95%) between 1990 and 2016. Between 2014 and 2017, average fuel burn per passenger kilometre flown has reduced at an average rate of 2.8% per annum. However, this efficiency gain was not sufficient to counterbalance the increase in CO2 emitted due to the growth in the number of flights, aircraft size and flown distance. During the 2013-2017 phase, the total verified CO2 emissions from aviation covered by the EU ETS increased from 53.5 Mt in 2013 to 64.3 Mt in 2017, equal to an average increase of 4.7% per year. Beyond CO2, although more research is needed to fully understand the non-CO2 climate impacts from aviation activities, these have recently been estimated to be at least as important in total as those of CO2 alone. The Commission has provided and updated analysis of the science and potential policy measures to address these non-CO2 drivers of climate change. 202

301.EU waterborne transport consists of two very distinct segments: international shipping (ships calling from third countries in EU ports and sailing between two EU Member States) and inland navigation (ships sailing within the same EU Member State, including inland waterways). GHG emissions from inland navigation are subject to the EU Effort Sharing Regulation. Member States have to implement measures to fulfil the Union’s target of reducing its GHG emissions by 30% below 2005 levels in 2030 in these sectors.

302.Data collected from the EU MRV system 203 confirmed that CO2 emissions from maritime transport are substantial, with over 138 million tonnes of CO2 released into the atmosphere in 2018. This represents over 3.7% of total EU-27 plus UK CO2 emissions. While compared to other modes of transport, maritime transport remains the most carbon efficient mode of transport per ton km, the reported CO2 emissions in the EU, based on the fuel sold and also accounting for the inland and domestic navigation, make up around 14% of the total transport CO2 emissions.

303.The EU's CO2 emissions from inland and domestic navigation 204 are about 16 million tonnes of CO2 and have decreased over time (about 26% below 1990 levels). This decrease is related to the renewal of the fleet, increase in energy efficiency (EU standards for inland waterways have been put in place since 2003).

304.On the contrary, CO2 emissions from the EU-related international shipping (i.e. from ships calling to EEA ports from third countries and ships sailing between 2 or more EU Member States) have continued to increase, and are currently around one third above 1990 levels. This increase is primarily driven by the growth in transport activity and the current heavy reliance on oil derivatives despite the uptake of energy efficient technologies.

305.Direct GHG emissions from rail transport are very low, due to the majority of traffic running on electrified lines, representing only 0.4% of transport emissions. On this basis, shifting substantially more passengers and freight to rail would significantly contribute to decarbonising transport.

Air pollution

306.Transport is responsible for more than half of all nitrogen oxides (NOx) emissions and significantly contributes to the total emissions of the other air pollutants. The situation has improved though compared to the past. NOx emissions from road transport decreased by 37% between 2007 and 2017 (non-road transport: -20%). 205 During the same period, emissions of total particulate matters that have diameter less than 2.5 micrometre (PM2.5) by road transport decreased by 42%, in non-road transport the decrease was 28% in the same timeframe 206 . Sulphur oxides (SOx) emissions from road transport and non-road transport were 70% and 60% lower in 2017 than in 2007, respectively.

307.SOx and NOx are known to be harmful to human health since they are precursors of PM pollution and ozone, causing respiratory symptoms and lung disease. In the atmosphere, SOx can lead to acid rain, which harms crops, forests and aquatic species, and contributes to the acidification of the oceans. NOx deposition in the oceans and seas induces eutrophication, which together with acidification, is a severe pressure on marine biodiversity.

308.The contribution of road transport to harmful NOx concentrations is particularly problematic in urban areas, because emissions occur close to the ground and mainly in densely populated areas. In “street canyons”, i.e. streets enclosed by a high density of usually tall buildings and high levels of road traffic, NOx emissions can be very high, leading to exceedances of air quality standards. 95% of the EU urban population remain exposed to pollutant concentrations above WHO air quality guidelines 207 and majority of EU Member States are in breach of the Union air quality legislation.

309.While gaseous emissions from transport are mostly arising from fuel combustion, other releases contribute to both non-methane volatile organic compounds (NMVOCs) (from fuel evaporation) and primary PM pollution, namely from road transport - exhaust and non-exhaust (from tyre- and brake-wear, and road abrasion). Combustion engines remain a significant source of transport nanoparticles. The relative importance of non-exhaust emissions for the larger sizes of particles has increased since the introduction of vehicle particulate abatement technologies, which reduced exhaust emissions 208 for some types of vehicles.

310.Maritime transport also contributes significantly to air pollution in Europe 209 as ship combustion generates SOx, NOx and particulate matter. Even though international and EU legislation has lowered the allowed sulphur content of marine fuels, these continue to contain more sulphur than fuels used on land. NOx reducing engine standards or retrofits are also much less stricter. 

311.Air transport also contributes to air pollution especially in the vicinity of airports. More precisely air quality is influenced not only by the emissions from aircraft engines, but also from other sources such as ground operations, surface access road transport and airport on-site energy generation and heating. The most significant emissions related to health impacts from aviation activities are particulate matter (PM), nitrogen oxides (NOx) and volatile organic compounds (VOCs) 210 . The ICAO technical design standards limit emissions of NOx, carbon monoxide (CO) and unburnt hydrocarbons (HFC) 211 . The general EU air quality legislation 212 establishing limit values for the certain pollutants (mainly NOx and particulates in the case of aircraft emissions) also applies at and around airports.

312.Black Carbon 213 is of great relevance for the EU in view of the on-going developments of the EU's air quality policy and the interlinkages to EU climate change policy. EU legislation addresses Black Carbon in the Directive 2008/50/EC of the European Parliament and of the Council on ambient air quality and cleaner air for Europe by setting binding air quality standard requirements on PM10 and PM2.5 214 . Although the Directive excludes PM emissions from international maritime shipping, future reductions of PM emissions from maritime transport due to the reduction of sulphur content and uptake of alternative fuels will contribute to a decrease of long range transboundary air pollution affecting background concentrations of air pollution in the EU. The joint Communication by the Commission and the High Representative of the Union for Foreign Affairs and Security Policy 215 on An Integrated European Policy for the Arctic of April 2016 outlines that the EU should contribute to international efforts to limit emissions of short-lived climate pollutants such as black carbon and methane that further accelerate climatic changes in the Arctic 216 .

Noise pollution

313.Noise pollution is the second largest health problem due to transport in the EU, with road traffic being the most widespread source of environmental noise. An estimated 120 million Europeans are affected by noise levels dangerous for health, mostly from road transport, above the recommended WHO levels 217 . 48,000 new cases of ischaemic heart disease are causes each year by transport, and 6,500,000 citizen have their sleep heavily disturbed 218 . It is also harmful to nature and certain eco-systems exposed to it 219 .

314.Transport related noise generates an external cost of about EUR 60 billion in the EU-27. 220 According to the latest data reported under the Environmental Noise Directive 221 , around 100 million people in the EU are exposed to average sound levels of 55 dB or higher during the day, evening and night for road traffic noise, 20 million for railway noise and 4 million for aircraft noise. Similarly, road traffic is by far the biggest source of environmental noise during night time, affecting around 75 million people, followed by rail with 15 million people, air with 1.5 million people and industrial noise with 0.5 million people. While aircraft noise does not affect a wide geographical area, it causes more stress and disrupted sleep than road or railway at the same noise levels. 222

315.Although modern electric passenger trains running on well-maintained track are relatively quiet, older freight wagons equipped with cast iron brake blocks can generate a significant noise issue, in particular since many freight trains are operated at night. This is a public health and political concern in some Member States, and leads to substantial opposition to increases in rail freight. Retrofitting of freight wagons with composite brake blocks (replacing cast iron brake blocks) is the most efficient way of addressing the matter 223 , 224 . The banning of “noisy” freight wagons from the busiest rail freight routes from December 2024 as a result of the revised Technical Specification for Interoperability for Noise will largely address the European dimension of the issue.

316.In spite of technological improvements which have made aircraft less noisy, the problem of aircraft noise in the EU has continuously increased in the past years. This is due to the continuous overall growth of air traffic in Europe as well as the expansion from population affected by aviation noise, linked to demographic growth and weak land use planning. Noise from aircraft is the third largest source of noise pollution affecting EU citizens, and research shows that people perceive noise from aircraft as more annoying than noise from road or rail, at the same noise level exposure. It is estimated that in 2017, more than 2.5 million EU citizens were subject to 55 dB noise level from aircraft, an increase of 12% as compared to 2005. With the expected continued overall growth of air traffic in Europe in the next decades - generating more flights in particular at medium size airports, the total population affected by critical noise levels from aircraft will likely further increase, especially at regional airports. Aircraft noise at night time is also a growing concern. In 2017, around 1 million EU citizens were exposed to at least 50 dB aircraft noise levels at night, an increase by 13% as compared to 2005.

Water pollution

317.According to a recent report from the European Environment Agency 225 , the increased threats posed by overexploitation of marine resources, pollution and climate change call for urgent action to bring Europe’s seas back to good condition, and we are running out of time to reverse decades of neglect and misuse.

318.Illegal discharges of oily waste, hazardous substances, sewage and garbage from ships harm the marine & river environment. The use of antifouling agents for ship paint is another source of emissions of toxic substances, generally organic pollutants, metal-organic compounds or heavy metals. In maritime transport and inland waterways, waste water and ballast water leads to the pollution of seawater, lakes or rivers. The emissions mainly occur in ports but also affects inland waterways, and can lead to substantial water and sediment pollution 226 .

319.In inland navigation there is no common rule at EU level on protecting rivers against wastes from vessels. The absence of a policy and regulatory framework creates a “gap” in relation to the protection of waters and it would require close cooperation with relevant international organizations to address this.

320.Maritime transport and tourism (cruises) can also be a significant source of plastic pollution, as demonstrated also by its accumulation along shipping routes. The accidental loss of 342 containers in 2019 in the North Sea and the resulting waste dissemination is another case in point. The EU is aware of the problem and, further to adopting a new Directive on Port Reception Facilities focused on reducing litter from shipping and fishing as a follow-up of its Strategy for Plastics and the Circular Economy Action Plan, is considering additional initiatives to tackle sea-based sources of marine litter, including microplastics, in close cooperation with international partners and other relevant initiatives, notably the IMO Action Plan to address marine plastic litter from ships.

Biodiversity loss

321.Transport can also cause several significant negative impacts on ecosystems and biodiversity. The design and use of road, rail and waterborne transport infrastructure alters the quality and connectivity of habitats and can create physical barriers to the movement of plants and animals between habitat areas. Species can be injured or killed by vehicles, become isolated by habitat fragmentation or incapable of fulfilling their life cycle, lose their habitat, or exhibit behavioural changes that put their survival at risk, such as feeding on or near roads, or changes in migratory behaviour including for migratory fish, which can prevent them from reproducing and consequently exerts high pressure on the survival of populations. Fragmentation of rivers and deterioration of their hydrological and morphological conditions is one of the main pressure affecting freshwater in the EU. Barriers in rivers can also prevent the flow of sediments and consequently affect downstream water bodies. The development and use of transport infrastructure can also increase pollution levels in surrounding habitats.

322.Noise and light pollution can affect the breeding success of many species of birds and mammals (e.g. bats) as well as their feeding, migration and wintering needs. Noise from ships can alter the capacity of fish and marine mammals to locate themselves, their capacity to search for food and to escape from predators.

323.Furthermore, transport infrastructure and vehicles can serve as a vector for the spread of invasive alien species (through hull fouling, ballast water in relation to maritime and inland waterways transport, stowaway species attached to vehicles, infrastructure facilitating dispersal of species across physical and environmental barriers (e.g. a mountain range now crossed by a tunnel, new canals etc.). 227 Invasive alien species have significant impacts on native species through competition, predation, etc., may cause alteration and/or loss of native habitats, or even impact overall ecosystem functioning.

324.The loss and fragmentation of habitats through land use for transport infrastructure are estimated to amount to EUR 37 billion annually at EU-27 level. 228  The biggest share of these costs is produced by road infrastructure. However, railway infrastructure also tends to have a high impact on habitat, as well as inland waterways.

325.Transport activities lead to other negative impacts on soil and water through abrasion of brakes, tyres, road surfaces and rail track (road, rail). Tyre abrasion in particular is one of the largest sources of microplastics, ending up in the food chain. Finally the deposit of combustion emissions from air onto land and into water may be the cause of severe instances of eutrophication and acidification hampering linked biodiversity.

Insufficient physical activity

326.Over-reliance on individual cars, in particular in urban areas, is linked with insufficient levels of regular physical activity for adults and children, and related health problems, including premature deaths 229 . A review of 28 health impact studies related to greater active transport and less car use found people who switched from using a car to active transport received substantial health benefits from increased physical activity. This benefit well outweighed any risks cyclists or pedestrians might experience from exposure to air pollution or being involved in motor vehicle crashes 230 . Being physically inactive is associated with many non-communicable diseases, such as cancer, cardiovascular diseases, overweight/obesity, dementia, type 2 diabetes and stress and anxiety. One study found that people who get insufficient exercise have a 20-30% increased risk of all-cause mortality compared with people who exercise for 30 minutes a day. The European Code against Cancer 231 , an initiative of the European Commission, informs individual citizens about actions they can take for themselves or their families to reduce their risk of cancer. The Code calls for people to be physically active in everyday life and to limit the time spent sitting.

327.Walking and cycling (combined with public transport or shared mobility if necessary) provide the opportunity for city dwellers, particularly those who do not have time for other exercise, to incorporate more physical activity into their daily routines 232 . The Commission’s sustainable urban mobility planning (SUMP) concept and published guidelines provide an appropriate approach to facilitate active mobility in cities. In addition, the WHO’s Health Economic Assessment Tool (HEAT) 233 estimates the value of reduced mortality that results from regular walking or cycling and should be part of comprehensive cost–benefit analyses of transport interventions or infrastructure projects, in particular at urban level.

Degradation of public space

328. Road and parking infrastructure for individual cars contributes to soil sealing and takes up valuable space that could be used to create green areas as well as pedestrian and cycling infrastructure, which are beneficial for people’s physical and mental well-being 234 . The average car is parked more than 90% of the time. 235 In addition, the COVID-19 pandemic has highlighted the issue of distribution of public space in favour of motorised traffic: with cars accounting for ~30-40% of journeys and occupying ~70-80% of public space in European cities, there was often insufficient space left for people to walk and cycle whilst complying with social distancing requirements.

329.While visual pollution per se is a lesser concern than safety or noise, in the future it is possible that frequent sighting of remotely-piloted or autonomous aircraft in the sky, in particular in urban environments, may negatively impact social acceptance of their operations, and heighten concerns, justified or not, about privacy, safety or security. Therefore public acceptance is key for new technologies such as drones and Urban Air Mobility.

4.1.1Zero- and low-emission vehicles and renewable and low carbon transport fuels 

330.Transport modes prevalent for our mobility and transport must be sustainable for the objective set in the Communication on the European Green Deal is to be attained. To achieve this, it is necessary to boost the production and uptake of low- and zero- emission vehicles, vessels and aircraft, supported by renewable and low-carbon fuels for road, waterborne, air and rail transport. There is need to ensure that the sustainable vehicles and fuels are supplied by the industry, put in place the necessary infrastructure, and incentivise demand by end-users. It will also be necessary to support research and innovation on competitive and future-proof technologies, products and services.

331.The European Green Deal stresses the need to ramp up production and distribution of renewable and low carbon fuels. It notes the relevance of complete alternative fuels connectivity throughout the EU and sets the objective of having 1 million public recharging and refuelling points in place by 2025.

332.This is because EU-27 transport still relies on oil for about 93% of its energy needs. Most energy consumed in road, air and waterborne transport is fossil fuel based. Road transport depended on oil products for 94% of its energy use and rail transport for 23% in 2018. While air transport relies only on kerosene, inland navigation uses few types of fuels, but all petroleum based. International shipping is capable of using a variety of oil based fuels, mainly heavier fuel oils due to their lower cost. In addition a few ships use liquefied natural gas fuel because of its lower pollution characteristics. The total EU oil import bill is estimated at EUR 227.5 billion in 2018 236 .

Figure 17: Evolution of final energy consumption by sector in the EU (million tonnes of oil equivalent) 237

333.After reaching its peak in 2007, oil consumption in transport (including international aviation and maritime) reduced by 12.2% during 2007-2013 (-2.1% per year). Since 2014, oil consumption has been following an upward trend at an average rate of 1.9% per year. The growth in transport activity, the shift towards larger cars and the low oil prices were the main reasons for the increasing energy consumption.

Figure 18: Transport sector consumption of petroleum products & biofuels, 2000-18 238

Source: Eurostat Energy Balances

334.Until 2017, the average fuel efficiency of new light duty vehicles has been improving over time and this has helped to improve the fuel economy of the whole fleet. However, a rise in registrations has been observed in the past years in the sports utility vehicle (SUV) segment. In comparison with other car types, SUVs tend to have characteristics such as large frontal areas, greater mass and higher drag coefficients that have a negative impact on fuel consumption. Following the “Dieselgate” affair of 2015, there has also been a marked shift toward gasoline cars which traditionally have had lower fuel efficiency than diesel ones 239 . These trends have contributed to an overall increase in average fuel consumption and CO2 emissions of the new passenger car fleet. In 2019 (provisional data), new cars registered in the EU, UK, Norway and Iceland had average CO2 emissions of 122.4 g CO2/km (4.3 g/km higher than in 2016).

335.The sales of plug-in hybrid electric passenger vehicles (PHEV) 240 and battery-electric passenger vehicles (BEV) in the EU have steadily increased over the past years. According to incomplete 2020 data from the European Alternative Fuels Observatory, the EU vehicle fleet currently includes around 1.7 million battery-electric and plug-in hybrid light duty vehicles 241 (Category M1 and N1). This is more than four times more than in 2015 (about 280,000). The size of the light electric vehicle fleet also exceeded 157,000. Registration of electric powered-two-wheelers (e-PTWs) have been rapidly growing in Europe 242 . However, electric vehicle deployment is still uneven in the Union. In 2019, the Netherlands (15.2%) and Sweden (5.1%) were the only Member States with comparatively higher market share for electric cars in new vehicle sales, while in 2020 more Member States are witnessing higher growth rates.

Figure 19: Number of BEV and PHEV passenger cars in 2020

 

Source: European Alternative Fuels Observatory 243

336.As regards Compressed Natural Gas (CNG) light-duty vehicles, Italy was the Member State with the largest fleet (close to 1.1 million), whereas fleets in other Member States were considerably smaller. The light-duty vehicle fleet fuelled by CNG in the whole EU has increased slightly since 2015, from about 1.2 million vehicles to 1.36 million vehicles.

337.Heavy-duty vehicle fleets in the bus and coach segment included approximately 20,000 CNG/Liquefied Natural Gas (LNG) buses and coaches, approximately 2,200 battery-electric buses and around 100 hydrogen buses. Zero-emission buses are rapidly growing in importance, also due to the requirements of the revised Clean Vehicles Directive. In 2019, 15% of all new bus registrations were alternatively-powered vehicles, according to ACEA. Concerning heavy-duty road freight transport, natural gas currently represents the main alternative fuel, with approximately 24,000 CNG and 4,000 LNG lorries in operation in 2019. While zero-emission lorries are still in an early stage of market development, demonstration fleets of electric lorries for regional use profiles are already in operation.

338.In addition to various national and European support schemes and measures to boost R&I towards clean vehicles such as the successful European Green Vehicles Initiative, the European CO2 standards have been the key driver of the uptake of the low and zero-emission light-duty vehicles. 

339.Current CO2 emission performance standards require average CO2 emissions from new cars and vans to be respectively 37.5% and 31% lower in 2030 compared to 2021; in the case of lorries, average 2030 CO2 emissions must be 30% lower than the 2021 baseline. For all three categories, emission reductions of 15% are required by 2025. These standards will further drive low and zero-emission vehicles in the market.

340.While rail is already largely electrified, it is not economic to electrify some parts of the network (e.g. rural branch lines or production site feeder lines), while it is difficult or impossible for others (e.g. parts of ports where catenary would interfere with cargo handling). Hydrogen, and battery electric rolling stock would allow the elimination of remaining diesel operations. Such alternative fuels powered trains, whose development is supported by Shift2Rail Joint Undertaking and Fuel Cells and Hydrogen Joint Undertaking (FCH JU), can bring rail to zero direct CO2 emissions, decrease air pollution, and improve rail’s multimodal performances (hybrid locomotives 244 can switch from an electrified line to a terminal eliminating the need for additional shunting locomotives).

341.Substantial emission reduction has been achieved in the aviation sector by improving the fuel efficiency of aircraft engines and design. The sustained policy and industrial efforts to improve aviation sustainability have allowed to reduce noise from aircraft and fuel burn per passenger by respectively 14% and 24% between 2005 and 2017. However, the overall sustained growth of air traffic (+60% over the same period) has continued to outpace the environmental improvements. Substantial public and private investments and adequate policy frameworks are needed to accelerate the decarbonisation of air transport.

342.New aircraft models provide 20% to 25% of improved fuel efficiency compared to the previous generation. 245 Promoting fleet modernisation by an earlier retirement from circulation of old aircraft and their replacement with a significantly more fuel-efficient aircraft can generate significant CO2 per each flight in the transition until breakthrough clean aircraft are developed and commercially available for deployment. Ensuring the capacity of European industry to increase the environmental performance of aircraft would have an important impact on the greening of global air transport as European aircraft today represent 45% of the worldwide commercial fleet and European engines power 70% of single-aisle aircraft in the world.

343.In the longer-term, new disruptive technologies need to be developed and deployed in the market, notably to unleash the full potential of sustainable fuels and otherwise provide for new clean methods of propulsion and power generation in aircraft.

344.This requires considerable investment in research and innovation, such as envisaged under the Horizon Europe programme by the proposed set-up of a Clean Aviation partnership with the aviation industry and further investment in collaborative research in clean aviation technology. The partnership should follow in the footsteps of the Clean Sky Joint Undertaking, which had a participation of 1.7 billion EUR from the EU budget 246 . The priority focus should be on the development of technologies that can generate the largest impact on overall aviation emissions, notably hybrid and full electric prolusion, ultra-efficient aircraft configurations, and the development of sustainable alternatives such as the emerging potential of hydrogen powered aircraft. Accompanying measures would be necessary to develop infrastructure and production capacity for hydrogen.

345.The stimulus for the development of new technologies should be seen in conjunction with the measures taken relating to innovation, production and deployment of sustainable aviation fuels (SAF). This is because in order to decrease significantly its emissions, the aviation sector will especially need to rely on the use of liquid SAF in the years to come. Indeed, whereas other transport modes have access to various sources of energy including renewable energy, aviation is still almost exclusively reliant on liquid fossil fuel, due to the physical properties of flying.

346.Concerning the nature of waterborne transport and the availability of alternative fuels in particular, it is important to distinguish between transport on sea (maritime) and inland waterways. The main distinction in maritime transport is to be done between deep sea shipping (long distance and high energy density requirements) and short-sea shipping, incl. domestic voyages (shorter distances with more technological alternatives available due to the nature of traffic, regular port calls, etc. requiring therefore a lower energy density).

347.The environmental challenges faced by the maritime sector impose to continue improving the energy efficiency of the fleet, the rapid advancements in the development and deployment of innovative low or zero emissions technologies and the widespread use of sustainable alternative fuels 247 . This requires the cooperation of all actors in the maritime sector: fuel suppliers, vessel and engine manufacturers, shipping operators, port authorities and service providers, etc. in particular to demonstrate commercially viable zero-emissions vessels by 2030. Whereas various technologies, including the use of hydrogen or electric propulsion, are being successfully tested for short journeys, the situation is more complex for deep-sea shipping, which has significantly higher power needs, requires much greater autonomy and the availability of global network of refuelling stations.

348.The Commission is preparing the “FuelEU Maritime” initiative, with the aim to deliver a legislative proposal at the beginning of 2021 to boost the demand for renewable and low carbon fuels in maritime transport. Reduction of GHG emissions from international shipping is also being addressed at global level at the International Maritime Organization (IMO) and the EU is one of the key drivers of the IMO’s work in this area. The agreement at IMO on new mandatory measures setting carbon intensity performance targets for all existing vessels has been reached in November 2020 248 . The new measures add further requirements to existing energy efficiency measures, which state that all vessels must put in place the so-called Ship Energy Efficiency Management Plan (SEEMP) to demonstrate their efforts to improve ship’s energy efficiency and all vessels built after 2013 must abide by compulsory energy efficiency standards (the Energy Efficiency Design Index, EEDI). In parallel, preparatory work has commenced to support the uptake of alternative low- and zero-emission fuels in shipping, with the EU advocating a lifecycle (well-to-wake) approach to GHG emissions.

349.In accordance with the first EU Annual Report on Carbon Dioxide Emissions from Maritime Transport (data collected in 2018 in the framework of the MRV regulation), more than 90% of all monitored ships have reported the use of heavy fuel oil (HFO). In terms of amounts of fuel consumed, HFO represented a little more than 70% of the fuel consumed by the monitored fleet in 2018. Gas oil accounted for only 10% of the total fuel consumed and another 10% was covered by light fuel oil and diesel oil taken together. The global limit on sulphur in marine fuel has been reduced which means that more of these cleaner fuels are likely to be used. These types of low sulphur fuels are generally used for auxiliary engines and boilers when ships are berthing in EU ports or during the operation of a ship in SOx Emission Control Areas (SECAs). The use of Liquefied Natural Gas (LNG) represents only 3% of the total amount of fuel consumed. It is mostly used by LNG and gas carriers. Even though the number of LNG-fuelled vessels continued to increase in 2019 across all ship types, these remain a very small fraction of the fleet. In accordance with DNV GL’s Alternative Fuels Insight database, the total number of commissioned LNG ships worldwide has just passed the threshold of 300 in 2019 with about half of them already in operation and the remaining ones on order.

350.At present, there is yet no consensus on the most realistic pathway to decarbonise the maritime sector as a number of fuel/technology combinations could become more competitive over time. In addition, the solutions are likely to be different for individual ships, different ship types and market segments. The key objective is to support the fuels that lead to the most GHG emissions reduction from a “well to wake” perspective, while being sustainable, available at sufficient scale in the mid and long term, safe and affordable. On the short-term, advanced biofuels and biogas are likely to be the first sustainable alternative fuels available to shipping companies.

351.While LNG delivers significant air quality benefits compared to other fossil fuels (reductions in SOx, NOx and PM emissions), it remains a fossil fuel and present limited advantages in terms of GHG emissions. It is therefore important to continue supporting a broader basket of fuel and technologies including electric/hybrid propulsion, advanced liquid biofuels, bio-LNG, liquid and gaseous synthetic fuels as well as the use of hydrogen. Support measures should aim at boosting demand for them, their production and distribution.

352.Due to the nature of the sector, the situation for inland waterways is similar to short-sea shipping (availability of network infrastructure, lower power requirements) and alternatives can be developed and deployed more quickly (including for instance with regards to electricity, and hydrogen). In 2018, more than 15,000 inland cargo vessels were registered in Europe. Looking at the vessels’ age structure, inland navigation fleet is relatively old: the majority of vessels were constructed before 2000 and before 2003 there were no provisions for the emission limits from engines used in IWT.

Figure 20: Number of inland vessels per year of construction in the Belgian and German fleet

Source: CCNR based on German Waterway and Shipping administration, Belgian Ministry of Transport. Included are dry cargo vessels, liquid cargo vessels and push&tug boats.

Figure 21: Number of inland vessels per year of construction in the Danube countries

353.There has been a slow innovation uptake concerning greening in the IWT sector. The relatively slow pace of innovation is mainly caused by:

·the long serviceable lifetime of engines in inland vessels (30,000 to over 200,000 hours, depending on the engine type) which translates to ca. 40 years of operation;

·the small and specific market for inland vessels and their engines, making it a less attractive market for engine manufacturers;

·the lack of incentives for vessel operators/owners to increase the environmental performance of the engines;

·The lack of information on existing possibilities for greening, in particular regarding their consequences for actual emissions (and how they relate to possible emission regulation) and the business case of the vessel operators/owners.

354.The number of newly built and repowered vessels in the EU is limited to several dozen per year. Compared to other shipping markets, inland market potential is low and the emission limits are the most stringent. International engine manufacturers thus often prioritise their development capacity for engineering engines for markets with greater sales potential. This hinders the modernisation of the powertrains in the European fleet.

355.Whilst potential solutions to enable clean climate neutral shipping exist, these are largely premature and investment in research and innovation, such as envisaged under the Horizon Europe programme through the establishment of the Zero Emission Waterborne Transport partnership, is required. It is envisaged that the partnership focus on decarbonised clean shipping and seek to demonstrate deployable solutions, appropriate for all main ship types by 2030. Addressing efficiency improvement, electrification, renewable energies such as wind, take up of new fuels such as hydrogen within new and retrofitted marine and inland waterway ships.

Fuel supply

356.The deployment of vehicles, vessels and aircraft as well as infrastructure and services needs to happen everywhere in the EU, in an interoperable manner. However, there are a number of issues that prevent the uptake of sustainable transport fuels: limitation of appropriate supply, lack of a suitable refuelling/recharging network and low or fragmented demand for the sustainable fuels and vehicles/vessels, influenced also by pricing and tax regimes.

357. The lack of appropriate supply is particularly relevant for certain fuels, namely sustainable biofuels, e-fuels, clean hydrogen, and biogas. Apart from electricity from renewable sources there is still considerable lack of availability of renewable energy sources for transport: the EU share of renewable energy in transport reached 8.3% in 2018 249 .

358.Air and waterborne transport must have priority access to sustainable liquid and gaseous fuels, since suitable alternatives do not exist for these modes, and these fuels are the furthest from mass production and use.

359.Sustainable aviation fuels (SAF) are fully compatible with current aircraft technology and already certified up to 50% of the fuel used in a flight. Although they have the potential to make an important contribution to tackling GHG emissions in aviation (emission savings can go up to 80% compared to conventional jet fuel), this potential is still largely untapped. Current production and use of SAF is below 0.1% of total jet fuel consumption in the EU. While the Renewable Energy Directive and the EU Emissions Trading Scheme contain some mechanisms intended to reward the use of SAF, these measures have so far limited impact to boost SAF supply and demand.

360.As a concrete deliverable of the European Green Deal, the Commission is preparing the “ReFuelEU Aviation” initiative, with the aim to deliver a legislative proposal at the beginning of 2021 to boost the sustainable aviation fuels market. Several Member States also intend to promote SAFs in their national legislations (such as Finland, France, Germany, the Netherlands, Spain and Sweden).

361.Sustainable advanced biofuels are not produced at scale, and most biofuel consumption happens at a low percentage blending with conventional fuels. Power-to-liquid and power-to-gas fuels from renewable sources are available only at demonstration scale. While there could be sufficient demand for all types of sustainable transport fuels catering for all the key products along the refining process, there is still a lack of investments in production capacity, also due to limited sustainable production. Volumes are limited and the resulting product price is not competitive with the fossil-based alternatives, even factoring in the carbon price and other existing incentives. In a vicious circle, the resulting lack of demand at such prices does not trigger the necessary investments in feedstock renewable electricity production and refining capacity that could bring about the required economies of scale. A long-term policy framework with strong incentives and closer industrial cooperation appear therefore necessary to break this circle and boost confidence for major investments, particularly for those transport modes that have no other technologically-viable and proportionate current decarbonisation alternative.

362.These issues also affect waterborne and long-distance heavy-duty road transport. While battery- and fuel-cell electric vehicles already represent a viable option for buses and for urban and regional delivery vehicles, alternatives to diesel for long-haul lorries and coaches are not yet widely available. Battery- and fuel-cell electric long-haul lorries and coaches are now in market development, with 331 battery-electric new registered heavy goods vehicles (N2 and N3 categories) in 2019, with larger numbers expected on the EU markets in the next 5 years.

363.On the other hand, LNG vehicles would require significant efficiency improvements in order to meet the required CO2 emission targets in 2030 and would need to find solutions to significantly reduce the emitted air pollutants. Synthetic fuels and biogas, that may have very high cost and renewable energy production needs are not available at scale either, and similarly to sustainable advanced biofuels, they also require fully addressing the issue of urban air quality. Shipping can be flexible in the types of deployable advanced biofuels and may be able to use lower cost fuel options which would not be deployable in other transport modes. An example is bio-ammonia, which however, is an extremely hazardous substance and would have to be handled accordingly.

Fuel infrastructure

364.Equally significant is the challenge that the lack of a suitable network of recharging and refuelling infrastructure poses. Two-thirds of EU cars park overnight on the street or in public car parks 250 . There are in particular four issues in relation to this:

1)While there has been considerable progress in some Member States, there are still not enough recharging and refuelling points in all Member States and for all modes. While the formal requirements of the Alternative Fuels Infrastructure Directive 251 (whereby Member States have to adopt a policy framework for the development of the market as regards alternative fuels in the transport sector and to make sure that an “appropriate number” of recharging or refuelling points are available) appear to be fulfilled, infrastructure planning under national policy frameworks in many Member States risks not to be in line with the required update of zero and low-emission vehicles and infrastructure needed to meet the increased ambitions under the European Green Deal.

2)There is no comprehensive network connectivity across borders and modes with minimum coherence in the EU. Recharging and refuelling points are distributed unevenly among Member States and within single Member States. Consumers and businesses also perceive the uneven development of different alternative fuel recharging and refuelling stations as a barrier in acquiring or investing in vehicles powered by alternative fuels.

3)Users of an alternative fuels road vehicle often face problematic conditions for using that infrastructure, particularly when departing from their home fuelling/recharging model. This is particularly relevant in the area of electric mobility, where there is a lack of coherent and transparent user information on availability, accessibility and usability of recharging stations as well as a broad variety of approaches to using and paying at these stations, in particular for cross-border users.

4)If not managed in a smart way, there is a risk that the rapidly increasing fleet of electric vehicles may lead to congestion in the electricity grid, in particular at peak times and at distribution level 252 .

365.To illustrate the first issue, in 2019, the territory of the EU hosted more than 200,000 publicly accessible filling stations 253 for alternative fuels, out of which about 194,000 were electric charging points, including around 22,000 fast-charging points. There are also 125 fuelling stations for hydrogen, as well as almost 4,000 filling stations for natural gas, out of which 249 LNG refuelling stations, and 34,000 LPG filling stations available. 254  

366.Whereas the number of alternative fuel filling stations has increased since 2011, the number of electric vehicles per charging point is increasing too: on average, one charging point serves seven vehicles. 255  However, the situation of recharging/refuelling infrastructure differs across EU countries. As Figure 22  shows, the infrastructure is not spread evenly, and parts of the EU transport network are not well equipped. Hydrogen refuelling infrastructure is still thinly spread with up to 125 stations (with a large concentration in Germany). It is clear that in view of the expected acceleration of electric vehicle ramp up, the pace of infrastructure roll out needs to increase: the European Green Deal set the indicative target of 1 million public recharging and refuelling points by 2025.

Figure 22: Situation of the publicly accessible recharging points in 2018 across EU 256

Source: EAFO

Other incentives

367.In recent years an increase in average CO2 emissions of new vehicles has been observed, together with a diverse, but still low, share of low and zero-emission vehicles among Member States. With this respect, the CO2 emission standards will drive manufacturers to invest in zero and low emission vehicles, to accelerate their deployment.

