Near-term actions (to 2030) fall into four categories:

• Establish fiscal policies that align price signals with strategic goals and that tap the potential for competing technologies to improve efficiency, thereby reducing costs and pollutant and climate emissions.

• Implement stricter regulations on the roadworthiness of the in-use vehicle fleet, supported by increased allocation of budget and resources to in-use vehicle enforcement and improved data collection.

• Design and implement near-term regulations that require imports of more efficient and cleaner vehicles. Options include corporate-average vehicle efficiency standards and EV sales requirements, both targeting vehicle importers.

• Develop deployment projections, plans and targets for EVs and charging infrastructure. These can inform stakeholders across the EV value chain, including electricity providers (e.g. distribution system operators), charging point operators and EV importers.

Fuel and energy pricing

Georgia should start by indexing gasoline and diesel taxes to inflation, with gradual increases providing a clear price signal for buyers. Clearly communicating the rationale and schedule for tax increases, as well as transparently using the revenues generated to ensure equitable outcomes (e.g. through direct tax reductions for rural populations or vocations that depend on vehicles, or by funding public transit or other transport infrastructure projects) can build trust and minimise opposition. By 2030, Georgia should aim to align with EU Energy Tax Directive minimums and adjust fuel taxes relative to purchasing price parity (PPP) benchmarks. This recommendation aligns with NECP measure EE-13, which proposes a GEL 250 per tonne increase (around GEL 0.185 per litre for gasoline and GEL 0.21 per litre for diesel)8.

Electricity tariffs should better reflect supply and demand. Day/night and, eventually, time-of-use (TOU) pricing can improve the economic competitiveness of operating EVs by enabling EV owners to charge during off-peak times. It also encourages more efficient use, strengthens network stability and reliability, and lowers the cost of supplying electricity.

Georgia’s NECP supports smart meter rollout, with phased adoption (60% coverage by 2030, 80% thereafter), enabling household and business savings over time. Economic modelling conducted for the NECP suggests that adopting TOU tariffs in the residential and service sectors could yield significant cost savings for both sectors. Under conservative assumptions (i.e. high valuation / probability of costs, low valuation of benefits), the savings are negligible in initial years, but grow over time. Scenario modelling of TOU tariffs advises a “smooth and slow” introduction of smart metering, reaching 60% of users by 2030, gradually increasing to 80% penetration.

Vehicle import duties

Import duties should align with emissions and efficiency goals while generating revenue. Differentiated taxation could follow one of two potential designs, and can be differentiated based on other vehicle characteristics, such as vehicle engine size (as is currently the case in Georgia), kerb weight or footprint. Options are:

• A “feebate” structure, with specific targets based on one or multiple performance metrics (e.g. CO2 emissions per kilometre of second-hand vehicles imported on a given year, or emissions category, such as Euro 6), coupled with a charge/credit scheme.

• A ceiling on specific fuel consumption or CO2 emission thresholds per kilometre, differentiated based on weight or footprint. This is effectively a Minimum Energy Performance Standards (MEPS) structure.

The latter is simpler to implement, avoiding the need for government accounting, enforcement mechanisms, and designing and managing a charge/credit scheme. However, the former would be more effective in achieving desired outcomes. Both could be designed to be self-financing and even generate government revenue.

Current exemptions to EV import duties could be extended to value-added tax (VAT) and discounts could be offered on mandatory technical inspections. Exemptions – initially for conventional hybrids and later for plug-in hybrids – should be phased out. Import duties on high-emitting, high fuel-consuming combustion vehicles should rise, and they should be indexed to fuel economy and Euro rating, with separate structures for light-duty, buses and trucks.

Implementing differentiated taxes requires tracking vehicle imports and new registrations (both new and used), including fuel economy and emissions ratings. This requires improved data collection, validation and reporting, which is also a recommended as a key short-term action.

Georgia’s NECP measure EE-16 proposes higher excise taxes on older imports by 2030. It recommends increasing taxes on imported vehicles older than 12 years by 200%, on vehicles 10 to12 years of age by 120% to 160%, and on vehicles 6 to 10 years of age by 14% to 80%.

The NECP measure (EE-14) proposes incentives for EVs/hybrids. However, a blanket extension of existing EV/hybrid exemptions are estimated to cost GEL 90 million (about USD 33 million) in lost revenue by 2030 – an unsustainable burden to the public purse. As noted in the NECP, such incentives would lower household car-purchase costs, but without price or income conditions, the gains would accrue mostly to high-income households. Targeted incentives for heavily-used vehicles (i.e. fleets) would be more effective. As EV prices fall, exemptions can be phased out earlier while keeping EV duties lower than for internal combustion engine (ICE) cars.

