Decarbonising at scale without blowing the TCO

Most people I meet in logistics want to decarbonise road freight. But when we talk about the investment, the conversation gets harder. New tech carries risk. Margins are slim. While end‑consumers want greener delivery, they aren’t willing to pay for it – Bain’s “Will vs Wallet” survey of 25,000 people globally found 76% say a sustainable lifestyle matters, yet fewer than 20% support a modest fuel-tax rise to accelerate the transition. That gap between ambition and real impact is why “system change” matters. Technology alone won’t carry us fast enough; the policy and market rules around us need to make the lower‑carbon choice the obvious, easy choice.

As an engineer, I find the rate of change in the electric truck market as staggering as it is exciting. In under 10 years it’s gone from near non-existent to being a credible competitor to diesel, with no sign of progress slowing down.

10 years ago, the closest thing to a heavy-duty electric truck you were likely to see on the road was a milk float. Just 5 years ago the first generation of electric trucks had a similar range to me on a bike (humble brag?), yet at house-sized price tags. The first workable models arrived in 2023: still expensive, but capable of a day’s short‑haul on the right route with support from incentives. We at DFDS should know - we already run almost 150 of these across Europe. And the rate of progress is only accelerating.

Price tag has been the biggest barrier for widespread adoption. But cheaper, higher‑density batteries, more efficient drivetrains and manufacturing scale are closing the cost gap to diesel, while rising ranges and faster charging are closing the operational gap—even in long‑haul. Bloomberg data shows global lithium‑ion pack prices have fallen roughly 30% since 2024, OEMs now offer long‑haul BEVs capable of ~600 km in real‑world demos, and megawatt charging (MCS) lets drivers take on a near‑full charge during mandated breaks. ICCT’s 2023 analysis projected battery‑electric trucks will undercut diesel on TCO in the US before 2030 - without regulatory support - largely because electricity is significantly cheaper than diesel. (Although how this will develop with the ongoing fuel price volatility is anyone’s guess.)

E-truck development

What about Europe? With exceptions like France, European electricity prices are significantly higher – before the recent energy crisis, US households were paying an average of just 15ct/kWh, whereas I paid 33ct/kWh in Copenhagen. Regulation in Europe has a much bigger role to play to force that level playing field earlier. Regulation can be a dirty word. There always needs to be a clear, measurable reason for its introduction – but that’s clearly the case here. Transport is one of the EU’s largest emitting sectors and slowest to decarbonise. Heavy‑duty vehicles account for over a quarter of road‑transport CO₂, which is why Brussels has tightened the regulatory screws. The EU is massively dependant on foreign oil for transport too – the latest Eurostat “EU imports of energy products” shows 10% of the EU’s total imports were petroleum oil, costing over €200bn per year. And then there’s the health cost of air pollution.

EU playbook: What are the ETS II, Eurovignette & Manufacturer Targets?

ETS II, launching in 2028 (delayed by 1 year), prices the carbon in road‑transport fuels upstream. Fuel suppliers will have to surrender allowances; markets expect much of that cost to trickle down to the pump. That’s a headwind for fossil, and it makes electric kilometres look incrementally better each year.

Eurovignette is the other lever. The 2022 reform requires countries with distance‑based tolls to vary rates by a truck’s CO₂ class. Implementation is patchy but real: Germany’s MAUT added a €200/tCO₂ surcharge from December 1, 2023, effectively several euro‑cents per kilometre for conventional rigs.

CO₂ standards for manufactures are the final major EU tool: the standard for heavy‑duty vehicles require manufacturers to reduce average emissions 43% by 2030, 65% by 2035 and 90% by 2040, ensuring a pipeline of zero‑emission models.

The EU’s rulebook is tilting the playing field toward electric trucks, and most credible studies still expect TCO parity or better before 2030 across many European segments. This maturation is visible in the latest ICCT market data, showing a growing demand for zero‑emission truck registrations through 2025, with battery‑electric models dominating.

None of this is painless. Small hauliers running older assets feel changes first - that’s a fairness problem policymakers shouldn’t ignore. But price signals still matter. ETS II and the Eurovignette exist to correct a market failure: diesel pollution was never “free” - we just sent the bill to communities and the climate. When these regulations stop fossil fuels from getting a free ride, electric trucks quickly become the cheapest option.

This is not to say these regulations are perfect. We’re aligned with the broad direction of ETS II and Eurovignette. But we’ll also say out loud what many operators think:

• First, stability beats novelty. Frequent rule changes make planning difficult. Clear, early and consistent trajectories give fleets and shippers the confidence to invest.
• Second, a carrot with the stick. If ETS II and Eurovignette raise revenue, recycle a meaningful chunk into electric trucks and charging—especially for SMEs.
• Third, less fragmentation. The patchwork in Eurovignette and national tolling rules turns decarbonisation into a strategy game only big players can afford. Simple and repeatable rules speed adoption for everyone.

We’d also love to see more regulation on... us. We’d welcome well‑designed, EU-wide fleet standards for large operators like DFDS. Straightforward, consistent European regulation requiring a minimum share of zero‑emission kilometres (and encouraging large buyers to procure a slice of zero‑emission transport) spreads risk and learning more fairly. Some proposals stalled because charging coverage is still uneven, but the idea is sound: if everyone must try electric trucks, everyone gets better, faster.

The headline result from independent studies is simple: with the right rules, electric trucks win on TCO. EY–Eurelectric even puts the prize at €250bn by 2030. The catch? Charging. Regional pricing and network charges can dominate the cost structure at high power sites, ending the possibility of cost-effective electric trucks. The EU AFIR regulation will help by growing the public network and making it work better across borders; it won’t, however, control electricity prices. A depot‑first strategy, smart routing and pragmatic use of public fast charging remain essential as fleets scale. Looking ahead, infrastructure is an energy security story - how we source power, manage peaks, and keep trucks rolling when the grid is tight and costs spike.

Electric trucks are finally about cost, not just carbon - which is great for both. ETS II and the Eurovignette are pushing in the right direction, even if the rules can be clunky. The win is corridor by corridor: the latest e-trucks, high impact regulation and cost-effective charging creates a big win for hauliers and consumers. But my key takeaway – in such a fast-changing market, what doesn’t work today might work tomorrow.

P.S. I’ve (deliberately) ignored hydrogen trucks, for the simple reason that hydrogen infrastructure and costs are significantly worse than BEV options in nearly all markets where we operate, and BEV ranges are now adequate for the majority of our flows.