368.Several experiences across different EU Member States and third countries show that reducing registration and vehicle taxes for those vehicles is a very effective means of triggering consumer demand, in addition to other demand-side incentives such as energy taxes, company car taxation 257 , scrappage and purchasing schemes and premiums, purchase subsidies or favourable infrastructure charges, etc. CO2-based road charging as set out in the Eurovignette Directive currently under negotiation would be an important incentive for greening fleets.

369.Additional policy measures could promote the uptake of zero emission vehicles and sustainable fuels. Public procurement can play a key role in particular in those segments – such as buses and fleets – where it represents a major share of the market. For example the pooled procurement by several cities of clean and safe vehicles (buses, refuse collection vehicles etc.) along with financial support for infrastructure measures and retrofitting of vehicles, for instance with turning assistants could be instrumental.

370.Concerning public transport in particular, the Clean Vehicles Directive 258 and the Clean Bus Europe Platform will help the transition towards low- and zero-emission options. By requiring a minimum share of public procurement of cars, vans, lorries and buses to be covered through clean (and zero-emission) vehicles, the Clean Vehicles Directive will help mobilise this potential in the period 2021-2030. The Directive must be transposed by August 2021, and it sets ambitious targets for two five-year periods (2021-2025 and 2026-2030). Post-2030 targets will be set as part of a 2027 revision.

371.In addition, given the significant additional costs of zero-emission solutions available for long-distance lorries, the adaptation of the Weights and Dimension Directive 259 for allowing zero-emission heavy-goods vehicles additional weight and dimensions on freight tonnage could increase the competitiveness of zero-emission vehicles.

372.Transporting more goods with fewer lorries might increase efficiency and sustainability 260 . So-called European Modular Systems (EMS), which are longer lorries of up to 25.25 metres typically used on inter-urban roads between transport centres, allow reducing fuel consumption and emissions by up to 15% 261 and at the same time congestion.

373.Specifically, the legislation on the maximum weights and dimensions of road vehicles provides for limited circumstances where derogations to the maximum dimensions of the lorries can be granted. The use of such vehicles, in particular the modular concepts, in international transport is however very restricted while their use would be justified for long haul on certain infrastructure. Today, adjacent Member States who wish to use these derogations to authorise longer lorries to cross the border between them can only do so if specific conditions are met. Currently, use of modular lorries is allowed in Finland and Sweden, and is being trialled in Denmark, the Netherlands, Belgium Spain, Portugal, Czech Republic and some German Länder.

Pollutant standards, batteries and roadworthiness

374.The Commission responded to the Dieselgate affair by overhauling its legislative framework for type approval and market surveillance, introducing new tests in vehicle type approval and during in-service conformity for checking real driving emissions (RDE) on the road 262 and is currently preparing a legislative proposal for stricter emission limits for cars, vans, buses and lorries.

375.A proposal on the EURO 7 is expected in the second half of 2021. The Commission is studying all the relevant issues, such as the simplification of the legislation, technological neutrality, adaptation to connectivity and automation, durability and lifetime compliance, stricter emission limits covering all conditions of use, and possible inclusion of pollutants not yet regulated. The proposal is expected to include also requirements for in-vehicle battery durability.

376.The Commission proposal on batteries, including EV batteries, establishes several sustainability criteria. EV batteries should comply with those criteria to enter (or to be allowed in) the Union market. Moreover the end of life of such batteries, including second-life, recycling efficiencies and materials recovery targets are also covered. Concerning the sustainability criteria, they cover several aspects along the entire life cycle of the batteries, such as the extraction of the minerals used in their manufacturing (the responsible sourcing or supply chain due diligence), the obligation on incorporation a certain level of recycled materials when batteries are manufactures and the carbon footprint of the batteries. Other aspects cover labelling and information disclosure to end-users and economic operators and extended producer responsibility.

377.Following the new stricter emissions limits, more effective emission testing should also be part of periodic technical inspections and technical roadside checks of vehicles. This concerns in particular testing for NOx and particulate matter.

378.Particles emitted by diesel engines are filtered by the diesel particulate filter (DPF), while currently all gasoline direct injection (GDI) vehicles also filter particle emissions via a gasoline particulate filter (GPF). The current framework requires the visual inspection of the filters as a method to verify if the filter is leaking, absent or defective. However, this method has proven to be ineffective, as the filter is often inaccessible (hidden or too hot to check) and the casing is often filled with some material to hide the traces of the filter removal. According to a Dutch study of 2016 263 , in approximately 5-7% of diesel cars with a DPF, the filter was removed or defective. While this does not seem a lot, a well-functioning DPF filters out about 99% of the so-called micro particles. These particles are so small that they enter the human body through inhalation via the lungs and have severe negative health effects.

379.The impact on the overall fleet emissions is very large, for instance a study on vehicles in Prague found that 1% of a fleet with a broken DPF doubles the emissions of the whole fleet, while 1% with a removed DPF due to excess engine-out PM (x10) emissions increase fleet emissions by a factor 10. The most effective solution would be the tailpipe testing of the exhaust gas verifying the particle numbers.

380.The main reason to tamper with DPF appears to be related to the very significant cost of the replacement filter, amounting to several thousand euros especially for heavy duty vehicles. In an older vehicle where the DPF has not been installed during the manufacturing, retrofits can be very effective in reducing emissions, eliminating up to 90 percent of pollutants in some cases, and Germany, Sweden and the Netherlands have experience with national retrofitting schemes for DPFs. However retrofitting may not be an appropriate solution as long as the cost of replacement DPFs has not been lowered enough to make it a reasonable repair in light of the market value of the vehicle in question.

381.After years of research and development conducted by some Member States, there is now a method and suitable equipment at periodical technical inspections to test particle number (PN), which indicate a malfunctioning of the DPF. Belgium, Germany and the Netherlands will introduce testing from 2021. The introduction of the new testing method for PN at EU level will require the revision of the roadworthiness framework, but in the meantime the Commission is closely following the Member States’ experiences and it is looking at possible ways to support the Member States’ efforts.

382.Another issue to consider in this context is tampering with the vehicle’s Selective Catalytic Reduction (SCR) system, mainly a problem linked to heavy goods vehicles. The SCR system uses AdBlue, a liquid developed to react in the SCR and decrease NOx emissions from diesel engines. Vehicles are in principle protected from running without AdBlue, but systems exist that bypass the vehicle controls (AdBlue killers). This is done in order to save its cost which can be a significant saving especially for operators of fleets of lorries. Such tampering is already a reason for failure of a technical roadside inspection of a vehicle, if detected. However, in the absence of a suitable NOx testing method and equipment, it is difficult to detect the often very sophisticated tampering. The Commission is closely following the progress in the development of such testing methods in view of possible legislative action. However, it is also not enough to rely on the legal framework only. The practice of some Member States combining several measures, such as high fines, on-site checks of transport company fleets, withdrawal of transport operator and transport manager licences, follow-up actions after identified manipulations appear to yield good results. The Commission is helping to spread this know-how, via Member States’ experts in the Roadworthiness Committee.

383.The development and supervision of harmonised testing methods for roadworthiness checks, as well as coherence with vehicle type approval, at EU level would have great added value, but requires additional technical capacity and resources.

384.Tyres are an important consideration in road safety.  Nevertheless, tyres are a significant cause of noise above 30 km/h and low performing tyres increase noise and its health effects. Regulating rolling resistance affects the energy consumption, and emissions of vehicles as well, thus again tyres are key in reducing carbon footprint. Last but not least tyres are a main cause of the microplastics released in the environment. Different factors influence the abrasion rate of tyres. Tyre design, type of their raw materials and external parameters such as roads, vehicle characteristics that can be regulated as well as ambient meteorological conditions to be taken into account, are some of these factors.

385.The Report from the Group of Chief Scientific Advisors 264 calls attention to the growing scientific evidence on the hazards of the uncontrolled, irreversible, and long-term ecological risks due to microplastics do exist for some coastal waters and sediments.

4.1.2Clean ports and airports

386.Ports and airports play an essential role for our international connectivity, for the European economy, and for their regions. There are many best practices already in place by the most sustainable airports and ports 265 . Our airports and ports can be made clean by deploying sustainable alternative fuels, and feeding stationed vessels and aircraft with green power instead of fossil energy; incentivising the development and use of new, cleaner and quieter aircraft and vessels; modulating airport charges; greening ground movements at airports as well as port services and operations; and through a wider use of smart traffic management. Public and private investment in aviation and waterborne transport in research for cutting edge technologies, in fleet renewals, in local renewable energy production, and in more sustainable multimodal access increase.

Ports

387.The EU has more than 1,400 inland and seaports, including 329 sea ports and 103 inland ports which are part of the trans-European transport network. Together, they accommodate the safe passage of 75% of the EU’s external trade, one-third of intra-European trade and 400 million passengers annually. Beyond the traffic generated in terms of shipping (freight and cruise/passenger), ports are economic and industrial hubs of their own, and therefore host other major sources of GHG emissions and pollution (air, noise and water): energy production facilities and refineries, landside operations in terminals, and hinterland connections (rail, road, inland waterways). European ports are therefore at the same time critical nodes of transport, energy and industry that constitute a key ecosystem contributing to building European strategic value chains. In this respect ports also have an important role to play in the implementation of the Green Deal.

388.As ports are often located close to heavily populated urban areas, pollution bears direct impact on liveability and quality of life around those areas, be it for ports’ workers or citizens living nearby. Ongoing air quality infringements are a concern for a number of EU coastal cities. Prior to the COVID-19 pandemic, coastal cities were also particularly affected by the growing popularity of the cruise industry, which relies heavily on highly fuel-intensive ‘mega-vessels’.

389.Exhaust gases from ships are a significant source of air pollution, in particular through sulphur oxide emissions resulting from the burning of fuel oil. Sulphur oxides are harmful to the human respiratory system and make breathing difficult. Ships traditionally used fuel oils for propulsion, which contained a sulphur content of up to 3.50 %, however, since 1 January 2020 a global sulphur cap with a limit of 0.5% applies. For comparison, the sulphur content of fuels used in lorries or passenger cars must not exceed 0.001%.

Figure 23 Cruise ships docking in Barcelona emit 5 times more sulphur than the city’s 560,000 cars every year 266

       

390.Since 2012, the EU has taken firm action to reduce the sulphur content of marine fuels through the Sulphur Directive. In some very fragile ecosystems such as the Baltic Sea, the North Sea and the English Channel – designated as ‘Sulphur Oxides Emissions Control Areas' (SECAs) – the maximum sulphur content was reduced to 0.1%, in 2015. Also, passenger ships spending more than two hours at berth are already subject to the 0.1% sulphur standard. Such stricter sulphur limits have more than halved sulphur dioxide concentrations around SECAs, bringing health benefits to people in coastal regions and ports, while the overall economic impacts on the sector remained minimal. However, the stricter limit has prompted some ship owners to install exhaust gas cleaning systems whose operation, in particular in open-loop mode, has the consequence of transferring pollutants, including polyaromatic hydrocarbons and heavy metals, from the air to the sea water, with potentially negative consequences, especially for port and coastal waters.

391.The designation of the North Sea and the Baltic Sea as NOx Emission Control Area (NECA) starting from 1 January 2021 is expected to further accelerate the uptake of cleaner vessels in Europe. In practice, all new vessels built as of 2021 will be required to reduce their NOx emissions by 80% compared to the present emission levels when sailing in these areas. This target can be achieved through the use of engine technologies and after-treatment with catalysts or by using Liquefied Natural Gas (LNG) as fuel.

392.In addition, on-shore power supply represents an attractive solution to reduce local pollution generated by vessels at berth in EU ports. This potential has already fully been recognised by Article 4(5) of Directive (EU) 2014/94 on Alternative Fuels Infrastructure, according to which shore-side electricity supply shall be installed as a priority in ports of the Trans-European Transport Network (TEN-T) Core Network, and in other ports, by 31 December 2025, unless there is no demand and the costs are disproportionate to the benefits, including environmental benefits. The preparatory work for the evaluation of Directive 2014/94 was launched in 2019 and should identify, inter alia, how effective these provisions have been to deploy on-shore power supply in European ports.

393.Ports have an important role to fulfil to enable the roll-out and uptake of alternative fuels in waterborne transport, including for alternative fuels corridors for inland waterways transport. Ports thus have a clear potential to become alternative energy hubs and to ensure the development of alternative fuels infrastructure through the cooperation and coordinated action of all the relevant ports to guarantee comprehensive and sufficient supply of alternative fuels.

394.In addition to the regulatory approach, the Commission has also identified the promotion of shore-side electricity as a priority for transport investment. It is highlighted in the TEN-T Guidelines and through the Connecting Europe Facility that the Commission has been supporting several projects since 2014, such as ELEMED and TWIN PORT III, for the deployment of onshore power supply in EU ports. Moreover, alternative fuel infrastructure, such as onshore power supply, is eligible under the General Block Exemption Regulation and can thus be funded with public support.

395.To further incentivise the deployment and use of shore-side electricity, Member States can also ask for an authorisation to apply a reduced rate of taxation on electricity directly provided to vessels at berth in a port in accordance with Article 19 of the Energy Taxation Directive. Denmark, Germany, Spain and Sweden, have applied for and been granted such authorisations. France and Italy have recently been granted the derogation.

396.Furthermore, the Communication on the European Green Deal announced action to oblige docked ships to use shore-side electricity, which could provide further impulse to the rollout. Alternative solutions, based on different technology, such as hybrid-ships with batteries charging while at sea, which can then be used when the ship is at berth should also be considered. The Commission is following up on the European Green Deal announcement in the context of the “FuelEU Maritime” initiative for a legislative proposal in 2021

Electrification of port infrastructure and ‘ground handling’ equipment to reduce emissions

397.In addition to the need for reductions of environmental impact of the sea side of the maritime transport chain, there is an important potential for such reductions in the ports themselves, e.g. through the use of alternative fuels in cargo handling equipment or in vessels used for technical-nautical services (pilotage, towage or mooring), the monitoring of the environmental performance of port operations and the replacement of diesel-powered machinery with either electric or gas-powered port machinery (e.g. rubber tyred gantry cranes, mobile harbour cranes, reach stackers, shunting locomotives). Train feeder lines to ports and their electrification support ease of access to sustainable distribution channels for maritime cargo.

398.Digitalisation of port processes and data sharing among port stakeholders could bring further optimisations in logistics operations and thus reduce unnecessary freight movements. Further automation of container management and port operations as well as the adaptation of ports and port infrastructure to automated transport modes could contribute to further enhancing the efficiency of operations. Such measures would contribute reducing pollution and thus to improved air quality in port areas and cities, as well as mitigate health risks for port workers exposed to the combustion exhaust fumes of cargo handling equipment used in ports.

399.EcoPorts under the European Sea Ports Organisation is the main environmental initiative of the European port sector and aims to raise awareness on environmental protections through cooperation and sharing of knowledge between ports and improve their environmental management 267 . It has developed a self-diagnosis method (SDM) to assess the environmental management programme of ports in relation to the performance of the sector and international standards as well as a port environmental review system (PERS) with an independently reviewed certification valid for a period of 2 years.

Promoting the use of environmentally differentiated port fees

400.As regards environmental charging, the 2013 Ports Policy Communication, encouraged a more consistent application of environmentally differentiated port infrastructure charges. According to the Port Services Regulation 2017/352, port infrastructure charges may vary, in accordance with the port’s own commercial strategy and its spatial planning policy, in order to promote a more efficient use of the port infrastructure, short sea shipping or a high environmental performance, energy efficiency or carbon intensity of transport operations. It also called for the Commission, together with Member States, to elaborate guidelines on common classification criteria for vessels for the purpose of voluntary environmental charging. Subsequently, there are around 30 ports in Europe that apply differentiated charges 268 (in the form of rebates) for vessels that have a better environmental performance than legally required. This is a market incentive that can stimulate fleet greening.

Optimisation of port calls to reduce emissions from maritime transport

401.A port call is a particularly important event in the whole maritime transport chain and a potential bottleneck in the entire logistic chain. The benefits of just-in-time arrival in terms of emission savings would potentially be significant if smart routing / steaming was implemented.

402.An international task force on port call optimisation 269 is working to establish standards for the exchange of information and data between all stakeholders, such as the ports and the vessels. The aim would be to have agreed standards recognised at the level of the International Maritime Organisation (IMO). The challenges related to port call optimisation has also been retained as one of the discussion topics of the Sustainable Ports Subgroup under the European Ports Forum.

Implementation of the new Directive on Port Reception Facilities (PRF)

403.Although most marine litter originates from land, a significant amount – an estimated 300,000 tonnes – of waste is discharged from ships into our seas, which poses an increasing threat to the marine environment. In this context the Directive (EU) 2019/883 on port reception facilities now also covers all plastic household and operational waste from ships, as well as fishing gear and other waste. It also applies to ‘passively fished waste’ – waste picked up by fishermen at sea. All ship types must comply, from small recreational vessels to large container and passenger ships, as well as the whole range of ports visited by those ships. It has introduced 100% indirect fee for garbage (MARPOL Annex V), meaning that fishing vessels can now dispose of passively fished waste and old/derelict fishing gear without paying extra charges.

404.This new Directive on Port Reception Facilities entered into force in June 2019 and has a two-fold objective: (1) reduce discharges of waste from ships at sea, and (2) ensure the efficiency of maritime operations in port. Currently work is ongoing to ensure implementation of the Directive (transposition deadline mid-2021). Four Implementing Acts are foreseen:

·On methods for calculation of sufficient waste storage capacity;

·On criteria to determine that ships meet the requirements in relation to the ship’s on-board waste management (including discharge waters and sludge from exhaust gas cleaning systems), with a view to qualifying for a reduced delivery fee;

·On monitoring data methodology and format for reporting of passively fished waste; and

·On a risk-based targeting mechanism to provide for uniform conditions for selecting ships for inspection.

405.A new Sub-Group on waste from ships under the European Sustainable Shipping Forum advises the European Commission on issues related to the implementation and operation of the Directive.

Preventing ship-source oil pollution

406.While the number of possible oil spills detected in European waters has dropped by half, from an average of 11 possible spills per 1000 km2 monitored in 2007 to five possible spills per 1000 km2 monitored in 2017, also thanks to the satellite monitoring services provided by the European Maritime Safety Agency, other types of marine pollution are increasing.

407.The new Directive on Port Reception Facilities (Directive (EU) 2019/883) calls on the Commission to assess the desirability of a review of Directive 2005/35/EC, in particular a possible extension of its scope, in order to align Directive 2005/35/EC to the relevant MARPOL Convention provisions prohibiting the discharges of waste from ships (recital 13). Directive 2005/35/EC regulates enforcement and sanctions with respect to illegal discharges of substances covered by MARPOL Annex I and II only (oily substances and noxious liquid substances).

408.However, Member States as contracting parties to the MARPOL Convention, also have to ensure that no illegal discharges take place involving packaged harmful substances (Annex III), sewage (Annex IV), garbage (Annex V), and if such discharges occur, that they are properly sanctioned. To strengthen the implementation and enforcement of the MARPOL discharge prohibitions included in these Annexes, through EU law, the scope of Directive 2005/35/EC needs to be widened. This would be in line with Member State obligations as MARPOL contracting parties, and also reflect existing regional cooperation in the framework of the regional sea conventions; in particular HELCOM, OSPAR and Barcelona Convention have established regional compliance networks to improve cooperation on the enforcement of the MARPOL norms, including operational detection/response actions, and the application of sanctions

Issues related to enforcement of rules for ships calling at EU ports to ensure the same level of environmental performance

409.Some difficulties in enforcing environmental rules for ships calling at EU ports arise from the international nature of shipping. Many non-EU flag states do not actively enforce environmental rules and thereby obtain a cost advantage over compliant flags, while putting the environmental burden on those states and areas where their ships trade.

410.Today, the Paris Memorandum of Understanding on Port State Control aims at eliminating the operation of sub-standard ships through a harmonized system of Port State control. Annually more than 18,000 inspections take place on board foreign ships in the Paris Memorandum of Understanding ports 270 , ensuring inter alia that these ships meet the international environmental standards (MARPOL). In order to support the Port State Control inspections, the European Maritime Safety Agency (EMSA) has developed the THETIS database 271 .

411.For ships visiting EU ports, certain additional requirements apply due to specific EU legislation (e.g. Sulphur Directive, Port Reception Facilities Directive, MRV Regulation, Ship Recycling). In order to enable users to be able to record and exchange data on inspections and verifications foreseen by this specific EU legislation, EMSA has developed an extension to THETIS, THETIS-EU, which facilitates targeting and alerts on the basis of predefined requirements.

Airports

412.Air transport provides air connectivity which is a key enabler for the free movement of people, goods and services underpinning the EU internal market as well as EU cohesion, economic integration and inclusive growth. By connecting EU to the rest of the world and remote areas, such as the outermost regions, aviation also supports tourism, export-focused industries and inward investment, supporting jobs and economic growth.

413.Airports are generally built in the vicinity of dense residential area or very close to major cities. While air connectivity brings significant socio-economic benefits, it also comes with climate, environmental and health challenges related to aircraft greenhouse, pollutant and noise emissions. Airports are hence subject to a range of cross-cutting environmental rules including on air quality, noise, and planning permissions (e.g. nature protection areas). Some airports are covered under ETS due to local power generation. The environmental impact of each airport varies greatly depending on the size of the airport, its activities and the type of aircraft operating at it.

414.Decarbonising air transport sector, next to addressing the challenges related to aircraft emissions reductions (including air and noise pollution) (see section 4.1.1, 4.1.4 and 4.1.5), would also require investments into airport infrastructure and operations to optimise air traffic management and strengthen the integration of airports into a genuinely multimodal network. It would necessitate improving airports' energy efficiency, ensuring the supply and infrastructure for sustainable aviation fuels, and hydrogen for hydrogen-powered airport operations and related services as well as renewable energy generation on-site, together with electrification and greening measures of airside activities such as groundhandling, ground traffic operations and aircraft on the ground, and other measures reducing environmental impacts.

415.In June 2019, as part of the aviation industry ambition, vision and roadmap, ACI EUROPE and its members (203 airports) committed to net zero carbon emissions from airport operations fully within their own control by 2050 at the latest, reducing absolute emissions to the furthest extent possible and addressing any remaining emissions through investment in carbon removal and storage. Three airports have already reached this target, while several others have announced to reach it before 2030.

416.So far, 162 European airports (representing 67.2% of European air passenger traffic) have volunteered to join the Airport Carbon Accreditation programme, which provides a common framework for carbon management with the primary objective to encourage and enable airports to implement best practices. 51 airports are carbon neutral suggesting good progress towards the ACI EUROPE target of 100 carbon neutral airports by 2030 and confirming the importance airports place on carbon neutrality. 272 In November 2020, the programme added further obligations, namely alignment with the Paris Agreement, extended carbon footprint covering all significant operational emissions from third parties, including airlines, and enhanced stakeholder engagement. 273

Airport charges, slot allocation and groundhandling services

417.The existing framework on airport charges, airport slots allocation and groundhandling services can also play an important role in making the sector more sustainable.

418.Airport charges are paid by airlines to airports for the use of facilities and services, which are exclusively provided by the airport managing body and which are related to landing, take-off, lighting and parking of aircraft and processing of passengers and freight. While the Directive requires that airport charges are non-discriminatory, it permits modulations for environmental issues provided that they are relevant, objective and transparent. The 2019 evaluation of the Directive showed that only 61% of airports modulate charges on account of noise and only 20% of airports do so on account of NOx emissions. The 2019 evaluation did not find any airports that would modulate airport charges on account of CO2 emissions. The planned revision of the Airport Charges Directive could aim to ensure the setting of airport charges is strategically aligned with the Green Deal Communication and environmental ambitions of the EU.

419.Current rules concerning the allocation of slots do not contain measures that would align slot allocation with environmental objectives. However, the Slot Regulation states that slot-coordinators shall take into account industry rules, such as the Worldwide Slot Guidelines in the slot allocation process. In their 11th version, published June 2020 the guidelines state that slot coordinators should try to ensure that due account is taken of environmental factors in the allocation of available slots. Environmental concerns could also be considered in local rules which apply to specific airports. However, their scope is quite limited with only a local impact.

420.Groundhandling is an essential service provided for airport users and often represent important costs for them. It involves ground administration and supervision, handling of passengers, baggage, mail, freight, and ramps, aircraft services, fuel and oil handling, aircraft maintenance, flight operations and crew administration, surface transport and catering services. Groundhandling services generate GHG and air pollutant emissions at airports. These are caused by usage of diesel fuel for airport vehicles and ground support equipment (GSE), fossil fuel for electricity and heating, jet fuel for auxiliary power units (APUs) that power aircraft at airport gates, and other sources. Airport operators can implement several measures to reduce the environmental impact of groundhandling services, including provision of electric buses for passenger transport, pre-conditioned air fixed power units to avoid GPU/APU (which run on diesel or kerosene), centralised de-icing pads to avoid contamination of groundwater, and alternative fuels for ground support equipment. Ground support equipment could also be pooled for use by all groundhandling service providers. Under this approach, either by agreement or as mandated by the airport, groundhandling equipment at the airport is owned centrally by the airport itself or by a leasing company on behalf of the airport. Such equipment can consist of for example electric lower deck loaders, electric conveyor belt loaders, electric passenger steps, main deck loaders, electric baggage tractors, power tractors and cool container dollies. The groundhandlers are then required to use the (modern and environmentally friendly) equipment to serve the aircraft, which they are contracted to handle.

421.The Groundhandling Directive 274 leaves it to the Member States to ensure the adequate level of environmental protection. Member States may make the groundhandling activity conditional upon obtaining the approval of a public authority independent of the managing body of the airport. The criteria for such approval can include environmental protection. The Directive allows the limitation of the number of groundhandling service providers in case of four categories of groundhandling services: baggage handling, ramp handling, fuel and oil handling and freight and mail handling. In case such a limitation is applied, the providers need to be selected in a public tender and the Member States may establish standard conditions or technical specifications covering also environmental aspects.

422.The Groundhandling Directive is currently being evaluated. This evaluation will closely examine issues related to the environmental and climate impact of groundhandling activities (particularly noise and emissions) and to climate change mitigation/adaptation policies employed by and/or incumbent (and enforced) upon groundhandling service providers and airports.

Addressing “airside” ground vehicle movements

423.Aircraft ground movements at airports have an impact on the local air quality as well as on the local noise emissions. Aircraft ground movements include taxiing from the aircraft stand to the start of the runway and vice-versa. Figure 24 shows the total aviation CO2 emissions per flight phases for flights in the ECAC region in 2019. It indicates that 4% of CO2 emissions, i.e. 8.6 million tonnes of CO2 came from aircraft ground movements, including the take-off run.

Figure 24 CO2 emissions per flight phases

424.Overall, it is estimated that around 6% of CO2 emissions in aviation, i.e. 11.6 million tonnes of CO2 are generated by ATM routing inefficiencies 275 . As illustrated in Figure 25 , of these, around 13% are estimated to be due to inefficiencies in aircraft ground movement, i.e. taxi-out for 9% and taxi-in for 4%. However, these estimated ATM inefficiencies are not based on actual fuel burn, and it is the view of some experts - including Eurocontrol - that actual inefficiencies could be higher and up to 10%. This can be explained by the fact that there are likely further inefficiencies, which until now are unaccounted for, for instance, related to the flight level and aircraft speed.

Figure 25 ATM inefficiencies

425.Solutions provided through the SESAR project are available for airports, airspace users and air navigation service providers to optimise usage of the airspace and the sequencing of ground traffic operations of aircraft before take-off and after landing. Large deployment of such solutions would allow engine running time reductions thus less emission for local residents. Examples of SESAR solutions include taxi route displays for pilots, pre-departure sequencing supported by route planning, wake turbulence separation optimisation, traffic optimisation on single and multiple runway airports, enhanced guidance assistance to aircraft and vehicles on the airport surface combined with routing, time-based separation, and others.

426.The Directive on the deployment of alternative fuels infrastructure 276 does currently not contain any specific obligations for Member States to decarbonise ground movements. However, it stipulates that the national policy framework, to be adopted by Member States, must consider the need to install electricity supply at airports for stationary aircraft. Moreover, hydrogen-powered airport operations and related services will also require adequate refuelling infrastructure at airports.

Impact of noise on local residents

427.Long-term exposure to aircraft noise is linked with a variety of health impacts, including ischaemic heart disease, sleep disturbance, annoyance and cognitive impairment. The legislative instruments in place, notably the “Balanced Approach” Regulation 277 , shall be applied by Member States in order to meet specific noise abatement objectives at the level of individual airports, where clear objectives of reduction in population exposure to noise should be set through the Environmental Noise Directive 278 . The Regulation compels Member States to ensure that the Balanced Approach is adopted in respect of aircraft noise management at those airports where a noise problem has been identified. The “Balanced Approach” refers to the process developed by the International Civil Aviation Organization under which the range of available measures, namely the reduction of aircraft noise at source, land-use planning and management, noise abatement operational procedures and operating restrictions, is considered in a consistent way with a view to addressing the noise problem in the most cost-effective way on an airport-by-airport basis.

Greener access to the airport

428.Today, an important share of passengers still use their car to access European airports. Although greener alternatives exist (rail, bus shuttles), these may not always be deemed the most practical or economical by passengers and not always seamlessly integrated into urban transport. In addition, car parks are still a significant source of revenue for airports. On average, 36% of passengers travelled to airports by public transport in 2018, compared to 43% in 2016 279 .

429.The Connecting Europe Facility (CEF) is financing multimodal connections to airports, such as the “Genoa Erzelli” in Italy or the connection of the Budapest-Arad railway line to the multimodal hub at Budapest Airport. The TEN-T Regulation requires that for airports on the network, both core and comprehensive, the improvement of multimodal interconnections with other transport modes is given priority 280 . In practice, this is very much focused on rail and light rail i.e. sustainable passenger connections.

430.Generally speaking, airports and the companies operating at airports are self-financing from user charges and commercial revenues, and the possibility to grant compatible State aid is limited under the current State aid rules, including under the 2014 EU Guidelines on State aid to airports and airlines. The Commission is conducting a Fitness check of State aid rules, including those for airports. Should this process conclude on the need to revise the rules for airports, current limitation could be revisited in respect of green investment. This would be particularly welcomed by smaller regional airports, many of which are essential to regional connectivity but are loss-making (71% of “small airports” are reportedly loss-making).

4.1.3Sustainable urban mobility 

431.The EU cannot rely only on technological solutions delivering in the future: immediate action to adapt our mobility and transport system is needed today to tackle climate change and reduce pollution, and a number of solutions already exist. In addition to making each and every transport mode more sustainable, sustainable alternatives need to be made widely available.

432.Urbanisation has been increasing in the past decades and this trend is likely to continue. So our mobility is an equally increasingly urban question, and poses challenges both for those who live in cities and those who travel into them, often every day. Urban congestion costs, for example, are estimated to account for EUR 180 billion per year in terms of delay costs and about EUR 32 billion per year in terms of deadweight loss at EU-27 level. 281 In addition, model estimates indicate that urban transport is responsible for about 22% of EU's CO2 emissions from transport. 282

433.The ability of a city to host infrastructure for public transport, cycling, walking and other mobility systems, depends primarily on its spatial setup and economic standing. In cities of high urban density, more people can be served by shorter networks (pedestrian pavements, cycling lanes, bus routes etc.). On the contrary, cities with urban sprawl need to construct and maintain much more infrastructure per inhabitant. The way various activities (work, residence, leisure, culture, commerce, etc.) are located within a city also plays an important role on proximity and transport needs. 283  Cities and towns can facilitate safe active mobility and creation of recreational spaces allowing physical activity, parks and green zones through inclusive urban planning and design.

434.The Urban Mobility Package of 2013 284 , the main EU policy basis, aimed to support cities to improve their urban mobility, with the concept of sustainable urban mobility plans (SUMPs) in the centre of the approach. Related EU guidelines were published to support local authorities in the process. The EU approach to urban mobility has inspired many cities within and beyond Europe, with over 1,000 SUMPs in place now 285 . Whilst the guidelines continue to be used extensively, major new trends in many areas of urban mobility have emerged and a wealth of practical SUMP experience has been acquired over the last few years. Therefore a major overhaul took place in October 2019: a revision of the Guidelines itself, as well as the development of a range of complementary guides on specific aspects of SUMP 286 .

435.The preliminary evaluation results of the 2013 Urban Mobility Package indicate that the package was a relevant step towards sustainable mobility, but the problems identified in 2013 still exist, with some – such as congestion or deteriorating climate and local environment – getting worse. In addition, as indicated by the Court of Auditors in their performance audit of the EU urban mobility policy and funding, no real progress at local level is possible without stronger involvement of Member States.

436.Clearer guidance is needed on mobility management at local and regional level, and on connectivity with rural and suburban areas so that commuters are given sustainable mobility options. European policies and financial support should also reflect the importance of urban mobility for the overall functioning of the TEN-T, with provisions for first/last mile solutions that include multimodal mobility hubs, park-and-ride facilities, and safe, active mobility infrastructure. 

437.Under the Environmental Noise Directive, Member States have to prepare action plans to reduce noise from transport in approximately 500 European agglomerations. Nevertheless, reduction of noise in urban areas require a mix of global and local actions that result in noise reduction for instance the improvement of the vehicle fleet needs to be accompanied by the deployment of better tyres and better roads. In that sense, the Environmental Noise Directive could be enhanced to coordinate the efforts needed for this co-benefit.

438.Under the Ambient Air Quality Directives 287 , Member States have to comply with air quality standards for a number of pollutants harmful for human health, including limit values for nitrogen dioxide and particulate matter (PM10 and PM2.5). In over 130 cities located in a majority of Member States, limit values for one or more of these pollutants have been exceeded for many years, with significant consequences for public health and the economy. Specific measures are not prescribed, although an increasing number of cities have turned to SUMPs which can contain different measures focusing on various aspects of urban mobility, with urban vehicles access regulations (UVARs) being one of them.

Figure 26: Annual mean NO2 concentrations observed at traffic stations, 2017 288

Source: European Environment Agency.

Figure 27: Percentile 90.4 of daily mean PM10 concentrations observed at traffic stations, 2017 289

Source: European Environment Agency.

Figure 28: Annual mean PM2.5 concentrations observed at traffic stations, 2017 290

Source: European Environment Agency.

Urban vehicle access regulations

439.In recent years, more and more European cities have started to introduce different kinds of Urban Vehicle Access Regulations (UVARs) to pursue a variety of policy objectives ranging from air quality to liveability and infrastructure optimisation.

440.Regulating vehicle access to cities should be part of integrated mobility policies: Sustainable Urban Mobility Plans (SUMPs) should, whenever applicable, cover also the question of UVAR. In order to support cities in better grasping this aspect, a dedicated guide on UVARs was published in October 2019 within the revised guidelines on SUMPs. 291

441.While urban mobility is largely a matter of national and local competence, the diversity of UVARs, in particular low-emission zones (LEZs), has posed new challenges for passenger and freight transport by creating obstacles to the seamless mobility of vehicles across the EU. If access of private cars to cities is to be restricted, doing it on a more harmonised or coordinated basis seems to be necessary, given that at present more than one quarter of the overnight trips carried out by EU residents in 2017 were abroad (the vast majority of which were in another EU Member State), and in two-thirds of the cases by car. It is clear that there is a need for better coordination across Member States despite the different EU policy initiatives and as shown by studies 292 that have addressed UVARs at EU level over the past years.

