Navigating the Road to Sustainable Transport: The HVO Fuel Alternative Amidst CO2 Regulation Challenges”

European Union countries and the HVO Fuel European Parliament faced a setback last week as they failed to agree on new regulations tightening CO2 limits for heavy-duty vehicles (HDVs). Germany, which had initially supported the proposal, withdrew its backing, echoing a similar move last year that halted proposed CO2 standards for cars.

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HVO Fuel

The car standards included a de facto ban on new internal combustion engine cars by 2035. The impasse was resolved by the European Commission’s modification, introducing a new category for vehicles running on internal combustion engines but solely on climate-neutral fuels, known as e-fuels.

In the recent attempt to enhance existing CO2 emission targets for heavy goods vehicles, Germany advocated for multiple alternative fuels, including biofuels, to decarbonize heavy-duty transport. Ryan Brady, General Manager at Stateline Transport, an Irish haulage and logistics business, welcomed this shift, highlighting the financial unsustainability of electric trucks (EVs) for his company. Brady explained that customer reluctance to commit to contracts and the high cost of EVs, averaging €400,000 even with a potential government grant of €200,000, made the investment in electric trucks challenging.

Brady emphasized the need for five-year customer security for EV financing, which customers were unwilling to commit to, leading Stateline to fully embrace Hydrotreated Vegetable Oil (HVO) fuel. This switch reduces carbon emissions by 90% without incurring fleet renewal costs. While HVO fuel offers cost advantages in vehicle purchases, challenges include the premium pricing of HVO fuel—20% higher than regular diesel and 50% higher than kerosene fuel. Sustainable liquid biofuels like HVO, derived from tallow and used cooking oil, are crucial for decarbonizing various sectors, including road transport and the production of Sustainable Aviation Fuels (SAF).

Several Irish suppliers and importers, such as GBF Ireland Ltd and Circle K, are actively involved in the HVO market. Although the majority of HVO is imported from the Neste facility in Rotterdam, there is a growing demand for HVO as a household heating fuel. The article suggests that governments, including the Irish Government, should intervene to accelerate the transition to more sustainable fuels like HVO. Lowering excise duties for HVO could make it more accessible, facilitating its adoption in various sectors and contributing to a 90% reduction in carbon emissions.