Cars climate brief #1:Why CO2 from new cars could drop by only 2% by 2029
This brief is the first of a series of short analytical pieces in which T&E will share fresh insights related to the revision of the car CO₂ standards. The current EU-wide car CO₂ targets are not bad on paper: they require a reduction in CO₂ emissions from new cars of 15% from 2025, and 37.5% from 2030 compared to 2021. Yet, a deeper look at the design of the regulation shows that as little as a 2% cut can actually be required between 2025 and 2029, or in the next decade. To begin with, carmakers who choose to ignore the voluntary electric car sales benchmark merely need to reduce their emissions by 6% instead of 15%. This is due to three flexibilities: CO₂ allowance for heavier vehicles shaves off 2 percentage points (pp); Allowance for eco-innovations shaves off a further 2 pp; and The transition to a new test opens the door for another 5 pp to be knocked off. Then, for carmakers who overshoot the rather unambitious EV sales benchmark, a further 5 pp is reduced via what is known as the “ZLEV bonus”. Read this short brief to understand how the 15% reduction on paper becomes a mere 2% effective reduction.