442.The lack of harmonisation or transparency has been the basis of concerns expressed by some stakeholders for example in relation to the availability of information online and in foreign languages, the difficulties for foreign drivers in particular to comply with the rules and issues related to enforcement, the level of fines, or the lack of provision of sustainable alternatives such as public transport. There are also concerns relating to different rules for access of domestic and foreign vehicles. On the other side of the argument, some cities report that existing UVARs are often not fully respected, sometimes also noting problems in enforcing fines. At the same time, it should be possible to use a comparable methodology for vehicles from all EU countries, which could remove the need for registration of vehicles that comply with the LEZ-criteria, and thus reduce the administrative burden for foreign vehicle owners and city administrations.

443.There are different types of UVAR. Low Emission Zones restrict access by the most polluting vehicles to a specific area within a city. The Commission is currently aware of over 300 low-emission areas. 293 Designating a certain area as a LEZ or environmental zone can result in a substantial decrease of emissions within the LEZ and therefore are a tool to reduce air pollution in cities. Often LEZs are implemented where and when EU air quality standards are breached 294 .

444.There are also congestion charging schemes, different types of parking regulations, and a growing trend towards other traffic restriction schemes, such as Low Traffic Neighbourhoods, roads which offer priority to cyclists or pedestrians, or pedestrian only zones. The Commission has received fewer concerns about such schemes.

Walking, cycling and micromobility

445.Active mobility modes such as walking and cycling are low-cost and emission-free forms of mobility, and thus the most sustainable ones. Together with public transport, new shared mobility and micromobility solutions they have a great potential to reduce local CO2, air and noise emissions, improve human health, as well as congestion and pressure on valuable urban space and infrastructure 295 . However, as with other forms of mobility, attention always needs to be paid to those persons with disabilities or reduced mobility that cannot always participate on those active mobility modes on an equal basis with others.

446.Ensuring that walking and cycling are safe, accessible and attractive encourages a reduction in the number of unnecessary car trips, especially in cities. Regular walking and cycling can also help to reduce the incidence of major non-communicable diseases (such as cardiovascular diseases, diabetes, overweight/obesity, cancer 296 ) due to more physical activity. Physical inactivity and sedentary lifestyles are one of the main driving causes of the rise in these diseases. Walking and cycling therefore contribute to reducing the significant pressure on health care and social protection systems and have also direct economic gains with effects on commercial activity and shifts local expenditure towards more local business 297 . Nevertheless active mobility also needs to be made safe – 70% of road fatalities in urban areas are to walkers, cyclists (as well as motorcyclists and other vulnerable road users) and many more are seriously injured. So the allocation of the public space for mobility in cities needs to be addressed. Segregated walking and cycling infrastructure is effective in encouraging active mobility and ensuring its safety, and where active mobility mixes with motorised traffic in cities, reducing speeds e.g. to 30 km/h, has been recommended in the Stockholm Declaration of the Third Global Ministerial Conference on Road Safety in February 2020 298 . Returns to investment from building safe footpaths and road crossings, bike lanes and bike parking are in any case substantial.

447.Congestion in urban areas is one of the biggest issues, with huge negative social, environmental and economic impacts. Measures improving walking and cycling conditions can reduce congestion in cities. For example, pedestrianisation improves mobility and accommodates more people during rush hours (Dublin), cycling improvements lead to 45% less car traffic and faster public transport (Copenhagen) or cycle highway network reduces the need for 50 000 car trips daily (Ruhr area) 299 . The EU-funded CIVITAS FLOW 300 project identified a broad set of benefits from more walking and cycling.

448.So due to the range of co-benefits that can be generated, cycling and walking therefore contribute to fulfilling objectives in a number of EU policy areas, in particular: reducing congestion in transport and mobility; low carbon development; innovation and technology; air pollution; industrial competitiveness and economic growth; environment and climate change; human health; local development and cohesion; equity and accessibility; and sustainable tourism.

449.Walking is the most inexpensive mode of transport. Consequently, ensuring that there are safe accessible and attractive conditions for walking is key. Almost every public transport trip starts or ends with at least a short walk. Research indicates that the reach of the existing public transport system can be extended significantly simply by making walking to and from hubs and stops easier, less prone to barriers and more pleasant by creating attractive urban spaces that are well connected to public transport infrastructure 301 . According to a recent Eurobarometer survey, just over four in ten (42%) use walking as their mode of transport or in combination with the main mode. 302 According to the estimates of Walk21 Foundation, the economic benefits of walking amount to more than EUR 250 billion – 40% of it due to improved mental and physical health. Research at a city level points to regular walking leading to a 14% reduction in the risk of mortality compared to those who do not regularly walk, with substantial economic benefits as well 303 .

450.According to the estimates of the European Cyclists’ Federation, the economic benefits of cycling in the EU are very substantial and amount to more than EUR 150 billion per year 304 , including EUR 6.5 billion environmental benefits, with health benefits providing the lion’s share of the rest.

451.When it comes to EU policy, the 2011 Transport White Paper acknowledged the importance of promoting cycling as an alternative to car use. The White Paper also acknowledged the importance of cycling in delivering clean and sustainable urban mobility and of cycling as an integral part of the urban transport system. In the Commission’s 2016 Strategy for Low Emission Mobility, active travel, i.e., walking and cycling was promoted as a local action by cities to be encouraged, enabled and embedded into Sustainable Urban Mobility Plans (SUMP) in enabling and encouraging cycling. Support for the development of SUMPs was one of the main elements of the Commission’s 2013 Urban Mobility package, with urban logistics, access restrictions, urban road user charging and the deployment of Intelligent Transport Systems (ITS) also interacting with cycling. Beyond urban areas, EuroVelo 305 , the network of 17 long-distance cycle routes is an important contributor to the cycle tourism industry in Europe 306 , and in parallel, EPaths has the potential to make a similar contribution to the walking tourism industry. The overall contribution of cycling and walking to tourism revenues is valued at more than EUR 176 billion.

452.The importance of cycling has been recognised by Member States 307 as well: in 2018, the EU’s Transport and Environment Ministers met in Graz, Austria, to discuss pathways leading to clean mobility. They adopted the “Graz declaration” 308 , which includes acknowledging cycling as an equal mode of transport, developing a European strategic and supportive framework to promote active mobility, and integrating active mobility in the current and future European funding and financing schemes. A recent joint statement by the Benelux countries stressed the importance of cycling and the urgent need for stimulating bicycle use as a necessary, safe and healthy alternative in (urban) mobility. Many stakeholders see a need for a more strategic, EU-level approach to be taken to enable and promote cycling in the EU 309 .

453.In order to develop the full potential of the active modes of transport, cycling and walking have to be taken seriously in urban mobility policies, including in transport planning, allocation of space and budgets. According to a 2020 Commission working paper, walking and cycling perform well in cities with dense road networks, higher densities and fewer steep slopes 310 . While many cities have been rediscovering them as the ideal urban mode of transportation and have gone a long way in promoting their use in recent years and months, their full potential is still untapped in many places. While about 17 % of the EU population stated in a 2019 Eurobarometer survey 311 that they use bicycle or scooter as their primary mode of transportation, there are huge differences in cycle use across the continent.

454.The full potential of cycling and walking in delivering a more sustainable and resilient urban mobility needs to be recognised and supported by key trip destinations including public transport operators, schools and universities, retailers, hospitals, and leisure centres. Employers in general can encourage better employee health through active mobility. Promotion campaigns and workplace schemes, supported by the necessary infrastructure investment, to make walking and cycling easier and more attractive have been shown to enable healthier communities, reduce absenteeism and improve overall employee wellbeing and increased productivity.

Figure 29: Main mode of transport on a typical day

Source: Special Eurobarometer 495 312

455.Many observers are calling for cycling and walking policies to be embedded within a wider SUMP framework that aims at the overall improvement of the mobility system of a town or city. In order to support towns and cities in this task, the Commission issued in 2019 Guidance on cycling projects in the EU 313 , a resource that enables users to identify the most relevant information for their situation. In addition, the SUMP guidelines revised in 2019 include, for the first time, dedicated annexes on supporting and encouraging walking 314 and cycling 315  in sustainable urban mobility planning.

456.The sharing of limited space for mobility in cities can lead to conflicts between transport users, in particular where the use of sustainable modes of transport like cycling and walking and new forms of micromobility are being promoted. Currently, 38% of road fatalities in the EU occur in urban areas, 70% of which are vulnerable road users (pedestrians, cyclists and motorcyclists). To avoid such tensions, the objectives of sustainability and safety need to be brought together from the outset. It is important that urban mobility planning in cities that aims to make transport cleaner and more sustainable seeks at the same time to make it safer. Among the key measures to address this concern is investment in safe cycling and walking infrastructure in cities while at the same time managing car use and introducing lower default speed limits.

457. It is only if actual and perceived safety is high that more people will choose to walk and cycle. Fear of sharing the road with dense motorised traffic is a primary reason that puts people off from cycling (and to lesser extent walking). To support local authorities and stakeholders in that regard, the revised SUMP guidelines include also a dedicated guide on urban road safety and active travel in sustainable urban mobility planning 316 .

Figure 30: Percentage of road fatalities on urban roads in the EU by transport mode, 2018

Source: CARE database 317

458.Micromobility represents a potentially huge global market and key players (regulators, industry, consumers) need to work closely together to make it a success. Micromobility is also widely praised for its potential to reduce congestion, yet the jury is out whether it replaces or complements public transport by covering primarily first/last mile trips. Cities – and other regulators – play a key role in authorising or banning operators and in defining conditions under which the service can be provided. They also play a role, together with public transport companies, to enable synergies with shared micro-mobility options.

459.These new personal mobility devices, in particular shared e-scooters, which were deployed in large numbers in cities all over Europe, also raise a number of safety concerns – some related to the safety of the devices themselves (e.g. their centre of gravity, brakes, lights), some to their safe use (e.g. use on pavements and cycle paths, helmets).

460.Differences between the rules that apply, often even within a Member State, make it difficult for visitors to follow local rules correctly, and hamper the business of sharing scheme operators that wish to operate in more than one country. Shared or not, micro-mobility vehicles need to operate in a regulatory framework that defines where they can be used (e.g. roads, bike lanes, pavements, pedestrian areas, 30 kph areas), at what speed, after which training, as of what age and in compliance with which safety rules (e.g. protective equipment, lights, turn signals, etc.).

Public transport, shared mobility and transport on demand

461.Urban transportation is a dynamic system where one component impacts on the other. Users, through their modal choices, are influencing the development of the urban transport system. One of the main challenges that cities face is mitigating the vicious cycle triggering an increased reliance on the private conventionally fuelled car in particular. There is a positive correlation between cities that have achieved a high share of public transport usage and reduced congestion. However, continuous investments backed by a long term strategy and density to stabilize demand are needed. It is equally needed to create the right conditions for public transport to flourish, such as, for example congestion charging or parking management. 318

462.According to a 2020 working paper by DG REGIO 319 , in virtually all European cities analysed, at least 80 % of the population has easy access to public transport. In addition, 56 % of an average city’s population has access to at least 10 departures an hour. Access to high-frequency departures is generally higher in cities with at least 1 million inhabitants and considerably lower in cities with fewer than 250 000 inhabitants, although there are some exceptions.

463.There is room for improvement of accessibility of public transport. A comparison between the population accessible by public transport with the nearby population in 42 European cities shows that within 30 minutes people can only reach 24 % of the population living within a distance of 7.5 kilometres. 320  

464.According to the latest EC survey on Quality of Life in European Cities 321 , across the surveyed cities, the share of public transport users varies from less than 30 % to slightly more than 60 % and this share increases with city size. In most countries, the share of public transport use is highest in capital cities, in part because these cities tend to have an extensive public transport network with frequent services.

465.A high use of public transport and satisfaction with public transport go hand in hand, as on average three out of four city residents are satisfied with public transport, and a positive relation is seen between public transport satisfaction and satisfaction about living in a city. Out of key aspects of public transport: affordability, safety, accessibility, frequency, and reliability of service, public transport frequency is found to be the largest driver for users’ satisfaction 322 . Public transport plays a key role in connectivity and provides ample economic opportunities, with many quality local jobs that are impossible or hard to delocalise. Urban and suburban public transport services carry approximately 185 million passengers on an average working day across the EU, providing the backbone of urban mobility in many EU cities. The public transport sector alone employs around 2 million people in the EU, being a very important employer in almost every city, and the economic value of public transport services are estimated at EUR 130 - 150 billion per year 323 .  

466.Public transport is one of the most cost-efficient way to decarbonise people’s daily mobility. It is also one of the safest ways to move people around, and in a sustainable manner. Its social aspects should not be underestimated, neither: it provides a relatively affordable mobility option for a large part of the population contributing to enhancing connectivity. As it brings people together, it plays important role in social cohesion and local development, too.

467.When it comes to reducing congestion, a full standard bus carries the same number of people as 40 cars while a full metro set carries the equivalent of 600 (assuming current average occupancy rates for cars). In addition to traffic reduction, it frees up space otherwise used for parking in dense urban areas.

468.Public transport, being normally linked with active mobility, contributes positively to public health policies by improving health of individuals, in particular in urban areas. According to a recent research study, compared with commuting by private motorised vehicle, rail commuters had a 10% lower rate of all-cause mortality and a 21% decreased rate of cardiovascular disease mortality, in addition to a 12% reduced rate of incident cancer 324 .

469.Public transport and especially light rail provides low-emission affordable mobility with limited need for public space. However, procurement of light rail, like tram and metro, remains extremely costly due to the very high customisation and the absence of EU interoperability standards. More ‘off the shelf’ products and joint procurement would lead to costs reductions and thereby more attractive mass transport market.

470.A dynamic, sustainable and safe local passenger transport on demand is also part of the solution to the challenges cities face today. Things have changed in recent years, mainly thanks to digital technology and the emergence of intermediation platforms. The right solutions to ensure that passenger transport on demand can deliver efficient services to citizens, while taking into account environmental and social concerns including working conditions of drivers. In 2016, the Commission adopted its communication “A European agenda for the collaborative economy 325 ”, has already provided some useful guidance in this regard, but there is clearly need for further clarity. The related issues are further discussed in section 4.3.5.

Urban logistics

471.Urban logistics is an integral part of urban mobility. It is a fast-developing industry paramount for the growth of the cities’ economic activities, but it is a significant contributor to congestion, pollution as well as to road accidents. For instance, in Europe it is responsible for 25 % of urban transport related CO2 emissions and 30-50 % of other transport related pollutants. In addition a growing urban population combined with other trends such as e-commerce and home delivery together with an ageing population will lead to an increase in demand for goods and services with a consequent increase in urban freight demand.

472.Hence a special consideration to Sustainable Urban Logistics Planning (SULP) is needed 326 . This is of high relevance for cities as urban logistics planning is a complex process. There is significant potential to improve operations and services, and captive fleets, such as mail delivery vehicles and refuse collection vehicles, can be well suited for the early introduction of new types of vehicles, alternative fuels and safety technology to reduce emissions and safety risks.

473.Thanks to the Directive on the deployment of alternative fuels infrastructure 327 , to CO2 emission performance standards for cars and light- and heavy-duty vehicles 328 and to the Clean Vehicles Directive 329 , the key elements of the regulatory framework to promote sustainable alternative fuels and zero- and low-emission vehicles are now in place. This framework is complemented by platforms for exchange of best practice like CIVITAS and ELTIS as well as EU financial support.

474.Multimodal integration of urban logistics, including the use of zero and low emission vehicles, urban rail and inland navigation is important. It can create a reliable and safe alternative to road only solutions, making better use of the available infrastructure and services, thus contributing to a strong, resilient and integrated transport system. Smaller suburban hubs or depots can avoid operations of several delivery services on the same routes by an effective use of common package stations. The last mile delivery in the city centres can then be transformed into cleaner modes such as electric vehicles, cargo bikes 330 or zero emission inland vessels.

475.Urban and regional freight services have seen significant innovation through the deployment of real-time smart logistics information and tracking networks, warehouse automation, a growing fleet of electric delivery vehicles and the emergence of sustainable micro-distribution by cargo bikes or other micro-vehicles, including, potentially, drones. While digital solutions have already been in use for some time, next steps include the sharing of data and information to consumers, retailers and distributors to squeeze efficiency from the system. Furthermore data collection and sharing of data are pivotal areas for reinforced cooperation as well as that of working on common indicators for urban logistics.

4.1.4Multimodality and modal shift

476.The European Green Deal states that: “Multimodal transport needs a strong boost. This will increase the efficiency of the transport system. As a matter of priority, a substantial part of the 75% of inland freight carried today by road should shift onto rail and inland waterways”.

477. ‘Multimodality’ in the transport sector, or "multimodal transport" refers to the use of different modes (or means) of transport on the same journey. The concept applies to both freight and passenger transport and in both cases can now be driven on by the growing trend towards digitalisation. Multimodality takes advantage of the strengths of the different modes, such as convenience, speed, cost, reliability, predictability, and in combination, can offer more efficient transport solutions for people and goods which will help ease the pressure on our congested transport infrastructure, and make the whole sector more environmentally friendly, safer, and cost efficient.

478.The whole EU would benefit from a more resource-efficient transport system, in particular one that better optimises the combined use of soft modes, individual road, collective road and rail as well as longer-distance air transport for passengers, and rail, waterborne and road transport for freight. Multimodality can provide an attractive and efficient alternative to private car ownership and transport by lorries. However infrastructure, tools and incentives for multi-modal connectivity are still limited and vary widely between Member States and regions. Multimodal transport is hindered also by administrative barriers and excessive complexity due to differences in sectoral and modal legislations at both the EU and national levels.

479.To understand the current role each transport mode plays in the EU-27 for freight, it is worth noting that the modal split has not significantly changed since 2008. For the external trade of the EU in 2018, maritime transport was the predominant mode, representing 46.7% of the value of exports and imports, followed by air transport (20.6 % and road transport (20.4%). For intra-EU trade, maritime transport counted for 29.2 % of the modal split in 2018 (2008: 25.9 %), whereas road transport represented half of the modal split for freight in 2018 (51%, slightly less than in 2008). The modal share of rail freight transport has decreased marginally from 13.2% in 2008 to 12.6% in 2018. The (low) share of inland navigation in the modal split for freight slightly decreased from 4.6% to 3.9 % during the same period. 331

480.For passenger transport in the EU-27, cars remain the dominant mode of transport, with a share of 71.7 % in 2018 (2008: 72.6%). Intra-EU aviation has expanded its modal share from 7.1 % in 2008 to 9.6 % in 2018 and is thus ahead of buses and coaches (8 % in 2018) and railways (6.9% in 20178. 332

481.Looking at land transport only, the passenger car dominates within the EU-27, with a share of 78 % in 2008 and 80 % in 2018. Throughout the same period, the rail mode share rose from 7.3% to 7.7 % and tram and metro mode share rose from 1.6% to 1.7%. Bus and coach share instead fell from 10.3% to 9 %. Looking at each country, the figure below shows that in 2018 Austria, the Netherlands and France were the only countries where rail had a share of more than 10%. Between 2015 and 2018, the rail modal share increased 333 the most in Poland, Czechia, Austria and Estonia and decreased the most in Denmark, Hungary and Croatia (change in percentage points).

Figure 31: Passenger land transport modal split by country (%, 2018) and change in percentage points for rail (2015-2018) 334

Source: Eurostat and statistical pocketbook 2020.

482.According to a detailed analysis of rail passenger services by DG REGIO, rail transport performance is widely disparate across the European Union 335 . While cities consistently perform better than towns, suburbs and rural areas in all countries, there are also cities with no rail services during peak travelling hours.

483.Analysis shows that improving the offer of high-speed rail services would provide passengers with an alternative to short-haul flights. In particular where high-speed rail services can be linked to form an attractive offer with long distance flights (e.g. Paris, Frankfurt, Amsterdam), this could not only reduce CO2 emissions compared to short-haul feeder flights, but also free up scarce airport capacity and avoid maintaining unprofitable air routes. This would however require investments into improving the access of high-speed rail to airports.

Figure 32: Air routes between metropolitan regions where rail travel times are below 2.5 hours by train

Source: EBP work for the European Commission

Figure 33: Air routes between metropolitan regions where rail travel times are below 4 hours by train

Source: EBP work for the European Commission

484.Improving the offer in high-speed services is not only a question of providing adequate infrastructure but also of offering cheaper and more flexible and reliable rail services: market opening under the Fourth Railway Package will allow railway undertakings other than the national incumbent to offer services on any line in the EU (with exceptions to protect the viability of public service operations) from December 2020. However, international passenger services, including long-distance services and night trains, face the following problems 336 :

·Traffic planning and management is often insufficiently coordinated by infrastructure managers and authorities across borders;

·Access to rail service facilities, ticket sale and real-time travel information during the journey can be difficult because not ensured seamlessly and across service providers;

·Technical interoperability, in particular the use of different power systems and legacy signalling systems remains a challenge to cross-border service provision. Unjustified differences in national safety and operating rules cause obstacles to seamless transport.

·Acquisition of rolling stock is challenging for new entrants due to the absence of a well-functioning second had rolling stock market.

·Different approaches to charging and taxation across modes result in comparatively high prices for long distance passenger rail (rail infrastructure use is charged per km and mark-ups tend to focus on longer distance passenger rail as other market segments, such as, for instance, freight transport are less able to bear mark-ups).

·Market opening will turn high-speed services that complied with certain publicly imposed requirements into hybrid services (partly open access, partly PSO based), which may raise legal and financial challenges for competent authorities and infrastructure manager.

485.Night trains could offer an interesting and more environmentally friendly alternative to car and air travel and the political interest for the promotion of night train services in Europe has gained traction. This market segment could be further developed, either on a commercial basis (open access) or through tendered PSOs, within the framework established in the Fourth Railway Package.

486.Bus and coach transport is a very efficient and affordable mode of transport, which is able to complement rail transport in areas not benefitting from rail infrastructure and for bringing passengers from and to multi-modal hubs. Moreover, it has the potential of becoming zero emissions with the same technologies used for lorries. However, despite these benefits, the modal share of bus and coach transport has remained unchanged, while the use of passenger cars has kept increasing. The Commission made a proposal 337 to address this situation, through amendments to Regulation (EC) No 1073/2009, but the proposal has not made progress in the Council.

487.Article 20 of Regulation 1008/2008 allows Member States to limit or ban flights when serious environmental problems exist, in particular when more sustainable modes of transport provide appropriate levels of service. Several Member States are considering such measures to contribute to the goal of climate neutrality. In doing so, they will have to make sure that any such measures is non-discriminatory, does not distort competition between air carriers and is not more restrictive than necessary to relieve the problem. Such a measure cannot exceed three years, after that it will have to be reviewed.

488. Key barriers to increased multimodality, in particular for passengers, can be overcome by the solutions offered by digitalisation. These issues will be discussed further in section 4.2.1.

489.Research and innovation will play a vital role to develop and validate new solutions for an integrated transport system with seamless transfer between modes and traffic management across sectors to ensure availability of efficient door-to-door mobility solutions also in times of local disruptions (weather events, traffic incidents etc.). Large scale demonstrations could help to validate better solutions.

4.1.4.1Improving multimodal freight operations

490.Effective management of freight transport and logistics chains is a precondition for EU industrial competitiveness and a more sustainable transport sector. Industry depends on high-quality, efficient and multimodal logistics chains to organise the transport of raw materials and goods across the EU and beyond.

491.While logistics is primarily a business-related activity, fragmented and incompatible rules and standards can create considerable red tape and inefficiencies to the logistics industry and affect also the competitiveness of multimodal transport vis-à-vis road-only transport. Therefore, suboptimal functioning of supply chains also results in higher transport emissions. The industry is asking for a coherent EU approach to logistics and multimodal transport that demands co-operation and co-ordination between different dimensions of transport policy and beyond.

492.One key aspect of the efficient use of transport is a high load factor. For example, road transport is known for having a share of empty runs of about 20%, which obviously reduces the overall load factor. Part of these empty runs can be explained by the use of dedicated equipment (e.g. lorries designed for milk transport), which typically cannot carry return loads as well as by the necessary empty driving when going to load cargo. But more often the reason is fragmented markets where loads cannot be arranged for return journeys. For rail freight transport, the share of empty wagons in single wagonload transport reported by three major operators is in the range of 30 to 65 % 338 , which is particularity striking given increasing capacity constraints and expensive infrastructure. Consequently, there is ample room to improve the load factors and it would provide an immediate relief in congestion and decrease in CO2 emissions for each tonne transported. Digitalisation of and transparency on available wagon load may play a key role.

493.The modal share of non-road hinterland freight was around 28% in 2018 339 . (~6% for IWT; 18.7% rail 340 ). The competitiveness of rail freight transport increases proportionally to the distance. Consequently, around 50% of volumes are moved across borders (compared to 6% of passenger traffic), giving the rail freight market an obvious European dimension.

494.There are several factors inherent to intermodal transport that generate additional costs for the operators and users (related to transhipment and additional transaction costs) and other disadvantages such as longer delivery times, complexity, higher risks and lower reliability. The figure below illustrates, based on cost data from the 2017 Survey study 341 , the costs incurred by shippers when choosing intermodal (rail-road) transport compared to road transport only. In addition, the rail freight, short sea shipping and inland waterways sectors need to continue to adjust to the changing characteristics of the market, where supply chain management is expected to become more flexible and faster.

Figure 34 Cost level and composition of intermodal transport compared to road-only transport

Source: European Commission 342

495.Adequate conditions need to be created incentivising the industry to use intermodal transport instead of road-only transport. The amendment of the only dedicated instrument, the Combined Transport Directive, was proposed in 2017. However, the positions of three institutions were far apart and, given a risk of ending up in a situation in which the incentives for combined transport could be further weakened, the Commission decided to withdraw the proposal. This means that the support measures in force for combined transport remain insufficient and are out of date.

496.The internal market for intermodal transport is poorly developed also due to lack of transhipment infrastructure (terminals), inefficiencies due to variations in sectoral legislation and the differences in technical norms and standards used by Member States and between the modes.

497.First of all, infrastructure bottlenecks still exist and further work is needed both at EU and Member States level as regards investments in cross-border infrastructure, in particular the main corridors. The density and choice of type of multimodal terminals and logistics hubs needs to take into account new trends and developing needs of the industry, in particular in urban areas. The distances between rail/road terminals on the TEN-T Core and Comprehensive networks are still well above 300 km in many regions; limiting the possibility of short (> 150km) road legs. While the availability of terminals is mostly sufficient in Benelux, Germany, Austria, Czechia and Slovakia, their density in Finland and in many Eastern-European countries, as well as in some regions of Sweden, Italy, France and Hungary is such that it is not possible to use intermodal transport. Improved statistical data on combined transport flows would help to prioritise such investments.

Figure 35 Intermodal terminals with rail access occurrence in Europe 343

498.Second, multimodal freight transport activities are subject to various sectoral rules. The range of legal instruments concerned is very broad, including the rules applicable to vehicles (technical, safety, environmental norms and standards), to personnel (e.g. professional qualifications, working time, posting of workers), to services (market access) and goods (e.g. customs, provisions for dangerous goods). At the same time, the prevalence of sectoral and modal approach has led to gaps where e.g. no tailored approach exist at EU level for multimodal investment projects either as regards state aid or for project assessment.

499.Quick implementation of comprehensive digital solutions would cut red tape and lower the administrative burden deriving from different sectoral and national requirements. Further digitalisation and solutions to data sharing are needed to support efficient functioning of transport corridors. These are further discussed in section 4.2.

500.EU transport policy aims to overcome barriers arising from a lack of coordination of technical norms and standards between Member States and transport modes. For example, the TEN-T Guidelines set common parameters for the length of trains. EU legislation on rail interoperability and safety allows trains to operate under a harmonised set of rules and the Commission is working with the EU Railway Agency and Member States to ensure superfluous national rules are withdrawn. A continued effort to ensure harmonised framework conditions is important to avoid unnecessary costs for multimodal transport.

501.Finally, the lack of internalisation of the external costs of all modes continues to penalise the competitiveness of intermodal transport vis-à-vis road-only transport. In the absence of pricing mechanisms fully reflecting the ‘polluter pays’ principle, intermodal transport remains financially disadvantaged except on very long distances of the order of magnitude of 600 km, unless public support is provided to compensate for the uncovered external costs of competing modes.

4.1.4.2Rail freight

502.Given the potential role of rail freight in the internal market, the EU adopted legislation 344 to open competition between rail freight service providers from 1 January 2007. In addition, eleven rail freight corridors have been established by Regulation (EU) No 913/2010 to specifically support international rail freight transport. The focus of the legislation was on fair and non-discriminatory conditions for the provision and use of railway infrastructure.

503.In parallel to opening the rail freight market, the EU developed legislation on railway interoperability with a view to reduce the technical, and operational barriers to cross-border rail traffic, while reducing the impact on human health, notably by setting noise limits. The technical pillar of the Fourth Railway Package includes substantial elements both harmonising EU requirements for rail vehicles and operations, and facilitating the clean-up and elimination of obstacles to seamless rail services caused by redundant national rules. Taken together these will reduce the cost of rail equipment and operations.

504.On the infrastructure side, diverging parameters, for example with respect to train length and loading gauge, continue to pose a significant barrier to more efficient freight operations.

505.Full deployment of ERTMS (the European Rail Traffic Management System) and the harmonisation of respective operating rules at EU level will further reduce costs and complexity for rail operators (since they will no longer need different safety systems for each Member State), and in the medium term will allow substantial cost savings to rail infrastructure managers and potentially major capacity increases. In the short term however, it imposes locomotive upgrade costs (hardware, training, testing and certification) on operators with already small profit margins.

506.Despite the above mentioned measures, a number of issues continue to affect the performance of rail freight:

507.Due to structural economic change, notably the declining importance of heavy industry in the EU, the goods being transported have undergone profound change, greatly reducing the freight flows where rail had a clear competitive advantage, e.g. in the transport of mass commodities such as coal and iron ore. Rail freight is less competitive for the increasing share of goods that require flexibility and more reliability, such as high-value components moved between manufacturers as part of complex supply chains and consumer goods.

508.For customers, rail freight’s attractiveness suffers from lack of punctuality, reliability, predictability and flexibility. In the first quarter of 2018, the percentage of freight trains delayed more than 3 hours reached 50% along the Alpine corridor. In this context fits reference to efforts to reduce delays such as the agreement by corridors, to reduce the maximum border crossing time to 2 hours, which passenger trains manage mostly without dedicated border stops. In the Green Lanes upgrade communication 345 adopted on 28 October 2020, the Commission announced continuous monitoring of schedule adherence and on time performance of rail freight trains at border stations, including dwelling times.

509.Information on the composition of trains, location and expected time of arrival (ETA), type of cargo and load factors etc. is scarce. Digital systems to plan, deliver and monitor rail services are often national. A European digital layer is in preparation, to a large extent on the basis of the technical specifications for telematics applications for freight and passenger services (TAF and TAP TSI), but it is not yet fully in place and use. In addition, capacity and traffic management is generally not coordinated between rail infrastructure and service facilities such as intermodal terminals. This hinders the ability to optimise the infrastructure, traffic and fleet management from an end-to-end perspective.

510.The performance of single wagon freight is hindered by the need for wagons to be manually coupled each time they are shunted – in spite of the fact that automated couplers are in widespread use in the rest of the world (since the late 19th century in North America). To date the cost of transforming the EU wagon fleet and the need to arrange a rapid migration at European level have prevented use of this in the EU, but the potential of modern coupling systems (which would also permit power and data transmission) means this issue needs to be urgently addressed. Work on specifications for Digital Automatic Couplers is being carried out in Shift2Rail Joint Undertaking with a view of incorporating it into the TSI.

511.Freight has usually a low priority both in capacity planning, i.e. when preparing rail timetables, and in operational traffic management, i.e. during operations, in case of delays. In addition, cross-border freight services often remain “trapped” between different priorities set at national level, reducing their speed and reliability for customers and resource productivity for operators.

512.Traditional rules for capacity allocation and management based on the definition of a yearly timetable for individual train paths also hinder more market driven business models. Rail is often unable to respond to short-notice requests for services from freight customers, with new services requiring months of pre-planning. Due to historical reasons and the prevalence of domestic traffic, such as commuter and regional traffic, there is still a lack of capacity of adequate quality available for cross-border freight traffic. This can be aggravated by lack of cross-border coordination of traffic management but also works on neighbouring networks, fragmentation and national orientation of IT tools used for capacity planning and traffic management, or poor cooperation on issues such as charging and performance. All of these issues have a clear network dimension and the current lack of coordination hinders the achievement of a truly Single European Railways Area.

513.Infrastructure managers seem to underemphasize their role as ‘traffic managers’ as opposed to managing the rail infrastructure assets. In some Member States, sophisticated schemes are in place to monitor and improve the state of the network but the impact of infrastructure works for maintenance and renewal on traffic is often not sufficiently taken into account. This is often caused by a lack of uptake of digital tools and automation of infrastructure managers business processes.

514.Profitability in the rail freight sector remains low, limiting the motivation for investment in new technologies and innovation or diversification of business areas to support growth strategies. New operators have entered the market but operate mostly in niches, serving specific corridors or industries. Many incumbent rail freight operators are in chronic loss and rely on regular recapitalisation and/or reorganisation to survive. Some market segments, like single wagon load and combined transport, are highly subsidised – or have simply disappeared. Overall, freight operators still have a way to go to better realise market potentials and to optimise operations and business models. In addition, the absence of a level playing field with other modes and high operational costs, e.g. for intermodal transhipment and single wagon load, increase the challenge of finding a viable business model.

515.Investments into infrastructure (at EU and national level) have not always supported operational improvements and infrastructure maintenance works are not duly coordinated across borders. Furthermore, in the event of incidents or infrastructure works, it has been difficult to provide diversionary routes with suitable characteristics (train length, gauge, axle load, etc.) even along the key axes included in the Rail Freight Corridors (RFCs). This can deeply affect both rail competitiveness and EU businesses. As an example, the total losses from the Rastatt, Germany incident in August/September 2017, where a major freight line was closed for 8 weeks, have been estimated at approximately EUR 2 billion 346 .

516.The Regulation establishing the Rail Freight Corridors 347 is currently under evaluation. More efficient use of rail infrastructure capacity at the EU level would be instrumental for making rail freight transport more competitive, both in multimodal context and as a mode on its own. Stronger cross-border traffic management cooperation, coordination and smooth operations suffering less obstacles from redundant national rules remain a significant challenge for the sector, which should be considered with the involvement and commitment of Member States, infrastructure managers, infrastructure users and customers of freight services.