Georgia has commissioned and published research on the costs and benefits of different vehicle tax incentives. This analysis will need regular updating: As battery costs fall and more affordable EVs (new and used) enter the market, exemptions could be phased out earlier than 2030, while keeping duties lower than for conventional ICE cars.

Vehicle import and registration regulations

Emissions standards: Georgia should adopt Euro 6/VI standards on vehicle imports by 2028.

EV battery capacity standards: As with conventional internal combustion engine (ICE) vehicles, EV imports should be subject to minimum standards on EV battery capacity and durability requirements. To ensure that used EVs entering the country are of sufficient value and durability, battery capacity for all imported EVs should be tested to be above a certain minimum threshold (e.g. 75%). To reduce costs, companies could offer EV battery testing as a commercial service to vehicle importers, with the government ensuring that testing procedures meet technical standards.

Data to inform efficiency labelling: Data on rated fuel consumption and other basic technical characteristics (e.g. engine size, kerb weight, vehicle footprint) can serve as the basis for vehicle efficiency labelling. A robust labelling system can then inform rankings of available models based on energy or electricity consumption, and inform consumers, helping them to make better choices. These data are also required to serve as the benchmarks for cost-benefit assessments and to inform policy design for supply-side regulations.

Mandatory EV share for vehicle fleets: Heavily utilised vehicles in government, public and commercial fleets offer the best economic and environmental payback. Many national, subnational (i.e. state or provincial) and municipal governments require such fleets to purchase minimum shares of zero- or low-emissions vehicles. The European Commission is also reportedly considering regulations requiring car fleets to shift new purchases entirely to EVs by 2030, five years ahead of the zero-CO2 emissions standards for cars and vans. Georgia, led by Tbilisi and Batumi, should phase in similar rules, with smaller cities following within five to 10 years.

Early efforts targeting fleets have proven effective. Fleet vehicles typically have overnight off-street parking, making installation and use of depot charging cost-effective. Most daily operations can be met with around 80% of battery capacity, while high-use fleets like taxis may need fast charging at key locations. Focusing on heavily utilised vehicles shortens the payback on upfront investments needed for battery electric vehicles (BEVs) and charging infrastructure. Clear regulations, reliable budget allocations (e.g. from import duties), together with financing from multilateral development banks and international financial institutions can further reduce costs.

The EV Task Force should spearhead an effort to design bulk procurement of electric buses and tendering of their operations to reduce costs and administrative burdens, working closely with Georgian cities. Tenders should ensure interoperability and avoid technology lock-in.

Public procurement rules requiring minimum EV shares provide a strong policy lever, but mandates could also extend to private operators such as taxis, ride-hailing or corporate minibuses. Targeted public support (e.g. low-interest financing) may be needed for smaller operators.

Mandatory EV share for two- and three-wheelers: Georgia’s motorcycle fleet is small (less than 10 000). Most motorcycles are imported from India, the United States and Ukraine. Given their safety and emissions impacts, strict regulations are justified, including bans or high import duties on ICE motorcycles, while duties on electric motorcycles and e-bikes should be waived. A regulation could also require that motorcycle importers bring a gradually increasing share of electric scooters and motorcycles into Georgia.

Annual vehicle circulation/registration tax

Annual circulation fees should be introduced to allow vehicles to remain on the road. In addition to the periodic technical inspection, which is not required for vehicles less than four years old, the annual registration process should carry a modest fee – enough to cover administration and support domestic scrappage and recycling industries, including training for EV battery handling. Registration revenues can be used to substantially improve data collection and quality of tracking of the in-use road vehicle fleet. It is important to keep online registration simple. Establishing this system could also provide a basis for further monitoring (e.g. odometer readings) and to inform the design of future fiscal measures, like distance-based pricing of the in-use fleet.

In-use fleet regulations

Tighten rules for the in-use fleet, targeting near-term alignment with European safety norms and EU emissions standards by the 2030s. Stronger enforcement of existing laws (emissions, speed limits) will require larger budgets for traffic police and equipment, partly or fully offset by fines. Georgia should aim to converge with EU inspection and maintenance norms by 2030. This recommendation aligns with EE-15 in Georgia’s NECP.

