In Focus
April 2018

Cutting EU greenhouse gas emissions – national targets for 2030

In this article ACFA would like to provide an update on how the challenge of greenhouse gas emission reduction targets is tackled in the European Union. In the EU the biggest administrative challenge is certainly to balance the overall commitment to the Paris Climate Agreement under the United Nations Framework with the interest and objectives of each member state. The article below gives the reader a glance and some insight of how this is currently being converted into a target-focused, pragmatic action plan in the EU.  

Introduction:

To help fight climate change, EU leaders adopted in October 2014 the 2030 climate and energy framework, which includes binding targets to cut emissions in the EU by at least 40% below 1990 levels by 2030. In October 2017 the European Commission proposed a review of Directive 2009/33/EC, the so-called Clean Vehicles Directive and introduced new, revised targets for the EU fleet-wide average CO2 emission of new passenger cars and vans that will apply from 2025 and 2030 respectively, to help accelerate the transition to low- and zero emission vehicles in the European Union. Both for new cars and vans, the average CO2 emissions will have to be 30% lower in 2030, compared to 2021

Stakeholders’ response to the proposal:

ACEA (European Automobile Manufacturers Association), which represents the 14 Europe-based car, van, truck and bus manufacturers, said it welcomes the fact that the date for the new targets has been set for 2030. “This is consistent with the timings already agreed by the EU heads of states with the 2030 Climate and Energy Framework,” ACEA Secretary General Erik Jonnaert said.

“However, setting an additional target already in 2025 – just a few years after the 2021 targets – does not leave enough time to make the necessary technical and design changes to vehicles, in particular to light commercial vehicles given their longer development and production cycles.”

“Clearly, CO2 targets can provide an impetus for innovation in the auto industry, but the current proposal is very aggressive when we consider the low and fragmented market penetration of alternatively-powered vehicles across Europe to date,” he said. In the third quarter, ACEA reported that alternatively powered cars accounted for only 6.2% of total passenger car sales, or 211,635, in the EU. Electrically chargeable vehicles (ECVs) made up 1.6% of all cars sold across the EU.

“The 30% reduction level proposed by the Commission is also overly challenging, going beyond the ambition level set out in the Climate and Energy Framework and in its own 2016 impact assessment, which specifies what is needed to deliver on COP21. In line with this, the European auto industry considers a 20% reduction by 2030 for cars to be achievable at a high, but acceptable, cost,” ACEA’s Jonnaert said.

The European Commission said that the proposed CO2 emission reduction targets are based on “sound analysis and broad stakeholder involvement, from NGOs to industry.”

“The EU must seize this opportunity and become a global leader, with countries such as the United States and China moving ahead very quickly. To give one example: EU sales of new passenger cars relative to global sales have decreased from 34% before the financial crisis (2008/2009) to 20% today,” the commission said in a statement.

“The proposal establishes ambitious, realistic and enforceable rules to help secure a level playing field between actors in the industry operating in Europe. The package will also put in place a clear direction of travel towards achieving the EU’s agreed commitments under the Paris Agreement and will stimulate both innovation in new technologies and business models, and a more efficient use of all modes for the transport of goods.”

The Clean Mobility Package proposal from the European Commission, the European Union’s executive body, includes the following documents:

– New CO2 standards to help manufacturers to embrace innovation and supply low-emission vehicles to the market. The proposal also includes targets both for 2025 and 2030. The 2025 intermediary target ensures that investments kick-start immediately. The 2030 target gives stability and long-term direction to keep up these investments. These targets will help push the transition from conventional combustion-engine vehicles to clean ones.

– The Clean Vehicles Directive to promote clean mobility solutions in public procurement tenders and thereby provide a solid boost to the demand and to the further deployment of clean mobility solutions.

– An action plan and investment solutions for the trans-European deployment of alternative fuels infrastructure. The aim is to increase the level of ambition of national plans, to increase investment, and improve consumer acceptance.

– The revision of the Combined Transport Directive, which promotes the combined use of different modes for freight transport (e.g. lorries and trains), will make it easier for companies to claim incentives and therefore stimulate the combined use of trucks and trains, barges or ships for the transport of goods.

– The Directive on Passenger Coach Services, to stimulate the development of bus connections over long distances across Europe and offer alternative options to the use of private cars, will contribute to further reducing transport emissions and road congestion. This will offer additional, better quality and more affordable mobility options, particularly for people on low income.

– The battery initiative has strategic importance to the EU’s integrated industrial policy so that the vehicles and other mobility solutions of tomorrow and their components will be invented and produced in the EU.

