Fleet operators and manufacturers call for infrastructure investment and technology-neutral standards to meet 2035 and 2040 HGV phase-out targets

The government is targeting phase out dates for the sale of new non-zero emission HGVs up to 26 tonnes by 2035 and for heavier HGVs by 2040. To set the regulatory pathway to achieve these targets, a public consultation was conducted to garner industry input.

Respondents were asked about four scenarios and various other questions around the transition. The four options included: do nothing; increase manufacturer CO2 emissions targets; introduce a ZEV mandate for manufacturers supported by a CO2 emissions standard for currently regulated vehicles; and implement mandates for large fleets to increase the proportion of zero emission trucks on their fleets.

While respondents offered nuanced views of which regulatory levers could be the most effective, broadly, the industry agreed this should be a multi-pronged approach, addressing vehicle cost, infrastructure, grid connections, low carbon fuels and enabling factors such as weights and dimensions. Energy costs were frequently cited as a concern and many warned that the timeline is already getting tight for operators to effectively plan their transition ahead of 2035 and 2040.

Option 1: Increased manufacturer CO2 emissions targets

Many respondents agreed that increased targets for manufacturers, aligned with the EU’s framework, would be beneficial. However, adaptations of this approach were suggested to tailor regulation to the UK market and address demand issues at the same time.

Lamech Solomon, head of decarbonisation policy at Logistics UK, says: “The logistics sector is committed to decarbonising, but for any regulation to be workable it requires government to address core barriers holding up decarbonisation, which include infrastructure readiness and cost challenges. Without addressing these, mandates risk outpacing practical deliverability.

“Following extensive discussion with our members, Logistics UK has identified Option 1 from the government’s consultation as the most credible and workable pathway. This option sets a manufacturer CO2 standard and provides a technology-neutral, flexible and the least-disruptive route to decarbonisation.

“Crucially, this option supports the decarbonisation of road freight in a way that is operationally deliverable and will enable a gradual fleet transition. In the early stages of the transition, when zero-emission technologies and infrastructure are still developing, operators would still be able to buy diesel vehicles, where they are operationally necessary, while progressively reducing emissions through manufacturer fleet standards.”

From an OEM perspective, DAF Trucks supports aligning with EU CO2 targets but Phil Moon, marketing manager at DAF, says: “The Vehicle Energy Consumption Calculation Tool (VECTO) doesn’t really account for the additional productivity that six axle combination vehicles over 4m can offer. In other words, those vehicles may be carrying more goods but it isn’t recognised in the calculation tool.”

Given this option allows for a technology neutral approach, the Chartered Institute of Logistics and Transport (CILT) agreed this could be a useful lever but encouraged the quick adoption of EU standards with UK-specific adaptations hashed out at a later stage to allow policy to be enacted swiftly.

In opposition, Energy UK stated it “does not believe that Option 1 would provide sufficient emissions reductions in the timeframe required, nor provide sufficient market signals to invest in the range of infrastructure that is needed (such as charging depots, shared hubs, and public HGV charging along the strategic road network). This approach risks delaying crucial, timely investment in essential vehicle infrastructure to support the uptake of eHGVs”.

Option 2: Introduce a ZEV mandate supported by a CO2 emissions standard for currently regulated vehicles

Similarly, the ZEV mandate discussion emphasised the importance of enabling the industry to adopt eHGVs in a cost effective manner. Moon explains: “So much is outside of the influence of truck sales, so we need to look at charging infrastructure, total cost of ownership and energy costs to incentivise operators.

“We can’t force customers to take trucks unless the economic situation is right, so to penalise manufacturers is something we consider to be unreasonable, that’s why we’re not supportive of a ZEV mandate for manufacturers.”

Fuels Industry UK agreed and responded: “Forcing OEMs to sell specific vehicles that preclude the use of GHG emissions saving low carbon fuels (LCFs) is not a technology-neutral approach and therefore is not supported by Fuels Industry UK. It is also possible that limiting the sale of non-ZE HGVs results in aging vehicles being used for longer. Without also incentivising LCFs this would result in the opposite outcome in terms of sector decarbonisation.”

Aldersgate Group, which represents members including Associated British Ports, Aviva Investors, BT, the John Lewis Partnership, Michelin, Netflix, Nestlé, Siemens, SUEZ, Tesco and Willmott Dixon, stated: “We are tentatively in favour of a sales mandate for BEV HGVs as part of a suite of interventions that could help deliver this outcome. Designed well, a mandate would offer clarity to all those in the value chain about the expected technology trajectory and enable fleet operators and users to plan their own transitions.

“On balance we believe that a mandate would be beneficial, but only if very carefully designed. It would also need to be supported by incentives (e.g. capital grants and tax relief) to support vehicle purchasing and supporting infrastructure. Overall, it should be presented as part of a full HGV transition package, rather than as an isolated measure.”

Option 3: Fleet adoption requirements

The idea of imposing adoption requirements on fleets was quite unpopular, with the industry warning of unintended consequences. Moon explains: “We don’t support fleet mandates either. Although from a manufacturer’s perspective, it may seem attractive, we need to have some pull through from the market. But realistically, forcing truck operators towards something which might not offer the same cost per tonne km, it’s going to be inflationary and I think there’s a real opportunity for distortion in the marketplace.”

