Support fuel-efficient transport Sectoral objective: According to the IEA, cars will need to become 5% more efficient each year,21 largely through electrification and a switch to smaller vehicles, to achieve the goal of doubling energy efficiency. Vehicles that use sustainable fuels also help to reduce emissions. Transport constitutes the movement of goods and people (excluding off-road industrial vehicles). As a sector, it is responsible for 26% of global energy demand and 21% of GHG emissions.22 Key policy enablers: IBC members highlighted the following as the top three government actions that could increase their investment in energy efficient fleets or logistics networks: i. Incentives that support the uptake of zero- and low-emission vehicles ii. Policy action that ensures sufficient capacity and charging points for electric vehicles (EVs) iii. Adoption of international standards for energy efficiency. Transport TABLE 6 Inform Publish anonymous aggregate statistics on industry benchmarks. Set government travel policies to support lower carbon-intensity transport. Regulate Adopt international standards related to energy efficiency. Review grid infrastructure planning to ensure sufficient electrical capacity and connection points for EVs. Review planning legislation to ensure charging points are a priority focus and consider creating low-emission zones in cities. Use demand-based signals for phase-out of higher-emission vehicles, timed in collaboration with private actors. Incentivize Support positive incentives to encourage uptake of zero- and low-emission vehicles. Support incentives towards a modal shift, increased efficiency of internal combustion engines (ICEs) and hybridization. Support diversified, optimized route planning and infrastructure for multiple types of low- or zero-carbon fuels such as biodiesel, hydrogen and renewable natural gas (RNG), as well as electric charging. Adopt market-based mechanisms that incentivize efficiency and lower-carbon energy in a technology-neutral way. The shift from ICEs to EVs in Belgium – now around 50% of the new vehicles market – was accelerated using tax incentives for company cars. The programme included the gradual phasing out of the tax deductibility for ICEs by 2028 in favour of EVs (which maintain 100% deductibility) as well as providing 200% tax deductibility for charging points in the first years.23CASE STUDY V Public sector action in transport (EVs)5Key building blocks Note: Top enablers chosen by IBC in bold Transforming Energy Demand: Accelerating Business Action through Government Leadership 15

Transforming Energy Demand 2025