Factsheet for measure
LU-2023-16/3442
–
Updated
– measures in Luxembourg
Decarbonising road transport
Décarbonation du transport routier
Background information
In light of the tripartite agreement of 31 March 2022 aimed at strengthening Luxembourg's commitment to combating climate change, a new aid scheme has just been introduced for companies wishing to convert their road haulage fleet to ‘zero emission’ CO₂ rolling vehicles. This aid is being introduced on the basis of the amended law of 15 December 2017 on the environmental protection aid scheme.
Content of measure
The new subsidy is based on an analysis of the propulsion technologies best suited to stimulating the decarbonisation of the logistics sector in Luxembourg, as well as on the price difference between these new technologies and an equivalent vehicle with an internal combustion engine.
The aim is to further encourage companies to invest in zero-emission technologies in order to reduce the environmental impact of their road haulage activities. New medium- and heavy-duty trucks (categories N2 and N3) equipped with zero-emission powertrains, such as pure electric vehicles and hydrogen fuel cell vehicles, are therefore eligible for this aid. In addition, heavy commercial vehicles equipped with an internal combustion engine with CO₂ emissions of less than 1 g/kWh are also eligible, such as a commercial vehicle with a hydrogen combustion engine. Added to this is the conversion (‘retrofitting’) of combustion engine vehicles, registered in Luxembourg, into zero-emission heavy commercial vehicles.
Also varying according to the size of the company, the amount of aid is calculated on the basis of the additional cost, i.e. the difference between the cost of acquiring a zero-emission vehicle and acquiring an equivalent vehicle with an internal combustion engine, or on the basis of the costs of conversion to a zero-emission vehicle for retrofitting. The aid is capped at €300,000 per group.
This aid is temporary and will be reviewed when the new European provisions on State aid are transposed into national law.
Updates
The following updates to this measure have been made after it came into effect.
|
15 January 2025
|
Compared with neighboring countries, emissions from the transport sector in Luxembourg are proportionately high in relation to the emissions actually generated in the country. This is due to the fact that emissions linked to the sale of petroleum products are included in the national balance sheet. Moreover, decarbonizing freight transport remains particularly difficult to implement due to several obstacles: limited infrastructure, insufficient regulatory incentives and lack of demand from shippers.
According to a report carried out by oil company Shell, in collaboration with Deloitte, some 80% of those surveyed consider insufficient access to fast battery recharging and hydrogen refueling infrastructure to be limiting factors. Participants also report that the alternative technologies needed for decarbonization - notably battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEVs) - are still 'excessively expensive to buy and operate'. Almost 2.5 times the cost of a diesel truck. What's more, 80% of those surveyed believe that the absence of well-designed regulatory incentives to narrow this cost gap in the early years of the transition is a major obstacle preventing fleet owners from investing in low- or zero-emission trucks on a large scale. What's more, 70% of participants say that shippers' willingness to encourage low-emission road transport services will be key to unlocking investment in decarbonization.
The FEDIL (Fédération des entreprises luxembourgeoises) report on the subject also considers that the transport sector requires more substantial government support. It also considers that the main challenge in decarbonizing professional transport is technological. Pending a technological revolution in this field and the emergence of a dominant technology, highly renewable fuels such as HVO100 can play an important role. But their cost at the pump is too high to encourage their use.
|
Use of measure
No information available.
Target groups
Actors and funding
|
Actors
|
Funding
|
National government
Social partners jointly
|
National funds
|
Social partners
Social partners' role in
designing the measure
and form of involvement:
|
Trade unions
|
Employers' organisations
|
|
Role
|
Agreed (outcome) incl. social partner initiative
|
Agreed (outcome) incl. social partner initiative
|
|
Form
|
Consultation through tripartite or bipartite social dialogue bodies
|
Consultation through tripartite or bipartite social dialogue bodies
|
Social partners' role in the
implementation, monitoring and assessment phase:
-
Social partners jointly
-
Main level of involvement: Sectoral or branch level
Involvement
On 31 March 2022, following meetings of the Tripartite Coordination Committee, the government signed an agreement with representatives of the Union des entreprises luxembourgeoises (UEL), the Lëtzebuerger Chrëschtleche Gewerkschaftsbond (LCGB) and the Confédération Générale de la Fonction Publique (CGFP). This agreement covered the effects of inflationary pressure, as well as aid to businesses, including some specific to the energy transition.
Views and reactions
The social partners are satisfied. On the one hand, the unions have been able to make progress in preserving jobs, livelihoods and people's purchasing power". On the other hand, the employers consider that they have been able to guarantee predictability for the country's businesses.
Sectors and occupations
-
This case is sector-specific (only private sector)
-
|
Economic area
|
Sector (NACE level 2)
|
|
H - Transportation And Storage
|
H49 Land transport and transport via pipelines
|
|
H52 Warehousing and support activities for transportation
|
This case is not occupation-specific.
Sources
