European Union CO2 Standards For New Passenger Cars and Vans: Interim Targets For New Vehicle CO2 Emissions
European Union CO2 Standards For New Passenger Cars and Vans: Interim Targets For New Vehicle CO2 Emissions
FACT SHEET 02
EUROPEAN UNION CO2 STANDARDS
FOR NEW PASSENGER CARS AND VANS
JUNE 2021
Regulatory design elements:
Interim targets for new vehicle
CO2 emissions
With introduction of the EU’s first CO2 standard for new passenger cars, official
type-approval emissions decreased at a rate of about 3.5% per year, compared to
about 1.2% prior to regulation. The 2015 target of 130 g/km was met well in advance
by manufacturers. During the 2016 to 2019 timeframe, however, when the 2015 target
remained in place without any strengthening, CO2 levels increased at a rate of about
0.5% per year. It was only from January 2020 onward that emission levels decreased
again, at the unprecedented rate of about 20% within one year. The 2020 target of
about 97 g/km on average was met by all manufacturers without any substantial
fines (Figure 1). Data for the first months of 2021 suggests that after having achieved
compliance with the 2020 target—which is nearly identical to the 2021 target—average
CO2 emission levels stagnated again.
200
Average EU new car CO2 emission levels (NEDC g/km)
pre-regulation: -1.2%/year
1st regulation: -3.5%/year
150
2nd regulation (pre-2020): +0.5%/year
2nd regulation (2020): -20.5%
100
Adopted Policies: -5.0%/year
50
0
2000 2005 2010 2015 2020 2025 2030
Figure 1. Historic development of the average CO2 emission level of new passenger cars in
Europe, including current target values for 2025 and 2030.
Unlike in other markets, such as the United States and China, the EU CO2 regulation
for new vehicles does not currently set annual interim targets but instead relies on
step-wise targets with five-year intervals in between. As a result, manufacturers can
focus on CO2 compliance during target years while taking advantage of efficiency gains
in development and production during interim years to maximize engine power, profit,
or other parameters in their portfolio. Such an approach is detrimental from a climate
protection perspective because the sooner new car CO2 emission levels fall, the faster
annual fleet-wide CO2 emissions decline and the higher cumulative CO2 benefits are,
relative to a business-as-usual scenario.
Furthermore, for successfully establishing battery and electric vehicle production
capacities within Europe, it is important to provide planning security as well as
a steady ramp-up of electric vehicle numbers for future years. With the current
regulations in place though, vehicle manufacturers can ensure compliance until
2029 without any increase in electric vehicle market shares and instead rely solely
on further improvements of internal combustion engine (ICE) vehicles (Figure 2,
“Adopted policies”). Only in 2030 will the share of electric vehicles have to increase
to a level of about 23%. If further development of combustion engine vehicles is
stopped and compliance is achieved by relying solely on electric vehicle technologies,
manufacturers will need to provide about 40% of their vehicles as electric in 2030.
Strengthening only the 2030 CO2 target level will likely not have any significant
impact on 2021 to 2029 electric vehicle market shares (Figure 2, “Higher 2030 target
only”). It is only by also strengthening the 2025 CO2 target level, plus introducing at
least one additional interim target—for example by pulling the current 2030 target
forward to 2027—that a stronger and steadier uptake of electric vehicles can be
assured (Figure 2, “Adding interim target” and “Annual targets”).
Adopted policies Higher 2030 target only Adding interim target Annual targets
60%
Zero- and Low Emission Vehicles
EV pathway EV pathway
50% EV pathway
market share (weighted)
-15% CO2 by 2025 -15% CO2 by 2025 -20% CO2 by 2025 -20% CO2 by 2025
-37.5% CO2 by 2030 -50% CO2 by 2030 -37.5% CO2 by 2027 [...]
-50% CO2 by 2030 -50% CO2 by 2030
40% EV pathway
ICE pathway
ICE pathway ICE pathway
30%
ICE pathway
20%
ZLEVweighted
10% ZLEVweighted ZLEVweighted
2030: 38-51%
ZLEVweighted
2030: 23-40% 2030: 38-51% 2027: 23-40% 2030: 38-51%
2025: 9-20% 2025: 9-20% 2025: 14-22% 2025: 14-22%
2020: 9% 2020: 9% 2020: 9% 2020: 9%
0%
2015 2020 2025 2030 2015 2020 2025 2030 2015 2020 2025 2030 2015 2020 2025 2030
ICE pathway: Manufacturers rely primarily on a further development of internal combustion engine (ICE) vehicles
EV pathway: Manufacturers stop all further development of ICEs and relying solely on electric vehicles for compliance
Figure 2. Estimated uptake of electric vehicles in Europe in accordance with CO2 target levels.
2 ICCT FACT SHEET | REGULATORY DESIGN ELEMENTS: INTERIM TARGETS FOR NEW VEHICLE CO2 EMISSIONS
Flowing from the analysis, ICCT recommends considering the following policy actions:
» The stringency of the 2025 CO2 targets should be strengthened as much as possible.
» Annual interim targets should be introduced from 2026 onwards, possibly in
combination with a banking system to allow manufacturers to save early compliance
credits for later years. As an alternative, the current CO2 target for 2030 should be
pulled forward to at least 2027.
» The stringency of the 2030 fleet-average CO2 targets for cars and vans should be
set at a minimum of a 70% reduction, relative to the 2020/21 baseline.
» A target for all new cars and vans to have zero tailpipe emissions should be
introduced for 2035 at the latest.
FOR MORE INFORMATION
» Europe’s lost decade: About the importance of interim targets
https://theicct.org/blog/staff/interim-targets-europe-may2021 www.theicct.org
» The role of the European Union’s vehicle CO2 standards in achieving the European [email protected]
Green Deal https://theicct.org/publications/eu-vehicle-standards-green-deal-mar21
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