517.Effective management of EU rail infrastructure is another important subject when it comes to building a truly single European railway area. An important element is the need to redesign the governance process for managing railway capacity so that it enables rail freight operators to provide transport services in line with the needs of their customers in terms of reliability, punctuality and flexibility. This requires a management process that considers rail capacity in a continuous manner across all planning and operational phases, and which is supported by state-of-the art digital tools. Such an approach would overcome the current lack of continuity and integration, creating a transparent link between the mid- to long-term capacity needs expected by operators and customers, the planning of infrastructure works restricting available capacity by infrastructure managers and the flexible, discrimination-free allocation of capacity when concrete capacity needs are known, including a short-notice allocation of train paths for spot traffic and in the event of disruptions. In addition, experience with the Rail Freight Corridors has shown that due to the prevalence of mixed-used lines in the EU railway network, a comprehensive approach to capacity management – comprising both passenger and freight traffic – is currently absent and hinders optimal utilisation of network capacity (see also section 4.3.2).

518.In order to implement such a novel governance approach in a harmonised and effective manner, it may be necessary to provide for rules whereby, to an extent, management of capacity takes place at a level beyond national borders. In some cases, the most appropriate way to do so may be to strengthen the role and competences of the existing rail freight corridors. In others, it may be more efficient to coordinate or assign certain tasks and functions at the EU level. It is necessary to thoroughly assess different options and to consider a possible revision of the Regulation establishing the Rail Freight Corridors 348 and, if necessary, corresponding provisions of Directive 2012/34/EU establishing a single European rail area.

4.1.4.3Inland waterways

519.Inland waterway transport is particularly relevant for certain corridors, for instance, current market characteristics show that for cross-border traffic within the Rhine-Alpine Corridor, inland waterways have a share of 54%. This mode of transport is especially important for some goods segments. In particular, inland navigation is successful in conquering new market shares within the liquid cargo and container segments: its modal share for chemicals and containers show the most potential for further increase, at least since 2008. Waterways in the heart of main European cities start playing an increasing role in the transport of people and the urban distribution of consumer goods, building materials and waste which helps to reduce traffic problems and emissions.

520.The successive NAIADES action plans contributed to largely maintaining the modal share of inland waterway transport in the overall transport mix, despite an economic crisis, changing markets, an imperfect governance framework and the lack of dedicated funding. The work is not finished yet. Much remains to be done to make better use of inland waterway transport and thereby create added value for Europe. The current Naiades II programme ending in 2020 is addressing challenges to be tackled to use the untapped potential of IWT to reach a more sustainable transport system.

521.To make IWT an attractive, reliable and green mode of transport the crucial thing is close cooperation with all relevant organisation at international and regional level. A common approach is needed in relation to the future development of this sector. Without an inland waterway transport agenda for Europe, there is the risk of returning to fragmented and uncoordinated actions that hamper the EU Single Market and result in more redundancies and barriers, deteriorating cross-border traffic, widening the digital divide and jeopardising synergies. It would lead to a declining role of inland waterway transport in the transport system. It would also deprive our economy and society from the benefit of innovations resulting from cooperation with other sectors. 

4.1.4.4Short sea shipping 

522.When adding air and maritime transport to the inland modes, road still keeps its leading position, followed by maritime transport. In 2018, road accounted for just over half of all tonne-kilometres performed in the EU. Maritime transport came next, with almost a third of the total transport performance, followed by rail (13.0 %) and inland waterways (4.1 %). In terms of tonne-kilometres performed, air transport plays only a marginal role in intra EU freight transport, with a share of 0.4 %.

523.However, the EU maritime industry is unable to fully benefit from internal market in short sea shipping due to diverging national measures, including burdensome non-harmonised reporting obligations at each port call. Better integration of maritime transport in the entire logistic chain, as well as exploiting ancillary maritime sustainability measures is needed. The new Regulation (EU) 2019/1239 establishing a European Maritime Single Window environment (EMSWe), once implemented, can simplify fulfilling the reporting obligations, but considerable efforts have to be undertaken for the implementation of the new regulation.

524.However, although the EMSWe regulation does not harmonise the measures by Member States, it provides for the first time a complete overview of such measures and establishes a notification obligation for new legislation for Member States, posing a limit to the proliferation of data requests which create barriers to internal market in short sea shipping. Furthermore, use of simplified digital procedures for internal market operations would improve the competitiveness of short sea shipping as compared to other modes of transport where no comparable obligations exist on transport of goods between Member States.

525.This includes the issue of making certain information publicly available e.g. Automatic Identification System (AIS) and actual time or arrival/departure. In this regard, the EMSWe regulation provides that arrival/departure times of ships must be made public available, allowing for better planning of cargo and vessel movements, and for increased integration of all modes linked to and centred around ports.

4.1.1Better incentives to users

526.Currently, transport user do not give enough consideration to sustainability. People need to be made aware of the environmental impact of their travel, purchases and day-to-day mobility. In other words, the right incentives need to be put in place, in addition to making each and every transport mode more sustainable and making sustainable alternatives widely available.

4.1.1.1Pricing and internalisation of external costs

527.As regards incentives, pricing instruments are powerful tools to green the transport sector. Even though both the “polluter-pays” and the “user-pays” principles have been on the EU agenda for a long time 349 , today in the EU no mode fully pays the external and infrastructure costs they are directly 350 responsible for 351 ; 352 (see also above). This is a problem that the Commission has repeatedly highlighted and tried to address: the pricing of transport services often does not cater for correct price signals and thus prevents an economic effective resource allocation as well as a fair burden sharing among users, polluters and society as a whole. In turn, internalisation of external costs would result in polluters and users fully taking responsibility for the costs they generate, thereby providing them with a strong incentive to reduce those costs by opting for alternatives, better technological solutions (i.e. cleaner vehicles), changing use patterns (i.e. using vehicles in times when there is no congestion) or decreasing use.

528.Nonetheless, despite a Commission proposal 353 to do so, carbon pricing has been introduced only in a fragmented manner across the transport modes, either through coverage by ETS (aviation for intra-EU flights, electric rail) or via the CO2 component in fuel taxes, but only in certain Member States 354 . Distance-based road charging for passenger cars and vans has been implemented only in a few countries in Europe, while the current systems of VAT and of the taxation of energy products often discourage the use of sustainable transport solutions or prevent the further incentivising of greener purchases by consumers. Taxation of vehicles in particular, which could encourage the uptake of cleaner solutions, lacks harmonisation in relation to CO2.

529.Other policy instruments (e.g. regulatory measures) aim more directly at reducing certain externalities (for instance, standards define the acceptable limits of pollutant emissions emitted by a new vehicle). Such measures are very effective in addressing specific market failures such as the principal agent problem or consumer myopia. Appropriate pricing measures, such as cap & trade GHG emission trading system, can be complementary to such regulatory instruments: they specifically correct market failures by internalising external costs and thereby enable market forces to find the economically most advantageous solution to deliver the desired policy outcome (e.g. reduction of GHG emissions) and incentivise people to opt for the most advantageous choice.

530. Several pricing instruments already exist in EU legislation but, on average, they do not allow full cost coverage. Furthermore, they are not differentiated enough according to the level of external and infrastructure costs.

531.Marginal social cost pricing is considered – from a theoretical economic point of view – as a first-best approach. It is defined as a situation where transport users are charged with a levy equal to marginal external (and infrastructure) costs, thereby excluding fixed infrastructure costs. It is also in line with the framework set in the 2011 White Paper for Transport for smart pricing and taxation for transport. However, implementing internalisation measures in line with such principle is technically challenging, as the level of costs can change very quickly: the external cost of congestion varies depending on the actual level of congestion. Transport users could find it difficult to understand or take into account continuously fluctuating cost. For these reasons, a certain degree of simplification is inevitable. A few examples of existing instruments are provided below, covering different modes.

532.The Energy Taxation Directive provides a framework for taxing motor fuels, heating fuels and electricity. Currently it essentially follows however a predominantly fiscal logic, meaning that the system of taxation often has no link to the actual damage caused by the fuel, for instance in terms of carbon emissions. In addition, the minimum rates of taxation of the same fuel are very different depending on whether it is burnt in a heater/boiler or in an engine. Differing conditions in Member States may also hamper the development of an internal market of sustainable alternative fuels at sufficient scale.

533.The ETD has provided for mandatory exemptions to fuels used in international aviation and maritime since 2003 355 . As acknowledged in Recital 8 of the Directive, the objective of the mandatory exemptions was to respect existing international obligations while safeguarding the competitiveness of European industry vis-à-vis third countries. However, as stated in a recent Commission evaluation of the Energy Tax Directive, the presence of sector-specific energy tax exemptions or reductions such as in the aviation and maritime sectors, may weaken the incentives for investing in more energy-efficient capital stock and production processes in these sectors and may affect the level playing field with other transport modes.

534.In its conclusions of 5 December 2019, the Council has invited the Commission to analyse and evaluate possible options with a view to publishing in due course a proposal for the revision of the Energy Taxation Directive. In particular, the Council calls on the Commission to update provisions in the future proposal in order to ensure that they are practicable and provide greater certainty and clarity in its implementation, taking notably into consideration relevant sectors, such as aviation, considering their specificities and existing exemptions and international dimension.

535.These considerations include the risk of carbon leakage (e.g. vessels can take advantage of fuelling outside EU jurisdiction; intercontinental air traffic can bypass the EU and connect at non-EU hubs, and short-haul flying can be replaced by driving) which can additionally affect the competitive position of EU companies and have negative unintended consequences contradicting the EU climate objectives. A recent paper of Eurocontrol for the ECAC airspace 356 shows that 16.5% of flights are able to perform full fuel tankering 357 and 4.5% partial fuel tankering with additional negative impacts on CO2 emissions, because of carrying more fuel than necessary 358 .

536.For waterborne transport the high capacity of tanks provides even more flexibility in fuelling outside EU jurisdiction (with a particularly high risk for diverting the short sea shipping routes to neighbouring third countries). For a deep sea shipping, according to a study by Ricardo 359 , on a single bunkering a Panamax bulk carrier can stay at sea for 56 days. Fuel suppliers could also avoid incurring the duty on fuel sold by setting up offshore bunkering facilities (e.g. beyond a 12nm zone). Past experience with California’s 1991 decision to lift the fuel tax exemption shows that within a year Californian bunker sales had collapsed as ships bunkered elsewhere, especially in Panama 360 . Quantifying the above-described risk of fuelling outside EU jurisdiction and the consequences thereof from the perspective of revenue generation, negative impacts on emissions and competition would require future in-depth analysis.

Figure 36 Minimum rates of taxation laid down in the ETD (1 Jan 2010)  361

 

Source: European Commission.

537.Revenues from fuel and electricity taxation amount to more than EUR 200 billion per year 362 which corresponds to about 1.6 % of the EU-27 GDP and to about half the total revenues of road, rail and inland waterways.

538.Today, the revenues from transport taxes and charges are only partly earmarked for expenditure for transport infrastructure and significant differences exist between modes. Earmarking of revenues may be used to gain public support for future initiatives to increase the extent of internalisation of external and infrastructure costs of transport. On the contrary, if no alternative mobility options are provided, increasing the taxes or charges on a specific mode might be perceived as a measure aiming simply at increasing tax revenues and its impact on greening the transport sector might be limited to a reduction in demand.

Other Market-Based Measures

539.Intra-EU aviation has been included in the EU Emission Trading Scheme (ETS) since 2012 and electrified forms of transport (e.g. rail, electrified cars etc.) are indirectly included, as power generation is covered by the ETS. The purchase of allowances by aircraft operators under the EU Emissions Trading System (ETS) resulted in a net reduction of 27 million tonnes of CO2 emissions for the year 2017, reaching over 100 million tonnes over five years. 363

540.The application of the EU ETS is currently suspended in relation to flights to and from countries outside the European Economic Area to allow for the development of an international instrument in the International Civil Aviation Organization (ICAO). All European States will join the pilot phase of the new Carbon Offsetting and Reduction Scheme for International Aviation as of 2021, with the aim of offsetting emissions above 2020 levels, without prejudice to the upcoming revision of the EU ETS Directive as regards aviation. This international scheme will require airlines flying between participating countries to offset all emissions beyond 2019/2020 levels.

541.In the 2030 Climate Target Plan 364 it was stated that the Commission will propose to reduce the free allocation of allowances, increasing the effectiveness of the carbon price signal in this sector, while taking into account other policy measures such as revised energy taxation and the ReFuelEU initiatives.

542.As regards maritime transport, the European Green Deal puts forward a basket of measures addressing, among other things, energy efficiency improvements and the uptake of alternative fuels. The introduction of correct pricing signals through the extension of the ETS is an important part of this basket of measures. The European Green Deal also recalls that European measures should be coordinated with action at global level, notably with the IMO. In the light of progress at global level, the Commission will give fresh political consideration to the international aspects of the EU ETS, taxation and fuel policies for maritime to ensure the gradual decarbonisation of all fuel use from transport relating to the EU with the ambition to include international emissions from navigation into the EU ETS. The Commission is currently carrying out a preparatory work to assess the impact of extending an EU ETS to maritime transport.

543.It is also worth noticing that the IMO identified a similar basket of candidate measures at global level, showing that all countries and the industry have aligned on the need for actions on different fronts. While short-term measures should be finalised and agreed by 2023, mid- and long-term measures are only expected after 2023. However, discussions on market-based measures are expected to start in the course of 2021 in conjunction with the industry proposal on a fuel levy to fund research activities at global level. Past discussions included a fuel levy and an ETS, though these were temporarily put aside by an agreement on mandatory energy efficiency standards for new built ships - to date the only legally binding standards that apply to an entire global industry and to all countries.

544.Road transport is subject to several different measures having the same objective of reducing CO2 emissions and other external costs, including CO2 standards, fuel and vehicle taxes and road charges. In terms of available alternative technologies to replace fossil fuels, private cars, urban and short distance delivery light lorries and heavy long distance road haulage are clearly distinct. Inclusion of road transport in the EU ETS could give the sector a clear signal and capture fleet emissions under a cap. Especially with increasing electrification, a case could be made to treat all vehicles alike. A measure to this effect may be combined with the other existing measures such as CO2 standards and road charging.

Taxation of vehicles

545.When it comes to low- and zero-emission vehicles an important factor to be taken into account is their still rather high initial purchase costs. While the total cost of ownership (TCO) is often competitive with conventional vehicles – and incentives such as reduced annual circulation tax can further increase their attractiveness – the fact remains that for many consumers the initial purchase costs can represent an important obstacle and many fail to make purchases on the basis of TCO. The evolution of the battery prices, which reduced dramatically over the last years, and which are projected to continue decreasing significantly, will have a positive impact on the affordability of vehicles. In addition, there are two key areas where steps could be taken by Member States to send a clear market signal in favour of low- and zero-emission vehicles:

·Vehicle purchase/registration taxes and VAT: reduced rates for purchase/registration taxes for zero-emission vehicles would provide an important stimulus to their faster deployment, by reducing their steep initial purchase cost and making them more competitive; overcoming the fragmentation of the Single Market for the automotive industry (see figure below). This would ideally be accompanied by a modulation of the corresponding taxation of other vehicles based on CO2 and air pollutant emissions per km. This should also be accompanied by the adoption of the Commission proposal on VAT rates, which would allow Member States to lower VAT on zero-emission cars.

·Circulation/ownership tax: a similar approach could be followed for the circulation / ownership tax. On the one hand, this would not directly reduce the initial purchase cost; however, the amount of the yearly tax to be paid allows for a clear assessment and can be an important element influencing buyers’ decisions when choosing a new vehicle

Figure 37 Purchase taxes in the EU in 2016

Source: CE Delft 365

546.The fiscal treatment of company cars would be another possible area of intervention: the preferential tax treatment of company cars applied in some Member States weakens efforts to internalise external costs and decarbonise mobility, by effectively promoting the daily use and purchase of larger and more polluting vehicles, especially when combined with other incentives, such as free parking at the workplace. If preferential treatment were at least to be accorded on the basis of the vehicle’s environmental performance, it could instead provide a clear market signal and accelerate market take-up of low- and zero-emission vehicles.

547.According to the Commission proposal for a Council Directive amending Directive 2006/112/EC as regards rates of value added tax 366 , Member States would in future be allowed to apply a maximum of two reduced rates of a minimum of 5%. This possibility is subject to a few conditions, notably to make sure that no distortions of competition within the Single Market arise. A list of goods and services to which reduced rates may not be applied is annexed to the proposal. It leaves Member States the possibility to reduce VAT to be paid on the supply of environmentally-friendly vehicles such as electric cars, if and when the proposal will be adopted.

548.Transport services, like any other service supplied by a taxable person within the EU, are subject to VAT. Historically however, Member States considered applying VAT to international air and maritime transport administratively too complicated and costly. This is why for international passenger transport, sea and air are exempt of VAT in the whole of the EU-27. At the same time, this VAT treatment is not given to competing modes, such as in particular rail in some Member States. The recent Tax Action Plan 367 has however announced a proposal by 2022 where this exemption will be re-examined with a view to VAT treatment on an equal footing between transport modes and an alignment with the objectives of the Green Deal.

Infrastructure charging

549.For road infrastructure, Directive 1999/62/EC (Eurovignette Directive) prescribes the principle for charging heavy goods vehicles. The Commission adopted a legislative proposal to amend it in May 2017, in order to extend the scope of the Directive to buses/coaches, cars and vans, to introduce differentiation of tolls and user charges per criterion such as noise, air pollutants and CO2 emissions of the vehicle, and to gradually move away from time-based user charging (vignettes) to distance-based pricing.

550.While the European Parliament adopted an ambitious position in October 2018, including effectively replacing time-based vignettes with distance-based tolls, Member States are not yet ready to agree on strong road pricing measures for cars. Other elements of the text (e.g. the requirement to vary tolls based on CO2 for lorries or the possibility to apply external CO2 charges or a congestion charge) would still contribute to the objective of the decarbonisation of transport. In addition, in 2019 the EETS Directive on interoperable electronic tolling was adopted, which will, inter alia, help the national authorities to recover unpaid charges. Indeed, smart, distance-based road charging, with varied rates for the type of vehicle and the time-of-use, is an effective tool to incentivise sustainable and economically efficient choices, manage traffic and reduce congestion.

551.In line with the user pays – polluter pays principle, for rail, infrastructure charging could play a much more supportive role towards the policy objectives. This would require both a better application and a rethinking of the applicable rules:

552.The charges for rail infrastructure are set under the provisions of Directive 2012/34/EU. 368   369 The Directive foresees two basic components of a charge: direct costs, which railway undertaking always have to pay, and mark-ups. Direct costs cover the costs directly incurred by the train run (but not costs related to the initial construction of the infrastructure). Mark-ups are foreseen as an exception to the basic charging principle of direct costs and can be levied only if the market can bear them. They cover additional costs of the infrastructure manager that are not covered by State subsidies.

553.Mark-ups increase the price of rail services. In some market segments (in particular high-speed rail), the cost burden on rail services (levied through taxes and charges) is currently significantly higher than their marginal infrastructure usage (direct costs) and external costs. 370 According to the Directive, direct cost charging represents the general principle, mark-ups are applied only if the market can bear them. However, where infrastructure manager’s limit charges to direct cost, this helps strengthen the competitiveness of rail services compared to other modes of transport. Particularly long-distance passenger services are currently often subject to high mark-ups. The current track access charge regime also raises questions as regards rail’s competitiveness versus aviation over longer distances. Since track access charges are charged per train/km or track/km, rail charges increase linearly with distance.

554.A further aspect is that delays in the rail system ought to be paid for by those who cause them. Directive 2012/34 foresees performance schemes to reward punctuality. However, in practice, a large number of Member States have so far failed to introduce such a system, probably in part because they have struggled to design a system that is at the same time effective but not too complex. Better compliance, if necessary on the basis of further EU guidance, would be necessary to enhance the overall punctuality of the rail system.

555.Track access charges can be modulated to set incentives for the use of specific technologies or vehicles, for example by reflecting environmental costs in the charges, such as noise (Art.31 (5) or by incentivising equipping trains with ERTMS (Art. 32(4)). Member States can already introduce noise differentiated track access charges, but there is currently no obligation to have such a scheme in place and only a few countries have done so. Further analysis would also be required to see whether charging could be used to better incentivise energy efficiency and the installation of ERTMS.

556.As regards airport charges, the EU has introduced legislation (Directive 2009/12/EC) to ensure that certain minimum criteria are fulfilled with regard to setting of airport charges. Notably, such charges must be transparent, must be established through a dedicated process involving the participation of airport users, they must be non-discriminatory and an independent supervisory authority must be empowered to review compliance with the Directive. The Directive does not provide for any actual (including minimum or maximum) levels of airport charges. Concerning ports, a study published in June 2017 identified around 30 ports in Europe that apply differentiated charges (in the form of rebates) for vessels that have a better environmental performance than legally required 371 .

4.1.1.2Better information to users

557.In line with the EU priority to move towards a green and carbon-neutral economy, more focus is needed for motivating on the one hand the offer of more sustainable services or operations and on the other hand the consumers to improve the sustainability of their transport choices. Consumers and businesses lack the right information that could help making their mobility and transport more sustainable. It is important to leverage the increasing interest of consumers for greener choices and to remove the many barriers they still face. Information on environmental performance of transport services should become easily available and be trustworthy, advertised green benefits should not be misleading.

558.However, no specific and universally accepted framework for calculating and reporting CO2 emissions from transport services exists. The availability of various methodologies, initiatives and calculation tools limits the potential to reliably measure, compare and benchmark various transport services, as well as to develop relevant transparency and information tools, such as eco-label programs and scoreboards in line with the principles of the ‘sunshine regulation’. The European CEN standard EN 16258, published in 2013, is the only standard specifically focused on carbon footprint measurement of transport services. However, since it leaves room for interpretation it does not guarantee a fully harmonised implementation and thereby comparability. The lack of a harmonised classification framework makes it also difficult to reward the best performance and pioneers of innovative technologies.

559.The study and stakeholder consultation undertaken by the Commission in 2014 on the standardised carbon footprint methodology for transport services 372 , recognised a clear need for a common methodological framework for carbon footprinting both at the EU and international scale. Further, the Commission co-financed between 2011 and 2019 two consecutive RTD projects addressing the calculation, reporting and verification of logistics emissions. The projects addressed the methodology development, verification and certification of the calculations/method and labelling to reward business. They also looked at the issues of the data quality, collection and exchange. The projects were closely interlinked with the work of the Global Logistics Emissions Council (GLEC), a platform for industry initiatives, associations and multinationals that developed the ‘GLEC framework for Logistics Emissions Methodologies’. The RTD projects in cooperation with GLEC supported the process which leads to the establishment of a specific ISO working group in 2019 working on a global standard for transport and logistics emissions calculation The envisaged revision of the abovementioned CEN 16258 standard will piggyback the ISO process.

560.The Commission is considering to launch an initiative to develop a harmonised framework to establish a fair benchmarking tool to companies and customers wishing to procure more sustainable services. Such a system, taking into consideration the existing EU frameworks 373 ,preferably aligned at global scale, would also facilitate the development of complementary measures and tools, such as GHG certification schemes, eco-labelling, green procurements, creating further opportunities towards emission reduction. Logistics operators should be able to compare and benchmark various transport and logistics services and to provide reliable information to clients on environmental impact of their orders. Shippers could include carbon efficiency as a criterion in their transport decisions. All this creating opportunities towards innovative solutions, cutting costs and further emission reduction.

561.After the sharp increase in e-commerce during the COVID-19 pandemic, it becomes even more important to provide information to clients on the transport-related environmental impact of their orders and provide transport choices at, for example, longer delivery times but lower emission levels. As the results of the recent Eurobarometer survey showed 374 , among respondents who buy goods online or by phone, six in ten (59%) would pick up a delivery themselves at a pick-up point, while 42% would wait longer for the delivery if it was done by a green mode of transport.

562.Information about environmental (including carbon) footprint of each transport mode could be integrated into travel information systems, indicating also the monetised impact, to inform consumers and raise their awareness; in the second step, the footprint could be included in the ticketing/pricing systems. The current delegated regulation 2017/1926 on EU-wide multimodal travel information services contains some relevant elements.

563.Examples of emission reduction effects supported by carbon accounting, can be provided from the perspective of sector specific carbon reduction schemes and individual companies. As regards the sector specific schemes, Logistics Emissions Reduction Scheme (LERS) and Smartway program can be mentioned in particular. LERS is a UK-based green freight benchmarking program, reporting that in 2018 its members achieved a 4% reduction in their CO2 emissions, while LERS member emissions are in general close to 13% lower per vehicle km than the industry average.

564.The U.S. Smartway program, benchmarking the efficiency of transport operations and run as a public-private partnership, has attracted since 2004 over 3,700 partners, who saved together 280 million barrels of oil and prevented from the emission of 134 million tonnes of air pollutants. Also individual companies see the benefits of accounting carbon footprint of transport and logistics services 375 .

565.Navigation solutions, are now ubiquitous: they come in-built in vehicles, can be attached to the vehicles in form of dedicated devices or can be simply downloaded to smartphones. These solutions guide millions of drivers everyday on their trips, all around the world, showing them the fastest way to get to their destination.

566.However, all too often the fastest way is not the ‘best’ way to get to the destination if the algorithm took into account other important factors such as fuel consumption and related environmental impacts. Eco-routing navigation solutions can help addressing this problem as they enables users to reduce their fuel consumption and CO2 and air pollutant emissions at the route choice level 376 and therefore their use should be promoted.

567.In addition to precise information on the impact of individual trips, experience from other industries and EU policies, notably the EU Ecolabel and the EU Energy label, demonstrated that labels 377   can be effective tools for communicating environmental performance and preventing proliferation of green claims.

568.For example, tyre energy labels 378 provide a clear and common classification of tyres performance for rolling resistance, braking on wet surfaces and external noise 379 . The labels help consumers make informed decisions when they are buying tyres as they can easily set their priority choice based on the 3 parameters.

569.The Car Labelling Directive (Directive 1999/94/EC) aims to raise consumer awareness on fuel use and CO2 emissions of new passenger cars in order to support the purchase or lease of fuel-efficient cars. A label should be attached to all new cars or displayed nearby the point of sale showing fuel economy and CO2 emissions. Moreover, at or through the point of sale further information on fuel consumption and CO2 emissions of all new car models should be available (posters, printed guide and promotional material).

570.The Commission evaluated Directive 1999/94/EC in 2016. It showed that consumer awareness about CO2 emissions and fuel economy has risen steadily since the implementation of the Directive. A number of Member States have set further mandatory or voluntary requirements regarding information tools. While the relevance of the Directive remains, the Directive also underlined the need and benefits for further clarification and simplification. Those include the need to address differences in label design in Member States following the absence of a common methodology, the lack of provisions on alternative fuelled vehicles or the lack of provisions concerning of air pollutant emissions, among other. Information on fuel consumption and emissions would also need to be adapted to the provisions of the Worldwide harmonized Light vehicles Test Procedure (WLTP) test cycle. The Commission issued a recommendation 380 to Member States in 2017, asking them to ensure that WLTP information would be incorporated into the national labels.

571.In order to address the problem of diverging CO2 emissions and fuel consumption values between what is communicated through the registration certificates and what the users actually experience in reality, and in order to strengthen consumer awareness, the Commission adopted the new Worldwide harmonized Light vehicles Test Procedure (WLTP) 381 and has introduced mandatory monitoring of the discrepancy between real world fuel consumption and the certified values through accurate 382 on-board fuel consumption monitoring systems. A series of tools that provide indicative vehicle in-use information to consumers have also been funded by European projects.

572.The European Union Aviation Safety Agency has also started a demonstration project for the feasibility of developing an environmental label for aviation that could potentially capture the environmental performances, notably of aircraft, airlines, flights and airports. This would need to be in line with the methodologies and policy objectives of the Green Claim initiative, announced by the Circular Economy Action Plan in March 2020, to be adopted in 2021. Such labelling, should the Commission decide to take it forward, would require a holistic approach and would need to take into account the existing methodologies and policy objectives.

573.Furthermore, awareness raising is an area where the European Commission has invested for years. Earlier this year, the Commission has proposed to declare 2021 the European Year of Rail, in order to promote rail as a sustainable form of transport. The European Mobility Week 383 is of particular relevance. It is the Commission’s leading awareness-raising campaign promoting behavioural change in favour of sustainable transport modes. It takes place from 16-22 September every year and culminates in the well-known Car-free Day.

574. By taking part, towns and cities can showcase the benefits of cleaner transport choices and make progress towards better mobility in Europe. Local authorities are strongly encouraged to use European Mobility Week to measure air quality, test new pedestrian areas and transport measures and get feedback from the public. At the same time, organisations, businesses, schools etc. can register their Mobility Action to become a part of the EMW campaign and to show what they are doing to promote sustainable mobility. In 2019 there was a record-breaking participation, with over 3,100 cities registered from 50 countries as well as 1028 ‘mobility actions’ in 56 countries. However, it is highly variable used – three countries (Austria, Spain and Turkey) each have participation from more than 500 cities, while the European Mobility Week’s footprint is much slighter elsewhere, suggesting there is potential to develop this tool further. Finally, each year we give EMW awards to reward local authorities judged to have implemented the best European Mobility Week in line with the annual theme.

575.Working with employers and their internal mobility offer to their employees, as well as with schools and universities and their pupils/students can also be a way to influence the behavioural change. Lasting change in behaviour is key when it comes to shifting to sustainable mobility, and proposing a good offer and incentives – combining economic and social aspects – by employers/schools etc. can be a powerful tool in that regard 384 .

4.1The challenge of digitalisation and modernisation

576.Digitalisation, automation, the emergence of the shared, collaborative economy and platforms, which are challenging the current and traditional mobility and transport landscape, will be key for building a smart, green and resilient transportation system. New ICT technologies, including artificial intelligence (AI), impact the way transport organisations operate. They pave the way for innovation, allow new services and business models to enter the market and challenge the incumbents. Digitalisation also facilitates novel ways of collaboration within and beyond the sector, including between supply chain actors. At the same time users’ behaviour and expectations – both passengers and businesses evolve rapidly with demands for more efficiency, less emissions and better performance of the whole transport system. This rapid transformation brings a number of opportunities. It can make the transport system more connected, multimodal and efficient allowing a better organisation and execution of travel and transport operations. It can help make better use of infrastructure and resources as well as integrate different modes of transport. It can ultimately make mobility safer by helping reduce safety risks involving human error. It can make transport and mobility more inclusive and cleaner, by for instance increasing the use of public, collective and shared transport. Ultimately it can help to better serve both citizens and businesses.

577.At the same time, however, it raises a number of challenges, from the ability of the sector to adapt its business models to a new reality, through more horizontal questions of data availability and accessibility, resilience to cyber-incidents, the availability of the necessary infrastructure allowing for digitalisation, protection of personal data to the potential impact on jobs and required skillset.

578.All transport modes have started to embrace this disruptive change, although at a different pace. Reaping the full benefits of digitalisation and automation often requires a coordinated change across the network and simultaneously on infrastructure and vehicles. However, underlying conditions allowing the transport sector to take full advantage of digitalisation to achieve sustainable, seamless, safe and smart mobility across the modes, as well as to minimise the risks, are not yet optimal to take advantage of these opportunities. EU support to research and innovation is helping to seize these opportunities and mitigate risks, but more needs to be done.

4.1.1Smart multimodal transport – challenges for seamless experience

579.We are still far from a perfect smart and multimodal mobility experience across the European Union, in which solutions are interoperable and can be combined and integrated smoothly along a single travel chain. At the moment travellers are not yet able to plan, book and enjoy their trips across Europe with the same ease as they would do for a domestic journey. They often encounter disproportionate and discriminatory registration requirements attached to the use of many types of services– from public transport and rail through to electric vehicle charging and car rentals.

4.1.1.1Cross-border multimodal challenges

580.A seamless cross-border multimodal transport environment is highly desirable but still an unmet challenge. From a passenger perspective, each transport mode currently still operates in a mostly isolated system. Planning and purchasing tickets/mobility services for multimodal journeys is often cumbersome, as we lack a conducive environment for EU-wide, multimodal information and ticketing and purchase services. 385 There are a number of barriers, including the availability and accessibility of data, legal and commercial barriers ranging from the lack of cooperation between suppliers for payment system interoperability to the existence of different licence, insurance and distribution agreements.

581.For rail, significant work has been undertaken to enable data exchanges - through legislation (Technical Specification for Interoperability of Telematics Applications for Freight/Passenger Services TAP/TAF TSI 386 and recently the recast of the rail passenger rights Regulation 387 ), EU funded research in the framework of Shift2Rail and sector-driven initiatives (Full Service Model). Whilst the technical issues seem to have been largely overcome, it remains very difficult for passengers to buy cross-border or even through-tickets combining in a journey services of several operators, or even to get an overview of the existing offer.

582.In fact, rail ticketing is currently largely in the hands of the incumbent railway undertakings, who sell mainly through their websites and at times stifle competition by refusing to sell tickets of other operators. This situation is all the more problematic since incumbents’ financing still largely depends on public support in the form of public service compensation. Such financing usually supports the incumbent’s rail ticketing platforms, with no conditionality to make those platforms accessible to competitors. At the same time, they sometimes withhold their best offers and real time traffic information from third party vendors, thus hindering the emergence of a strong independent ticketing market.

583.The barriers to ticket distribution do not only hamper smooth multimodal experiences for passengers but also constitute market access barriers for new companies that would like to provide rail services, thus limiting the potential benefits of market opening. A number of national regulators have become active on the issue 388 , but a European solution is still missing to ensure seamless travel and fair competition throughout the single European railway area. Under Article 13a(2) of the Rail Governance Directive, the Commission shall present a report to the European Parliament and the Council by 31 December 2022 on rail ticketing platforms, accompanied, if appropriate, by legislative proposals.

584.For mobility platforms, which would like to offer multimodal services (provide real time information, and/or sell/issue tickets, offer new services), access and re-use of data needed to develop their services is often hampered, including due to interoperability challenges at EU level (data formats, protocols for data exchanges etc.).

585.Another issue concerns the promotion of intermodal solutions combining aviation and rail journeys through Computer Reservation Systems (CRSs). CRSs are computerised reservation networks used by travel agents (online and offline), online reservation sites and large corporations as a single point of access for booking airlines tickets, rail tickets, but also other items such as hotel rooms, rental cars, and other travel related items. CRSs are also used by some metasearch sites in order to obtain information about the services of airlines that participate in CRSs.

586.When adopted in 2009, replacing the Regulation previously governing this matter 389 , the Regulation for the Computer Reservation Systems 390 Code of Conduct took steps to promote rail transport and inter-modal transport. This included allowing rail operators and CRSs to freely negotiate booking fees and contractual terms for ticket distribution. Rail ticket information is also subject to the neutral display requirement which applies generally to air ticket information, whenever rail and air tickets are displayed together in the primary display. The evaluation 391 found that there is insufficient evidence to confirm that the Regulation on the CRS Code of Conduct remains an appropriate instrument to promote rail transport and inter-modal transport.

587.The potential of digitalisation is not used to its fullest for drivers either. Nowadays, around 60% of the population of the European Union holds a valid driving licence, representing some 270 million citizens. Many European drivers make cross-border trips within the Union for private or professional purposes or change their country of residence.