Due to the industry reliance on subcontracting, a mandate on larger fleets could push more freight onto smaller hauliers who are more likely to be running diesel trucks and hauliers could restrict growth to stay outside of this type of mandate. Aldersgate noted: “Efforts to protect the SME sector could disrupt the market, potentially causing unintended consequences for market structures and risking gaming, if only large companies are made to bear additional costs.

“If fleets have to adopt higher cost BEVs, transport buyers and third party logistics providers could pivot from dedicated fleets to lower cost SME subcontracts. While a fleet mandate could accelerate uptake among large operators, its impact would be structurally limited due to SME dominance, cost pressures, and operational constraints. On balance, it carries higher risks than a carefully calibrated sales mandate.”

Richard Smith, MD of the RHA says: “The goal, as we see it, is how the ‘addressable market’ for zero emission vehicles can be developed to a position that regulation can then drive without imposing costs on to hard-pressed operators. We see proposals for a ZEV mandate for manufacturers or fleet adoption requirements as impractical without other enablers such as the infrastructure in place to power zero emission vehicles.”

Despite the potential issues with this approach, Energy UK feels a combination of Option 3 and Option 2 could deliver the highest carbon savings. However, its response stated: “There is a knowledge gap between freight operators and the electricity sector. Providing a mandate alone will not support the road freight industry. Government should consider multi-year compliance periods or rolling targets, allowing operators and manufacturers to average compliance across several years. This would provide flexibility while still maintaining a clear long-term decarbonisation trajectory.”

Low-carbon fuels

While the consultation noted the importance of low carbon fuels (LCFs) for near term decarbonisation, it didn’t explicitly ask about the role these fuels should play in a regulated transition. Many respondents wanted more recognition for LCFs as interim solutions.

Solomon says: “For Option 1 to deliver its full potential, it is essential that the regulatory framework gives appropriate recognition to LCF. CO2 standards that measure only tailpipe emissions risk undervaluing the significant carbon reduction benefits that LCF can deliver across the existing and near-term fleet.

“Logistics UK continues to urge government to ensure that the methodology underpinning any strengthened CO2 standard accounts for the lifecycle carbon emissions of vehicles running on LCF, so that operators investing in these fuels are not disadvantaged. This is consistent with a genuinely technology-neutral approach and would better reflect the actual greenhouse gas savings being achieved.”

The RHA also promotes a technology-neutral approach, as Smith says: “Different technologies work in different contexts, and we remain neutral on which alternative fuels are used. Progress can be made on short distance routes and journeys with lighter loads, but heavy loads and long-distance journeys remain a challenge.”

Energy UK agreed and stated: “Alongside electric HGVs, other low-carbon fuels, including low-carbon gases, can play a transitional role in delivering near-term emissions reductions in hard-to-abate segments of the transport sector. Where low-carbon hydrogen is an appropriate, cost-effective option to decarbonise – a metric of gCO₂ per vehicle activity would better reflect the realities of decarbonisation, and allows comparison across technology types. This can then be tightened based on vehicles delivering the highest rates of decarbonisation.”

Discussing alternative fuels as an interim option, Aldersgate adds: “Even if it is possible to phase out the sale of ICE HGVs by 2040, technology costs, practical challenges for the heaviest loads, and the high proportion of SME operators means that there is likely to be a substantial ‘long tail’ of ICE HGVs continuing to operate well into the 2050s. If it is not possible to achieve 2040 phaseout, the tail will remain for longer. Low-carbon fuels offer a viable option in the short to medium term.”

However, Jamie Sands, head of solutions at eHGV pioneer the Welch Group, argues: “Stop subsidising alternative fuels for road freight. The multi-fuel narrative creates policy ambiguity that delays investment decisions.”

Other proposals

Instead of the three regulatory structures proposed in the consultation, Sands says: “Phase-out dates should be set by operational archetype (return-to-base, trunking, long-haul, refrigerated), not weight class. A 44-tonne artic on a fixed nightly trunk is technically easier to electrify than a 7.5-tonne rigid doing multi-drop rural with no depot charging.

“Infrastructure is the binding constraint, not vehicle cost. Redirect public money from purchase grants to charging infrastructure. A vehicle grant helps one operator buy one truck. Infrastructure investment enables every operator on that connection to electrify.

“Grid connection waits of five to 15 years don’t match regulatory timelines. We’re calling for a formal coordination mechanism between DfT, DESNZ, and Ofgem. We also proposed a National Freight Transition Authority to coordinate grid delivery, depot planning, corridor charging, and workforce development. Nobody currently owns the whole picture.”

Others agreed that targets should centre around applications rather than weight classes and also called for weights and dimensions to be addressed to support the heavier end of the spectrum. Road tolling systems similar to those in Europe were also suggested.

The CILT proposes: “Any mandatory measures should fall first on buyers of freight rather than hauliers. This will help to ensure costs are passed onto consumers rather than squeezing the already small margins of hauliers, and is more likely to shape vehicle procurement decisions across supply chains.”

Ultimately, the main message was to ensure collaboration between different stakeholders, to be realistic about timelines and focus on decarbonising in a way that makes economic sense while reducing emissions as quickly as possible.

Smith concludes: “To secure progress, we need a partnership approach between government and industry. A national coordinating body, led by government in partnership with industry, to co-ordinate the practical activities required by multiple agencies is needed to deliver HGV and coach decarbonisation.”