The Clean Mobility proposals will be sent to co-legislators for their approval. The Commission called “on all stakeholders to work closely together to ensure the swift adoption and implementation of these different proposals and measures, so that the benefits for the EU’s industry, businesses, workers and citizens can be maximised and generated as soon as possible.”

The European Fuel Oxygenates Association (EFOA) welcomes the proposal, citing that high octane fuels will play a major role in reaching EU clean mobility targets. EFOA stated in a press release that it “welcomes the proposal for revised CO2 standards for new passenger cars and for new light commercial vehicles published by the European Commission, as it marks an important step towards greener mobility in Europe. The Commission’s Impact Assessment recognizes that around 95% of vehicles on Europe's roads still have an internal combustion engine (ICEs), which means that upgrading ICEs and improving the quality of fuels will offer significant benefits.

Firstly, EFOA believes that high quality, high octane fuels combined with high performance engines can play a key role in reducing emissions from passenger cars. For instance, a realistic 7% lower fuel consumption through higher octane would save 20m MT of CO2 per year. EFOA calls upon the European institutions involved in the co-decision process to fully recognize this potential.

This could not only benefit the petrol fleet but also would contribute to the transition towards zero carbon mobility. “Currently, 96.8% of the yearly fleet mileage of electric vehicles is covered by hybrid cars. High octane petrol helps increasing the fuel efficiency and emission reduction potential of hybrid cars, making them a more attractive option. I strongly believe that the Commission’s proposal could be improved to bring about rapid and cost effective emissions reductions in Europe” commented EFOA Secretary General Ewa Abramiuk Lété.

Finally, current transport policy needs a variety of measures and decarbonisation solutions. Giving an equal opportunity to different technologies should be an important part of the future approach, in order to deliver a policy which brings real change to CO2 and air pollution levels. As such, the focus on measuring the tailpipe emissions should be changed in order to fully capture the CO2 emission reduction of vehicles. While EFOA supports legislation which encourages a progress towards low emission transport, we believe that focus on incentives to specific technologies would make emission reduction process much costlier than necessary. It will also miss out on opportunities for more rapid and cost-effective solutions available today.

EU initiates to accomplish CO2 targets

Apart from the EU Commission proposal, various initiatives to reach the CO2 emission targets have been launched. One of them is the Effort Sharing Regulation.

The Effort Sharing Regulation sets binding targets to cut greenhouse gas emissions for each EU country. In sectors such as transport, agriculture, buildings and waste management emissions will be cut to 30% by 2030 compared to 2005. These sectors account for the majority of the EU’s greenhouse gases (about 60% of total EU emissions in 2014).

The targets above are also part of the EU's commitment in the Paris Climate Agreement.

To guarantee that all member countries participate in the EU's efforts to reduce emissions coming from the sectors mentioned above, the Effort Sharing Decision establishes binding annual greenhouse gas emission targets for EU countries for the period 2013–2020.

In April 2018 MEPs adopted a new regulation that is the successor of the Effort Sharing Decision. It lays down EU countries' minimum contributions to emission reductions for the period 2021-2030 as well as the rules for determining the annual emissions allocations and how to evaluate progress.

However, the proposal will need to be approved by the Council as well before the legislation can enter into force.

As the capacity for cutting emissions varies by member state, this is taken into account by basing the targets on the countries' gross domestic product per capital. The resulting 2030 targets range from 0% to -40% compared to 2005 levels and are in line with the EU's general 30% reduction target.

Source: European Parliament briefing

A strategy to cut emissions will be drawn up for each EU country to make sure they decrease emissions at a constant pace throughout the period.

A safety reserve with a total of 105 million tonnes of CO2 equivalent will be created and be available in 2032. It is intended to help less wealthy EU countries reach their 2030 targets. The reserve will be accessible only if the EU attains its 2030 target and then only under strict conditions.

However, some flexibility will be possible. For example, EU countries will be able to bank, borrow and transfer annual emission allocations between each other from one year to another.

Proposals beyond the current campaign

To ensure long-term predictability, MEPs also propose to set a target for 2050, namely to reduce greenhouse gas emissions by 80% compared to 2005 levels

Members also want to give more support to lower-income EU countries. Provided they have taken, or will take, action before 2020, they will be rewarded with more flexibility further down the line

Other initiatives to cut greenhouse gas emissions

There are two other pieces of legislation to help the EU its commitments under the Paris Agreement on climate change:

  • The European Emissions Trade Scheme
  • The Land Use, Land Use Change and Forestry Regulation

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