Demand stimulation policies: Mandates and quotas

Shipping

Current status of implementation and existing gaps

Establishing mandates and quotas for shipping is crucial for setting targets. While sector-specific emission reduction targets are more common (refer to the row on Sector-specific emission reduction targets and measures), mandates and quotas can also take other forms, such as setting targets for the adoption of various low-carbon fuels.

Examples and initiatives

Under the FuelEU Maritime regulations, there is a sub target of 2% use of renewable fuels of non-biological origin (RFNBOs) by 2034.

Aviation

Current status of implementation and existing gaps

Fixing binding targets or quotas on the aviation sector that require a specified level of uptake of SAF can accelerate the creation of initial markets.

Examples and initiatives

Refuel EU Aviation mandates a minimum supply of SAF, as well as other measures related to energy savings, fuel infrastructure and the promotion of green flights, which send effective signals to markets (European Council, 2023).

Iron and steel

Current status of implementation and existing gaps

Fixing binding targets or quotas on a specific industry requiring a specified level of uptake of low or near-zero carbon commodities can accelerate decarbonisation efforts. The progress on this enabler in the iron and steel sector is limited.

Examples and initiatives

In the EU, the automotive sector alone consumes 17% of the region’s steel. A study by Transport & Environment finds that by setting targets for car makers to use increasingly green steel, Europe can avoid significant CO2 emissions while not paying significantly higher prices. For example, switching to 40% green steel would add just EUR 57 to the sticker price of a new electric vehicle in 2030 (T&E, 2024).

Chemical and petrochemical

Current status of implementation and existing gaps

Fixing binding targets or quotas on a specific sector requiring a specified level of uptake of low or near-zero carbon commodities can accelerate decarbonisation efforts. The progress on this enabler in the chemical and petrochemical sector is limited.

Examples and initiatives

The EU Renewable Energy Directive III mandates EU member states to use renewable fuels of non-biological origin in transport and chemical and petrochemical industry.

Cement

Current status of implementation and existing gaps

Fixing binding targets or quotas on a specific industry requiring a specified level of uptake of low or near-zero carbon commodities can accelerate decarbonisation efforts. Direct binding quotas or mandates for low-carbon cement usage are still developing.

Examples and initiatives

There is a growing push to incorporate carbon intensity thresholds for construction materials like cement. The European Commission’s focus on building materials includes discussions around setting quotas or thresholds for low-carbon cement in public construction projects (Cembureau, 2024).

Enablers

Enablers (39)