588.Digital driving licences would be convenient for drivers, reduce the risk of fraud and facilitate enforcement. 392 Unless interoperability is ensured, these developments are likely to lead to a patchwork of different national rules that could hamper the full exploitation of the potential of digitalisation in this area.

589.The lack of Union rules providing for digital driving licences is also disadvantageous for cross-border enforcement of traffic offences. The possibility of real-time checking of licences and preventing driving licence tourism is currently limited. Furthermore, there is no mutual recognition of driving disqualifications and penalty points, given that Member States have different systems of adding or subtracting points for different degrees of traffic offences, which can eventually lead to the withdrawal of the licence.

590.At the moment it is also cumbersome for the drivers to demonstrate compliance with urban vehicle access regulation (UVAR) criteria when travelling across Member States. The current identification/declaration of vehicle characteristics is done by registering manually in a city system, by buying a sticker, and/or using number plate recognition. The process is often lengthy and cumbersome. Despite the potential of fast digitalisation of the automotive sector, an EU-wide digital sticker or other form of digital vehicle identity such as ENPR, communicating digitally the vehicle characteristics to the relevant authority is far from being a reality.

591.In fact, seamless identification for all mobility-related services across modes, which could facilitate and encourage multimodal choices of European travellers, is not available either. At the moment, despite a ubiquitous use of smartphones and digital solutions, there is no EU tool recognised in all Member States that would enable Europeans to use one mobility account, with all necessary personal information, preferences, banking account details, driving licence or other potential documents such as the licence plate of their car (or even its characteristics (EURO norm)), to avoid the burden to register each time they want to get access to parkings, to city centres, to get access to and use mobility services, or to store (or even replace) all tickets/proofs of purchase (e.g. urban public transport, train, plane, taxi/PHV, shared mobility solutions, etc.).

592.The advantages of digital solutions are also supported by the general public. In the recent Eurobarometer survey on mobility and transport 393 , citizens identified the most useful digital solutions for their future personal mobility. A single ticketing tool for all urban journeys in any European city came top of the list (19%), with the digital driving licences valid anywhere in Europe second (10%). Citizens are also interested in solutions allowing them to pay tolls, parking and other charges in real time and directly from a smartphone or other device as well as in simple procedures to access areas subject to UVARs in different European cities. These solutions need to be accessible for persons with disabilities and reduced mobility as well.

4.1.1.2Multimodal & collaborative economy challenges in urban context

593.Seamless and smart multimodality facilitated by digitalisation is also key in urban and sub-urban areas. Urban transport plays a key role for developing a European transport system that offers seamless door-to-door mobility, for long distance and cross-border transport as well as for regional and local mobility.

594.The majority of long distance freight and passenger journeys start or finish in urban areas. The corridors of the trans-European network pass through many urban areas with related challenges for urban roads. Cities increasingly face problems caused by mobility and transport: congestion, road crashes, air and noise pollution. Transport CO2 emissions are rising, with urban transport representing close to ¼ of them 394 . The question of how to improve mobility while tackling these problems is a common challenge to all major cities in Europe.

595.At the same time, access to information and to an increased variety of transport services enabled by ICT technologies put individual travellers much more in control of how they want to travel. More and more often they expect to have a choice, adapted to their demand rather than have their travel routine dictated by transport operators.

596.This growing pressure on urban passenger transport systems has increased the demand for new and innovative solutions with various forms of transport services being integrated into a single mobility service accessible on demand, including also shared and collaborative mobility services (car-, bike-sharing, ride-hailing, e-scooters etc.).

597.Building on these new modes and the developments in information and communication technologies, the “Mobility as a Service” (MaaS) concept, which assumes that various forms of transport services – both traditional and innovative ones - are integrated into a service accessible on demand, has recently come to light. In practice, a successful MaaS involves many actors (local, regional and national operators, public, private, etc.) putting forward and reassigning available resources to make multimodal travel easier, more efficient and accessible.

598.While MaaS holds the promise of making urban mobility smarter, more-user friendly and sustainable, in some cities the close competition between different stakeholders makes them unwilling to share information, expose their business models and collaborate with their competitors, in turn making it difficult to come up with a true Mobility as a Service scheme. There are also challenges related to data, which is key to blend services together. The availability and accessibility to relevant data sets in digital, machine readable format and interoperability of different systems (booking, payment, ticketing, authentication, etc.) is still not optimal.

599.Simultaneously, an increasing number of cities have witnessed a steady shift towards shared and collaborative mobility services enabled by the emergence of intermediary platforms. Those platforms enable the sale of mobility services, acting as intermediary between customers and mobility service providers, and in some cases, create new mobility services themselves e.g. e-scooters, bike-sharing, car-sharing and ride-hailing.

600.The development of new mobility services may present many opportunities. However, it does not mean that the current mobility offer automatically becomes more efficient or it replaces the old one. Regardless of new mobility service availability, public transport remains the backbone of mobility in urban and sub-urban areas. Multiple US and European research highlights 395 that new mobility services need to complement rather than replace public transport. They show that measures such as ensuring the proper infrastructure can help integrate these services between themselves and with local public transport. However, integration is already lagging behind in some European cities for more traditional services.

601.As far as ride-hailing is concerned, in most Member States, both taxis and private hire vehicles with driver (PHV) exist next to each other. Taxis and PHVs have traditionally coexisted and served distinct markets. However, on-line platforms have radically changed – or even disrupted - this situation, blurring these traditional boundaries, creating a flourishing new sector and bringing taxis and PHVs in increasing competition. Local on-demand passenger transport has shifted from being organised locally, often based on low-tech dispatch centres, to co-existing with pan-European or global companies using sophisticated technologies and algorithms.

602. This development has generally increased the quality and efficiency of the ways in which taxi and PHV services are provided. The possibility to order PHVs and taxis on-line, thanks to apps using geo-localisation services, has been welcomed by users and triggered an increase in demand. According to the recent Eurobarometer, users perceive traditional taxi services and private hire vehicles as similar type of service, appreciating the availability and ease of booking as positive aspects of both. 396  

603.However, this has not been without tensions and led to different national legislative responses. Ensuring a level playing field between these two types of actors is just one of the challenges. Addressing legal uncertainty is another one - ride-hailing platforms, which are essential for PHV services, are objecting to the fact that the legal environment is constantly changing and differing between EU Member States. Compliance with as many regulatory regimes as the cities they want to serve is a barrier to develop a single market for these players.

604.While the new services have the potential to improve the overall mobility system by offering alternatives, e.g. by helping people choose new modes of travelling and reducing ownership of private cars, which are responsible for the lion’s shares of emissions from the transport sector. However, this is yet to be proven at a large scale. There are legitimate concerns about the real environmental impact, including whether they would indeed decrease car ownership and traffic, unless the vehicles used are sustainable ones. 397  In this context, it seems worth exploring how the use of cleaner vehicles can contribute to mitigating the environmental impact and how a shift to low and zero-emission vehicles for taxi and PHV services could be encouraged/achieved.

605. Part of the possible negative impact is also the result of constraining and obsolete rules - taxis are often limited to picking up passengers in dedicated geographical areas resulting in empty return driving when taxies, after a trip out of these areas, are forced to return to these areas for picking up passengers. PHVs are often obliged to return to the ‘garage’ after each trip, also resulting in much empty driving. This is due to rules that pre-date the arrival of on-line platforms and therefore ignore the efficiency gains they can bring, thus causing unnecessary emissions.

606.Concerns are often raised about the working conditions of drivers and the employment status of platform workers. Certain drivers working for platforms are self-employed, not well protected under labour law. Moreover, the fact that there are generally no common requirements on professional competences nor harmonised rules on driving and rest times, could be a risk in terms of the security of users and road safety.

607.Last but not least, these new services also raise a number of other issues from the use of public space, road safety, maintenance, liability, insurance as well as overall integration of different mobility services into coherent urban mobility.

608.While new mobility services become a day to day reality, there is currently no specific EU legislation for the services or intermediary platforms related to taxis, road e-scooters or bikes. National governments and cities struggle with applying existing laws or, in some cases, create new rules, which sometimes restrict the emergence of these new services. Businesses, on the other hand, miss legal clarity allowing to take informed decisions about possible investments. 398 The recently updated Sustainable Urban Mobility Planning guidelines 399 take these new developments into consideration but do not constitute a binding legal framework.

4.1.2Intelligent Transport Systems and connected, automated mobility 

4.1.2.1ITS challenges in road transport 

609.Another major trend, relevant both for urban and non-urban environment is the deployment of Intelligent Transport Systems (ITS) and related solutions, which are revolutionising the way we move and travel. The general public is well aware of the innovation ITS have brought about in the mobility e.g. vehicle-navigation systems, traffic information integrated with navigation, parking systems.

610.Beyond specific ITS use-cases, applying various information and communication technologies has also a huge potential to fundamentally change mobility across the modes, making it safer (e.g. by reducing human error in driving), more accessible (e.g. bringing mobility to those who cannot drive themselves e.g. elderly or disabled people), more efficient and sustainable (e.g. by making it a lot easier to share vehicles).

611.Yet, the development and deployment of connected and automated mobility systems might pose a multitude of challenges: from the development of technologies for the vehicle, its integration within the multimodal transport system, its interaction with the surrounding environment and other (in particular vulnerable) road users impacting road safety to the need for complementary investments in digital and physical infrastructure. There are also a number of related policy challenges – from regulation and standards, through ethics and impact on professional drivers.

612.Public acceptance of this promising technology has not yet been established. The majority of citizens are not yet ready to simply trust a driverless vehicle to behave safely, whether inside a car or on a pedestrian crossing. The recent Special Eurobarometer survey on “Expectations and concerns of connected and automated driving” 400 showed that a majority of those surveyed would feel comfortable in automated vehicles that are being supervised by a human operator in it, but less than half say they would feel comfortable in the case where a human operator is supervising the vehicle remotely. For the time being, a majority would not feel comfortable in the presence of fully automated vehicles on the roads either. The transfer of control between machine and driver and under what conditions is one of the big issues to ensure technology acceptance and safety.

613.As for driving such vehicles, two thirds of respondents would feel comfortable if they could take back control at any point in time, while for just over half it would be enough to be able to take back control if the vehicle does not understand the situation. 401 But there are also safety considerations with respect to how drivers take back control (e.g. when an automated car encounters a situation it cannot deal with, such as an atypical maintenance lane).

614.Part of the issue is that transition to higher levels of automation in road transport allowing for safe interaction between highly automated and “traditional” vehicles in “mixed traffic” and with non-motorised road users need to be fully addressed. Questions related to human-machine interactions and awareness (e.g. how can other road users recognise highly automated vehicles and predict their behaviour, where previously there would be eye contact between users) will be at the centre of this issue.

615.A large part of the answer will come from Cooperative ITS (C-ITS), enabling direct communication between vehicles and their surrounding infrastructure. Already today C-ITS based on ITS-G5 is deployed on commercial non-automated series-vehicles. As highlighted by the 2016 strategy for C-ITS, accelerated deployment of C-ITS will bring increased road safety and pave the way for higher levels of automation.

616.A number of Advanced Driver Assistance systems, which have great potential in preventing crashes and/or their severity, will become mandatory for all new vehicle models (in 2022) and later for all new vehicles (in 2024) under the revised General Vehicle Safety Regulation (see also sections 3.4 and 4.3). In order to ensure safe operation of the assistance systems throughout a vehicle’s lifetime, roadworthiness testing centres will need access to relevant data.

617.Last but not least, the current traffic rules are not yet fit for higher levels of automation. Those rules are set by Member States based on international conventions managed by the United National Economic Commission for Europe (UNECE). In contrast to UN conventions on vehicle safety, the EU is so far not a contracting party to the conventions related to traffic rules and only has observer status, which could hamper its ability to coordinate Member State positions. An aligned and holistic European approach to global questions on automated driving, including traffic rules, testing or liability aspects, would be desirable from a single market perspective and for promoting European industrial global leadership, as well as in terms of materialization of road safety benefits.

618.For the time being, the legal and policy framework defining links between vehicles and traffic management, between public and privately owned data, and between collective and individual transport, are not sufficiently developed. There is no coordination mechanism at the EU level that would help ensure consistency of the deployment and management of ITS and CCAM across Europe. There is no coherent way of implementing a type-approval for connected and automated vehicles and their emissions testing and roadworthiness inspection methods, for example.

619.Competition in the automotive industry is shifting from building cars (hardware) to software-centric, connected services. Moreover, fragmentation in the industry might affect EU competitiveness significantly, taking into account that industry approach in Europe could be conservative compared to other developers.

620.In this context, the emergence of new mobile radio communication systems such as 5G and its vertical application to the automotive and transport sectors can act as a catalyst to accelerate the way towards multi-service mobility and transport ecosystems and contribute to the resilience and sovereignty of the European industry in the field. This strong expectation of multiple ecosystems enabled by a common 5G network infrastructure associated with connected vehicles and road infrastructure will enable to combine different technologies, sensors (in vehicles and on the ground), high accuracy location, precise positioning, high definition mapping, converged AI on devices, at the network edge (including Mobile Edge Computing) and in the cloud, and, in particular high quality direct and network communications between all moving and fixed elements (vehicles, bikes, pedestrians, and road infrastructure).

621.This vision has been the basis for the CEF Digital programme over the 2021-2027 period, which includes an indicative list of 5G Corridors envisaged for funding, based on TEN-T corridors. It received the support of leading European industry associations, ACEA, CEDR, GSMA and 5GAA, through the publication, on 2 October 2020, of a 5G Strategic Deployment Agenda for CAM 402 . The roll-out of 5G corridors, in complement with deployment activities in the fields of C-ITS and CCAM, will provide a strong basis to Europe for the development of the multi-service ecosystem for mobility and transport.

622.While a number of research, large-scale demonstration and testing projects are taking place in EU Member States (some with Commission support), they are not numerous or coordinated well enough across the EU. 403 To address the most pressing challenges, the EU is currently supporting the set-up of a new public private partnership, based on a vision that maximises the societal benefits of CCAM and its potential to create new, more inclusive, shared and sustainable mobility services. This proposed partnership should establish links with other partnerships (under Horizon Europe), in which activities relevant for connected and automated mobility are planned.

623.However, even with such a partnership in place, further coordination capacity may be needed at EU level in relation to the deployment and management of ITS and CCAM across Europe, including in areas such as road infrastructure, type-approval and market surveillance, roadworthiness inspection methods, traffic rules for automated mobility, as well as to other detailed EU level safety and related tasks, and for the preparation of technical rules, coordination among national authorities' actions, and collection and analysis of relevant data.

4.1.2.2ITS challenges in other modes of transport 

624.To achieve a truly intelligent transport system, efficient capacity allocation and traffic management, automation and digitalisation must also be addressed across other transport modes as they help to avoid a capacity crunch on the one hand and reduce CO2 emissions on the other.

625.Rail is a highly complex operating environment, consisting of a number of systems which are or should be automated, and where interoperability between diverse infrastructure networks and vehicles (rolling stock) is required.

626.The key elements include passenger and freight information (relating to ticket, seat reservation, freight consignment and location), timetable design (advance planning to optimise use of network capacity, rolling stock and personnel and allow public timetables to be produced, freight services sold etc.), traffic management (near real time control of operations, to resolve conflicts between trains, prioritise services, where inevitable real world problems prevent the timetable being operated precisely as planned), signalling (ensuring switches are set and train movements controlled to prevent conflicts between trains and get them to their intended destination), train protection systems (systems on board trains to ensure they do not pass signals set at danger, and in modern systems, to ensure they do not exceed the safe speed for the line and signal aspect) as well as train automation (automated functions drive the train itself – either as an assistance to the driver; taking over functions from the driver but retaining him for passenger confidence and emergency tasks, or allowing completely unattended operations).

627.Taking these in reverse order: in rail, automatic train operations (ATOs) are essential to make the most of capacity while ensuring energy saving, reliability and safety. While some metros have been automated for many years, higher automation levels and autonomy on mainlines are not yet ready on main lines, preventing the appearance of more flexible services. ATO would also allow higher capacity (since the speed of an automated train can be precisely matched to the minimum safe distance from the previous train).

628.Introduction of rail automation is much simpler than in road, since the overall environment is already highly controlled. Nevertheless the availability of common standards for equipment and train operation, which are needed to ensure interoperability, is not yet optimal. The standards for Automatic Train Operations Grade of Automation 1 and 2 404 were developed within the S2R JU programme, and are now available. They will be included in the next revision of the CCS (Control Command and Signalling) Technical specifications for Interoperability, scheduled for 2022.

629.In order to reap the full advantages of automation and not to break interoperability, rail ATO in the EU should be based on the common EU train protection/signalling system (ERTMS). Despite its name, the European Rail Traffic Management System does not yet include traffic management – rather it harmonises automatic train protection and communication systems, which ensure that trains stop where they need to, and travel at a safe speed for the line that they are on. Efforts have been made to improve interoperability by replacing 21 obsolete national systems with one, helping to greatly reduce the cost of rail equipment, growing the capacity of the rail network, and improving railway safety.

630.However, due to the complexity of replacing legacy systems in Member States (the system itself needs to be partly installed beside the track and partly on board trains), as well as its substantial costs, the ERTMS deployment in Europe is slower than wished. Part of the challenge is that a standard, modular system architecture for rail control and signalling that would help speed up the deployment of ERTMS and lower the deployment costs does not exist yet, though this is being addressed through the Shift2Rail programme and its successor.

631.Network wide deployment is now underway in several member states, with many others planning it: such deployment allows the legacy systems to be removed completely. The latest versions of ERTMS (Level 2 and 3) will allow most trackside equipment to be removed, leading to substantial cost savings for infrastructure managers over the medium term (estimated at EUR 1bn per year for DE alone). Reduced maintenance needs also increase rail capacity and reliability since fewer route closures for maintenance are required.

632.Traffic management is another key aspect of achieving smart rail operations. It helps manage the paths of trains through the network, ensuring they keep to timetable and re-planning them when things go wrong. Currently this is managed by a patchwork of tools at regional level.

633.Higher levels of European Train Control Systems (ETCS) and the Future Railway Mobile Communication System (FRMCS) will accelerate the digitalisation of rail operations and enable safer and more secure higher traffic density on rail tracks. Advanced 5G communications systems will contribute to this process, but also to a better connectivity environment for train passengers. A first version of a Strategic Deployment Agenda “5G connectivity and spectrum for rail”, released on in April 2020 by the rail infrastructure managers and rail undertakings associations, EIM and CER, provides guidance to the deployment of 5G connectivity infrastructure for digital rail operations and ‘Gigabit Train’ for passengers in the perspective of CEF Digital.

634.The ability of 5G infrastructure to deliver high quality, secure and ultra-reliable connectivity to both FRMCS and Gigabit Train, as well as to CAM in areas where rail tracks and roads run in parallel, will enable to speed-up the deployment process and lower the overall costs.

635.There are also challenges related to automation and traffic management in the European airspace. Digitalisation holds promise to substantially improve the situation. Progress has been achieved on the research and innovation side through the SESAR project. However, today Air Traffic Management (ATM) still relies to a large extent on an outdated technology.

636.Scalability of ATM - in a safe, efficient and effective way - remains one of the most important challenges for the sector. Today this is not fully achievable due to the fragmented and monopolistic nature of ATM in Europe.

637.A true network oriented approach 405 to ATM in Europe is also missing. The local approach to Air Navigation Services provision is less effective and leads to congestion and capacity crisis whereas experience shows that more effective network coordination decreases delays and congestion.

638.The shortcomings of the current ATM system lead to a number of environmental challenges. The congestion above Europe in 2018 and 2019 led to environmentally sub-optimal flight paths in terms of CO2 emissions, when pilots had to fly around congested airspace sectors. The way the ATM services are charged is also not optimal from the environmental perspective. Under the current system, airspace users optimise their routings by minimising not only the sum of fuel costs, but also the route charges. This may lead to choosing to fly longer routes because the charges are lower in a certain charging zone. The overall “benefit pool” of ATM sector is at least 11.6 Mt of excess CO2 emissions that ATM can directly influence 406 .

639.Challenges of automation and smooth integration into a smart transport system are also relevant for the deployment of drones – a growing business in Europe, delivering services in all environments (from mapping, infrastructure inspections, delivery of goods and e-commerce, to mention just a few), with a potential to reduce congestion, accidents and make mobility cleaner.

640.These ATM challenges are addressed through the Single European Sky framework and in particular through its technological pillar, the SESAR project. SESAR aims to establish the ‘digital European sky’ that will allow the optimal use of the European airspace through innovative technological and operational solutions based on a high degree of digitalisation and automation. The digital European sky addresses air and ground operations offering solutions for civil and military airspace users, airports, air navigation service providers. More efficient flight trajectories will also allow modern aircraft to fully exploit their greener and quieter technologies.

641.Drone deliveries can solve last/first mile logistics issues for some areas of Europe. Analyses by the JRC indicates that under the most technologically realistic scenario, up to 7% of EU citizens could get access to such services. When considering technological improvements scenarios, this range is extended to 30%. Furthermore, results suggest that due the differences in population and land-use patterns in the different Member States, the potential drone coverage across Europe could be very heterogeneous, with the Germany, Italy and France appearing as the most likely countries where drone-beehives may have the most efficient development 407 .

642.Several solutions were successfully demonstrated in Horizon 2020 (e.g. CIVITAS and the EIP SCC Smart Cities living labs) and with support from the European Regional Development Fund. Smarter, integrated deliveries will cut overall traffic and provide better information on delivery times 408 , while the use of cleaner vehicles will help to reduce local pollution levels. These types of solutions can deliver cascading benefits on the urban mobility systems and are incentivized by pricing and city interventions – public space allocation for micro distribution centres on bikes, facilitation between private stakeholders.

643.The deployment of drones may be facilitated by the U-space services, in specific Geographical Zones defined as ‘U-space’ airspace. U-space services allow drone operators to rely on a high level of digitalisation and automation, permitting a safe, efficient and secure access to airspace for large numbers of drones, while addressing an appropriate interface with manned aviation and air traffic services.

644.Whilst these rules can contribute to counter or mitigate possible security risks e.g. in case of malicious use of drones at the same time, every incident increases the risk of losing public trust and acceptance, which are crucial for taking advantage of the economic and employment opportunities of drones and drone-related services. Drones pose also a number of urban mobility challenges – flying at very low levels, they require a rethink of the boundaries of urban and public space, including urban infrastructure planning, levels of noise and safeguards to ensure citizens’ confidence, for instance in relation to privacy.

645.There are barriers to achieving a fully intelligent transport system in the waterborne sector as well. In case of Maritime Autonomous Surface Ships (MASS) there is no EU policy and regulatory framework that would enable and facilitate cross-border testing and trials at sea. Such testing and trials as for example undertaken within the Horizon 2020 autoship project 409 , is important not only for such type of ships, but also for the necessary maritime monitoring and control of such ships in the future

646.First steps to address the situation have been taken through operational guidelines and the further development of the vessel traffic monitoring and information system 410 in order to enable seamless maritime transport and traffic management of both manned and unmanned ships. Due to the international nature of shipping, linking ports of countries worldwide, harmonized technical standards, developed with an active participation of stakeholders, are necessary.

647.The absence of adequate policy and regulatory framework also applies for Inland Waterways Autonomous Ships, despite launching several sector initiatives in the context of Smart Shipping on local and regional level. A holistic view on automation of the sector, covering adjustments of existing regulations (e.g. on vessel-, crew-, infrastructure requirements, incentives for the sector to invest in automation), is missing. Meanwhile, steps have been taken to support the deployment of harmonised River Information Services (RIS) in order to enable seamless transport and traffic management on the European inland waterways. The evolution of RIS needs to take into consideration new requirements stemming from the digital transformation happening in the sector (e.g. digital ship operator platforms, port information systems, synchromodality, corridor management, Smart Shipping, and Inland Waterways Autonomous Ships).

648.The study supporting the evaluation of Directive 2005/44/EC on harmonised river information services (RIS) 411 highlighted that a full harmonisation and interoperability of RIS has not been achieved yet, due to different speeds in implementation and varying data quality. Potential adaptions and extensions of the legal framework on RIS may help closing the harmonisation and interoperability gaps. Among others, streamlined revision cycles for the RIS technical specifications in the European Committee for standards in the field of inland navigation (CESNI) could facilitate the evolution of RIS towards Smart Shipping and help the digital transformation of the sector with a view to the synchromodal developments in transport.

649.Further support through the Connecting Europe Facility Programme would contribute to the implementation of River Information Services (RIS) on national as well as river corridor level as required by the TEN-T Regulation in order to ensure a smooth transition into full operation of RIS until 2030.

650.Whereas the digital transformation of maritime ports is progressing fast, smaller inland ports are often lagging behind in the digitalisation of business processes and the digital integration of hinterland transport chains. This issue could be addressed by actions supporting the implementation of single windows and port community systems for inland ports, building upon the established frameworks and experiences of their maritime counterparts and using the full potential of existing and emerging river information services.

651.The Commission services have started preparatory work related to a smart tachograph for Inland Waterways (IWT), which could improve the functioning of the IWT market, minimise the administrative burden, improve enforcement and increase the uptake and acceptance of electronic documents/solutions. This is part of a broader effort to create a modern, coherent, flexible and well-enforceable legislative framework at the EU level for IWT, facilitated also by digital tools, as requested by the EU social partners.

4.1.3Innovation and mobility of the future 

652.Achieving the Green Deal in the field of mobility, making full use of digitalisation and maintaining the EU industry’s global competitiveness cannot happen without research and innovation support. 412  For example, R&D investments in the automotive industry reached EUR 57.4 billion in 2018, i.e. 28% of EU spending (source ACEA)  413 , mainly on clean vehicles and also a large amount spent on digitalisation and mobility of the future. There is currently a risk of significant decrease in the R&D effort which has major spill-over and cross-fertilisation effects for other sectors of the EU economy and competitiveness.

653.The research and innovation framework programme Horizon 2020 already deployed EUR 5 billion for the period 2014-2020 to develop and test innovative solutions for seamless, green, integrated, inclusive, affordable, safe, secure and resilient transport systems. Furthermore, research and close-to-market innovation is supported by the European Regional Development Fund, within the framework of Smart Specialisation. By investing in both technology and socio-economic research, pooling resources and sharing risks, the programme supported improving the transport sector’s efficiency in the use of natural resources and reducing its dependence on fossil fuels, thus reducing its environmental impact while sustaining the European transport manufacturing industries and related services to maintain or take worldwide leadership. Facilitating strategic planning and a trans-national approach to common European and global problems, it tackled growing mobility needs for people and goods and enabled public acceptance and uptake of new technologies. 414

654. However, challenges still persist as far as the full innovation cycle from policy-based need for research to large market deployment is concerned. The transport sector requires a close alignment between R&I initiatives for specific modes and a systemic approach towards a multimodal integrated transport system that is safe, secure, efficient, affordable, sustainable and based on user needs for hassle-free door-to-door passenger mobility and freight transport. However, this is still not the case.

655.There is currently still an insufficiently strong pathway between R&I projects, policy development and the market introduction of innovation. Furthermore the coordination needed between EU and national funding programmes (where about 80% of public R&I funding is programmed) is not yet optimal.

656.The transport sector with its large assets (esp. aircraft, trains, vessels) and long-term investment cycles for infrastructure (roads, rail, ports, inland waterways, airports and traffic management) also requires specific strategic approaches for large scale innovation deployment. It is expected that this can best be achieved by specific public-private partnerships such as in aviation (Clean Sky and SESAR) and rail (Shift2Rail), if accompanied by a suitable regulatory framework and market measures to ensure uptake of results. Similar initiatives are being investigated to achieve zero emission waterborne transport and for connected, cooperative and automated mobility as well as clean road transport. 415

657.Under Horizon 2020 416 and in the framework of smart specialisation thematic platforms 417 , partnerships have successfully engaged major, strategic industrial partners in research and innovation in the respective industrial sectors, thus becoming important drivers for a systemic transformation strengthening Europe's competitiveness. They helped respond to major socio-economic challenges in areas where well-identified market risks and fragmentation require a long-term concerted effort. They also linked activities across the innovation cycle, from research outcomes to closer-to-market activities, facilitating the creation of an internal market for innovative technologies, products and services. These partnerships will have to strengthen even further their impact, accelerating research, development and demonstrations of innovative technologies and operational solutions as well as increasing market uptake. They are expected to develop close synergies with national and regional initiatives, acting as dynamic change agents, strengthening linkages within their respective ecosystems and along the value chains, as well as pooling resources and efforts towards the common EU objectives.

658.The need for systemic change in transport also requires a new approach between innovations in those sectors relevant for this transformation. The decarbonisation of transport can only be successful in close collaboration with the energy sector and its work on smart electric grids, batteries and production of innovation alternative fuels (hydrogen, biofuels, and synthetic fuels). Digitalisation and automation in transport relies on technology transfer and application of latest technologies in the areas of big data, artificial intelligence as well as information and communication technologies.

659.Activities of citizens’ engagement can be promoted in order to involve a representative group of people in the co-design of the future transport system, to increase awareness about the potential added value of new technologies in their daily life and to ensure the development of a transport system properly addressing peoples' needs while recognising their diversity. A network of ‘European Living Labs’ could be established in order to engage with citizens at a local and practical level.

660.Mastering the threefold challenges of GHG neutrality, digitalisation and competitiveness requires much higher efforts and funding for R&I than in the past. A more integrated approach has been proposed with a common R&I cluster on climate, energy and mobility. EU support to R&I will be vital to avoid fragmented approaches and prepare larger European markets for innovation uptake. Financial instruments such as blending under InvestEU or under the EIC can leverage private innovation deployment funding.

661.In addition, so far the EU has not yet developed a coherent policy and research framework related to “mobility of the future” innovations. Often cross-modal, and not so long ago only abstract ideas, technological breakthroughs and innovative business models requiring new policy and regulatory solutions are maturing at a very fast pace with physical prototypes and projects springing around.

662. Furthermore, mobility is facing a massive transformation, as new digital technologies enable innovative related businesses. As such, a redesign of conventional siloed approaches to transportation modes and mobility is taking place, blurring the traditional roles. This phenomenon is amplified with the entrance of new actors from other sectors.

663.Hyperloop for example 418 , is a concept which essentially allows the transport of people and goods at very high speeds via magnetically levitated (mag-lev) pods in vacuum tubes. Potential speeds of over 1000 km/h are in theory possible. Thus it could potentially compete with aviation over long distances – while being electrically powered and thus readily decarbonised.

664.The technology is still at an early development stage, with its true economic and technical feasibility still to be demonstrated. Nevertheless, given its potential it is important that the EU can help to assess the potential of the new technology and potential services and can support the development of a suitable regulatory, standardisation, safety and interoperability framework.

665.At the same time some of the brightest engineers in the world are racing to make previously science fiction personal air vehicles a reality. While none are ready to fly yet commercially, some industry representatives point to the possibility to having them ready in the near future, with tests starting as early as 2020/2021. 419

666.While many of Europe’s strategic competitors have pushed ahead with developing an enabling environment for emerging technologies, the case for Europe to become the test bed and pilot deployment destination for these innovative and potentially game-changing technologies is not obvious. While inventors and investors are ready to test them, it is often not clear how these new transport means should be approached from a regulatory point of view, in particular, with respect to traditional vs adaptive and flexible regulatory responses. The EU is often considered too complex and not ‘friendly’ enough to deploy new ideas. EU Member States may also be tempted to proceed on their own to gain a competitive edge and avoid lengthy coordination processes.

4.1.4Digital enablers

667.The transition towards smart mobility - more efficient, user-friendly and sustainable can only happen if the right digital enablers are in place. In this regard, shaping a proper data economy for mobility; analysing available spectrum and needs; boosting connectivity infrastructure deployment; or designing a clear framework for using Artificial Intelligence and other breakthrough technologies, should be fundamental pillars towards the successful transport transformation.

Data for smart transport and mobility

668.Data is at the heart of this digital transformation. Exchanging data is a prerequisite for a seamless passenger experience across modes, allowing integrated planning, ticketing, and purchase. Furthermore, exchanging data enables operators to optimise their operational and maintenance processes. In addition, data governance should be based on a systemic approach in which all sectors benefit from the data exchange, especially when implementing smart cities. The industry is actually requesting more action on the connectivity side, data governance, data sharing, and communication.

669.Interoperability is a precondition for successfully linking data flows and distributed systems across sectors, borders and transport modes and with related areas such as security, energy, health, environment etc. The European Interoperability Framework 420 is currently under review as part of the Commission’s commitment to presenting a strengthened EU interoperability strategy by the end of 2021. This will directly support sectoral digital transformation strategies, such as mobility.

670.Data exchange is equally important for smoother logistics, so that choices on transport modes and routes could be made and adjusted in real time, based on traffic conditions, availability of vehicles, vessels and infrastructure, cargo location and final destination. Transport and logistics operators need sufficient information on the network and traffic conditions to be able to predict reliable journey times and optimise costs, energy consumption and environmental impact – from tackling congestion to minimising local air pollution. Information on planned works or capacity restrictions is needed to plan for the most suitable modal choice to make effective multimodal transport, integrating all modes of transport a reality. Real-time information on the localisation of goods and their transhipment would also enable the activation of smart contracts linked to goods handling along the logistic chain, making the EU logistics more efficient as a whole and enabling door-to-door service.

671. The use of infrastructure and therefore optimisation of capacity could also be improved thanks to services based on data exchange. For driverless vehicles and trains, on their part, timely access to information on physical infrastructure usage rules (e.g. traffic rules for road transport) could be paramount for correct functioning.

672.The access to real-time traffic and logistics data in freight transport is crucial to ensure smooth flow of goods across the European borders and contribute to reducing empty runs. The Galileo Green Lane App allowing for real time visualization of congestion at the European road border crossing points proved its benefits in facilitating cross-border carriage of goods in the time of cross-border traffic restrictions introduced by the Member States due to COVID-19 pandemic.

673.Data is also key for improving road safety. Large amounts of in-vehicle data that are extremely valuable for traffic management, roadworthiness tests, investigation of crashes (particularly useful in terms of road safety for those resulting in fatality or serious injury, and in the longer run, also for the analysis of incidents and “near misses”) are already generated in all recent vehicle models, and volumes of such data are set to increase with higher levels of automation.

674.Data is key for improving aviation safety. Based on EU research and TEN-T programs, EASA launched the initiative Data4Safety, for secured identification of anomalies and potential incidents precursors by analysing operational data from the operators that voluntary participate in the initiative.

675.To take advantage of the opportunities presented by the data economy, several modal and multimodal rules have already been put in place, though challenges remain.

676.The Intelligent Transport Systems Directive and four of its Delegated Regulations 421 mandate the creation of National Access Points (NAP) as a single point of access for users to the ITS data to facilitate access, easy exchange and reuse of transport data (multimodal, road safety-related, safe and secure parking, real-time traffic and travel data). Since the adoption of the delegated regulations, National Access Points 422 have been established in most Member States and although implementation is not yet complete, the developments represent significant progress in setting up an EU backbone infrastructure for ITS data. 423

677.Those early stages of implementation made it already apparent that Member States are faced with common challenges and are looking for common solutions through working further together. Yet, currently there is no place where NAPs operators and National Bodies/competent authorities can work together on common issues related to the development, operation and evolution of NAPs or on new challenges such as e.g. data collection activities and negotiations with private data providers and/or global players. Therefore, as announced in the European strategy for data in February 2019, the Commission will establish a stronger coordination mechanism to federate the National Access Points established under the ITS Directive and contribute to the development of the common European mobility data space.

