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Polish road transport sector at a crossroads: pressure to reduce emissions and lack of government support

TSLPolish road transport sector at a crossroads: pressure to reduce emissions and lack of government support

The Polish road transport sector generates roughly 6 percent of Poland’s GDP and holds a leading position within the EU – local companies account for nearly 1/5 of all transports in the Union’s market. Currently, the sector is at a crossroads, with its direction being dictated by regulations aimed at combatting climate change and escalating demands from clients regarding emissions reduction. In order to retain a market presence and remain competitive, Polish carriers should have the opportunity to utilise a full range of zero-emission technologies, such as electric vehicles and biofuels. However, current government and legal regulations are not facilitating this transition.

The transport and logistics industry is experiencing increasing pressure from EU regulations to reduce CO2 emissions. This pressure is manifested in initiatives such as raising fees for vehicles that run on diesel or LNG. In Germany, this increase was as much as 80 percent for toll rates per 1 km of travel. This is a significant amount. It turns most business plans upside down and means our services have to become more expensive, says Maciej Wroński, president of the Employers’ Union “Transport and Logistics Poland”. On the other hand, we also feel the pressure to implement low-emission solutions from our clients, both when bidding on contracts and delivering services, even on an ad hoc basis. Clients must report CO2 emissions – from the production of goods to their delivery to store shelves – and as such, they expect us to use vehicles that do not emit carbon dioxide for transport.

According to last year’s report by PSPA, the transport industry is one of the most important sectors of the Polish economy. In 2021, it generated nearly 6% of Polish GDP and employed over 950,000 people, representing the third most populous professional group in the service sector (after trade and education). At the same time, the Polish road transport sector transported 380 billion tkm (tonne-kilometres) – the most in the EU, 24 percent more than second-placed Germany. Poland has the largest fleet of trucks in the community – every fifth truck moving on EU roads is registered in our country. In 2021, the fleet of heavy-duty vehicles over 3.5 t consisted of approx. 1.2 million vehicles. This led to the leading position of Polish carriers, who were responsible for almost 1/5 of all transports in the member states (“Electromobility in Heavy Transport”).

The Polish and EU road transport sectors are, however, undergoing changes, enforced by regulations aimed at combating climate change. This sector is also one of the largest emitters – in 2019, as much as 71.7 percent of transport emissions in the EU came from road transport. Although heavy-duty vehicles make up less than 3 percent of the total number of cars on European roads, they account for 19.4 percent of CO2 emissions from road transport. In Poland, 98.2 percent of registered heavy-duty vehicles are diesel-powered (report “Electrification of the Road Heavy Transport Sector 2023” PSPA and PIE). Therefore, investments in emission-free solutions are necessary – under another scenario, the Polish sector risks not only losing its leading position but also losing competitiveness in key Union markets.

At this point, it could be electric vehicles or fuel cell-powered ones. Unfortunately, all these hydrogen technologies are not currently advanced enough to be implemented. Meanwhile, electric technologies have several barriers that make their application in long-distance transport impossible. One of these barriers is the price of an electric vehicle, which is currently four to six times higher than vehicles powered by diesel or natural gas. This significantly higher price would have to translate into the rates of our services, and yet customers, who expect zero emissions in road transport, are not particularly willing to incur these costs. The carrier will not pay for this out of his own pocket, because in this whole chain from production to delivery to the customer, he is the entity with the lowest financial capacity, says the president of the Employers’ Union “Transport and Logistics Poland”.

As he points out, the industry is highly counting on subsidies and support from the government in the transition towards a zero-emission fleet.

In most EU countries, the purchase of an electric zero-emission vehicle is subsidized. Subsidies sometimes even reach 80 percent of the difference between the purchase price of a traditional and an electric tractor unit. In Poland, there is indeed a subsidy, but it is limited exclusively to public transport vehicles. Even in passenger transport – regional or supra-regional – a carrier who would like to purchase an electric bus will not receive this subsidy. If he doesn’t get it, both this passenger and cargo carrier will not be competitive, because his colleague from Germany, France, the Czech Republic, or Sweden will be able to provide this service much cheaper, explains Maciej Wroński.

The last year’s report “Electrification of the Road Heavy Transport Sector”, developed by PSPA and PIE, suggests that electrification could bring significant benefits to both Polish carriers and the entire economy. Thanks to it, by 2035, the activity of the Polish road transport sector could increase by 9.9 billion tkm, and through accelerated electrification, the industry could also create an additional 21,000 jobs.

Barriers related to electrification could be bypassed by using other vehicles, powered by climate-neutral fuels. One such fuel is HVO, a fuel made from vegetable oils, waste diesel oil, or oil used in catering, which undergoes a hydrogenation process and has the same properties as traditional diesel. Unfortunately, in Poland, this fuel cannot be sold, it cannot be distributed, because there are no technical standards that would set some standards, there are no legal regulations for this purpose. For this reason, even if a fuel distributor wanted to introduce HVO and sell it at his station, he would simply lose his license. Meanwhile, this is an alternative to electrification of transport, estimates the president of TLP.

At the end of last December, the Employers’ Union “Transport and Logistics Poland” appealed to the Minister of Climate and Environment and the Minister of Infrastructure, calling for the introduction of HVO fuel into commercial circulation in Poland and financial support for the road transport industry in the purchase of zero-emission vehicles. The Union emphasizes that Polish carriers must have the opportunity to use the full range of technologies available today, including biofuels in medium- and long-distance transport, and electrification in distribution and local transport.

If the Polish government does not take seriously the issue of transforming road transport, if it does not provide support, the Polish industry, which is currently number 1 in Europe and performs the most transports in the EU, will simply shrink, because it will become non-competitive compared to carriers from other EU countries, emphasizes Maciej Wroński.

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