New CO2 targets will boost cleaner car sales but fall short on climate ambition

Carmakers will be required to reduce the carbon emissions of new cars they sell in Europe by 15% in 2025 and 37.5% in 2030. The CO2 reduction targets, based on 2021 levels, were agreed in the last round of talks between the Austrian Presidency, European Parliament and the European Commission this week after 27 hours of negotiations. T&E welcomed the deal, which will improve fuel economy for consumers, but it warned that the targets are well below what’s needed to meet the goals of the Paris climate agreement.

T&E said the new law means there will be much greater choice in affordable, fuel-efficient and electric models. Also, under the deal, the Commission will develop a system using information from fuel consumption meters to ensure emission reductions are delivered on the road, but this will not come into force until 2030.

Greg Archer, clean vehicles director at T&E, said: ‘Europe is shifting up a gear in the race to produce zero-emission cars. The new law means by 2030 around a third of new cars will be electric or hydrogen-powered. That's progress but it’s not fast enough to hit our climate goals.’

While achieving the targets of the international climate accord requires the last new car in Europe with an engine to be sold by the early 2030s, the new EU regulation incentivises carmakers to ensure that at least 15% of sales in 2025 and 35% in 2030 be zero and low-emission vehicles (ZLEVs). The European Parliament's proposal to penalise carmakers for failing to supply sufficient ZLEVs was blocked by governments and the Commission.

A Council proposal to give very generous credits to plug-in-hybrids was limited during the negotiations, as was the double counting of plug-in cars sold in Central and Eastern Europe which will be capped at 5% of new car sales. However, there remains a risk of gaming by carmakers registering zero and low-emission vehicles in one country and selling them on in another.

T&E said this could have been a much better deal if governments and the Commission had not caved in to carmakers’ lobbying. The regulation, together with the anticipated truck standard, will deliver around 38% of the emissions cuts needed in transport for the EU to meet its effort sharing goals. This means governments will need to adopt strong policies to reduce vehicle use.

Greg Archer concluded: ‘This regulation is a good deal for citizens: reducing fuel costs for drivers, creating over 200,000 jobs and reducing our dependence on imported oil. However, carmakers’ successful scuppering of more ambitious targets means governments will now need to do a lot more at national level to bring down transport emissions.’

The agreement is expected to be rubberstamped by national ministers and the European Parliament in the new year. Transport is Europe’s biggest climate problem. Cars and vans represent almost two-thirds of all transport emissions.