The European Commission has pulled a sharp U-turn, offering a reprieve to combustion-engine cars with a proposal to roll back a zero-emissions standard set to apply to new vehicles from 2035.
Instead, the exhaust-pipe CO2 emissions limit will only be cut by 90% from the reference level. As it applies to the average for all vehicles sold by a manufacturer, it will be able to continue selling a number of conventional models alongside all-electric cars.
Manufacturers will also be allowed to continue marketing plug-in hybrids and electric vehicles with small combustion engines to extend their range.
All this, however, is on condition that they will compensate the remaining 10 percentage points by using climate-friendlier made-in-Europe green steel, while factoring in how much sustainable renewable fuel their new cars will use, based on market availability of the low-carbon alternatives to petrol and diesel.
The emissions associated with renewable fuels will depend on how much biofuel and synthetic fuel derived from hydrogen and CO2, known as e-fuels, are available on the market, a Commission official explained.
Offsetting
“All potential further emissions generated have to be fully offset upstream,” Commission vice-president Stéphane Séjourné told reporters in Strasbourg.
If carmakers don’t compensate for their residual emissions, they will face the same hefty fines currently foreseen in the CO2 standards regulation.
The move marks a major win for EU carmakers, conservative political parties and governments on the right of the political spectrum, who lobbied hard against the EU’s clean car mandate, arguing that this would kill a struggling industry responsible for 2.5 million jobs and 7.5% of the bloc’s GDP.
While giving in to this major industrial and political pressure, the European Commission is also offering carmakers extra flexibility to meet intermediate emission reduction goals between 2030 and 2033, allowing them to bank and borrow fleet CO2 reductions from one year to another.
With the new 90% emission reduction target, the EU executive expects non-electric cars to represent between 30 and 35% of sales in 2035, transport commissioner Apostolos Tzitzikōstas said.
The new people’s car
As previously reported by Euractiv, the Commission also proposed to incentivise sales of a new category of small, affordable electric cars by granting extra emissions reduction credits that will ease compliance with the gradually tightening CO2 limits.
In practice, each small (no more than 4.2 metres in length) electric car will count as 1.3 cars for the purposes of total fleet emissions, thereby reducing the overall average.
The small cars, as envisaged by Commission President Ursula von der Leyen, will also have to be “made in Europe” – although precisely what that means will be decided only next year in an upcoming law dedicated to the acceleration of Europe’s industrial decarbonisation.
Vans are also targeted. In response to a slow uptake of electric models, the Commission has lowered the emission reductions goal that this segment must achieve in 2030 from 50% to 40%. It has also exempted electric vans from strict speed-limiting and driving-time monitoring devices when they exceed a 3.5-tonne limit due to the extra weight of batteries, a measure intended to attract commercial buyers.
Corporate fleets national mandates
In a separate piece of legislation, the Commission proposed rules to make corporate fleets, such as delivery vans, greener. The new rules will affect only companies with over 250 employees and a turnover over €50 million, but the EU mandates will apply only at the country level.
This means that each EU government will be responsible for reaching individual national targets for the uptake of low-emissions models, likely by offering tax advantages to low- and zero-emission cars and vans.
A third piece of legislation will try to slash red tape and compliance costs for manufacturers, namely by cutting back plans for new implementation rules and simplifying the testing regimes for new vans and trucks.
According to the Commission, this latest “omnibus” simplification proposal should allow manufacturers to save some €706 million per year.
To complete its automotive package, the Commission also unveiled a plan to reduce dependency on China for battery supplies by boosting local production, with €1.5 billion in interest-free loans on offer to European producers.
The proposals are now in the hands of the European Parliament and national governments in the Council of the EU, which can amend the rules before negotiating a final legal text.
Magnus Lund Nielsen contributed reporting from Strasbourg.
(rh, aw)
