Electric-car production in the European Union will get a spur under a proposal by regulators to introduce credits for EVs as part of stricter emission curbs on automakers in the region.
The European Commission, the EU’s regulatory arm, is proposing a CO2 emissions reduction target for new cars and vans of 30 percent by 2030 compared with 2021. The proposal also sets an interim of a 15 percent reduction by 2025 to help ensure automakers kick start investment early.
In a nod to automakers, the Commission plans to earmark 800 million euros ($927.7 million) to support the roll out of charging points for electric vehicles and 200 million euros for battery development.
Proposed credits for EVs and low emission cars such as plug-in hybrids are a policy innovation and would allow automakers to offset their overall target if the share of zero and low-emission vehicles in their fleet surpasses a benchmark set by regulators.
Zero-emission vehicles are battery electric and fuel cell vehicles while low-emission vehicles are defined as those having tailpipe emissions of less than 50g/km. These are mainly plug-in hybrid vehicles equipped with both a conventional and an electric engine. The limit would rule out most hybrid vehicles currently on sale.
Unlike California’s system – viewed by many in the sector as the leading laboratory for policy on electric cars – EU regulators shied away from quotas.
The proposal will need the approval of EU governments and the European Parliament in a process that usually takes more than a year. It has already met with opposition from nations with big automotive sectors, such as Germany.
European automakers lobbied for the emissions reduction target to be set at 20 percent and have called for compliance to be conditional on consumer uptake of electric cars.
ACEA, the auto industry’s lobbying body, said the 2030 target for a 30 percent reduction is “overly challenging” and “very aggressive.” In a statement, ACEA reiterated that the industry considers a 20 percent reduction to be achievable at a “high, but acceptable, cost.”
The EU’s current caps on CO2 from cars are 130g/km set for 2015 and 95g/km fixed for 2021. The existing limits are averages for the EU fleet as a whole, with individual manufacturers having specific targets backed by financial penalties.
The system of penalties for breaches will remain in place for the 2025 and 2030 limits. Under the draft proposal, if carmakers are found in breach of rules, they face penalties of 95 euros for every gram of CO2 above the limit and for each new vehicle registered in a given year.
The reductions are part of the EU’s stepped-up fight against global warming. Europe is gearing up for a technological revolution in road transport that will eventually see the end of combustion engines in favor of greener alternatives.
The European Commission is taking advantage of the landmark climate-protection agreement reached by almost 200 countries in Paris in late 2015 to get a grip on European road-transport pollution, which has bucked a general trend of falling EU discharges of greenhouse gases including CO2 that are blamed for climate change. Under the Paris accord, the EU aims to slash such pollution by at least 40 percent in 2030 compared with 1990.