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As part of its ‘Moves II’ programme of incentives for efficient and sustainable mobility, the Spanish government announced it was offering incentives for motorists to swap petrol and diesel cars for low-emission vehicles. But it excluded vehicles – cars, vans, light commercial vehicles, buses and coaches – that run on liquefied petroleum gas (LPG, also called “autogas”) or natural gas (CNG or liquified natural gas) from the category of low-emission replacements. This was challenged by the Spanish Liquified Gas Association in an appeal to Spain’s supreme court.
That court has now said the government was within its rights to exclude LPG vehicles from the ‘Moves’ plan, both because they do not contribute to decarbonisation objectives and because LPG technology has already enjoyed significant fiscal support as a transitional form of technology towards a zero-emissions fleet. It said the government’s decision was legitimate because of a need to promote technologies that are the best use of public resources but struggle to thrive in a purely commercial environment.
Even with this ruling, LPG and natural gas (CNG, LNG) still enjoy more favourable tax treatment than petrol and diesel in Spain.
T&E’s Spanish office director Isabell Büschel said: ‘This is the right judgement for the right reason. The court stated clearly and correctly that LPG and natural gas are fossil fuels. Spain’s commitment to carbon neutrality means vehicles that spew out toxic particles like any other fossil fuel engine do not justify tax and purchase incentives. In fact gas-powered engines should be banned from the low-emission areas of our cities.’
The judgement comes as a new report by T&E provides evidence that cars, vans, buses and trucks fuelled by compressed natural gas (CNG) emit high levels of toxic pollutants. The gas industry has claimed that LPG, CNG and LNG are fuels that can help improve air quality and fight climate change. But T&E’s report shows these fuels emit large amounts of particles and ultrafine particles, which are associated with cancer, Alzheimer’s, and heart and respiratory diseases.
The report is in English, but with summaries in Spanish, Italian and Polish as those three countries suffer from poor air quality and have tax incentives for gas-powered vehicles. In Italy, natural gas for transport is taxed 99.5% less than diesel, with an annual loss of public revenues of approximately €675 million.
The Polish government treats gas vehicles as low-emission vehicles – like electric vehicles, they are subsidised for purchase, have access to planned clean transport zones in cities, and gas is exempt from excise duty.
In Spain, vehicles powered by natural gas or LPG benefit from the ECO label, granting them numerous advantages in different cities throughout Spain. For example, in Madrid or Barcelona, they benefit from discounts on road tolls, exemptions from registration tax, or bonuses on circulation tax for being considered “greener cars”.