Regulators clamp down and automakers switch up
Carbon dioxide emissions standards are, according to many observers, the single biggest accelerant of the eMobility transition. They have forced automakers down a decarbonized path and will be the fundamental driver of change.
Taking 2021 as a baseline, cars and vans must emit 15% less CO2 from 2025. Then, from 2030, cars must emit 37.5% less CO2, and vans 31% less. For every gram that every vehicle exceeds the emissions targets, a €95 fine applies.
However, it seems these regulations may not go far enough to meet the ambitions laid out in the SSMS to get 30 million zero-emission vehicles on the roads by 2030. The European Commission has already committed to review the CO2 standards (pdf) for cars and vans by June 2021, and for heavy-duty vehicles the year after.
The regulations are also designed to accelerate EV sales. They stipulated that new EV car and van sales made up more than 5% of automakers’ total sales in 2020, rising to 10% in 2021 and to 15% in 2025. From 2030, it becomes 35% for cars and 30% for vans. The reward is relaxation of the emissions cap, but there is no penalty – erroneously, we think – for non-compliance.
For automakers, the regulations mean a complete rethink of powertrains, massive investment in research and development, and disruption to long-standing supply chains in order to deliver cleaner vehicles with lower lifetime emissions.
They will bring more than 200 new electric and plug-in hybrid models to market in 2021, giving private and fleet customers greater choice and accelerating, in turn, the pace of electrification.
National and local initiatives favor electric
Several European governments plan to banish the sale of new diesel and petrol ICE vehicles by 2030. Norway, one of the most progressive economies for EVs, is aiming for 2025.
France, which plans a five-fold increase in EV sales by 2022 compared with 2017, operates an effective bonus-malus scheme that could serve other nations well. The “bonus” is an environmental reward of up to €6,000 for vehicles costing less than €45,000 that emit less than 20 grams of CO2 per kilometer. The “malus” is a tax of up to €20,000 on the biggest polluting vehicles at the point of registration, effectively funding the bonus payouts.
At a town and city level, almost 300 low-emission zones now ban polluting vehicles. So a logistics or last-mile delivery business either has to switch to EVs or pay a penalty to reach its urban customers.
However, despite inducements to electrify, EV ownership is not within everyone’s reach. The market is disjointed, and a continental divide is emerging. Economies that offer the best incentives and have the wealthiest populations account for the biggest take-up of EVs. There is a real risk that poorer nations are being squeezed out, with adverse implications for air quality and health.
The split is evident. Slightly more than 75% (pdf) of all EV charging stations are located in Germany, France, the Netherlands and the UK, while more than three-quarters (pdf) of all EVs are sold in those same countries, plus Norway. If decarbonization is Europe’s ambition, ways to harmonize EV adoption and to reverse the polarization of poorer economies must be found.