678.Also, although NAPs allow data to be shared, the usage of the data provided by them is still relatively low, partly due to the fact that they have been created only recently. The services related to the exchange of static road attribute data used for updating digital maps are an exception, progressing well but in need to expand to local levels. For the multimodal information services a lot of static data (such as schedules and basic fares for all transport modes) has also become more accessible. Still, the accessibility of dynamic data (e.g. real-time information on disruption and delays, dynamic fares and seat availability) has been left to discretion of Member States making it difficult for service providers to have access to them.

679.Despite the legislation in place, reluctance to share data continues to be a limiting factor. This is due to issues of lack of trust, high expected costs and unclear benefits for those providing the data. 424 Also, the quality of safety-related data is not yet optimal. Last but not least, the data layers (e.g. road and multimodal data, traffic and travel data) are not yet structured and coordinated well enough and tools allowing effective accessibility, exchanging and data collection are missing.

680.Similarly, through-ticketing for railway journeys, allowing passengers to purchase one ticket covering multiple operators and networks, is not systematically available in the European Single Railway Area. Technical preconditions for the issuing of through-tickets are met, inter alia through TAP TSI and industry initiatives, but underlying commercial agreements between railway undertakings and between railway undertakings and ticket vendors are lagging behind. The same is true for multi-modal ticketing.

681.Further progress is also needed to develop comprehensive digital solutions to facilitate effective management of multimodal transport flows. At the moment, operators are often requested to report information on cargo on board several times to several authorities, and the potential of the re-use of data is not fully exploited. Legal acts introducing sectoral reporting obligations for maritime transport (such as health, border controls, customs, transport) have been developed in an isolated manner so transport operators have to deal with a patchwork of processes and data requirements.

682.The implementation of the Maritime Single Window Regulation and Regulation on Electronic Freight Transport Information 425 , covering a major part of business to government data exchange will take place in coming 5 years until 2025.

683.The European Maritime Single Window environment, once fully implemented, will guarantee harmonised submission and reuse of data under ship related reporting obligations for all EU port calls through national single windows. Furthermore, the EU Customs Union is already equipped with several EU-wide (trans-EU) IT systems and a diversity of national systems and a diversity of national systems. Harmonisation of processes and data in the area of customs is ongoing. In addition, further legal work is needed to harmonise different sectorial data requirements.

684.For cargo documentation, the application of the Regulation on Electronic Freight Transport Information 426 (eFTI) as of 2025 is expected to allow industry to cut administrative costs for the equivalent of 75-102 million work hours yearly, leading to overall savings between EUR 20 and EUR 27 billion until 2040 427 . Paper sheets for the equivalent of up to 900.000 trees annually would also be saved, and better integration of transport information flows across the different transport modes should facilitate efficient multimodality, with positive impacts on emissions reduction. However, the regulation covers only cargo related information, while the other documentation required for transportation, related to vehicles and drivers, is handled by a number of separate systems. For full user benefits, the eFTI data sharing environment should be in the future interlinked with the systems handling vehicle and driver data, by providing for their interoperability and interconnectivity. Further interconnectivity should also be explored with the EU e-customs and maritime single window environments.

685.For the inland waterways, the introduction of harmonised River Information Services (RIS) supports the sector’s digitalisation progress.

686.However, there are still areas, in particular in road transport, where digital exchange of information is not yet universally accepted.

687.Despite progress made across different modes (with respective challenges, the real data economy in the transport sector has not yet been realised due to the lack of a well-functioning data ecosystem for the transport sector as a whole (beyond mere reporting and business-to-administration data exchange). Existing data is not sufficiently shared neither within nor across modes, due to different standards, habits, lack of trust, commercial sensitivities and, in certain cases, data ownership concerns. Data availability and willingness to share is hampered by the absence of a ‘trusted environment for data sharing’ across mobility sectors where transport operators, users, infrastructure managers, public authorities, agencies, and other relevant stakeholders can easily connect and exchange data in a secure and interoperable way.

688.For example, in case of EU-wide multimodal ticketing and payment systems distribution of relevant data (e.g. on fares) is vital for those services. But currently, transport service providers can exclude third parties from the further use of their data.  428 A single booking for a door-to-door multimodal delivery, with options for a time of the delivery, cost and its environmental impact, is not yet possible either. Harmonised real-time multimodal cargo, carrier and traffic information together with interoperable optimisation tools would facilitate the dynamic and automated re-routing of cargo, thus, constantly ensuring the optimal match with the set conditions.

689.Many public and private sector organisations have already platforms in place facilitating data sharing in support of business and legal compliance processes. However, sharing information on a more universal basis requires interoperability, a trusted and secure environment, harmonised procedures and data models. The Digital Transport and Logistics Forum (DTLF) will facilitate the access to data through developing solutions for interconnecting existing sources of information and data platforms and defining minimum service levels. It supports not only the implementation of the Regulation on Electronic Freight Transport Information for business to administration data exchange, but aims at establishing a technical, organisational and legal framework and governance structure for cost-effective and secured business to business data exchange.

690.Clear and transparent rules on data sharing within and across modes are also necessary to prevent a potentially distorting situations, in which the incumbent or a single platform dictates transport conditions. In the current set-up a few actors in the value chain might have a near monopoly on certain types of key data sets limiting the innovation capacity of other actors as well as the potential for new entrants.

691.An example of this is when vehicle manufacturers or digital platforms owners have a privileged access to car data and to vehicle resources, proposing services directly to the driver and not allowing for fair competition between service providers. Similar for mobility platforms, ticketing and payments systems, where main operators are reluctant to give access to their data. This was also the case in air ticket distribution in the past and led to the adoption of the Regulation on a Code of Conduct for computerised reservation systems (CRS) 429 . However, due to market and technological changes, there are questions as to whether the objectives of the CRS Code of Conduct are still relevant, and whether it remains fit for purpose. 430

692.Urban mobility will greatly improve if data exchange models and cross-sectoral platforms are properly defined and accommodated, for instance through good practices on implementing interoperable urban digital platforms for cross-domain data management, building capacity for creating urban digital twins and promoting AI-enabled urban data services.

693.In view of the above, and in order to take advantage of the opportunities of the data economy and to position Europe at the forefront of the development of an intelligent transport system, in its Communication on a European Strategy for Data, the Commission announced it would create a common European mobility data space to facilitate access, pooling and sharing of data from existing and future transport and mobility databases and platforms. 431  

Artificial Intelligence, 5G and other key enabling technologies

694.This untapped data potential is also likely to hamper the possibility of reaping the benefits of key technologies such as Artificial Intelligence (AI). At the moment, the sector does not have a comprehensive roadmap that would allow it to unlock the full potential of AI, also beyond data issues, and manage related challenges in transport and logistics sectors.

695.The Commission has so far developed a horizontal approach to AI. The AI strategy adopted in 2018 432 is based on three pillars: boosting EU technological and industrial capacity and AI uptake across the economy; preparing for socio-economic change, and ensuring an appropriate ethical and legal framework. In May 2019, the Commission also published a Communication on AI’s trustworthiness, designed to increase its public acceptance. The Communication presented the ethics guidelines and announced the pilot phase to refine the assessment list that helps organisations implement these guidelines. 433 In the following White Paper on Artificial Intelligence - A European approach to excellence and trust 434 , the Commission further elaborated the need to focus on a two-pronged approach in AI: building an ecosystem of excellence and an ecosystem of trust.

696.Recognising the benefits of AI, the EU has funded many projects in this domain. The new Digital Europe Programme will provide further funding for AI projects, including for testing AI, including embodied AI, use across different sectors. With the funding of research and innovation in AI in the Horizon Europe and Digital Europe programmes respectively, the Commission is also shaping the European AI landscape, in order to build it on European strengths and be in line with European values. In the mobility sector several specific applications already show high potential – e.g. automated driving (which relies on on-board ability to combine planned data and real-time data often consisting of images, to optimise performances – including on energy, and ensure high level of safety), predictive functions (of maintenance / emergencies or dysfunctions, computation of Expected Time of Arrival).

697.The Commission has so far developed a horizontal approach to AI. The AI strategy adopted in 2018 435 is based on three pillars: boosting EU technological and industrial capacity and AI uptake across the economy; preparing for socio-economic change, and ensuring an appropriate ethical and legal framework. In May 2019, the Commission also published a Communication on AI’s trustworthiness, designed to increase its public acceptance. The Communication presented the ethics guidelines and announced the pilot phase to refine the assessment list that helps organisations implement these guidelines.

698.Recognising the benefits of AI, the EU has funded many projects in this domain. The new Digital Europe Programme will provide further funding for AI projects, including for testing AI use across different sectors. In the mobility sector several specific applications already show high potential – e.g. automated driving (which relies on on-board ability to combine planned data and real-time data often consisting of images, to optimise performances – including on energy, and ensure high level of safety), predictive functions (of maintenance / emergencies or dysfunctions, computation of Expected Time of Arrival).

699.In parallel, mode-specific initiatives in the field of AI have also emerged. Eurocontrol, together with the European Commission and a wide range of partner organisations set up a European Aviation High Level Group on AI (the EAAI HLG) with the goals of advancing the understanding among aviation/ATM actors of AI and its potential, demystifying the topic, and helping accelerate the uptake of AI in the aviation sector. The “FLY AI Action Plan” published in March 2020 provided a series of recommendations, notably to create a federated AI infrastructure containing historical data for training purposes and to develop AI applications, together with an appropriate governance structure. It also recommended accelerating the deployment of AI notably in the areas of cyber and non-safety-critical applications, as well as to conduct more AI research to help respond to the safety-criticality of aviation/ATM operations. 436  

700.In the rail sector, AI can be used for predictive maintenance, mobility management, and the creation of new smart services. Business analytics coupled with Artificial Intelligence can improve the status and reliability of rail components, as well as provide reliable transport demand forecasts, therefore allowing the network to be used at its optimal capacity and cost-efficiency.

701.Artificial intelligence is becoming increasingly important for the maritime industry as well. The rise of automation in the maritime supply chain along with the demand for more autonomous shipping has led to an increase in the demand for AI. Predictive maintenance, intelligent scheduling, and real-time analytics, are among possible applications, on sea but also for inland navigation.

702.Road transport is one of the sectors where the automation of driving assistance systems has most successfully been applied, and where the application of AI may open up entirely new possibilities for entering onto higher level of vehicle automation, connectivity and cooperation between various road users.

703.However, AI faces limitations and challenges like any other technology. Data is the foundation of all AI systems – quality (including as regards representativity), quantity, integrity and legality are important factors. It also faces challenges, such as the need to comply with safety, personal data protection rules and to resist cybersecurity risks.

704.In the transport sector it is also crucial to assess if the introduction of AI might create new safety risks that are not taken into account in the current safety legislative framework. Certification processes in transport are traditionally based on technical specifications. The use of software is already encompassed in them, but only for fully predictable outcomes, which is not the case for AI and machine learning, posing also additional challenges related to liability.

705.Data and services derived from space systems, including satellite images, satellite navigation and satellite communications are key enablers for smart and sustainable transport. Galileo – Europe’s Global Navigation Satellite System (GNSS) is providing enhanced quality and range of services, unaffected by strategic choices (being the only civil Satellite-based Positioning, Navigation and Timing system worldwide). Among its potential, Galileo, reinforced by a regional European Geostationary Navigation Overlay Service (EGNOS), could dramatically change traffic management, simplify signalling and enhance its performances, leading to a strong increase in capacity, combining various transport modes. Galileo is also a critical component for connected and autonomous driving thanks to its unique features of decimetre-level accuracy and signal and data authentication. Copernicus, Europe’s Earth Observation Programme, is providing data and information that help underpin the modal shift of transport in urban areas towards more sustainable and smart mobility.

706.The availability of adequate, efficient harmonised radio spectrum for critical applications in the transport sector is another vital enabler for the successful digitalisation of the transport sector. On the one hand, seamless and continuous broadband connectivity for passengers is required while on-board of any transport mode for best use of commercial services offered to users by Mobile Network Operators.

707.On the other hand, vehicles rely more and more on connectivity depending on the performance of the network while transport safety cannot be compromised. This brings about new challenges. In the case of rail, the safety critical applications are based on the obsolete GSM technology and legacy infrastructure, which is being progressively phased out. The phase in of a new technology, based on 5G, will require a migration before the final decommissioning of the existing radio system. However, the current spectrum allocation imposes constraints for the co-existence of the two systems and technological solutions causing a capacity challenge.

708.5G itself is expected to become a major enabler for the digitalisation of transport and the emergence of new mobility solutions in Europe. It will come with high reliability, mission critical services, and a distributed and flexible architecture. To reap its benefits, comprehensive coverage of the whole transport network and the continuity and evolution of existing services are needed.

The challenge of making the transport sector more resilient

709.In order to make the twin transition to sustainable and smart mobility and transport truly successful and the whole system more resilient, in addition to specific measures to increase the sector’s crisis resilience, there is need to boost investment, upgrade EU transport infrastructure and modernise fleets, while deepening the Single Market, and providing fair social conditions for workers and making mobility just and fair for users. All while ensuring that safety and security remain paramount.

4.1.5Crisis resilience and management

710.As described in section 2, the transport sector has been heavily hit by the pandemic. From the onset of the COVID-19 pandemic, the Commission has been working with Member States to ensure economic continuity and to ease the shock, notably by maintaining the flow of freight, preserving the supply chains, and securing essential travel, as well as ensuring the functioning of the Single Market and maintaining the highest levels of transport safety and security.

711.The COVID-19 pandemic has shown that it is important to have adequate crisis management and support structures in place that can be quickly activated as needed and that provide a well-defined, predictable and reliable framework for reacting to crises that affect the transport sector. Such a framework could comprise different components dealing with the various challenges that the transport sector could face in the case of various shocks. Efficient and effective joint coordination structures and mechanisms at EU-level could ensure a common response and actions that are harmonised, complimentary and in full respect of the acquis and basic EU principles. In the Council conclusions of October 2020 437 , the Council asked the Commission to swiftly draw up a pandemic and other major crisis contingency plan for the European freight transport sector and to extend, where appropriate, the contingency plan to passenger transport and transport in general. The Council also stressed that in major crisis situations, the TEN-T corridors and other essential cross-border connections should be kept operational.

712.The COVID-19 pandemic has in particular highlighted the importance of maintaining essential transport services at all times. In that regard measures are needed to protect the survivability and business continuity of the sector, including clear and non-discriminatory rules on financial support.

713.The temporary State aid framework set up during the COVID-19 pandemic allows Member States to support the transport sector during the crisis by providing emergency liquidity. At the same time, the integrity of the Single Market and level playing field for operators must be maintained, including by ensuring that there is no discrimination among incumbents and new market entrants, and that no new barriers for competition are introduced.

714.Furthermore, regulatory and technical specifications and standards are needed in crises situations in order to ensure the functioning of the transport system, for instance through health and sanitary protocols. The relevant components could be developed on the basis of the work done and lessons learned during the COVID-19 pandemic as well as previous relevant crisis situations.

715. The pandemic has proven that the European transport system is fragile and further efforts are needed based on the lessons learnt through the actions taken during the crisis. In particular as regards the impacts of climate change, from road and rail networks to ports, airports and inland waterways, critical transport resources are facing unprecedented threats from a climate, which is already changing. The need for climate-proofing has become an essential consideration and priority for the transport sector.

716.The European Green Deal notes – in the context of a new, more ambitious EU strategy on adaptation to climate change – that climate change will continue to create significant stress in Europe in spite of the mitigation efforts.

717.Flooding from high precipitation and extreme storms, in possible association with related impacts including landslides and slope failures, will bring major risks across the region for all modes of transport (road - and airport - infrastructure, railway and inland waterways). At the same time there is also greater risk of increased water scarcity and low water levels in our waterways.

718.Rising sea levels and greater wave activity causing erosion put vital coastal transport infrastructure (i.e. coastal roads, railways, seaports and airports) at risk. Over 60% of EU seaports 438 may be under high inundation risk by 2100, causing disruptions to operations and damages to port infrastructure and vessels, especially along the North Sea coast, where the traffic of over 500 ports accounts for up to 15% of the world’s cargo transport.

719.Rising temperatures linked to increased heatwaves and drier and hotter summers will affect roads and railways, where pavement damage and damage to track and electricity catenary, damages to bridges and increased landslides in mountainous areas are among key risks. Areas considered particularly worthy of more detailed analysis include roads in Southern Europe (South-Eastern France, Italy, Western Balkans, Portugal, Spain, Greece and Turkey) as well as in Nordic countries (Norway, Sweden and Finland). Climate proofing not only individual infrastructure investment projects, but also existing transport corridors, networks and systems will be increasingly relevant, as the majority of the existing infrastructure is built for the past climatic conditions 439 .

720.Strengthening the efforts on climate-proofing, resilience building, prevention and preparedness is crucial. Work on climate adaptation should continue to influence public and private investments, including on nature-based solutions. It will be important to ensure that across the EU, investors, insurers, businesses, cities and citizens are able to access data and to develop instruments to integrate climate change into their risk management practices.

721.The capacity of infrastructure is also closely linked to the resilience of infrastructure in the case of disruptions. For rail, to improve the international contingency management, European rail infrastructure managers have unanimously approved the International Contingency Management Handbook and its implementation from timetable period 2019. The purpose of the handbook is to define standardised procedures that allow continuation of freight and passenger traffic flows at the highest possible level despite an international disruption and to assure transparency of the status of the disruption and its impact on traffic flows for all relevant stakeholders across Europe. The Commission is following up on its implementation. However, recent incidents in which the Handbook has been applied have shown that there are limits to improving the resilience of railway networks via operational measures. In certain cases, infrastructure investments will be unavoidable to create additional possibilities for rerouting traffic.

722.In addition, ensuring the resilience of transport and mobility against various security threats is essential. For example, as all transport modes become increasingly technology-dependent, cyberattacks can have a paralysing impact on our economy and could potentially cause accidents and casualties.

In response to the COVID-19 pandemic, the Commission took a number 440 of steps at EU level relevant for the transport sector, which can be divided into two broad categories:

1. Measures to help Member States manage the crisis at the borders, enabling new health measures to be introduced while sustaining supply chains and availability of goods and essential services across the EU:

-issued Guidelines for border management measures to protect health and ensure the availability of goods and essential services (16 March) 441 ;

-invited Member States to designate the relevant internal border-crossing points of the TEN-T network as well as additional major border-crossing points to the extent necessary, as “green lane” border crossings; and urged Member States to set up safe passage transit corridors along the entire TEN-T network (23 March) 442 ;

-recommended the suspension of all types of driving restrictions in place (week-end bans, night bans, sectoral bans, etc.) for freight transport and asked Member States to consider the urgent suspension of the ban on transport workers spending rest periods in vehicle cabins (23 March) 443 ;

-asked Member States for a better tailored application of rules such as travel restrictions, visa and other requirements for transport workers (23 March) 444 ;

-issued guidelines to facilitate air cargo operations (26 March) 445 ;

-presented practical guidance to ensure the free movement of critical workers (30 March) 446 ;

-adopted guidance on repatriating cruise ship passengers and protecting ship crews, including sanitary advice, recommendations for crew changes, disembarking, and repatriation for seafarers and passengers (8 April) 447 ; and

-adopted a package of measures to support the transport sector 448  solving operational problems, removing administrative burdens, and increasing regulatory flexibility (29 April) 449 .

-upgraded the Green Lane approach to ensure that multi-modal transport works effectively in areas including rail and waterborne freight and air cargo, and provides additional guidance to facilitate application in practice, on issues such as electronic documentation, and availability of rest and refuelling points 450

The Commission services have also:

-coordinated with Member States the establishment of single national contact points for COVID-19-related transport issues and established a dedicated EU platform (18 March) 451 ;

-provided practical guidance as regards the implementation of temporary derogations from the general rules on driving and rest times in the road sector (18 March) 452 ;

-informed Member States on Commission services’ view regarding inability to comply with certain provisions of legislation in relation to licences, certificates and inspections (26 March) 453 ;

2. Measures to help relieve financial and operational pressures on the sector:

-prepared measures to maintain the flow of liquidity to the economy, and to alleviate the employment impact for hardest hit sectors, including through the Coronavirus Response Investment Initiative (13 March) 454 ;

-put forward a dedicated investment initiative (13 March) 455 ;

-made a legislative proposal on the protection of historical rights on airport slots (13 March) 456 ;

-made a legislative proposal to make certain rules of the Air Services Regulation more flexible for airlines, Member States and the Commission in view of COVID-19 pandemic 457

-adopted the Communication “Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak” 458 (19 March, 3 April, 8 May, 29 June and 13 October for its amended version);

-proposed the activation of the general escape clause of the Stability and Growth Pact (20 March) 459 ;

-issued interpretative guidelines on EU passenger rights regulations in the context of the developing situation with COVID-19 on (18 March) 460 ;

-proposed to establish a European instrument for temporary support to mitigate unemployment risks in an emergency (SURE) following the COVID-19 outbreak 461 ;

-issued guidance on State aid rules and public service obligation rules in air, maritime and land transport in the support of the transport sector during the COVID-19 pandemic and the recovery phase (19 and 26 May)  462 ;

-proposed a Regulation establishing measures for a sustainable rail market in view of the COVID-19 pandemic (19 June) 463 regarding charging.

Following the immediate crisis response measures, and taking into account that with the improvement of the epidemiological situation Member States started lifting restrictions on travel, on 13 May the Commission adopted a package of guidelines and recommendations on restoring tourism and transport 464 .

Building on the Joint European Roadmap, this proposal aimed to help EU countries in guiding them towards lifting travel restrictions, safely restoring transport services and resuming tourism activities. This package included in particular guidelines on the progressive restoration of transport services and connectivity, setting out general principles and mode-specific recommendations for the safe and gradual restoration of passenger transport by air, rail, road and waterways. The guidelines included a series of recommendations on the need to limit contact between passengers and transport workers, and passengers themselves, reducing the density of passengers where feasible, and on the use of personal protective equipment, such as face masks, and on adequate protocols in case passengers present COVID-19 symptoms. The package also included a recommendation which aims to make travel vouchers an attractive alternative to cash reimbursement for consumers 465 . The guidelines were complemented by specific guidelines issued by EASA for aviation 466 , ERA for railways 467 and EMSA for cruises 468 in May and July 2020.

As a follow-up to the package of 13 May 2020, the Commission has continued intensive coordination efforts with Member States to facilitate the implementation of the guidelines and recommendations, including by daily contacts through the network of national transport contact points for transport and exchanges in the context of the EU Integrated Political Crisis Response (IPCR).

Moreover, on 26 May, the European Commission has put forward its proposal for a major recovery plan. To ensure the recovery is sustainable, even, inclusive and fair for all Member States, the European Commission proposed to create a new recovery instrument, Next Generation EU, embedded within a powerful, modern and revamped long-term EU budget.

At the beginning of July, a dedicated COVID-19 SUMP Practitioner Briefing was published, focusing on green recovery in urban mobility. It takes stock of SUMP-related issues and all the good practices that cities have been introducing and still plan to implement as restrictions ease. It also includes lessons learned for immediate, mid-term and longer-term actions that European cities and regions are developing. 469

Finally, on 4 September, the Commission adopted a proposal for a Council Recommendation to ensure that any measures taken by Member States that restrict free movement due to the coronavirus pandemic are coordinated and clearly communicated at the EU level.

4.1.5.1Governance 

723.In line with the Commission's dedication to Better Regulation, there is need to significantly reduce the administrative burden for Member States, the Commission and other EU institutions. Current planning and reporting requirements - both for the Commission and Member States - are dispersed across a wide range of separate pieces of legislation adopted at different points in time. This has sometimes led to redundancy, incoherence, overlaps and lack of integration between the transport areas and modes. It makes effective response to crisis and adequate contingency planning very difficult.

724.In order to comply with requirements laid down in EU transport legislation, EU Member States need to fulfil numerous reporting obligations. Substantively, such obligations serve different purposes, as Member States report to the Commission for monitoring purposes, on implementation achievements or submit progress and activity reports to name just a few. Typically, these requirements are laid down in specific legal acts establishing an obligation to comply with highly specialized requirements each.

725.Often, the reporting periods covered are fixed to one or two years respectively, as defined by the legal act establishing the obligation 470 . Yet, reporting obligations may also initially rest dormant and only be triggered by certain events 471 .

726.Reporting requirements vary in their demand for execution. Usually, they are template-based, employing a questionnaire method and are built on pre-defined indicators 472 .

727.Overall, different reporting schemes might bear effectiveness and efficiency gaps. The Commission has already taken effort to map the entire EU legislative stock looking to identify burdens, gaps and inefficient or ineffective measures in REFIT (Regulatory Fitness and Performance Programme 473 ). With regard to reporting obligations there remains potential for further analysis. Streamlining all different Member States reporting requirements should bear potential to see how administrative burdens could be alleviated and strive to improving governance while focusing on EU added value.

728.Therefore there appears to be a need to consolidate the existing patchwork of national reporting obligations from the main pieces of EU legislation across transport by replacing different existing sectorial reports with one comprehensive integrated plan and report. This could significantly simplify Member States' obligations: it could reduce, align and update such requirements, and remove existing duplications. An appropriate transport governance framework, could enable establishing and tracking progress of comparable national transport plans among Member States.

729.For such a framework to be fully effective, and in order to be able to monitor progress to the achievements of European objectives, it is needed to improve the coverage and level of details of transport statistics. On some aspects, the persistent lack of comparable and complete transport data and statistics needs to be addressed.

730.The biggest gap in European transport statistics remains in the passenger mobility area. An estimated 83% of mobility in Europe by private cars, buses, urban transport and other modes (including active ones, such as cycling) is currently not covered by official European statistics or not sufficiently detailed to enable the right policy decisions. The political demand for passenger mobility statistics is increasing, especially considering the ongoing changes in mobility patterns due to technology developments (alternative fuelled vehicles, shared mobility, mobility as a service, multimodality, intelligent transport systems, and big data). Harmonised statistics on passenger mobility are collected on voluntary basis, which results in low country coverage. Without better regulated data collection, not much use can be made of these.

731.Another gap in the existing official statistics concerns the statistics on infrastructure, vehicle stock and traffic volumes which are currently collected on a voluntary basis and therefore not available for all countries (especially concerning information on alternative fuel infrastructure and vehicles).

732.There is also a lack of data and comparison between EU countries on transport prices and public and private investments in transport infrastructure, including recharging and refuelling infrastructure, as well as investments in sustainable public transport 474 .

733.Another important aspect is the need to align the existing methodologies across modes and between transport and energy statistics, in particular for data on energy consumption in transport. This would allow to have comparable indicators across modes and report transport energy intensities for the passenger and freight sectors, and to analyse their evolution over time, which is not possible based on existing European statistics.

734.As far as urban mobility data is concerned, there is no legal requirement at the EU level to systematically collect relevant local/urban transport data, resulting in very different approaches across Member States. As a consequence, the development of common policy initiatives helping to manage urban mobility challenges is hindered. As cities and urban areas continue to develop Sustainable Urban Mobility Plans (SUMPs) and work towards EU policy goals, it is important for this progress to be documented to ensure that such achievements become visible. The Commission has therefore developed, through a 2-year pilot project with almost 50 cities, a first set of indicators that support cities to perform a standardised evaluation of their mobility system and to measure improvements that result from new mobility practices or policies 475 .

735.The issue of lack of urban mobility data was also recognised by the Court of Auditors 476 that, in its 2020 report on EU urban mobility policy and funding recommended to the Commission, among others, to ‘propose legislation requiring Member States to collect and submit regularly relevant data on urban mobility and on the adoption of SUMPs in all EU urban nodes of the core and comprehensive TEN-T networks, including their surrounding areas.

736. In November 2019, the Commission launched a study on new mobility patterns. The study aims at creating an extensive data collection covering the areas of passenger mobility, urban logistics, fleet composition, transport activity and traffic for the EU Member States.

4.1.6Infrastructure and investment 

737.Beyond enabling a well-functioning internal market, transport infrastructure across the European Union is a key element to ensure connectivity, sustainable economic growth and cohesion among Member States.

738.Although significant progress has been made to develop the European transport network, our infrastructure remains a network of the 20th century, is not fully connected and interoperable and often in worsening condition in terms of quality and capacity, and is only marginally equipped with the sustainable and smart solutions that would be needed to allow climate-neutral mobility, due to the lack of adequate public and private investment over the last decades and excessive time needed to renovate and upgrade.

739.The availability and quality of transport infrastructure varies between Member States and is relatively low in the eastern part of the EU. It is negatively affected by shrinking resources dedicated to upgrade and maintenance as well as the lack of resilience to climate change and weather extremes. Since the previous global economic crisis, the EU has been suffering from low levels of investment in transport infrastructure. This has held back the modernisation of the EU's transport system. 477 Government investment continues to remain low as a share of GDP in the EU, levelling out at 2.7% in 2016, the lowest level in 20 years 478 . Generally, investment in infrastructure has halted its decline, but it is still at 20% below pre-crisis levels, thus slowing economic convergence. Total infrastructure investment stands at a 15-year low of 1.6% of GDP, down from a peak of 2.2% in 2009, with transport infrastructure the most badly affected. The decline is strongest in countries with the lowest infrastructure quality, pointing to a slowdown in the convergence process. 479

740.Overall, from 2009 to 2017, the EU saw a 15% decline in infrastructure investment activities (as a share of GDP). This decline was more pronounced in regions with poor infrastructure quality, thus reinforcing infrastructure investment gaps and raising concerns about the effect not only on economic competitiveness but also on economic and social convergence within the EU. 480

741.In fact, infrastructure investment remains below the level before the financial crisis of 2008. The comparison with 2008 levels is most striking for the countries of central and eastern Europe, where current investment levels are around 35% lower than before the crisis, followed by southern Europe (with 30% lower investment levels). Real infrastructure investment has surpassed 2008 levels in western and northern Europe, but even there investment rates (i.e. investment as a share of GDP) lag behind their pre-crisis levels. 481

742.Despite a major progress achieved over the last decade in upgrading infrastructure in cohesion Member States, they are still lagging behind in terms of connectivity and accessibility. Equally, limited investment in rural areas and outermost regions has been hampering their connectivity and accessibility as compared to urban areas across the EU.

743.Analysing at regional level how many people living in a 120-kilometre radius can be reached within a 90-minute drive by car, a working paper from the Commission estimates that within the EU, Bulgaria, Croatia, Poland, Romania and Slovakia have the lowest road transport performance, while Belgium and the Netherlands score highest. The performance of Spain and Portugal, which have benefited from a longer period of support from ERDF and the Cohesion Fund, is now above the EU average. 482

744.However, the transport performance of a country also depends on how urbanised it is. Most metropolitan regions outperform other regions. On average, cities outperform rural areas although not all cities perform that well. Cities in eastern EU Member States achieve a lower performance, especially the smaller ones. 483

745.In global comparison in 2019, four EU countries are among the top ten economies in the world in terms of the perceived quality of their roads, railways, air and water transport infrastructure: the Netherlands (2), Germany (7), Spain (9) and France (10). 484  

Figure 38: Perceived quality of transport infrastructure in the EU countries

Source: World Economic Forum 2019 (includes access to seaport services for landlocked countries).

746.There is broader uncertainty about long-term needs and policy directions and on how to best balance between private and public investment. Given the long time for implementation of transport infrastructure and its long-term effect and well as the life span of assets (planes, trains, ships etc.), this requires foresight and stability in terms of planning and prioritising.

747.Decarbonising and cleaning the transport sector requires significant investment, inter alia for developing and testing new solutions as well as the renewal of mobile assets and related enabling infrastructures. According to the Commission Communication “Stepping up Europe’s 2030 climate ambition - Investing in a climate-neutral future for the benefit of our people” the additional investments for 2021-2030 in vehicles (incl. rolling stock, vessels, aircraft) and alternative fuels infrastructure deployment are estimated at EUR 130 billion per year, compared to the previous decade. The “green and digital transformation investment gap” for infrastructure would add an additional EUR 100 billion per year 485 . Just to complete the TEN-T core network and build it as a truly multimodal system, EUR 300 billion will need to be invested over the next 10 years.

748.The renewal of vehicle fleet across would bring EU added value in particular by improving cross border connectivity (for instance in rail), underpin the environmental objectives and creating economic benefits in terms of GDP stimulation and jobs.

749.In addition, a significant increase in the share of intermodal operations can only be achieved with substantial increases in numbers and capacities of intermodal terminals and the capacity of key railway trunk routes and nodes. However, current investment rates are not in line with perceived investment needs.

750.Despite efforts to pool and better guide research activities for example in the rail, road and aviation sectors, as explained above, R&D&I in the transport sector remains fragmented and sluggish, with only insufficient funding available in most areas and long lead times preventing rapid deployment. We need to address the chicken and egg problem that investment in new technologies will only happen when there is sufficient confidence that new tech will actually be used. So need strong deployment plans with full legal backing.

751.The European Recovery Instrument (‘Next Generation EU’) will support critical recovery investments and reform priorities until 31 December 2024. The Commission will issue bonds to finance EUR 750 billion of Next Generation EU which are to be repaid in the period 2027-2058. Two thirds of the Next Generation EU budget will fund the grant component of the Recovery and Resilience Facility and reinforce other key crisis and recovery EU programmes. The rest of the budget will be on-lent to Member States, still under the Recovery and Resilience Facility (see also in section 4.3.2.3).

752.The Sustainable Europe Investment Plan is the investment pillar of the European Green Deal. The plan will crowd-in private investments through the EU’s budget guarantee under the InvestEU Programme. It further includes the public sector loan facility under the Just Transition Mechanism, notably to facilitate public sector investments in the regions most affected by the transition. Support to public administrations and project promoters in identifying, structuring and executing sustainable projects will also be provided.

753.The EU in June 2020 adopted a regulation setting up an EU-wide classification system, or "taxonomy", for sustainable activities. The taxonomy will contribute to private sector investment in new green technologies and modes of transport by providing businesses and investors with a common language to identify environmentally sustainable economic activities. The taxonomy will cover a wide range of transport sectors and will be constantly updated to keep pace with technological developments.

4.1.6.1Capacity across modes

754.The lower levels of investment come in a time when Europe is facing capacity crunch across many modes. As demand for transport has kept growing, current infrastructure is not able to cope with the growing number of passengers and users, causing congestion, delays and generating heavy costs for ordinary travellers and businesses alike. Congestion is an issue that the Commission has already identified as pressing in the 2011 White Paper on transport. 486 Progress has been very limited over the last ten years. Mainly in densely populated countries of the EU, such as the Benelux countries or Malta, road congestion continues to be an important problem

755.Annual road congestion external costs have been estimated in monetary terms to amount to almost 2% of the EU-27 GDP. 487  The slow deployment of smart mobility systems, which could better manage traffic flows, and problems with interoperability are causing considerable economic losses, both in unexploited capacity and in duplicating equipment.

