This is good. Trump has inadvertently created more momentum around climate change than anyone else ever could – he’s doing a similar thing for European unity by the way. But words need to be matched by actions, and that is particularly true for the transport sector.
Transport is Europe’s biggest climate problem. Last week’s report by the European Environment Agency shows EU emissions increased in 2015 – for the first time since 2010. This was caused “by increasing road transport, both passenger and freight”, as well as higher heating consumption.
The Commission seems to understand the urgency. Last week it published the first chapter of its Clean, competitive and connected mobility package. As part of the package the Commission reaffirms that it is “considering” a zero-emission vehicle target, it specifies the timeline for the cars and trucks standards and has put forward a very decent road charging proposal.
EU trucks tolls are the second biggest tax levied on trucking in Europe and the EU sets the rules for tolls, so this is important. The Commission wants tolls to be differentiated based on truck CO2 emissions, it wants big toll discounts for zero-emission trucks and it wants tolls to be expanded from today’s 15 countries to more nations. What’s more, the Commission wants member states to extend tolls to cars and vans too.
Apart from the obvious benefits of tolling – the green tax shift, efficiency, fleet renewal – distance-based charges have a big role to play in decarbonising transport. The ultimate goal of climate policy is to eliminate fossil fuels, and so, ultimately, fuel taxes. In a world without fuel taxes we’ll have to find new ways to manage demand and raise revenues. Tolls are likely to play a big part in that.
But although the Commission’s opening move is promising, the real test will come in November when it proposes new car CO2 standards. German carmakers (through the VDA lobby arm) are using Trump’s climate decision to try and convince the Commission to reduce the ambition of its plans in order to preserve their ‘competitiveness’.
The VDA is not only shamelessly opportunistic, it is also wrong. Trump’s decision to put US climate policy on hold and possibly roll back US CO2 standards for cars are a climate disaster, but also an industrial opportunity. It is a chance for our industry and regulators to firmly reclaim the global clean vehicle leadership it lost through the Dieselgate scandal.
China’s zero-emission vehicle target – which Germany tried to dilute – is the clearest sign yet that the big Asian markets want to leapfrog diesel and petrol and go straight to zero-emission vehicles. If EU carmakers want to continue selling in China, they’ll need a strong European home market. The Commission seems to understand this: Commission vice-president Maroš Šefčovič literally said he wants to avoid “a European Kodak moment” and put the EU and its industry on a path towards zero-emission mobility.
A zero-emission vehicle sales quota could play a major role in doing exactly that. By 2035 we need to sell the last combustion car. So while there will still be a role for more efficient combustion cars for the next 15 years or so, the future is clearly zero emissions. That’s where carmakers and suppliers need to invest. A sales quota provides planning certainty not just to OEMs and suppliers but also to utilities, battery manufacturers and infrastructure providers.
And of course, a zero-emission vehicle mandate would be a testimony to Europe’s genuine commitment to the key goal of the Paris agreement: the complete decarbonisation of our economy.