EU environment ministers adopt common position on car and van CO2 targets
10 October 2018
The EU Council of environment ministers agreed on a 35% CO2 emission reduction target from cars by 2030. This target is more stringent by five percentage points than the 30% target in the Commission proposal of November 2017, but less stringent than the 40% target agreed by the European Parliament earlier this month.
Under the Council common position, the fleet average CO2 emissions of new passenger cars registered in the EU would have to be 15% lower in 2025, and 35% lower in 2030, compared to the 2021 emission levels. For vans, the Council maintained the targets proposed by the Commission: 15% in 2025 and 30% in 2030.
The Council meeting started with the member states divided into two camps: those in support of the Commission’s initial 30% proposal (this group included Germany), and those calling for the 40% target for both cars and vans. Austria proposed a compromise target of 35%, which was eventually split into separate 35% and 30% targets for cars and vans, respectively.
The Council also agreed to raise the benchmark for zero- and low-emission (electric or plug-in hybrid) passenger cars for 2030 to 35%, from the 30% in the Commission’s proposal. In addition, the Council introduced a better weighting of zero- and low-emission cars in the zero- and low-emission incentive mechanism, as well as additional incentives (better weightings) for manufacturers to sell zero- and low-emission cars in markets with a low market penetration of these vehicles (below 60% of the EU average). For vans, the Council agreed to leave the Commission proposal unchanged.
The final CO2 targets and other provisions of the regulation will be decided in three-way negotiations between the Commission, the Council and the Parliament that started today (October 10th).
The standards under discussion, even at the least stringent 30% CO2 reduction target by 2030, cannot be met by improved combustion engine technology—they would require a significant increase in the sales of electrically chargeable vehicles. However, considering the low market share of electric vehicles, the lack of government incentives in many EU countries, as well as the lack of electric vehicle charging infrastructure, the auto industry is potentially faced with a serious business risk, and has repeatedly called for a relaxation of the post-2021 CO2 targets.
Unless the sales of electric vehicles rapidly increase soon, the EU auto industry is also likely to miss the 2021 CO2 target of 95 g/km—in part due to the declining sales of diesel cars. According to various estimates, the corresponding total penalties to be paid by automakers in 2021 can reach from 7.9 billion euros (Dataforce) to as much as 14 billion euros (IHS Markit).
Source: European Council