Figure 39: Average peak-hour delay per representative driver (hours per year) in 2018

Source: European Commission Joint Research Centre. Calculations based on TomTom data

756.Congestion in urban transport is a growing problem in many cities despite efficiencies brought by ITS and other innovations. This is mainly due to the predominant reliance on private cars, with an average 1.3 person occupancy per trip. With road capacity in urban areas being limited, investments should focus on sustainable transport modes with the highest potential for moving people and goods, such as public transport, walking and cycling.

757.For rail, traffic density is unevenly distributed across the EU: The most intensively-used networks, on average, are those of North-West Europe including the Netherlands (operating almost 50 000 train-kilometres per route-kilometre in 2016), Austria, Denmark, Luxembourg, Germany and Belgium. The least intensively-used networks are those of the Baltic States, Greece, Finland, Romania and Bulgaria. 488  Low network utilisation means that the fixed costs of operations, maintenance and renewals of the infrastructure need to be recovered from, or justified by, a smaller volume of trains and passenger or freight traffic. On the positive side, it suggests that there would be room to accommodate more rail traffic on these networks. At the same time, parts of the network suffer from maintenance backlogs and related speed restrictions, which ultimately also limit capacity and quality of infrastructure services.

758.The Single European Railway Area Directive 489 requires that infrastructure managers declare as ‘congested’ any infrastructure for which it has not been possible to satisfy requests for infrastructure capacity. The Directive also makes provision for a capacity analysis and a capacity enhancement plan, which need to be carried out if lines are declared congested. As these are considered cumbersome by some infrastructure managers, there is a risk that actual congestion is much higher than reported and that capacity issues are not properly addressed. Even so, the total length of track declared congested (including in Norway) is rising and has now reached nearly 3 000 kilometres, including 1 000 kilometres of rail freight corridors, around nodes or covering sections of corridor lines. This suggests that further growth of traffic in some passenger and freight markets will be constrained, at least until alternative routes or additional capacity are available. In view of the significant regional divergences, it is very difficult to obtain a precise overview of capacity constraints on the European network.

759.The analysis of railway capacity and current or potential future bottlenecks is hampered by the fact that there is currently no harmonised way to define railway capacity – and, consequently, capacity bottlenecks – and that the methodologies and assumptions to forecast demand differ widely between Member States. In order to overcome this situation, common definitions and methods have to be defined at EU-level which may require the establishment of a body with the necessary expertise and resources. So far, agreement on a more common approach was impeded by the close link between the capacity issue and the investment planning, which is still dominated by national approaches given the prevalence of national-level financing for investments in new and upgraded infrastructure.

760.Notwithstanding this lack of a common approach to assess capacity and capacity bottlenecks, various reports and studies of the Rail Freight Corridors confirm the existence or prospect of capacity bottlenecks for rail freight transport. Bottlenecks exist mainly in major and smaller urban nodes, such as Lyon, Milan and various nodes in Germany, as well as on intensively used strategic axes on which several flows overlap on a single line, such as the access lines to the transalpine crossings of Rhine-Alpine and Scandinavian-Mediterranean corridor or the key Czech rail axis between Prague and Česká Třebová.

761.An issue of specific importance is the availability of capacity in case of disruptions affecting the main lines included in the corridors. Due to the existing density of the railway network, disruptions at a single location may bring traffic along entire corridors to a standstill, which obviously has a very negative impact on the reliability of rail transport. A number of recent cases has shown that despite improvements in international coordination in the wake of the catastrophic 2017 disruption of the Rhine-Alpine at Rastatt, only a limited share of trains can be re-routed during disruptions of strategic lines. According to the best available information, only 10 to 25 % of freight trains could be diverted during the disruptions close to Modane (FR) in 2018, Perpignan (FR) and Auggen (DE) in 2020.

762.Building new rail lines is very expensive and takes a long time. It will therefore be crucial to make better use of the existing infrastructure. Better cross-border coordination on traffic planning, to seamless transport management and planning of works would allow for a more efficient use of capacity, as would the systematic deployment of ERTMS and automated train operation (ATO). Optimisation of capacity management could also release capacity.

763.Timetables are the key structuring element for railway traffic but the current process to design them is the result of decades-long historical development. It is not in line with current needs of transport users, e.g. as regards flexibility and predictability, and it does not facilitate proper cross-border coordination. This results in a waste of capacity which could be removed at relatively low cost. The railway sector currently develops key elements to do so in the context of the so-called ‘Timetable Redesign’ project. Implementation of this project would require public support in the form of changes to the regulatory framework. The TEN-T parameters, in particular train length and loading gauge - which will lead to capacity increases - have to be in place in 2030 as a minimum.

764.Ports have long been the places where industries can prosper, creating valuable employment, and providing much needed connectivity for European trade. The challenges the sector is facing are numerous: global political changes, new shipping alliances along with ultra-large container vessels, new technologies creating new business models, lack of investments, stronger environmental requirements. The estimated investment needs for maritime ports infrastructure is around EUR 5 billion per year until 2027.

765.Inland navigation is one of the most CO2 efficient mode of transport per tons of goods. Unfortunately the sector is small and face difficulties not only to finance infrastructure investments but also to comply with environmental rules. Inland waterways infrastructure needs, including inland ports is around EUR 47 billion between 2021 & 2027. Current CEF support is around EUR 1.8 billion for IWT. This shows that at the European level under investment might hamper the development of inland navigation as alternative to road, if not complemented by other sources of financing.

766.In the area of air traffic management, many inefficiencies remain, partly due to the still fragmented airspace and the absence of a completed Single European Sky. The current fragmentation of the European airspace still leads to operational inefficiencies and large volumes of unnecessary fuel burn.

767.The use of the EU’s transport system is not optimised either, due to lack of coherent modal and multimodal infrastructure. Intermodal travel cannot become a reality if airports and freight terminals are not linked with efficient transport solutions on the ground and if airports and freight terminals serving the same conurbation are not linked effectively. Interoperability between ports (both inland and maritime), and hinterland connections remain an issue. The number of multi-modal platforms and transhipment nodes is not optimal either. Equally, the efficiency of cross-border travel is constrained by a fragmented high speed rail network.

768.The TEN-T Regulation establishes guidelines for the development of a trans-European transport network. A number of its requirements are aimed at sustainable, safe, secure, inclusive and smart transport solutions. It provides for the removal of bottlenecks and filling of gaps in the transport networks, facilitating multi-modality, introducing harmonised interoperability standards or smart infrastructure components as well as charging and refuelling equipment for emission-free vehicles. Catching up of countries with less developed infrastructure is necessary to ensure better connection into the single market. This includes in particular cross border infrastructure.

769.Horizon Europe is envisaged to include R&I actions to identify and demonstrate solutions towards sustainable multimodality, including infrastructure and network management. The development of the comprehensive network, which ensures accessibility of all regions to the trans-European networks, is to be assessed in particular when revising the TEN-T Regulation. The Commission has proposed the adoption of new rules regarding the Connecting Europe Facility 490 . The intention is inter alia to support the deployment of a digital infrastructure along the TEN-T corridors, and to create the conditions for the large-scale testing of advanced connected and automated mobility applications and services, including for other modes of transport such as rail and inland waterways. In the medium term, after 2025, such deployment may have reached scale effects. At that point, connected transport paths may contribute to the digital transformation of vertical industries in the field of mobility and transport, and in particular automotive and rail.

770.Within urban areas, the infrastructure for the most sustainable and cost-efficient ways of transportation, active mobility, is often inadequate and not matching the rising demand. More walking and cycling would help to achieve the European Green Deal as well as air quality requirements, tackle road congestion, and both encourage active mobility while making it safer. A systematic inclusion of the carbon impact and health benefits of active mobility in infrastructure and transport projects and policies is needed. The respective WHO Health Economic Assessment Tool (HEAT) elaborated with UNECE 491 should be applied at local, national and EU levels.

771.Active mobility infrastructure would enable better last mile solutions for multimodal transport in cities. Support needs to be directed towards multimodal/mobility hubs and urban distribution centres (consolidation/micro-consolidation centres). Zero-emission light electric (freight and personnel) vehicles such as cargo e-bikes and shared e-bikes schemes can decarbonise urban mobility and increase its efficiency.

4.1.6.2Future-proof infrastructure 

772.Insufficient investment in infrastructure over the past decade also led to a maintenance backlog. Crumbling bridges, degrading road and rail infrastructure became a painful reality with higher risk of congestions, accidents, increased noise and lower level of service to society. Several issues have to be considered in this respect. First, delaying maintenance works in order to cut expenditure in the context of tight budgets usually leads to increased costs when taking into account the whole life cycle of infrastructure. A persistent lack in regular maintenance and renewal reduces performance and capacity of the infrastructure (e.g. through speed reductions and disruptions).

773.Second, maintenance should be addressed from the outset: infrastructure should be designed and implemented in a sustainable way, through the lifecycle approach, taking into account future maintenance needs, taking into account research work done in this area.

774.Third, maintenance activities may have impact on the capacity of the network (e.g. sections which are not usable during maintenance works). Compensating maintenance backlogs by massive maintenance and renewal programmes may reduce significantly infrastructure availability in the short to medium term.

775.For rail, the backlog in maintenance means that more works will need to be carried out on the network in coming years, making close coordination between infrastructure managers more important than ever. In the past, failure to coordinate such works across borders has often led to significant complications, delays and financial losses for railway undertakings and has hampered the competitiveness of rail vis-à-vis other transport modes. Digitalisation of need identification and maintenance planning is expected to reduce infrastructure barriers caused by maintenance works.

776.The quality of infrastructure planning and implementation is also weakened by the decreasing project management and implementation capacity across Member States due to cuts in human resources. This situation has been exacerbated by the financial crisis: following lower levels of investment over the past years, public administrations had less resources. As infrastructure managers often depend to a large extent on increasingly scarce public funding, transport projects are particularly impaired by this reduced capacity to prepare projects.

777.The lack of administrative capacity has led in certain Member States to situations where available funds could not be absorbed, procedures being contested, public consultations not properly conducted, projects delayed, etc.

778.This reduced administrative capacity also leads to consequences in the field of public procurement, with suboptimal outcomes. While the current legal framework established the Most Economically Advantageous Tender (MEAT) principle 492 , in practice the lowest-priced offers tend to be awarded the contract, which often leads to compromising quality. Furthermore, instruments in the existing legal framework that can contribute to ensuring a level playing field in public procurement are not fully exploited. 493

779.Furthermore, procedures to monitor, maintain and renew infrastructure such that it remains to in good quality are sometimes not in place or not properly implemented. However, good practice examples 494 do exist in this area and could provide a blueprint to improve performance elsewhere.

780.Another challenge relates to accessibility. Currently one in six citizens in the EU suffers from some kind of disability or are of reduced mobility because of their age or other circumstances (e.g. obesity), and the share of this population will grow significantly because of the ageing of population and insufficient physical activity (also related to car use). At the same time the current passenger transport infrastructure is not always accessible enough for this population, so they either travel with private cars or left excluded from transportation, which has a negative impact in their life (lack of social inclusion, less job opportunities, worse access to healthcare).

781.Climatic changes that potentially affect transport systems include both gradual ones, such as sea level rise, and intensification of extreme events. Climate change adaptation need to cover all transport modes and requires horizontal action. This includes:

·Identifying the level of vulnerability of the transport system, highlighting the rapid detection of disruptions

·Implementing a systemic approach for the planning, design, construction, operation and management of transport infrastructures having into account the effects of climate is essential for overcoming the impact of future changes and become climate-proof.

782.In particular for road and rail infrastructure, key vulnerabilities include 495 :

·Mainly heavy precipitation and river flooding

·Sea level rise and storm surges

·Increasing average temperature all over Europe could require changes in maintenance operations, or even adaptation of some infrastructure elements, and practices and represent extra costs.

783.For airports and seaports, the greatest risks relate to inundation and higher wind gust speeds; sea level rise, storm surges and inundation, respectively. 496

784.Inland waterways are vulnerable to climate change because river navigation depends on precipitation and water levels for its operations. Droughts and floods have the most disruptive impacts for inland waterways because low water levels impose limitations to navigation services. Hence inland waterway transport is directly affected and already feels the impact of climate change. Recent drought periods as well as floods disrupt inland navigation activities by imposing restrictions on the amounts of loads transported, increasing the number of vessels to compensate reduced load factors and a shift to less energy-efficient modes, i.e. undermining its capacity to contribute to transport decarbonisation goals. In the case of the Rhine, the other modes of transport do not dispose of sufficient capacity to absorb the shift.

785. Inland waterways can exert pressure on aquatic ecosystems, mainly due to modification in the hydromorphology of rivers, fragmentation of ecosystems, disruption of ecological flow, or pollution of water and sediment. An integrated approach is needed. Therefore, waterway transport needs a reliable, safe, cost-effective and climate resilient infrastructure network. Since inland waterways have multiple functions: water supply, energy generation, recreation, biodiversity, this requires an integrated water policy to ensure that such infrastructures have a neutral or positive impact on biodiversity and do not compromise the achievement of good status of the water bodies they relate to, in line with the objectives of the Water Framework Directive, the Habitats Directive and the Biodiversity Strategy. The Water Framework Directive provides the right framework for integrated water management at the basin level. The Fitness Check of this Directive however shows that there is a need to strengthen its implementation, and to better integrate it with other sectoral policies including the navigation policy. The multi-dimensional functions of rivers, canals and lakes must be taken into account when developing waterways while dealing with climate change. An integrative approach among all water users towards ecologic, societal, economic and safety-related functions is a condition sine qua non for a successful climate responsive policy in terms of adaptation.

786.These trends imply a growing need for finding synergies between the transport, energy and digital sectors, which are not yet harnessed to the full extent, including for the deployment of alternative fuels infrastructure. New approach to the design of network and business models is needed, which should also take into consideration the impact of the climate change on the current and future infrastructure as well as demographic changes impacting the mobility patters of the future. Horizon Europe calls for proposals are planned to help to develop and test new methods of transport infrastructure maintenance and upgrade, with a view to improving safety, climate resilience and environmental impact (incl. habitat and biodiversity) and develop new solutions to accommodate connected mobility. These R&I actions are also expected to accommodate new and evolving transport modes and improved integration of transport infrastructure and energy systems.

787. Finally, facilitating the movement of military troops and assets is essential for the security of European citizens and to allow for more efficient deployment of EU armed forces abroad. Today, there are obstacles which are hampering the movement of military equipment and personnel across the EU, including physical, legal and regulatory barriers. Military mobility is a key priority for the EU-NATO cooperation. Transport infrastructure is not always fit for the specific needs of military transport which has specific requirements (e.g. in terms of weight of the vehicles on bridges or dimensions of tunnels). The Commission services and the European External Action Service (EEAS)  497 are comparing the military and the civilian requirements to identify gaps and synergies. The Gap Analysis will also inform the subsequent definition of the dual-use infrastructure requirements, which will constitute the legal basis for CEF co-funding through the military mobility envelope. Finally, the Commission in consultation with the Member States and relevant stakeholders will develop a dual-use project pipeline over 2020 to identify investment priorities before CEF co-funding starts in 2021.

4.1.6.3Access to funding 

788.In view of the above, investment into connectivity, both at national and European level, requires a strategic approach both in terms of levels to close the underinvestment gap and in terms of coherent, future-proof priorities. It should be based on three main axes:

·Effective use-based infrastructure charging covering a significantly greater share of infrastructure costs;

·A greater participation of private capital, in particular through green financing, while preserving European control of key infrastructure;

·A reinforced complementarity of public funding sources at national and European level

789.At the moment, however, investment is defined quite narrowly and is not necessarily aligned with all policy goals in particular decarbonisation and health. The focus is predominantly put on new infrastructure but does not address upgrading and maintenance. There are also limited investment options for movable assets (vehicles, vessels), active mobility infrastructure, retrofitting and renewal of vehicles that could help adapt to the current and future challenges, including safety, modernisation and cleaning the transport sector as a whole. The renewal of the rail and vessels fleet would bring EU added value in particular by improving cross border connectivity, underpin the environmental objective of modal shift and creating economic benefits in terms of GDP stimulation and jobs. Last but not least, limited access to investment for smaller market players (SMEs, especially in the road and waterborne sectors) is hampering innovation investments in these sectors. These issues are addressed by the InvestEU regulation which foresees support to maintenance, mobile assets and seamless support to SMEs through the Sustainable Infrastructure and SME Windows.

790.At the EU level the coordination and coherence of support across different EU programmes (Connecting Europe Facility, Cohesion Fund, ERDF and InvestEU) and European Investment Bank’s support as regards objectives and conditions underlying public funding is not optimal either. Conditionality to receiving funding may need to be better aligned, in line with relevant European policies.

791.The Recovery and Resilience Facility will be one of the main tools for the recovery, with an unprecedented EUR 672.5 billion of frontloaded non-repayable support as well as loans during the crucial first years of the recovery. The Member States will encompass in their recovery and resilience plans their national agenda of reforms and investments designed in line with the relevant country specific recommendations and EU policy objectives, centred on the green and digital transitions. The Facility will support Member States’ efforts to strengthen effectively their social and economic resilience, and hence their economies’ growth potential and job creation, thereby supporting the EU objectives.

In the Communication ‘Annual Sustainable Growth Strategy 2021’ 498 the Commission highlighted that “investing in sustainable mobility can also strongly support the recovery. Measures addressing transport can bring significant greenhouse gas emission reductions and improvements to air quality, while fostering productivity growth. In designing their national recovery and resilience plans, Member States should consider such measures as investing in public transport and in infrastructure that supports the shift towards more sustainable and smart mobility, including seamless and efficient European multimodal networks as well as upgrading Trans-European Transport Network networks for passengers and freight. Reforms and investments aimed at boosting demand for zero- and low-emission vehicles and accelerating the rollout of recharging and refuelling infrastructure are also key for achieving this goal. This should be complemented by investments in low carbon energy technologies and value chains, including hydrogen or batteries, and on sustainable energy infrastructure. Reforming the environmental incentives provided by the taxation of vehicles and fuels will be particularly important to accompany this trend.”

The Annual Sustainable Growth Strategy 2021 also set out a number of European flagships as “pursuing these flagships will ensure the success of the recovery of Europe; it will make Europe a digital and greener continent and will increase the cohesion among Member States”. Among them is Recharge and refuel: “Promoting future-proof clean technologies to accelerate the use of sustainable, accessible and smart transport, charging and refuelling stations and extension of public transport will make European cities and regions cleaner, accelerate the industrial transition and contribute to reaching the Paris climate objectives. By 2025, the flagship will aim to build one out of the three million charging points needed in 2030 and half of the 1000 hydrogen stations needed”.

In addition to guidance to Member States Recovery and Resilience Plans 499 , the Commission also provided examples of component of reforms and investments, including on clean, smart and fair urban mobility 500 .

792.Closer policy dialogue between the EC and the EIB has been established with the revision of the EIB transport lending policy. The Cleaner Transport Facility has been established as an umbrella for EU support to the deployment of smart and sustainable transport (covering CEF including Blending Operations and CEF Debt Instrument; EIB own-risk; and European Fund for Strategic Investment). Also, the Safer Transport Platform was established as a gateway to advisory services to support the uptake of funding and financing opportunities for projects that improve road safety. Lastly, funds from the NER300 programme 501 can be channelled through the CEF Debt Instrument for electric mobile assets and renewable energy transport infrastructure.

793.Furthermore there is a need to improve the capacity to plan, design and procure transport infrastructure projects at local and regional level. At those levels, advisory services and related resources would be required in order to prepare projects. Relevant programmes are already operating in collaboration with the EIB, including: the Joint Assistance to Support Projects in European Regions (JASPERS); the European Local ENergy Assistance (ELENA); and more generally through the European Investment Advisory Hub.

794.All these trends will need to be taken into consideration in the review of the EU-level transport infrastructure network policy (based on the TEN-T Regulation and supported predominantly by CEF and the Cohesion Fund and ERDF). This policy has been crucial to connect national transport networks, overcome technical barriers (inter-operability) and enhance major transport axes across the Union. In addition, investments in the transport sector and TEN-T network in particular were also supported by the EIB, including under the European Fund for Strategic Investment. Around 20% of the total lending of the EIB goes to the transport sector, representing EUR 59 billion since 2014. The largest share of the loans has gone to the projects in the rail sector, followed by road and urban mobility. The core network, which represents around 55% of TEN-T railways, 43% of TEN-T roads and the whole TEN-T inland waterway network in addition to many ports, airports and other transport terminals and inter-modal junctions must be completed by 2030. It must be then complemented by the comprehensive network (completion by 2050), which seeks to ensure full geographical accessibility across the Union.

795.This should help in also reflecting the importance and challenges of regional or local freight transport networks as the corridors mainly relate to long-distance transport services. Infrastructure provision in urbanised areas needs to be better linked with the management and optimisation of traffic flows. While bottlenecks can appear in and/or around cities, e.g. congested ring roads, solutions might be found on the corridor (e.g. stimulating multi-modality) or vice versa.

796.However, the full roll-out of the TEN-T network needs substantial investments, as estimated by the European Corridors Coordinators Work Plans, to upgrade existing networks, construct missing links, which are not always prioritised by Member States’ national authorities, improve interoperability and network capacity, among others. The current estimations envisage that EUR 300 billion will be needed to complete the TEN-T core network alone.

797.Comprehensive Transport Strategies provide a stable, long term framework for investments planning in the transport sector. The existence of such plans is a pre-requisite (ex-ante conditionality, enabling condition) to access support from the Cohesion Fund and ERDF. These national and regional plans include measures at the level of the TEN- core and comprehensive network, and also provide the link between local/regional transport networks and the TEN-T.

798.Railways transport infrastructure has been identified as the segment most in need of investment to finalise the TEN-T network and maintain/modernize the existing network, with around 60% of the total demand for funding/financing. Fixed infrastructure costs are comparatively low per km for aviation and road and very high for rail, due to the very different nature of the infrastructure involved 502 . On the other side, marginal costs are very different by mode, once external costs are being considered.

799.Due to a combination of market failures and the lack of level playing field between the modes, cross border infrastructure in general and railway infrastructure projects in particular are often not financially viable and struggle to attract private capital. Also, regulatory aspects and state infrastructure ownership remain a barriers to tapping into capital market investment in transport projects.

4.1.7Single Market

800.Mobility keeps Europe moving and the economy growing: people need to commute and travel, while businesses must be able to deliver goods and services. Without transport, the internal market simply would not function, nor would European industry be competitive. Transport services accounts for about 5% of total EU Gross Value Added. The volume of transported goods in the EU, as well as the passenger transport activity, increased by about 30 % between 1995 and 2017.

801.The functioning of the EU Single Market hinges on a dense network of transport infrastructure, highly competitive transport services and a sound regulatory framework to ensure the highest standards of safety and security, as well as international competitiveness and connectivity. An effective and vibrant internal transport market is key to driving innovation and entrepreneurship, increasing service quality and lowering transport costs for the benefit of European citizens and businesses. Completing the Single European Transport Area envisioned by the 2011 White Paper 503 therefore still remains the cornerstone of European transport policy.

Single Market for road transport

802.In July 2020, the European Parliament and the Council adopted the so-called Mobility Package I 504 . The package contains a number of social and market rules for the commercial road transport sector, intended inter alia to enhance working conditions for drivers, as well as to eliminate distortion of competition between operators in the sector, by removing notably unfair business practices such as letterbox companies. Now the efforts must concentrate on effective and consistent enforcement of these rules. The Commission is currently analysing the impact of certain provisions such as the mandatory return of the truck at regular intervals to one of the operational centres of the undertaking.

803.To further enhance the smooth functioning of the EU passenger transport by bus and coach, the Commission services will assess the adequacy of current driving and rest time rules for bus and coach drivers. Should the assessment demonstrate that, specificities of the bus and coach sector justify specific rules on driving and rest times, the Commission may propose relevant adaptations.

Single European Railway Area

804.With the implementation of the Fourth Railway Package (a set of 6 legislative measures adopted in 2016) the internal market for railway services is set to be completed, resulting in a Single European Railway Area. This package puts the emphasis on competition to deliver the efficiency and innovation. This is the final step of a gradual process which started already in the 1990s.

805.The Fourth Railway Package comprises a ‘technical pillar’ and a ‘market/governance pillar’. The market pillar opens up to EU-wide competition the market for domestic passenger services, which covers over 2/3 of all passenger services. This follows the markets for rail freight and international passenger services, which have been open to competition for years. Some Member States (Austria, Czechia, Germany, Italy, Sweden) have already partially opened their domestic markets, with positive results in terms of passenger volumes, quality of service, choice, and in some cases rail fares. The Commission is closely monitoring Member States’ implementation of the new legal framework.

806.From December 2020, EU railway companies anywhere in the EU will enjoy the right to offer international and domestic rail services on a commercial basis, where economically feasible (with possible exceptions related to economical interference with existing Public Service Contracts). This is known as ‘open access competition’, and has already helped to improve services and frequencies, and reduce fares on some lines.

807.Furthermore, the package introduces the principle of mandatory competitive tendering for public service contracts for rail. These contracts usually involve public subsidies, because the public service obligations make them unprofitable. Historically, they were awarded directly to the incumbent national railway company.

808.As regards enforcement, it is important to bear in mind access to service facilities (in respect of which details are regulated by way of a Commission Regulation 505 ), which remains an essential condition for competition to develop on a fair basis, in particular the maintenance of rolling stock.

Cross-border passenger services

809.In line with the ambition to promote sustainable modes of transport, there is a growing wish to support cross-border rail passenger services. As described above, the enabling regulatory framework is in place, but this kind of services are currently underdeveloped.

810.Member State initiatives, notably from the Netherlands and from Germany, aim at promoting the development of new and revival of cross-border services, including night train services. The Netherlands have set up a Member State platform which will work on concrete measures to remove obstacles. Germany has developed the so-called Trans Europe Express 2.0 concept which aims at the development of a long distance cross-border high speed and night services network.

811.These Member State initiatives are welcome, provided they comply with all relevant rules, including the relevant rail legislation, especially regarding market access 506 and State aid rules 507 .

812.Finding neutral timetable information and easy ticketing options (also discussed in section 4.2.1) are essential for the development of a successful network of cross-border rail passenger services. Unequivocal, enforceable and clearly communicated passenger rights are similarly essential to attract new passengers to rail.

4.1.7.3.1Market access for public transport services by rail

813.Although the relevant legislation is in place, market access for public transport services by rail is still hampered by several factors:

·Access to information is essential to ensure that rail operators can submit serious offers in tendering procedures. It is the object of a specific provision in the 2016 amendments to the Regulation n°1370/2007. Nonetheless, there are still extensive debates and litigations in Member States on the scope of the information to be provided, which negatively affects the conduct of competitive tendering procedures.

·Access to rolling stock is identified as a major bottleneck for new entrants. The amended Regulation n°1370/2007 provides that competent authorities must assess whether measures to facilitate access to rolling stock are necessary but are not obliged to adopt any such measures.

·Ticketing for rail (through- or combined tickets) is hindered by several factors, in particular the recurring issue of access to dynamic information on fares, reservations and real-time traffic information (also discussed in section 4.2). In addition, according to studies 508 , the rules applicable to PSO compensation could constitute hurdles to revenue sharing between PSO and commercial operators via (combined) ticketing schemes.

·The contracts that are directly awarded for long periods, as mentioned above, have the effect of foreclosing the market accordingly.

4.1.7.3.2Rail rolling stock availability

814.Rolling stock availability is a major barrier for new entrants. With the European Union Agency for Railways (ERA) becoming the single authorisation authority and bringing significantly enhanced harmonisation of technical requirements, rail gets much closer to the situation of road and aviation, where the same vehicles and aircraft can be used anywhere in the EU, increasing market flexibility and reducing the risks for vehicle owners. However, the lack of ‘go-everywhere’ rail rolling stock continues to increase cost. Establishing a rail system architecture that further aligns technical specifications for interoperability and the elimination of obstacles caused by redundant national technical, safety and operating rules will help the rail sector to modernise und become more attractive for new service providers and clients.

815.Due to high costs and business risks, time lags and potential interoperability issues, smooth and non-discriminatory access to rolling stock is fundamental for alternative rail operators to enter new markets 509 . This is particularly true for passenger services (including night trains), regardless if they are provided under PSO contracts or commercially. Smaller operators risk lacking the appropriate financial resources to engage in significant investments for buying rolling stock in order to enter a new domestic market or to compete for bigger PSO contracts.

816.The secondary markets and leasing markets for passenger rolling stock are very limited, making it harder for new entrants to access rail markets. In some reported instances, incumbents scrap or sell abroad redundant rolling stock instead of selling or leasing them to new entrants (especially if new entrants would compete on the same markets) 510 . Rail regulatory bodies acknowledge that, although the rolling stock market is not regulated, limited access to this market may severely restrict access to the railway market for new entrants 511 .

817.The Regulation on public passenger transport services by rail and by road 512 includes some provisions related to rolling stock in the framework of competitive tendering procedures for the attribution of public service obligations. Before launching such procedures, competent authorities must assess the need for measures to ensure effective and non-discriminatory access to suitable rolling stock, taking into account the presence of rolling-stock leasing companies or equivalent in the relevant market. Competent authorities could then decide to take “appropriate measures” to ensure effective and non-discriminatory access to suitable rolling stock.

818.The Commission also called the EU rail regulatory bodies to oversee the assessment of rolling stock market to be performed by the competent authorities. In the medium to long term, the tendency of competent authorities themselves to own or finance rolling stock for Public Service contracts and progress in interoperability levels will lead to better access to rolling stock. However, the availability of rolling stock needs to be ensured also in the short to medium term to avoid barriers to the development of the single rail market. It remains necessary to carefully review existing models of procurement and financing of new and second hand rolling stock and determine a policy to facilitate access, addressing also State aid aspects.

4.1.7.3.3Rail interoperability

819.From a technical point of view, seamless rail transport throughout the EU requires two main things. First, networks with harmonised characteristics and trains designed to run on these networks. Second, harmonised operational rules between the EU countries and operators (railway undertakings and infrastructure managers) to allow efficient cross-border traffic.

820.Although the Fourth Railway Package provides for rail operators to receive a single safety certificate from ERA for operations throughout the EU, operational and safety rules are not yet fully harmonised, adding to the complexity and cost of cross border operations, and in particular resulting in stops and checks at borders between Member States creating substantial delays. Differences in national operational rules are also an obstacle to the development of pan-European digital and automation solutions. Thus a major thrust of the future work of the Commission, with the help of ERA, may be to harmonise these processes or eliminate national rules leaving freedom for individual operators to optimise the approach while ensuring safety.

821.In addition to EU-level harmonisation, the Commission is working on a voluntary basis with the sector and Member States along Rail Freight Corridors to build trust and solve the main issues: harmonisation of braking tests, checks at borders, timely information on train composition between countries, as well as rules on language competence, referred to as Issues Logbook.

822.Work is being conducted by the Commission on Technical Specifications for Interoperability (TSIs), taking into account the next challenges ahead, linked to various aspects of innovation like digitalisation, automation, decarbonisation and cybersecurity, but also the interest in stability and predictability. A major issue in rail is a chicken and egg problem whereby new innovations only have a business case if they are widely deployed on both rolling stock and infrastructure. The EU can assist in overcoming this issue by joint development of new technologies (through the rail research partnership with rapid follow up in revised standards), with commonly agreed deployment plans and via funding support from CEF. In addition, a system architecture could be developed, splitting infrastructure and rolling stock into modular components which would more readily be updated.

4.1.7.1Aviation Single Market

4.1.7.1.1Rules for air services

823.The Air Services Regulation 513 provides a common set of rules regulating the provision of air services within the Union, i.e. flights carrying passengers, cargo and/or mail for remuneration and/or hire. It contains three sets of rules on the licensing of EU carriers, the right of EU carriers to operate intra-EU flights and on pricing of intra-EU air services.

824.The evaluation published in July 2019 514 found that the Regulation had had overall positive effects and brought sizeable EU added value in creating the EU internal aviation market. On the other hand, it identified a number of shortcomings in all three areas covered by the Regulation which may disproportionally affect certain parts of the market and/or stakeholders, and where improvements may be beneficial for the good functioning of the internal market for aviation.

825.An assessment of the impact of possible policy changes was launched following the publication of the evaluation, and a support study carried out. However, the dramatic changes to the situation facing the air services sector resulting from the COVID-19 pandemic means that further analysis is required as to the expected impact of different measures. This future work will also consider how the framework may be adapted to better support the recovery and resilience of the sector in the medium to long-term, as well as to promote social and environmental sustainability as far as possible.

4.1.7.1.2Airport charges

826.Effective competition between suppliers, in this case airports, encourages cost-effective operations, drives down prices and increases quality. It also enables operators to make long-term investments in facilities and services that match the requirements of the customers, in this case airlines and air passengers. The absence of effective competition between airports could manifest itself in a range of ways. Airports could choose to maintain airport charges at current levels but allow quality to fall or could seek to raise airport charges above levels warranted by costs faced by an efficient operator or by long-term investments. This could be the case where airports operate efficiently and extract excessively high margins, which would normally not be achievable in a competitive market. It could also occur where airports operate inefficiently by allowing their costs to rise or by not adopting cost-saving or innovative technologies, or a combination of these. Historically, the reason why governments impose economic regulation on airports (as well as other utility and public infrastructure providers), has been to curb ex ante the risk that they misuse the significant market power they may hold.

827.This is also why in 2009, the European Union adopted a Directive on airport charges (“the Airport Charges Directive”). The Airport Charges Directive has established a common European framework for regulating essential features of the airport charges setting process. The Directive has introduced a number of process-based requirements (consultation, transparency, non-discrimination) that airports and airlines need to comply with when the airport charges are negotiated. The oversight and enforcement role has been given to independent supervisory authorities (ISAs). The Directive applies to EU/EEA airports whose annual traffic is over 5 million passenger movements and to the airport with the highest passenger movement in each Member State.

828.In July 2019, the Commission published an evaluation of the Directive. This evaluation has indicated that some of the elements of the Directive deserve consideration. Certain questions do not find an explicit answer in the Directive, for example as regards the requirements pertaining to the independence of the supervisory authority in certain cases. It is also not clear whether the Directive optimally focuses regulatory intervention on cases involving a risk of misuse of significant market power, and ultimately on harm being imposed on EU consumers.

829.As announced in the 2015 Aviation Strategy, a revision of the Airport Charges Directive is expected. The above mentioned evaluation will provide the background to such revision.

830.Capacity constraints at airports are an important factor in assessing the level of competition between airports. At certain locations (small airports) there is overcapacity and the airports struggle to cover their costs – such airports are more proactive in attracting airlines. In contrast, and recognising the ongoing impact on future demand for airport services of the COVID-19 pandemic and related uncertainties, some airports (in particular the largest) have struggled with the challenge of increasing capacity to keep pace with demand. Such congested airports have been less able to increase volumes and hence have had less incentive to reduce airport charges or improve further service quality.

