The transport sector is once again facing change. Alongside stricter environmental zones, electrification and rising fuel prices, a new factor is coming into play that directly impacts your costs: EU ETS 2. For many businesses, this raises important questions. What is EU ETS 2, when will it start, and what does it actually mean for your fuel price and margins? In this article, you will get a clear and practical EU ETS 2 explanation. We also explain how this system will affect your daily operations and cost structure.
To be clear from the start: what is EU ETS 2? It is a new European emissions trading system focused on CO₂ emissions from fuels, especially in road transport and buildings. While the existing system mainly targets heavy industry and energy producers, EU ETS phase 2 focuses on fuel use in sectors like transport.
The structure of EU ETS-2 is similar to the current system. A cap is set on total emissions and companies must purchase allowances for the CO₂ they emit. The key difference lies in who is responsible. Instead of transport companies, fuel suppliers fall under the system. They must accurately track how much fuel they sell, calculate the associated CO₂ emissions and report this to authorities. They are then required to buy and submit emission allowances to cover those emissions.
Although this happens behind the scenes, the impact is very real. Fuel suppliers will pass these additional costs on through their prices. This means the end user ultimately pays. For transport companies, this translates directly into higher diesel prices, even though they are not directly participating in the emissions trading system.
As a result, fuel becomes not only more expensive but also more complex to manage. It is no longer enough to look only at pump prices. The development of the EU ETS 2 price will play an increasingly important role in your overall cost structure. This requires a different approach to planning, cost calculation and negotiations with clients.
At European level, it has been agreed that EU ETS 2 2027 should be fully operational. From that moment, fuel suppliers will need to purchase and surrender emission allowances, and the costs will start to affect fuel prices directly.
The current plan is clear: the system should be fully active in 2027 and have a direct impact on the market. However, flexibility has been built into the regulation. If energy prices in 2026 are exceptionally high, for example due to rising oil or gas prices, the start can be postponed to EU ETS 2 2028. This safeguard is designed to prevent companies and consumers from being hit by both high energy prices and additional CO₂ costs at the same time.
There is also an ongoing political discussion within the EU. Some member states are concerned about the financial impact, especially in sectors like transport where margins are already tight. As a result, there are calls to delay implementation to 2028 regardless of energy prices. Whether this happens will depend on future EU decisions and negotiations.
The key question for transport companies is what EU ETS 2 will actually do to diesel prices. The EU ETS 2 price is determined by the CO₂ market and can fluctuate based on supply, demand and policy. Still, a simple calculation can give a reliable estimate.
Formula: extra €/liter ≈ ETS2 price (€/ton CO₂) × CO₂ per liter / 1000
CO₂ per gallon (source): 8.887 g CO₂/gallon petrol and 10.180 g CO₂/gallon diesel. This converts to roughly 2.35 kg CO₂ per liter of petrol and 2.69 kg CO₂ per liter of diesel, based on 1 US gallon = 3.785 liters.
For diesel, this gives a clear indication. At a CO₂ price of 50 euros per ton, the diesel price increases by around 13 to 14 cents per liter. If the price rises to 100 euros per ton, the increase is about 27 cents per liter. Taxes and margins can influence the final price, but the scale is clear.
In practice, these costs add up quickly. A truck covering high annual mileage consumes tens of thousands of liters of diesel. A price increase of just a few cents per liter can lead to several thousand euros in extra costs per vehicle each year. This makes EU ETS-2 a structural factor in your fuel expenses.
The impact of ETS 2 EU goes beyond fuel prices alone. It affects your entire cost structure. Fuel is already one of the biggest cost factors in transport, and this share will increase.
For many businesses, cost management becomes even more important. Not all costs can be passed on. Driving more efficiently, optimizing planning and investing in the right vehicles will be key. Want to know which vehicles are a smart investment under EU ETS phase 2 or how to prepare your fleet? Get in contact with our experts.
