Mandates and Penalties: The Impact of Policy Implementation on Biofuel Markets – A Comparative Study on Road and Aviation Transport Fuel Prices in Different EU Countries

Paper in proceeding, 2026

To achieve the EU’s 2050 climate neutrality goal, biofuel use in domestic transport is necessary which has mostly been promoted by biofuel blending mandates. By 2022, all EU Member States had implemented such mandates for road transport fuels, while only two had applied them to aviation fuel. The mandates vary in design, criteria and penalties for non-compliance, resulting in varying impacts on the blended fuel market. This study maps penalties for non-compliance with blending mandates in the road and aviation sectors and assesses their impact on fuel prices and mandate fulfilment. Based on penalty levels, it was estimated how much fuel suppliers are willing to pay for biofuels and the calculated maximum prices on blended fuel were compared to actual consumer prices. While no clear correlation between penalty levels and mandate fulfilment could be found, findings highlight the need for a balanced combination of penalty levels, blending mandates, and policy measures to increase the biofuel share in transport fuels without disrupting fuel markets.