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)
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Policy and regulation
- 1 Sector-specific emission reduction targets
- 2 Carbon pricing mechanisms
- 3 Economic support for green commodities and fuels: Subsidies
- 4 Economic support for green commodities and fuels: Taxation
- 5 Economic support for green commodities and fuels: Carbon Contracts of difference
- 6 Demand stimulation policies: Green public procurement
- 7 Demand stimulation policies: Mandates and quotas
- 8 Demand stimulation policies: Emission reduction standards
- 9 Demand stimulation policies: Phase out of ICE Vehicles
- 10 Carbon limits in end products
- 11 Product definitions, standards, certification schemes and emission accounting frameworks
- 12 Fast-tracked permitting
- 13 Research and development support
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Technology infrastructure and system operation
- 14 Technology readiness: Reduced demand and improved energy efficiency
- 15 Technology readiness: Direct use of clean electricity
- 16 Technology readiness: Direct use of renewable heat and biomass
- 17 Technology readiness: Direct use of sustainably sourced biomass and biofuels
- 18 Technology readiness: Indirect use of clean electricity via synthetic fuels
- 19 Technology readiness: Implementation of CO2 capture, utilisation and removal measures
- 20 Physical infrastructure: Power grids modernisation and expansion
- 21 Physical infrastructure: Electric charging facilities for EVs
- 22 Physical infrastructure: Hydrogen networks
- 23 Physical infrastructure: CO2 capture and storage networks
- 24 Physical infrastructure: Ports and airports
- 25 Digital technologies and infrastructure
- 26 Quality infrastructure
- 27 Supply-side flexibility and demand-side management via smart electrification strategies
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Market conditions business and finance
- 28 Early market creation measures: Offtake agreements and long-term contracts
- 29 Early market creation measures: Industry coalitions
- 30 Early market creation measures: Emerging business models
- 31 Corporate climate commitments and transition plans
- 32 Ecolabels of green products
- 33 Sustainability-linked investments, climate bonds and sustainable finance taxonomies
- 34 Financing programmes and de-risking instruments
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Supply chain skills and community engagement