Data

Improve data collection, validation and transparency. Georgia’s National Statistics Office, through its centralised data portal, along with air quality monitoring and other topic-specific portals on road vehicles and fuels, provides timely, transparent, and user-friendly public data, setting a benchmark for the South Caucasus region. Building on this, Georgia can further enhance the accuracy, transparency and relevance of transport data to support evidence-based decision-making.

Collect and audit detailed vehicle import and registration data. Public reporting of key technical details (e.g. make, model, year, trim, kerb weight, engine type, fuel consumption, emissions standard and exporting country) can improve policy implementation and detect anomalies and violations. Some of these parameters are already publicly available for passenger cars, but more granular data is needed for trucks and buses (including country of origin, model year, pollutant emissions, Euro standard (or equivalent) emissions rating, gross vehicle weight, engine power/size and axle configuration). These data can guide vehicle-efficiency labelling in the short term and inform supply-side regulations in the 2030s.

Improve accuracy and validation for data on in-use fleets and transport activity. Accurate information on annual mileage by vehicle type, powertrain and age, as well as road and rail freight operational statistics (mileage, representative loads, cargo type), is needed to inform and improve benchmarks, projections and policy design. Detailed fleet and operational data at national, regional and local levels can inform urban planning, modal shift and freight strategies. Partnerships with universities, and the use of grants or public tenders, can reduce costs and tap domestic expertise.

EVs and charging infrastructure – planning and target setting

Targets for electric vehicles: Aspirational EV targets can guide the transition to a zero-emission fleet. As sales rise, binding requirements – like those in California, Canada, and the United Kingdom – have proven effective in aligning stakeholders across the EV value chain, including distribution system and charging point operators, EV battery and vehicle manufacturers (and their suppliers) and recyclers. Targets set now should build ambition for mandatory sales requirements in the 2030s9.

This roadmap proposes minimum, baseline and ambitious targets, expressed as shares of new registrations (including imports of new and used vehicles). Based on trends for EV market adoption across 32 markets, Georgia could see half of new light-duty registrations as battery electric vehicles (BEVs) by 2035. This implies a 29% BEV share by 2030 – well above the 5% target in the 2024-2025 Climate Action Plan. Georgia should raise its ambition to at least two-thirds EVs in new registrations by 2035 (baseline trajectory). Ambitious targets aligned with the Paris Agreement – putting Georgia’s light-duty road transport sector on a path consistent with keeping global warming to “well below 2°C” – would require nearly all newly registered vehicles to be BEVs by 2035.

Targets and annual progress should guide the design and ambition of supply-side regulations in the medium term (to 2035), as detailed in the following section.

Buses and trucks: Projections for medium- and heavy-duty vehicles are more uncertain than for cars. Urban buses are the exception: They are well suited for electrification with depot charging, and sales shares are already in the double digits globally, with some cities having already transitioned entire fleets. Intercity buses and trucks still lag behind, but are also reaching high single-digit or low double-digit shares in many countries.

Rising sales of battery electric trucks reflect national circumstances, often driven by industrial policy and efforts to cut oil import dependence (e.g. China, the European Union, the United States, India and other major importers or manufacturers). Although trends remain uncertain, this roadmap sets registration-share targets for urban buses and coaches, as well as medium- (N2) and heavy-duty (N3) trucks. These targets follow a no-policy (reference) trajectory and are designed to ensure Georgia meets its conditional NDC targets (baseline). They also define an ambitious EV registration share that would align the country’s heavy-duty road transport sector with Paris Agreement goals.

Develop a strategy for public charging infrastructure. Technical regulations give certainty to suppliers and users. Georgia should codify AC and DC charging standards, and align plug, hardware and communication protocol standards with international norms. Charging standards should accommodate the diversity of EV imports to Georgia, recognising the need to provide coverage for models coming from the United States, European Union, Japan, Korea and China.

Private sector investment requires clear incentives and deployment certainty. Permitting for siting, construction and grid connection should be streamlined, starting with charging in public bus depots and off-street sites (garages, workplace lots, apartments) in cities. Planning for the 2030s should extend to highway charging for cars, coaches and trucks, based on reliable EV adoption projections. A deployment strategy can support regulations by 2035 to ensure minimum coverage, equitable access and investment certainty.

Incorporate EV projections into grid planning. Adoption projections for light- and heavy-duty EVs must be integrated into electricity grid planning, identifying both spatial and temporal demand. Focus should be on:

• cities, where light-duty EVs and buses will be first adopted, and industrialised regions and freight corridors (e.g. the East-West Highway and the main north-south corridors), where road freight activity will be concentrated and where public funds can crowd in private investment

• regions with weak commercial viability for high-speed charging, where regulations and targeted public funding are likely to be needed to guarantee equitable access and prevent under-investment

Medium-term actions (to 2035) are the following:

• Gradually increase taxes on fossil-derived transport fuels on a clear annual schedule, allocating a share of the revenues to public financing for EV charging infrastructure and/or electric bus procurement.

