Including road transport in the EU ETS (European Emissions Trading System): A model-based analysis of the German electricity and transport sector

The EU ETS (European Emissions Trading System) is being enlarged stepwise to cover an increasing amount of overall European CO2 emissions. However, one of the largest and still growing CO2-emitting sector, the transport sector, and particularly road transport, has not yet been included in the EU ETS. Against this background, the question arises whether integrating the road transport sector in the EU ETS represents a cost-efficient CO2 reduction strategy. For this reason, the consequences of this integration are analysed with a focus on Germany. To do so we utilise a model-based approach. In order to account for both sectors simultaneously, we couple an electricity system model, PERSEUS-EU (Package for Emission Reduction Strategies in Energy Use and Supply in Europe), with a road transport model, COMIT (CO2 emission Mitigation in the Transport sector). The time horizon we consider ranges from 2010 to 2030. In our analysis, we differentiate our scenarios according to commodity prices, share of renewable energies in electricity generation and share of electric vehicles. The results show that the enlargement of the EU ETS to include road transport leads to a reduction of overall CO2 emissions, but equally reduces the mitigation efforts in the road transport sector. Simultaneously, the German electricity sector is mainly influenced according to the certificate demand or supply of the road transport sector.