Still smoking: the PHEV emissions scandal continues

Summary

Analysis of official 2024 real-world data reveals that plug-in hybrid electric vehicles (PHEVs) continue to exhibit a widening gap between real-world performance and official WLTP (Worldwide Harmonised Light Vehicle Test Procedure) testing values. On average, real-world emissions for 2024 PHEV models were nearly six times higher than official figures. The widening gap is driven largely by the market shift toward heavier, higher-power, longer-range models that lack sufficient electric motor power. These empirical findings underscore the necessity of the upcoming November 2026/27 utility factor (UF) correction to align official accounting with actual climate impact and incentivize meaningful vehicle performance improvements.

Correcting the plug-in hybrid electric vehicle UF does not threaten the European PHEV producers, it ensures that PHEV design and performance are improved. Market evidence from the past 2025 UF correction shows that CO₂ emissions can be reduced through better technology and longer electric range to offset the increase in official CO₂ emissions from the UF correction.

The UF corrections encourage manufacturers to develop PHEVs with longer electric ranges. However, demand also determines which models succeed, and taxation plays a key role in influencing buyers’ choices. In most Member States, current PHEV taxation does not prevent high-emitting models from receiving more favourable treatment than best-performing PHEVs.

Real-world fuel consumption data reveal that PHEVs climate benefits were overstated and have emissions close to traditional combustion cars:

The evidence from recent PHEV model launched after the 2025 UF correction suggests that the UF correction incentivised technical improvements:

T&E’s analysis shows that, by 2030, electric ranges of around 140–220 km will keep PHEVs at or below 50 gCO₂/km. This increase in range is consistent with the expected progress in battery and vehicle technology. If PHEVs are fitted with better technology, the range increase needed is limited to about 180 km. The final UF correction starting in November 2026 not only harmonises regulation with real-world performance, thus correcting a critical regulatory misstep, but it also encourages the development of higher-performance PHEVs.

Crucially, freezing the UF is the single change to the car CO₂ framework that would have the largest impact on 2030 and 2035 BEV sales. In total it would lower BEV sales by 13 percentage points in 2030 and 18 percentage points in 2035 in the car CO₂ proposal of EPP rapporteur Massimiliano Salini.

Current tax systems do not reward the best-performing PHEVs and often provide them with similar treatment to pure electric vehicles:

Key recommendations

The EU should keep the planned correction of the PHEV UFs: European co-legislators should not interfere with the planned and approved upcoming correction of the UF in the current Automotive package discussions.

The UF is a technological methodology that is designed to ensure the official PHEV emissions match real-world emissions. It should not be for politicians to interfere with the application of this technical methodology. Instead, co-legislators should merely reaffirm their political support for a robust, science-based system that guarantees that official emission accounting reflects real-world performance.

Taxation should complement the UF correction by using stricter CO₂ and electric-range criteria to better distinguish between PHEVs. This would ensure that the high-emitting models do not receive more favourable treatment than best-performing PHEVs.