• Design, implement and enforce supply-side regulations, such as fleet-average fuel economy standards or EV sales requirements that target vehicle importers as the regulated entity.

• Adopt regulations and other supporting policies to ensure minimum charging infrastructure deployment for cars, buses and trucks.

• Phase out tax exemptions for hybrids and electric light-duty vehicles, potentially replacing these with exemptions for medium- and heavy-duty trucks.

• Develop regulations and/or incentives that promote domestic EV battery collection and export/recycling capabilities.

• Develop an inventory and plan to sustainably and strategically exploit natural resources to develop clean fuels for domestic use and export.

Increase taxes on fossil-derived fuels

Gradually increase taxes on fossil-derived transport fuels on a clear annual schedule, allocating a share of the revenues to public financing for EV charging infrastructure and/or electric bus procurement. Taxes on fossil-derived automotive fuels should be gradually increased to levels that align with their estimated environmental, health, climate and other externalities. As already highlighted, benefits extend to reducing Georgia’s dependency on oil imports (and related price volatility) and incentivising the adoption of EVs.

There is a potential negative impact on household incomes, as well as distributional and equity impacts. Therefore, it will be important to limit the regressive impact of fuel tax increases by ensuring that revenues are reported transparently and are allocated to improve mobility, including among adversely affected groups.

Note that this recommendation aligns with NECP measure EE-13, which proposes to increase the tax on gasoline and diesel for oil products and lubricants by GEL 250 per tonne of fuel.

Supply-side regulations

Fiscal incentives for EV and hybrid imports reduce public revenues. Supply-side regulations targeting vehicle importers as the regulated entity are the most effective way to reduce Georgia’s oil dependence and CO₂ emissions.

Two main approaches exist:

• Emissions and fuel-economy standards (sales- or registration-weighted): These performance-based standards set a metric based on the intended outcome. They thereby ensure ICE vehicles become more efficient and, once sufficiently stringent, bring EVs into the mix.

• Minimum EV import/registration shares: This requires importers to gradually increase the share of EVs they sell. Flexibilities like credit trading or banking can improve efficiency, but should be capped (as done, for instance, in the United Kingdom) to ensure effectiveness.

There are trade-offs between these two regulatory designs. The former would ensure that conventional ICE vehicles registered on Georgian roads continue to become more fuel-efficient, and once it becomes sufficiently stringent, it would also drive EVs into the pool of vehicle imports, while enabling importers to choose the mix of vehicles they bring into the country in a way that maximises profits. However, it would require that information on vehicle performance be systematically collected and standardised across different regional and national testing cycles, to provide a level playing field for imported vehicles. To date, this approach has been pursued only by New Zealand which required the development of conversion/harmonisation procedures.

An alternative is to require importers to gradually increase the share of EVs they bring in. Flexibilities, such as allowing the trading and banking of credits can improve the regulation’s economic efficiency. But these should be limited (e.g. through caps or interest rates, as in the United Kingdom) to ensure the policy effectively raises the share of EVs registered. The data requirements of a zero-emission vehicle (ZEV) import share mandate are far lower than those of a CO2 or fuel-economy standard, making it simpler to design, implement, monitor and enforce.

In the 2030s, Georgia should shift from fiscal incentives (e.g. import duty exemptions, differentiated import duties) to regulatory tools, guided by market developments such as EV costs. The transition can begin with cars and urban buses, and later extend to trucks.

Charging infrastructure

Adopt regulations to stimulate charging infrastructure deployment. A mix of technical standards, policy regulation, public funding and fiscal support is needed to ensure rapid and equitable deployment.

Technical standards for hardware and software interoperability, communication protocols and performance specifications for components and assembled products are needed to ensure infrastructure is fit for purpose.

Minimum rollout requirements: Regulations similar to the European Union’s Alternative Fuel Infrastructure Regulation (AFIR) help to mandate minimum coverage and capacity for both light- and heavy-duty vehicles (LDVs and HDVs). This complements supply-side vehicle rules and provides certainty of availability. Current benchmarks (such as the European Union’s recommended ratio of one public charger per 10 LDVs) will shift as EV uptake grows, reflecting differences in road networks, congestion and use. Minimum capacity (in megawatts) and coverage – such as maximum distance intervals under the AFIR – should be tied to grid-planning assessments of charging needs for LDV/HDVs, based on geography and projected fleet size.

