EU Commission Proposes New Carbon Emission Standards for Trucks

24 May 2018

Last week, the European Commission proposed setting targets for lowering truck emissions, known otherwise as heavy-duty vehicles (HDVs), for the first time, calling for 15 percent and 30 percent reductions in carbon dioxide emissions by 2025 and 2030, respectively, compared to 2019 levels. 

The Commission also put forward a comprehensive action plan for batteries, seeking to “create a competitive and sustainable battery ‘ecosystem’ in Europe.” 

The proposals are part of the third and final Mobility Package developed under the Commission’s “Europe on the Move” initiative, which aims to tackle EU-wide mobility issues ranging from road fatalities to air pollution and rising emissions. In that vein, the Mobility Package released last week also included proposals on safe mobility as well as connected and automated mobility.

The measures developed under “Europe on the Move” are part of the detailed implementation of the Strategy for Low-Emission Mobility, adopted in July 2016.

Earlier Mobility Packages from May and November 2017 included initiatives to reduce carbon emissions by 30 percent by 2030 for new cars and vans; encourage a transition from current toll pricing schemes based on time to “smart road charging” based on distance; improve road safety; encourage long-distance bus connections as an alternative to private cars; and promote the combined use of different modes for freight transport, among others.

With the addition of emission reduction standards for trucks, Commission officials say that they have closed the gap on much-needed regulation in the transport sector. Transport contributes nearly one-fifth of the EU’s greenhouse gas emissions, so regulation of emissions could be a valuable way to help meet the bloc’s commitments under the UN’s Paris Agreement to cut all emissions by at least 40 percent from 1990 levels by 2030. (See Bridges Weekly, 29 March 2018)

While HDVs make up less than five percent of vehicles on the road, they account for about one-quarter of total emissions in the sector. Commission officials say that regulation of truck emissions will also bring the EU up to speed with other leading economies that have imposed similar requirements, including Canada, China, Japan, and the United States.

Responses to the truck standards

Ahead of the Commission’s proposals, several EU member states, NGOs, and other stakeholders called for “ambitious” emission reduction targets. France reportedly hoped to see targets set for 2025, 2030, and 2050 in order to accelerate efforts to make the sector less carbon-intensive. Ireland, Lithuania, Luxembourg, and the Netherlands called for reduction targets of at least 24 percent for 2025 and 35-45 percent for 2030, according to sources cited by Reuters.

Various other stakeholders also lobbied for certain factors to be taken into account. Among these was an alliance of various multinational companies, ranging from supermarket giants like Carrefour to furniture manufacturer IKEA, among others, as well as transport companies and hauliers associations, according to Transport and Environment (T&E), a Brussels-based NGO. The alliance called for 24 percent reductions in carbon emissions by 2025, stating that the target would not only help in meeting climate targets, but also yield significant savings for businesses.

The European Automobile Manufacturers Association (ACEA) welcomed the Commission’s goal of decarbonisation of road transport, as well as its “two-step approach” in setting progressively stricter targets over time. The industry trade association argued that the proposed targets may be “too aggressive,” given that vehicle manufacturers start planning their strategies and production for new or updated goods several years in advance, and thus need more time to prepare.

However, according to Maroš Šefčovič, the Commission Vice-President responsible for the Energy Union, the 2025 targets can be met by implementing existing technology solutions, and later targets are far enough away that the sector should have adequate time and incentives to develop new technologies.

Batteries and supply chains

In its 2016 report on a European Strategy for Low-Emission Mobility, the Commission noted that by 2050, greenhouse gas emissions from the transport sector will need to be at least 60 percent lower than 1990 levels, along with being well advanced towards the goal of fully eradicating emissions. Šefčovič also noted the EC’s objective of a “triple zero” in mobility: zero emissions, zero congestion, and zero accidents.

In order to reach zero emissions, experts say that full electrification of the transport sector will likely be necessary. Batteries are integral to this push, with the need to consider life-cycle sustainable criteria, ranging from extraction of raw materials or the sourcing of secondary raw materials, to the design, manufacturing, and recycling of batteries.

As part of the Mobility Package, the Commission released a comprehensive action plan for batteries. Describing the plan at a press conference, Šefčovič said that “battery production is a strategic imperative, and we have to move fast because we are in a global race.”

“We need to prevent technology dependence on competitors, and we have to exploit the huge potential for investment and jobs. We expect as of 2025 that the annual [European] market for batteries will be in the realm of €250 billion a year,” he added.

Šefčovič noted the importance of mapping and further exploring raw material availability in EU member states, including lithium reserves in Portugal, new discoveries of cobalt in Finland and Sweden, and secondary (recycled) raw material. He further stated that the Commission would push for free trade agreements that secure fair and sustainable access to raw materials from resource-rich countries outside the EU.

In order to increase market penetration of electric vehicles (EVs) and meet climate goals, analysts say that it will also be important to reduce tariffs on batteries and finished EVs. As reported in an ICTSD scoping paper from December 2017, batteries account for more than half of the cost of the EV power train and around one-third of total EV cost, meaning that tariff cuts could help speed up the transition to a zero-emission transport sector. (Editor’s note: the International Centre for Trade and Sustainable Development, also known as ICTSD, is the publisher of Bridges)

The Commission’s action plan also emphasises a full life-cycle approach to EU battery manufacturing, focusing on sustainable, or “green,” battery production that uses secondary raw material. “This is where we believe our competitive edge lies. In sustainable, green battery production, we clearly want to be the global trendsetter,” Šefčovič said.

The Commission’s efforts to encourage and standardise the full life-cycle of battery production is organised under the recently-formed EU Battery Alliance. This group includes key industrial stakeholders and innovators, interested member states, and the European Investment Bank, and Šefčovič praised each group for their respective contributions.

Support for member states’ binding emissions targets

With the release of the third and final Mobility Package, EU Commissioner for Climate Action and Energy, Miguel Arias Cañete, said that “all sectors must contribute to meet our climate commitments under the Paris Agreement.”

“That’s why, for the first time ever, we are proposing EU standards to increase fuel efficiency and reduce emissions from new heavy-duty vehicles,” he added.

Commission officials note that setting these standards will help capture a type of emissions that currently lies outside the scope of the bloc’s flagship carbon market, the EU Emissions Trading System (EU ETS). They say that having such standards will help member states achieve their binding annual emission reductions under EU’s Effort Sharing Regulation for 2021 to 2030, which was recently released on 14 May.

ICTSD reporting; “EU states call for ambitious truck CO2 emissions targets,” REUTERS, 7 May 2018.

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