4.1.7.1.3Slots

831.Airport capacity could also be influenced by inefficient allocation of slots. The number of EU congested airports has increased from 98 to 104 in the last 8 years, to such an extent that at some of them no slots are available. More than 50 per cent of the congested airports worldwide are located in Europe. While the existing slot framework has managed to contain flight delays to a reasonable level, there are still issues regarding the capacity utilisation and the efficiency of the allocation of slots. Recent air carrier bankruptcies have shown the economic value of slots (in many cases, slots are the most valuable asset air carriers have). The current allocation system might inhibit competition between air carriers, by freezing slot allocation and by giving an advantage to incumbent airlines as a result of the ‘grandfathering’ rules. The "use it or lose it" rule has led to behaviours by air carriers holding on to slots even if they are unable to use them profitably, as opposed to making them available to competitors or new entrants. The widespread lack of transparency on the available capacity at airports that can be allocated, as well as on some parameters used by the slot coordinator allocation, can affect the efficiency of the process.

832.Further, an increased awareness of environmental concerns has started debates on how to include environmental criteria in the slot allocation process. Lastly, the recent COVID-19 pandemic has shown that the resilience of the Regulation to quickly and efficiently respond to the needs of the market under such circumstances should be improved. The Slot Regulation was quickly amended as a result of the decrease in air traffic resulting from the pandemic, by exempting airlines from certain slot use requirements. As the situation evolves and the market slowly recovers the issue is no longer whether airlines should simply be exempted from the rules or not. It is rather how to grant airlines relief but also gradually return to a new normal. All the foregoing considerations should be taken into account when discussions on the 2011 proposal will resume.

4.1.7.1.4Groundhandling

833.While capacity is a bottleneck both in the air and on the ground, air carriers cannot provide services without efficient and high quality groundhandling services. Whether the lack of capacity of groundhandling services themselves contributes to the lack of airport capacity or whether improved groundhandling services could contribute to unlock capacity issues at congested airports are questions to be clarified.

4.1.7.1.5Computerised Reservation Systems

834.There are questions as to whether the ex-ante competition Regulation on a Code of Conduct for computerised reservation systems (CRS) remains fit for purpose. An evaluation of the Regulation on the CRS Code of Conduct 515  found that in the current context, the Regulation is less relevant than before for preventing distortion of competition in air ticket distribution. At the same time, the evaluation showed that new developments, such as the rise of new players and distribution channels for air tickets, may require different action to improve market efficiency and encourage fair competition, in so far as these aspects are not already covered by existing horizontal legislation. The Commission is preparing an impact assessment of the full range of policy options, including possible revision, as a follow-up to the evaluation.

4.1.7.1.6Rules for air navigation services

Providers of data and terminal air navigation service providers

835.The fact that the European Air Traffic Management (ATM) system comprises a patchwork of national ATM systems operated by national air navigation service providers (ANSPs) means that interoperability and network efficiency creates an obstacle for sharing data. ATM capacity cannot be scaled to meet changes and fluctuations in demand. In 2018, delays grew disproportionately compared to traffic – traffic grew 14% but delays grew 273%. The main constraints are lack of flexibility of staff and technology. The seasonal peaks of traffic make this issue even more complex.

836.The SESAR project has delivered new concepts and technologies but this has not translated into technology uptake at a sufficiently rapid pace, partly due to the challenge of availability of the required standards. A single market for ATM data services and terminal air navigation services is needed to foster interoperability and the take-up of innovative technologies and processes of providing air navigation services.

837.Currently, air traffic services are almost everywhere provided by vertically integrated national ANSPs. Those national ANSPs are each responsible for producing, processing and combining this data to make it available to their frontline operators, who will use it to provide air traffic services for airspace users. Most of this data is currently not shared between ANSPs. Remote provision of air traffic services is not possible as along as all needed ATM data are not available across the network. The shift to new service delivery models could enable further rationalisation of the underlying infrastructure, whereby the focus will move from local infrastructure to service provision complying with performance requirements. Achieving a resilient European ATM system requires an evolution of the existing model so that the necessary ATM data (such as communication, navigation, satellite, meteorological and aeronautical information data) can be shared and made available to ANSP throughout the Union. The onset of a new European market for ATM data services would need to be underpinned by technical solutions, legal requirements and service delivery structures in order to function effectively.

Regulatory oversight of air navigation services

838.The Single European Sky has contributed to certain improvements in the performance and modernisation of the European ATM sector but it has not yet generated the expected paradigm change in terms of performance by ANSPs and has not sufficiently reduced fragmentation of the European ATM system. Currently, the Commission is the de-facto economic regulator of monopolistic air navigation service providers. It adopts implementing Decisions, based on the advice from the independent Performance Review Body (PRB). Those Decisions are adopted under qualified majority voting of Member States that are at the same time the owners of the regulated entities. To increase the efficiency and effectiveness of the economic regulation, the Commission proposed in its recent SES2+ amended proposal 516 to establish a fully independent European regulator. Furthermore, economic regulatory oversight of air navigation services that are provided under monopolistic conditions is not effective. Where National Supervisory Authorities (NSAs) lack independence from entities that exert ownership rights over regulated service providers, conflicts of interest inevitably hamper service quality and price.

839.Defragmentation of the European airspace requires economic regulation and monitoring across borders where and as long as competitive supply of services does not prevail. Presently, economic regulation lacks the necessary independence from the entities that exert ownership rights over the regulated undertakings. Users lack trust and confidence in national economic regulatory bodies, they do not lodge complaints and the national supervisory authorities generally hesitate to take stringent decisions and do not apply penalties to enforce them. National economic regulators have no procedures to exchange dossiers, to handle cases jointly. They do not exchange information on cases, there is no joint investigation, and site inspections of service providers are not foreseen in Union legislation on economic regulation.

840.According to a survey at the level of the National Supervisory Authority Coordination Platform-Performance Working Group, airspace users do not lodge complaints with NSA on aspects of economic regulation. Economic regulators have to be able to impose penalties where a regulated entity does not abide by their decision or does not give access to requested information. Although Single European Sky legislation foresees the instrument of penalties, most national economic regulators have not used it. Similarly, judicial appeals against decisions of regulators or air navigation service providers have rarely occurred.

841.Effective regulation can ensure transparency and effective stakeholder consultation. Airlines should understand what they pay for and they should be able to curb excessive surpluses of service providers, as long as air navigation services are not provided on market conditions. Surpluses of regulated undertakings in excess of surpluses in competitive sectors can indicate monopolistic pricing and ineffective price regulation. Conversely, where air navigation services previously provided under monopolistic service provision were shifted to be provided under market conditions, the competent authorities witnessed a significant drop of the price with the same or better service quality.

4.1.7.2Waterborne Single Market

4.1.7.2.1Inland waterways transport market rules

842.The existing legislation concerning the Inland waterways transport (IWT) market is globally old (adopted between the 1960s and 1990s) and so does not sufficiently take into account the changes occurred in the sector as well as the geographical extension of the European Union.

843.There is therefore a need to evaluate the existing IWT market access related legislation, in terms notably of excessive regulatory burdens, unintended effects, overlaps, gaps, inconsistencies and/or obsolete measures which may have appeared over time and represent barriers for a smooth and fair IWT market.

844.Finally, mobility within the IWT internal market is hampered by the absence of an appropriate legal framework on crewing requirements at EU level. Operators face various requirements when operating cross-border. Current applicable national rules regarding crewing requirements (including rest times) are considered outdated, do not take account of technical and educational developments and, in general, of the workload of the crew.

4.1.7.2.2Mutual recognition of boating licences (maritime and inland waterways)

845.Contrary to car driving licences, the national boating licences for recreational craft are often not mutually recognised by the EU Member States, nor do all EU Member States recognise the UNECE’s International Certificate for Operators of Pleasure Craft (ICC) 517 and there are no EU level measures to address this problem. This means for example that in case of moving from one Member State to another (e.g. from Belgium to Germany), EU citizens lose their boating licence.

846.Improved mutual recognition of boating certificates and in particular the ICC could ensure free movement of people as well as support employment in the yachting and marinas sector thanks to increased recreational boating in and between Member States. Today the sector counts about 253,000 directly employed persons (372,000 including indirect employment).

4.1.7.2.3Regulatory oversight of ships operating in EU

847.In relation to the maritime transport, while the rulemaking is international, the control and enforcement mechanisms are weak and essentially left to the individual States. It is widely acknowledged that lack of enforcement is the weak point of international maritime regulation since IMO is a decision making body but lacks any control and enforcement mandate. Only in 2016, mandatory audits to all the IMO States were commenced with the aim of determining the extent to which they give full and complete effect to their obligations and responsibilities as flag, port and coastal States. However, the results of the individual audits are not publicly available and there is no system of sanctions for the States that are not promulgating and implementing the international conventions.

848.Whereas through the EU a reasonable level playing field was achieved between EU Member States, this is not the case between EU flags and third country flags. The IMO States have very different levels of capacity to give full effect to the international rules. This creates distortion of competition and undermines the effectiveness of the regulatory framework since it may cost less for a shipowner to be registered under a flag of a third State that does not fully enforce all the rules – while ships still compete for the same cargo and sail anywhere in the world.

849.As a result, the number of EU ships in the world fleet is slowly decreasing. Today, the Commission's 2004 Guidelines on State aid to maritime transport include the tonnage tax to address this issue. Under tonnage tax schemes, maritime transport companies pay taxes on the basis of the ship tonnage (i.e. the size of the shipping fleet) rather than on the basis of their actual taxable profits. Such schemes can be approved by the Commission under EU State aid rules. Without such schemes, an even greater number of ships would be flagged out for tax reasons.

850.Apart from the competitiveness aspect, this also poses a maritime and environmental safety problems. Weak enforcement of international rules undermines flag State responsibility as the first line of defence to ensure maritime safety. Coordinated and harmonised enforcement mechanisms based on port State Control also involving the European Maritime Safety Agency (EMSA) are available when it comes to ensuring implementation of the international rules on board vessels calling to EU ports regardless of flag.

4.1.8Social aspects 

851.The transport sector is a major contributor to the EU economy, supporting millions of jobs across the EU and being a key driver of European integration. The sector represented around 5% of the EU workforce in 2017.

852.European social standards and rules protecting consumers are among the strongest of the world. Yet, certain developments puts those aspects at risk: the economic downturn due to the pandemic, uneven level playing field amid growing international competition, erosion of traditional social structures and demographic change, are among the challenges that should be addressed to keep a high-skilled workforce in Europe, protect workers’ rights and to ensure that the green and digital transitions are just and inclusive 518 . To foster mobility of people, the transport sector should also remain affordable, available (including for persons with disabilities 519  and reduced mobility or living in rural and remote areas), accessible, and offer high quality services.

853.Mobility is a critical aspect of social inclusion and an important determinant of well-being including for vulnerable groups of society. Transport fulfils a basic need and has an enabling function insofar that it affects household’s income as well as citizens’ ability to integrate into society and the labour market. For example, public transport enables access to various public services, such as health services, childcare, education, long-term care, housing, labour market and social services as well as leisure activities. It follows from Principle 20 of the European Pillar of Social Rights that certain transport services can be considered essential services to which everyone has the right to access. The same principle also states: ‘Support for access to such services shall be available for those in need.’ Yet, important barriers that can make it difficult for people to access these services include income, age, gender, disability or reduced mobility and territorial inequalities/ spatial segregation.

4.1.8.1Workers’ rights and transition to automation and sustainability

854.Workers in the transport sector face a number of challenges when it comes to social rules and their application.

855.First, it might be difficult to identify applicable social rules. Some mobile transport workers cross one or several borders on a daily basis. It can therefore be sometimes challenging to identify which are the applicable labour law and social security rules. A large majority of competences regarding social security and applicable law lays in the hands of Member States. This is a problem for the protection of workers’ rights and for the level playing field.

856.Recent studies 520 have shown that 40% of drivers in the road transport sector across the EU work regularly more than the allowed maximum average 48 hours per week. The picture is similar in other transport modes. Atypical legal constructions also often divert legal responsibilities and may result in less favourable working conditions for workers.

857.In maritime transport, the jurisdiction relevant for social security protection changes frequently as the consequence of seafarers operating on relatively short-term contracts. It becomes an incoherent patchwork.

858.There is also a need for clarifying the social security rules for the inland waterway transport sector. There are currently several regimes applicable on EU waterways. There is a need for clarifying key concepts and applicable rules as well as for a single regime at EU level.

859.In a liberalised and competitive aviation market that requires greater flexibility and cost-effectiveness, airlines’ business models have evolved significantly. In this context, various employment arrangements and practices have developed in the sector. Low-cost flights, that typically operate point to point, grew by 61% from 2007 to 2016. With the increase in point to point routes, the number of operational bases has steadily grown since 2008, and aircraft and aircrews of the same airline are increasingly based outside the principal place of business of the airline.

860.This trend has intensified the cross-border nature of aircrew activities and added complexity to their legal status under EU and national law. While all staff benefit from the protection offered by EU law they may enjoy different rights and levels of protection depending on the national law that applies to them. It has created uncertainty as to what labour law applies to the employment contract of aircrews assigned to a home base outside the principal place of business of the airline, how to apply the existing rules and what court has jurisdiction but also which authority should ensure enforcement of their national labour legislation in the case of aircrews based in their country but working for an air carrier seated in another country. Moreover, the contractual home base may not always correspond to the place from where the aircrews effectively start and finish their duty. 

861.Taking into account structural changes in the aviation market, the Commission decided to work on how to improve the social agenda for aircrews. In 2015, the Commission presented an Aviation strategy for Europe, which highlighted the social agenda in aviation as a priority and commissioned soon after a study on employment and working conditions of aircrews in the EU internal aviation market. 521 According to this study, the majority of aircrew members who responded to the survey (82% of pilots and 88% of cabin crew) said that the labour law applicable to their contract is that of their contractual home base. Air carriers who tend to operate multiple operational bases where aircrews are based were found to be more likely to apply the law corresponding to the country where they have their principle place of business, regardless of where their aircrews are based.

862.In March 2019, the Commission issued a report on maintaining and promoting high social standards in aviation, focusing on aircrews. The Commission, in the context of its expert group on social matters related to aircrews, has been looking at the specific issue of enforcement of applicable labour law and its application to aircrews in the light of existing EU law and at how this could be further improved by identifying best practices and providing recommendations. A document drawn up in September 2020 on this subject, highlights in particular the need to further improve enforcement of applicable labour law by the authorities of the country where the aircrews concerned are based for the better protection of aircrews and the proper functioning of the internal market, and to raise awareness for the benefit of both crew members and airlines.

863.In this context, an updated Practice guide on Jurisdiction and applicable law in international disputes between the employee and the employer was adopted by the European Judicial Network in November 2020 to reflect all the important clarifications brought by the European Court of Justice in its judgments since the first Guide was published in 2016. Its aim is to guide practitioners and provide further clarity and better information on the rules on jurisdiction and applicable law and consequently assure better protection of aircrew and a level playing field between carriers. The Updated Practice Guide will contribute to the correct enforcement of the rights that workers draw from EU and national law.

864.In the field of Air Traffic Management, where labour agreements are concluded at the national level, the Commission has invited staff associations 522 to participate in the developments of a roadmap on the implementation of the Single European Sky reform.

865.Airport groundhandling services are a competitive and labour-intensive industry. Such industry features have led to pressure to reduce costs which may have impacted working and employment conditions. The Commission is carrying out an evaluation of the Groundhandling Directive which will look at possible unintended social impacts on groundhandling workers. Moreover, the work undertaken by EASA on safety standards on this matter should allow to improve the situation.

866.Second, the level of social protection can be insufficient. Through the European Pillar of Social Rights, the EU works to safeguard the rights of citizens by ensuring equal opportunities and access to the labour market, fair working conditions, and social protection and inclusion. EU employment legislation guarantees minimum levels of protection that apply to everyone living and working in the EU. The EU provides common rules to protect social security rights when moving within Europe 523 .The rules on social security coordination do not replace national systems with a single European one. All Member States remain free to decide who is to be insured under their legislation, which benefits are granted and under what conditions. There can be big discrepancies between Member States.

867.These discrepancies, if coupled with disregard for applicable social rules by certain operators and with ineffective enforcement by authorities, can give rise to precarious employment practices and harsh working conditions, and lead to social dumping. The lack of proper enforcement of social rules occurs too often. These cover low detection of infringements to social rules and poor execution of penalties. This is partially linked to the above mentioned problem of unclear applicable rules. Social security and applicable law lays this responsibility with the Member States.

868.Traditionally the port labour market has in many places been subject to regulations and collective agreements necessary to adapt to the irregularity of port traffic and the ensuing fluctuations in labour demand. The current evolutions in the shipping sector, in particular the development of megaships, with massive volumes of cargo to be loaded/unloaded, brings additional constraints on the organisation of port labour and on working conditions.

869.In the maritime transport sector, precarious working conditions often stem from fierce cost-based competition in the sector, as EU carriers face strong competition from non-EU carriers in particular from Asia. Since seafarers can be recruited anywhere in the world, shipowners increasingly tend to recruit seafarers through manning companies in low cost labour supplying States, including for vessels flying the EU MS flag. The salary is low compared to European standards and social security protection is scattered between flag States. The difference in labour cost can therefore be quite considerable on and between vessels operating under the same national jurisdiction. In practice, this can mean that national legislation such as on minimum wage can be circumvented. Other national rules, such as anti-discrimination legislation on the prohibition of mandatory pregnancy testing, can also be circumvented when the seafarers is recruited though manning companies in third countries before arriving to Europe to serve on a vessel.

870.Inland navigation is not an exception and also face challenges to improve workers’ working conditions, in particular in the river cruise sector. Concerns have also been raised about the application of the rules on posting of workers due to the highly mobile nature of the workforce as well as the heavy administrative burden faced by the small and medium-sized enterprises that make up most of the inland navigation sector.

871.In waterborne transport, the enforcement authorities therefore tend to focus more on vessels safety related issues as low hanging fruits since controls on working and living conditions (social rules) are more difficult to detect. Besides in inland navigation, there is no extra-territoriality principle (as it exists in road transport). The fact that the offences committed in a Member State during a journey cannot be sanctioned in any other Member State for a certain period considerably decreases the effectiveness of the enforcement.

872.Working and living conditions for seafarers are regulated through the Maritime Labour Convention of the International Labour Organization (ILO) setting minimum standards. Those minimum standards are in most essentials retained at EU level in the Directive implementing the European social partner’s agreement. Control issues at EU level are incorporated into the overall EU legislation for flag and port State control. The EU sectoral social dialogue committee in the port sector provides the social partners with a framework to develop a joint approach to the social challenges related to port labour relations, including working conditions, health and safety questions, digitalisation, training requirements and professional qualifications.

873.The International Maritime Organization’s Convention on Standards of Training, Certification and Watchkeeping for Seafarers (STCW) ensures the minimum level of training for seafarers on board vessels and it is implemented in to EU law by the Directive 2008/106 as amended. The STCW Convention includes a common system of EU-wide recognition of third countries that comply with the requirements therein. The systems in third countries is monitored regularly by the Commission with the assistance of European Maritime Safety Agency. This monitoring scheme also includes verification of the compliance by the Member States.

874.In road transport, the preparatory work 524 leading to the Commission’s proposal in 2017 (Mobility Package 1) has identified a number of issues behind the problem of inadequate working and social conditions of drivers, such as illicit employment practices, long periods away from home and inadequate resting facilities as well as issues related to enforcement. Regulation (EU) 2020/1054 525 adopted in July 2020 aims to address these issues (see also section 3.5). The top priority of the Commission is to ensure common understanding of the legislation and monitor its consistent application and effective enforcement by the Member States.

875.The set of rules adopted in July 2020 under Mobility Package I not only clarifies and strengthens certain provisions in the road transport legislation but also includes enhanced enforcement requirements. The new enforcement regime should significantly improve compliance with the social and market rules in road transport by eliminating precarious employment and business practices.

876.Platform work is understood as all labour provided through, on, or mediated by online platforms in a wide range of sectors, including transport (drivers and delivery workers). The main challenges identified in a recent study 526 include employment status, information available to the workers about their working conditions, dispute resolution, collective rights and non-discrimination. According to this study, national legislation on working conditions and social protection of platform workers is still rare 527 . There is some sector-specific legislation, such as on personal transportation services and food delivery services provided through platforms. It regulates the working conditions and social protection for persons in non-standard employment or enhances the rights and protection of the self-employed. Given that platform workers are mostly treated as self-employed, their collective representation poses a challenge and trade unions do not necessarily defend the interests of platform workers 528 . On 30 June 2020, the Commission launched a process – comprising both a public consultation and informal consultations with stakeholders – to ensure that the EU competition rules do not stand in the way of collective bargaining for vulnerable self-employed people, including platform workers. 529

877.Overall, changes in the sector, in particular those relating to automation and digitalisation are bringing many challenges. Jobs in the transport sector, especially low- and middle-skilled jobs, are at high risk of automation. At the same time, the ongoing digital transformation presents new opportunities, such as an improved working environment or completely new jobs. A recent consultation of the SME panel revealed that transport companies on average do not think their labour force is well prepared for the transition to automation and digitalisation, almost half (44%) thinks it is even insufficiently or not prepared at all. Over one in three (37%) responding transport SMEs indicate that it has a need for guidance on how to anticipate or manage the transition towards automation and digitalisation. Another 33% indicate it does not know whether additional guidance is needed, which might be an indication of insufficient insights in how automation and digitalisation might affect the future of work and the workforce.

878.At this stage, the exact pace, scope and impact of automation in transport is unclear and estimates of how many jobs or tasks will become redundant or will change considerably in the future vary significantly.

879.In aviation, digitalisation is not expected to generate unemployment in Air Traffic Management but will require the definition of new competency profiles, which shall be supported by amended regulations for the licensing and training of traffic controllers and technical personnel. Some reskilling of staff will also be necessary, notably by adapting the training methods to more automated tools.

880.Digitalisation and automation also require a significant adaptation of port workers’ training and skills and may have profound impact on local communities. Under the research topic “The Port of the Future” Horizon 2020 finances four research projects looking at the possible future developments of ports and port operations 530 . The Connecting Europe Facility is funding the project iTerminals 4.0, which will develop and perform Internet of Things (IoT) solutions and operational pilots at eight European container terminals 531 . In a recent study of the potential and impact of transport automation, the World Maritime University points to the rapid development of port automation and the importance of training and reskilling of the workforce in ports 532 .

881. At the same time, development of new technologies is contributing in changing the shipping industry. Equally, the role of seafarers and crew members in inland navigation changes or is expected to change as technology on board and onshore change. Paper charts are replaced by electronic, navigation started to rely on autopilot, engine room are frequently operating unattended, thus in general systems on board becoming more autonomous and able to make decisions. This requires a change of the education, training and employment philosophy in the sector. Since some position would become redundant as replaced by the new technology seafarers, crew, still being needed, would have to become more specialised and learn to operate surrounded by technology as a new co-worker.

882.Transition to more sustainable transport will also impact the workforce. As stated in the Communication on the European Green Deal, pro-active re-skilling and upskilling are necessary to reap the benefits of the ecological transition. The proposed European Social Fund+, Just Transition Fund as well as the Recovery and Resilience Facility will play an important role in helping Europe’s workforce to acquire the skills they need to transfer from declining sectors to growing sectors and to adapt to new processes. 533

883.In recent years, the increasing globalisation of value chains, new business models and forms of work, as well as technological developments, put the industrial relations systems face to critical challenges and ask for revitalised industrial policies in the transport sectors. Trade unions, employer organisations and public authorities play an important role in the governance of the employment relationship, through collective bargaining and sectoral collective agreements. The improvement of the functioning of social dialogue and adequate involvement of social partners are crucial to ensure resilience of the transport labour market on both short and long term.

4.1.8.2Skills and attractiveness of transport jobs

884.The success of EU transport largely depends on the availability of a skilled workforce. There is a risk of skills mismatch for certain transport sectors already today and the workforce will need to keep pace with changing skill requirements caused by automation and digitalisation, as well as by transition to a more sustainable mobility. The availability of skilled workers may also be impacted by the COVID-19 pandemic 534 which particularly hit the transport sector and its workers.

885.Any shortage of transport workers 535 could compromise growth and reduce European connectivity. This risk exists in all modes with an ageing workforce (a third of workers are above 50 years old and mostly male 536 ). This is notably due to the lack of attractiveness of the sector, in particular for young people and women.

886.Furthermore, as explained in the previous section, the transport sector often suffers from harsh working conditions. These include atypical hours, long periods away from home or frequent problems of harassment and lead to a general lack of attractiveness of jobs in the transport sector.

887.This lack of attractiveness and the need to make the transport sector more appealing to women were also raised by stakeholders in their responses to the public consultations on the ‘Sustainable and Smart Mobility Strategy’: a survey of more than 2,770 women transport workers from across Europe showed that “what is most needed in the transport sector is to eliminate the entrenched male culture, to provide safe workplaces where women are not exposed to violence and harassment by colleagues, superiors or customers, to have full access to proper sanitary facilities, to end unequal pay and to foster a good work-life balance 537 .

888.A further reason for not being appealing is the lack of information about what the sector does and what the career prospects are with sometimes reduced employability and overall attractiveness of careers due to very specific qualifications. The European sectoral social dialogue committees, the first Mobility Package proposed in 2017 and the ‘Women in Transport – EU Platform for change’ 538 have started addressing these issues.

889.To fight today’s driver shortage, comprehensive measures are needed. For instance, for long distance road transport, the establishment of a comprehensive network of safe and secure parking will contribute to better working conditions and allow easier access to the profession for female drivers. The emerging highly automated driving technologies may help to address the issue of shortage and gender imbalance of drivers in the road sector. Driverless lorries in long-distance operations and remotely controlled vehicles may attract newcomers, including women, with the right skillsets required to operate or monitor such highly automated vehicles.

890.The ageing of the transport workforce also increases the need for developing lifelong learning programmes and increasing recruitment efforts for new technology-based skills and knowledge. In particular for key occupations such as train drivers this will be crucial to fully tap into the potential of digitalisation and automation.

891.Removing more and more staff from train technical functions will make them available for service jobs at terminals and station platforms or on board trains and may thus increase the quality and safety of services and help reducing cost. The opportunities offered by the technological innovation could help identifying ways to attract young people and women to the sector. Training and communication skills must adapt accordingly. The EU rules on the certification of train drivers is an important contribution in helping skillset to remain adequate in changing circumstances. Should these rules be revised, the impact of technological developments must be taken into account in order to shape the skills and job profile of future train drivers.

892.In aviation, the level of attractiveness of the sector, which still remains generally high, has however been somewhat degraded over the past years due to fierce cost-based competition among market players. The situation is different in the segment of air traffic management workers, where wages remain attractive but working conditions may be affected locally by staff shortages and increasing requirements for flexibility in work organisation.

893.The attractiveness of waterborne transport suffers from harsh working conditions, such as atypical hours, long periods away from home, and reported cases of harassment. A further reason for the lack of appeal is the scarcity of information about what the sector does and what the career prospects are.

894.Maritime transport appears to have continuing difficulties in attracting European youngsters. One of the reasons include a general perception of harsh working and living conditions, and the absence of a modern working environment i.e. access to internet on board of vessels. The seafarer’s profession has also taken a reputational hit from reported experiences of forced labour, working under unacceptable conditions.

895.Waterborne is a sector predominantly employing males, with women representing no more than 2% of seafarers globally. From a geographical perspective, the majority of seafarers originates from Asia (Philippines, India and Turkey) and Eastern Europe (Ukraine, Russia). In the EU, the main labour supplying countries are Romania, Bulgaria, Poland and Croatia.

896.EU social policy in maritime transport aims at ensuring decent living and working conditions for seafarers, as well as adequate social protection to maintain the attractiveness of the profession; alongside enhancing adequate education levels. A main vehicle for Commission policy development of social issues in waterborne transport has also been the sectoral social dialogue between the social partners. However, as of today there is no systematic EU dialogue at expert level with Member State on these issues.

897.The Commission has initiated a number of projects and studies, among which the “SkillSea Project” under the “Blueprint for sectoral cooperation on skills”, to be concluded in 2023. The Commission also recently published a study on social aspects within maritime transport sector. The study examined policy achievements, gaps and shortcomings on social aspects since the ad-hoc Task Force on Maritime Employment and Competitiveness (2011) was set-up; its recommendations are being further discussed with European social partners and Member States.

898.To increase the accessibility of transport, professionals also need to be trained on accessibility and on providing assistance to passengers with disabilities and reduced mobility. The legislative developments enhancing accessibility for persons with disabilities and reduced mobility and requiring the provision of assistance for these persons provide new business and job opportunities in these markets.

899.The European Commission remains active at all international fora in discussions and actions on adapting the global regulation to new realities of the transport workforce, taking into account the pandemic crisis, as well as to make transport more resilient to any crisis in the future.

4.1.8.3Access to transport: affordability, availability and accessibility

900.Affordability of transport is a crucial issue. Indeed, whereas the Single Market in transport led to lower prices and more choices, increasing Europeans’ connectivity, mobility remains expensive for people who are more vulnerable. In fact, for users of transport services in the EU, consumer prices for operation of personal transport equipment and for transport services have increased at a faster pace between 2005 and 2018 than overall consumer price inflation. 539  Yet, the share of transport in final household expenditure on consumption has remained basically unchanged at 13% from 2005 to 2018. This figure varies depending on the Member State - in 2018, the share of household expenditure devoted to transport was largest in Slovenia (16.9%), ahead of Lithuania and Luxembourg (both 15.8%), and the smallest in Slovakia (6.8%), Croatia (9.7%) and Czechia (10.4%).

901.The price index for fuels and lubricants for the operation of personal transport equipment has increased by 9% from 2015 to 2019 (the price index for overall transport services, purchase and operation of personal transport equipment has increased by 8% over this period). The consumer price index for passenger transport services has also increased from 2015 to 2019, although differently for each mode: rail: + 5%; aviation: + 7%; waterborne: +4%; and road transport: +5%. 540  Yet, the share of transport in final household expenditure on consumption has remained basically unchanged at 13% from 2005 to 2018.

Figure 40: Share of different items in household consumption expenditure in the EU 541

902.In the EU-27, 2.3 % of the population cannot afford public transport and in some Member States more than 5% of the population cannot afford public transport (e.g. Romania, Bulgaria). Low-income households struggle even more to afford public transport. On average, 5.4% of the population with the lowest income in the EU-27 cannot afford public transport, and in some Member States this share can reach up to 20 % (19.5% Bulgaria, 17.3% Hungary, 11.9 % Romania) 542 .

903.In 2018, private households in the EU-27 spent EUR 931 billion or roughly 13% of their total consumption on transport-related items. Around 30 % of this sum (around EUR 262 billion) was used to purchase vehicles, around half (EUR 510 billion) was spent on the operation of personal transport equipment (e.g. to buy fuel for the car) and the rest (EUR 159 billion) was spent for transport services (e.g. bus, train, plane tickets).

904.As regards to private cars: the EU counts 531 cars per 1,000 inhabitants. Luxembourg has the highest car density in the EU (690 per 1,000 people) and Latvia the lowest (329). In Latvia, nearly half of all household (48.8%) do not own a car, while more than 31% of French families have two cars (ACEA Report, 2019). The daily use of cars is also closely related to income levels: respondents who almost never have difficulties paying bills are more likely to use a car on a daily basis (52%) than those who have difficulties paying their bills most of the time (37%), so car ownership and use can be correlated with income and wealth levels. On average, 6.5 % of all EU citizens cannot afford a car and in some countries, this share exceeds 20% (Hungary, Bulgaria and Romania).

905.When choosing between different transport modes, the unemployed are the most likely to use urban public transport: 23 % against an average of 19 % (Eurobarometer 406, 2013). In Brussels, 53% of households do not have access to a car. Two thirds of the poorer households in Berlin do not have access to a car. Policies aimed at addressing the “affordability of car use” therefore have a very different impact depending on whether they are addressing car use in urban or rural areas, where car use is much more prevalent.

906.At-risk groups for transport poverty include households with low incomes, the unemployed, ethnic minority members, or households that have children, or members with reduced mobility (including persons with disabilities, elderly persons). Rural and peri-urban communities are more at risk because they lack access to alternatives to car-use.

907.Transport poverty increases social exclusion as citizens might not have the means to get to work, services, social networks, and to reach essential facilities they are entitled to. Lack of mobility can lead to social disadvantage and exclusion. In general, groups more at risk of social exclusion are especially subject to transport disadvantage.

908.According to the European Social Policy Network (ESPN) report on “Access to essential services for people on low incomes in Europe” 543 , the lack of availability and affordability are the two main barriers that affect access of people on low incomes to adequate public transport services in the EU. In those Member States where targeted measures are in place for low-income people, those include reduced tariffs, subsidies as well as social protection measures. The latter are often linked to minimum income schemes, also for eligibility. In addition, improving the quality of the infrastructures (e.g. improved physical accessibility) is one of the ways to improve access to essential transport services.

909.Unless done with due consideration to the people in vulnerable situations in our societies, including persons with disabilities and reduced mobility, internalising external costs and more sustainable transport could, because of higher transport costs, raise concerns over the transport affordability and risk of connectivity’s loss in remote areas or for people on low incomes, especially where provision of public transport is poor.

910.Price signals are important to incentivise greener options and choices. However, if transport is to remain affordable, this cannot only be about making polluting modes of transport more expensive by internalising external costs, but also about reducing the costs generally on more sustainable alternatives. Specific compensation schemes and the effective use of taxation and subsidy will be key to ensure a socially and geographically fair transition.

911.The importance of keeping transport affordable in a context of transition towards making it sustainable is illustrated by the respondents to the Eurobarometer on Mobility and Transport 544 who state that their switch to more environmentally friendly modes of transport would be subject to the condition of it not being more expensive.

Figure 41: Conditions to switch to more environmentally friendly modes of transport

912.Availability of transport is another key issue. The Eurobarometer on Mobility and Transport 545 shows that the less urbanised the respondent’s environment is, the more likely they are to say there is no alternative to taking the car: 46% who live in rural villages say this, compared to 25% living in large towns. A study focusing on smart transport services in rural areas 546 , concluded the predominant absence of specific policies for rural transport with very few obligations to provide rural mobility services. Organisational arrangements for rural shared mobility need to be strengthened.

913.Public services obligations (PSOs) play an essential role in ensuring connectivity, a high level of quality of service and in keeping transport affordable. Transport services provided under PSOs are socially, economically and politically very significant: most urban bus, metro and tram services; 2/3 of all passenger rail transport services; 180 air routes connecting peripheral and development regions; about 1% of EU GDP and of total employment. PSOs provides connectivity that is vital for EU remote regions: a 10% increase in connectivity stimulates GDP by an additional 0.5% 547 .

914.While the principle and usefulness of PSOs as a tool to ensure affordable services and availability is generally acknowledged by all stakeholders across transport modes, the scope and specification of PSOs can be contentious and have a negative impact on the functioning of the internal market.

915.The tendering process is perceived burdensome and inflexible. Besides, stakeholders highlight a risk of non-genuine PSOs imposed by Member States. When the scope of the PSO goes beyond a real public need and/or covers services that can provided commercially, the compensation and/or exclusive rights granted to a specific operator for the provision of the public service can prevent market entry and distort competition. This issue was highlighted in the 2019 evaluation of Regulation n°1008/2008 on air services: unnecessary PSOs on routes that could be commercially viable may have the effect of driving away competitors, effectively reducing the connectivity of remote regions.

916.This is all the more problemati