Heating, price increases coming: up to EUR 600 more per year from carbon tax

The entry into force, from 2027-2028, of the Ets2 mechanism by which the European Emissions Trading Scheme, which has been in operation since 2005, will also be extended to the road transport and heating sectors, will lead to a significant increase in costs for households and businesses with the annual outlay for heating set to rise by up to EUR 600 per year. While, in the light mobility sector, the annual outlay for fuels could increase by up to EUR 280 per year.

A study by Bip, a multinational strategic consultancy firm with consolidated experience in analysing the economic, industrial and regulatory impacts of energy transition policies, commissioned by Assogasliquidi-Federchimica, estimates the possible increases connected with the application of Ets 2, currently postponed by a year but already under discussion by companies: according to Bip, the higher costs could affect between 2 and 15 billion for road transport and between 0.7 and 5 billion for residential transport by 2030. A range that depends on the price range of CO₂ allowances.

"After estimating the impact on the heavy transport sectors," stressed Matteo Cimenti, president of Assogasliquidi-Federchimica, "we have confirmation that even on light and residential transport the Emission Trade System will have a strong impact on the Italian economy, and its impact will be added to that of the RED III directive; this suggests flexibility and caution in its application". From the analyses, Cimenti added, 'the ability of LPG to maintain economic competitiveness with respect to other sources and carriers emerges in the various scenarios of Ets2 application. At the same time, the urgency of supporting the growth in availability of bio and renewable solutions (bio LPG and rDme) is also evident. Therefore, we have called for the resources from auctions to be used to increase bio LPG and renewable DME, and to reduce the costs generated by regulations on households, with appropriate offsets on the cost of the energy bill'.

The BIP study also first of all calculated the impact of Ets2 on Tco (Total Cost of Ownership), an indispensable parameter for knowing the total cost of an asset throughout its life cycle, and LPG fuels record a Tco that is 10-40% lower than alternatives. lPG is confirmed as one of the fuels preferred by consumers," highlighted Dario Stefano, president of the LPG Autotraction Group of Assogasliquidi-Federchimica, "but the sector continues to be penalised by the uncertainties that remain at European level regarding a necessary new phase. The European Commission document on the revision of the regulation on CO₂ emissions, in fact, does not yet guarantee full respect for the principle of technological neutrality, reserving a marginal role for biofuels and, moreover, only from 2035. It is therefore necessary to intervene quickly and courageously, to recognise the contribution of biofuels immediately, reverse the trend and revive registrations, which are indispensable for the renewal of the ageing car fleet.

Even in the residential sector, the application of Ets2 would produce a series of price increases, as Marco Roggerone, president of the LPG Combustion Group of Assogasliquidi-Federchimica, pointed out. "In this sector, the entry into force of Ets2 overlaps with the application of the Epbd directive (so-called 'Case Green') and its application guidelines. In continuity with previous analyses carried out by Bip, it emerges that modern gas condensing boilers, increasingly fuelled by renewable gas, would make it possible to reach the decarbonisation targets indicated in the directive with far lower costs than a 100% electric conversion and without inconveniences for consumers; but the current wording still envisages a ban on the marketing of boilers from 2040. The Commission's openness to the revision of the Ecodesign Regulation seems an important step towards rethinking the limits introduced, which would otherwise present households with a hefty bill for meeting their basic needs of heating, cooking and hot water production. And speaking of primary needs, LPG has always been an ideal solution to enable people living in rural or mountainous areas to heat, cook and have domestic hot water, with low CO₂ emissions and virtually zero local pollutant values.