Tendering models: Competitive concession tenders should bundle multiple sites, requiring charge point operators (CPOs) to cross-subsidise less profitable, infrequently used locations with revenues from highly utilised chargers, ensuring broader and fairer coverage.

Fiscal and financial support: Public funds should back deployment in low-viability areas, which is essential for rapid EV uptake. Instruments such as partial credit guarantees can de-risk investment, while keeping commercial lenders as main financiers of CPOs10.

Data requirements: To operate public or semi-public charging facilities, CPOs should be required to provide regulators with minimum data at every charging station – location, operational status, power rating and the charging standard of each plug. Geostat can integrate this into its geographic portal to create a national charging information platform.

Transition to differentiated import duties for electric trucks

Once regulations on vehicle importers are in place, fiscal policies should play a secondary role. Import duties and taxes should be revenue-neutral, ideally differentiated by vehicle performance, with high rates on high-emitting vehicles (whether measured by CO₂, local pollutants, or both) to also generate public revenue.

As EVs gain a sufficient share of imports and registrations, import duty exemptions should be phased out, with exceptions instead targeting electric trucks and coaches, where adoption lags behind LDVs and urban buses. Differentiated import duties on these heavy-duty vehicle categories can help to ensure that exemptions do not reduce revenues.

EV battery collection and export or recycling

Georgia should develop regulations and incentives that promote domestic EV battery collection as well as exports and recycling. An assessment of used EV battery volumes should be informed by data and projections of EV imports. This can inform the need for centralised EV battery collection procedures, partnering with car dealerships and service centres, and safe transport protocols to a storage facility. Georgia should coordinate with neighbouring countries to determine the economic viability of establishing itself as a regional hub for initial EV battery treatment (e.g. grinding to black mass) or for the repurposing of used EV batteries for second-life grid applications.

Policy design can draw on international best practices and funding, including the GEF-8 projects under the United Nations Environment Programme on battery treatment, disposal and recycling, as well as the Zero-Emission Vehicle Transition Council’s ZEV Rapid Response Facility.

Low-emissions fuels strategy

Georgia has strong potential to use renewable electricity and biomass to produce sustainable biofuels and e-fuels for transport, including aviation and shipping. Ensuring a sustainable biomass supply will require supportive policies and incentives to promote domestic production and use.

The European Union’s 2018 revision of the Renewable Energy Directive (RED II) strengthened sustainability criteria and set a 14% renewables target for road and rail transport by 2030, with a 3.5% target for advanced biofuels (Annex IX Parts A and B) and a 1.7% cap on certain feedstocks (Annex IX Part B)11. Georgia, as part of the Energy Community, must define renewable energy targets for 2030, outlined in the 2024 Draft Law on Renewable Energy. The United Nations Economic Commission for Europe (UNECE) and World Experience for Georgia (WEG) provide recommendations and best practices, including:

• Advanced biofuel targets with penalties for fuel suppliers, specified as volume or emissions-intensity reduction targets, as per the European Union’s Fuel Quality Directive. This is the most common approach, and has been used in the Czech Republic, France, Greece and Ireland.

• Tax exemptions – such as zero excise duties or reduced carbon and energy taxes on biofuels – with reductions tied to the share of biofuel in the fuel mix. Examples include Austria, Croatia and Latvia.

In 2021, renewables accounted for 7.3% of the transport energy mix. Advanced biofuels accounted for 27% of the European Union’s total biofuels demand (12% from biofuels produced via pathways listed in Annex IX, Part A, and 15% via Part B pathways). Together, conventional and advanced biofuels made up nearly 90% of all renewables in transport, with the remaining share coming from renewable electricity.

Georgia’s domestic capacity is small: Since 2018, Biodiesel Georgia has produced around 1.2 kilotonnes (kt) of biodiesel annually from used cooking oil and canola, blended into fossil diesel. The company is seeking EUR 3 million to expand capacity to 3 kt – enough to meet around 0.6% of 2023 diesel demand – though securing sustainable feedstocks remains a challenge.

The Kulevi refinery, currently under construction, could supply renewable diesel and biojet kerosene, taking advantage of European Union incentives under RED III, the ETS/ETS2 and ReFuelEU Aviation.

Long-term actions (in the 2040s and beyond) include:

• Designing electricity markets that let aggregators participate by using EVs as mobile, decentralised storage, thereby enhancing flexibility, reliability and the delivery of low-emissions electricity at lower costs.

