EU: Revision of the CO2 emission standards for cars and vans

 

The EU Commission is conducting a public consultation about the revision of the CO2 emission standards for cars and vans.

The EU rules on CO2 emission performance standards for new cars and vans is a key policy to reduce road transport CO2 emissions and reach the Union’s climate objectives. This initiative will revise the current rules, based on a fact-based analysis, taking into account all relevant technological developments, and the importance of an economically viable and socially fair transition towards zero-emission mobility.

Regulation (EU) 2019/631 (CO2 standards for light-duty vehicles (LDVs) Regulation) sets CO2 emissions performance requirements for new passenger cars and light commercial vehicles (‘vans’). Its aim is to: (i) contribute to achieving the EU’s greenhouse gas (GHG) emission reduction targets; (ii) deliver benefits to consumers and citizens from a wider deployment of zero-emission vehicles; and (iii) stimulate innovation in zero-emission technologies, thus strengthening the technological leadership and sustainable competitiveness of the automotive value chain and stimulating employment and quality job creation in the EU.

The European Climate Law sets a legally binding target of net-zero GHG emissions in the EU by 2050 at the latest, and the intermediate target of reducing net GHG emissions by at least 55% by 2030, compared to 1990 levels. As stated in the political guidelines for the 2024-2029 Commission, work is ongoing to prepare the way towards the 90% emission reduction target for 2040. Reaching these climate targets will require action and a wide range of innovative technologies in all economic sectors, including in the area of mobility.

In line with the Better Regulation Guidelines, the evaluation will assess the effectiveness, efficiency, relevance, coherence and EU added value of the CO2 standards for LDVs Regulation.

Currently, there are already more than 6 million zero-emission passenger cars on the EU’s roads, but a significant ramp-up will be needed to achieve the 2035 targets. The CO2 standards for LDVs provide long-term certainty and predictability for investors along the value chain, while allowing for sufficient lead time for a fair transition. This in turn supports the EU automotive value chain’s technological leadership, stimulates quality employment and promotes accessible and affordable zero-emission mobility solutions for all, including vulnerable groups. The importance of a stable and predictable framework providing certainty for the investments needed in the sector is widely recognised, particularly for developing new value chains in the EU (especially the battery value chain), infrastructure (recharging points, electricity grid) and reskilling workers.

As the automotive sector is undergoing a structural transformation at an unprecedented speed and of great magnitude in a challenging and increasingly volatile geopolitical context (as explained in the Industrial action plan for the European automotive sector), additional flexibilities may be needed for manufacturers to comply with the CO2 standards for LDVs Regulation, without impacting the long-term market signal provided by the standards. For the same reasons, simplifying the Regulation and reducing its administrative burden should support the sector in its transition. The European Court of Auditors also made recommendations in 2024 on possible simplification and burden reduction of the Regulation by making better use of electronic tools for collecting and verifying monitoring data.

As mentioned in several Commission documents (see ‘Political context’), reaching the 2035 climate neutrality target for cars will require a technology-neutral approach, in which e-fuels have a role to play and all relevant technological developments will be taken into account.

Certain aspects of the CO2 standards for LDVs Regulation are subject to review. Where possible, simplification and reduction of administrative burden should be pursued. A technology-neutral approach will be followed, in which e-fuels have a role to play. The review will take into account technological developments, including as regards plug-in hybrid technologies, and the importance of an economically viable and socially fair transition towards zero-emission mobility. In addition, the impacts of establishing minimum energy efficiency thresholds for new zero-emission vehicles will be assessed. The impact assessment will explore a variety of options and compare them to the baseline (i.e. maintaining the current Regulation), covering in particular the issues set out below.

• Flexibility, simplification and reduction of administrative burden. The impact assessment will look at options to streamline and simplify the Regulation to allow manufacturers meet their targets in the most cost-efficient way. The current monitoring and reporting rules will be reviewed to simplify how they work, including through a better use of digital tools. As part of the options to support the sector in its transition, the impact assessment will also assess if the possible revenues from excess emissions premiums could be used to financially support the road transport sector and transport users.
• 2035 CO2 emission targets. Article 15 of the Regulation tasks the Commission to assess progress made towards achieving the 100% reduction targets that apply from 2035, taking into account the technological developments, including as regards plug-in hybrid technologies, and the importance of an economically viable and socially fair transition to zero-emission mobility.
• Role of fuels. Fuels policy is an important aspect of road transport decarbonisation, and the EU legal instruments in place regulate the GHG emissions of vehicles and transport fuels separately. In line with the political guidelines for the 2024-2029 Commission, the mission letter to Commissioner Hoekstra and the recent Competitiveness Compass communication, getting to the 2035 climate neutrality targets will require a technology-neutral approach, in which e-fuels have a role to play. In this respect, the impact assessment will look at options regarding the role of fuels, taking into account other EU legislation and the needs of other sectors with fewer decarbonisation alternatives, including aviation and maritime.

To find out more about the EU vehicle emissions regulations, please do not hesitate to contact the Institute for Global Automotive Regulatory Research.