DfT consults on CO2 emissions framework for HGVs

The Department for Transport (DfT) and Office for Zero Emission Vehicles are seeking views from fleet operators and other stakeholders on the most appropriate future regulatory framework to support the UK’s transition to zero-emission HGVs.

The government has already committed to phasing out the sale of new non-zero emission HGVs up to 26 tonnes by 2035, and all non-zero emission HGVs by 2040. The consultation seeks views on the specifics of how these targets may be achieved.

The government is considering multiple options, which may be introduced individually or in combination. ‘Option 0’, no regulatory framework, would “form the baseline for any alternative option against which to measure the CO2 emissions savings potential”, said DfT.

Under Option 1, a new framework of manufacturer targets would be created based on the existing regulation of CO2 emissions from new HGVs under EU regulation 2019/1242.

“This regulation would establish targets based on each manufacturer’s fleet average specific CO₂ emissions,” said DfT.

“Expanding this framework to end the sale of new non-ZE HGVs would involve setting a CO₂ emission reduction target trajectory on a pathway to 100 per cent, supported by interim targets, for the announced end-of-sale dates.

“CO₂ emissions reduction targets may initially be met by improving the fuel efficiency of conventional vehicles through, for example, improving aerodynamics, the rolling resistance of tyres, or engine efficiency.

“The marginal cost of achieving emission reductions from a conventional vehicle increase exponentially once a specific CO₂ emissions target is sufficiently high, requiring manufacturers to start investing in alternative powertrains to achieve targets at least cost.”

Such an approach would necessitate many design considerations, said the department.

“The contribution of CO₂ emissions reductions from HGVs could be weighted proportionately to the vehicle’s characteristics, such as payload, mileage, average lifetime, or CO₂ emissions. This could mean that the vehicles that are most difficult to decarbonise and those that contribute the most towards GHG emissions are credited proportionately and thus given additional incentive to decarbonise.

“Further flexibilities such as a credit and debt mechanism (whereby credits earned for over-compliance may be used to balance debts accrued due to under-compliance across vehicle types), a banking and borrowing mechanism (whereby non-compliant manufacturers may borrow credits from future years to avoid penalties), and a trading mechanism (whereby manufacturers may trade credits or vehicles amongst each other) could also be considered for this option.”

Option 2, meanwhile, would involve the introduction of a zero-emission vehicle (ZEV) mandate supported by a CO2 emissions standard for currently regulated vehicles.

“A new regulatory framework could be created setting requirements for HGV manufacturers to provide more ZE HGVs by reducing their share of new non-ZE HGVs sold over a specified period of time,” said DfT.

“Each year, manufacturers could be issued allowances based on the new non-ZE HGV targets set for each vehicle category, manufacturer’s sales of vehicles in that category and a weighting assigned to that vehicle category.

“The sale of non-ZE HGVs depletes these allowances and selling more non-ZE HGVs than permitted by allowances may result in a penalty, subject to flexibilities.”

Finally, Option 3 would place requirements on fleets themselves to adopt a certain percentage of ZEVs.

“To encourage the uptake of ZE HGVs, fleet targets applied only to the largest freight operators could require an increasing portion of their vehicle purchases, leases, or portion of their fleet to be ZE.

“To prevent exposing SME operators to undue financial burdens, and to instead target a scheme at large operators who have access to more capital, more financing options, and potential bulk purchasing discounts, a set of exclusion criteria would be established under this option. The criteria could be based on the size of the operator’s existing fleet.

“Two broad options could be considered for the targets within a fleet mandate: a trajectory may establish the share of an operator’s entire fleet which needs to be ZE for a range of years, or a requirement that a proportion of vehicles added to a goods operator’s licence – either through new purchases, second-hand purchases, or through leases – must be ZE after a certain date.

“As the HGV sector is diverse with a combination of urban, regional, municipal, construction, and long-haul mission profiles, each of which face different challenges in the transition towards ZE technology, such a framework could base the targets on an operator’s vehicle fleet composition.”

Stakeholder views are sought on these regulatory options, as well as the scope and eligibility criteria for ‘zero-emission’ – for example, whether hydrogen combustion engines, which produce low levels of CO2 from their exhausts, should fall within scope. Perspectives on options for vehicle categorisation, flexibilities and penalties are also invited, as well as input on CO2 emissions reduction trajectories.

In a foreword to the consultation, the transport minister Keir Mather said: “Some HGVs may be challenging to shift towards zero-emission, particularly those that drive long distances, carry very heavy loads, or have demanding mission profiles. To address this, we are open to views on which phaseout date should apply to challenging-to-decarbonise HGVs.”

In its consultation document, DfT conceded that the UK was “lagging behind” on zero-emission (ZE) HGVs, despite having become “a leader in the sale of ZE cars”.

“Advanced regulations on the supply side, more generous incentives and infrastructure have led to our neighbouring countries embarking on the transition to ZE HGVs at an accelerated pace,” it said.

“In 2024 the UK had a ZE HGV new registrations share of 0.6 per cent  (rising to 1 per cent in Q1 and Q2 of 2025), compared to a 2.0 per cent market share of sales in 2024 across the EU-27 and 4.5 per cent in Germany.”

It explained that most registrations of ZE HGVs in the UK has been concentrated in vehicles up to the 26-tonne threshold, with 148 battery-electric trucks registered in 2025 up to the second quarter, whereas there were only 66 ZE trucks registered of over 26 tonnes in the same period.

“More HGVs are coming to market and the Zero-Emission Heavy Goods Vehicles and Infrastructure Demonstrator (ZEHID) – a government led programme which has already provided over £120 million in funding – is expected to deliver around 300 additional ZE HGVs above 40 tonnes in 2025 and 2026 and to kickstart nationwide investment in the essential charging and fuelling network needed to keep them moving,” it added.

“Technological innovation, driven in part through effective regulation of the GHG emissions from new diesel HGVs sold in the EU, and consistently falling lithium-ion battery prices have contributed to a falling cost differential between ZE HGVs and their conventional counterparts. These innovations are also expected to deliver ZE HGVs with greater ranges to the market as the sector continues to develop. As the TCO of ZE HGVs continues to fall, freight operators are expected to start to see cost savings from adopting these vehicles over the conventionally fuelled HGVs.”

Nonetheless, said DfT, there is a strong case for government intervention “to correct for market failures”: it acknowledges that it is “highly unlikely” that the market will deliver the transition required to reach net zero in the absence of regulation.

“There is also a coordination failure between the deployment of ZE HGVs and the necessary infrastructure needed for their charging and fuelling,” it concedes.

“These nascent markets require scaling up in tandem to ensure that investments in infrastructure provision make commercial sense for private investors. Regulatory intervention will send a clear signal to the market, providing certainty that the sector needs to move forward with the transition to ZE technologies.”

The consultation document, complete with DfT’s assessment of the potential advantages and disadvantages of each of the presented options, can be accessed here.

Interested parties have until 17 March to respond.