• Phasing out high-emitting vehicles through mandates and other tools, starting with new registrations and eventually the entire fleet.

• Developing low-emissions and circularity policies to boost automotive and EV battery recycling and further reduce life-cycle emissions from vehicles, infrastructure and operations.

• Transitioning from fuel taxation to road use charges and tolls, including distance-based pricing and congestion charges.

Electricity market design

Ensure that electricity markets promote EVs as vectors for mobile energy storage and grid services. Technical, regulatory and market measures are needed to enable EVs to serve as pooled and mobile energy storage. These are needed to support aggregators, vehicle-to-grid (V2G) integration, and to create price signals for flexibility and arbitrage.

Electricity markets should allow aggregators – companies that pool EVs and their storage capacity – to participate in wholesale, capacity and ancillary service markets. Aggregators can provide multiple grid services, including energy arbitrage, peak shaving, backup power and frequency regulation. Regulations should recognise aggregators as official market actors, granting rights to bid, settle transactions and access balancing/flexibility markets. Transparent remuneration, regulatory certainty and consumer-protection frameworks are needed to define data sharing, responsibilities and liability while safeguarding EV owners’ mobility, privacy and cybersecurity.

Technical standards must enable energy export from vehicles. International V2G protocols (e.g. ISO 15118, OpenADR) should be adopted, along with standardised smart-charging hardware and software and interoperable platforms for real-time data exchange between aggregators, DSOs and TSOs.

Markets should provide dynamic price signals (e.g. tiered or time-of-use pricing) to make EV participation economically attractive. Preliminary regulatory, technical and market design work can start immediately to enable future aggregator and V2G integration.

Phase-out of high-emitting vehicles

As more new cars, buses and trucks go electric, attention can shift to phasing out the most inefficient and polluting in-use vehicles. Policy options include in-use regulations and inspections (with enforcement and penalties), access restrictions, fleet renewal incentives and fiscal measures like differentiated tolls. The appropriate mix depends on context, including technology costs, equity, public budgets and priorities such as safety, local pollution and climate goals.

Circularity and low-emissions manufacturing

Following its successful implementation of world-leading CO₂ standards for cars and vans, the European Union is exploring policies to reduce emissions beyond the “use phase,” covering vehicle and battery manufacturing and end-of-life impacts. For instance, the EU Batteries Regulation aims to lower EV battery carbon footprints, enforce social and environmental due diligence in supply chains, and increase circularity through mandatory recycling and mineral recovery targets. A proposed regulation replacing the vehicle end-of-life directive would encourage circular design; set minimum recycled-content standards; regulate vehicle deregistration, scrappage and trade; promote reuse and recycling of materials and spare parts; impose extended producer responsibility; and apply end-of-life rules to all vehicle categories.

Such regulations will need to extend beyond automotive suppliers to cover fuel, mining and material producers. Additional policies could target parts and vehicle manufacturers, using sector demand to encourage low-emissions materials without substantially raising costs for consumers.

If Georgia develops clean technology value chains, regulations or incentives to cut emissions and environmental impacts could confer competitive advantages. The country’s low-carbon electricity and renewable energy potential would make locally produced batteries and components attractive in markets with carbon pricing or European Union-style carbon footprint thresholds.

Transition to road use charges

As the number of EVs and fuel-efficient vehicles increases, fuel tax revenues will fall, requiring replacement with user charges that reflect road use. Transitional measures such as registration surcharges or tolls can support EV adoption while preparing for full distance-based systems. Taxes should combine registration fees and distance charges, ideally varying by time and location to boost efficiency and equity. Phased implementation – from registration fees and odometer-based tolls to GPS-enabled schemes – provides a scalable way to sustain road financing and account for external costs.

Case studies, such as Slovenia, show how phasing from fuel excise to per kilometre charges can help anticipate and avert future revenue shortfalls. Mileage-based systems can better align revenue with infrastructure wear, congestion and emissions, while axle weight and congestion fees can further tie fees to actual road impacts.

A national multimodal strategy

A national multimodal efficiency and environmental strategy could focus rail sector reforms, road freight efficiency, logistics improvements and modal shift, alongside long-distance passenger transport options such as coach services, as well as pricing schemes that favour high-capacity intercity and high-speed rail over road transport.

Opportunities in each area are outlined below, followed by a summary of policy priorities along the roadmap timeline (short, medium and long term) as set out at the end of this section. A recommended timeline for specific actions is also discussed.