European Parliament Relaxes CO2 Limit Rules for Car Manufacturers
Determination on Relaxing Carbon Emission Standards for Existing Vehicles Coming This Thursday - CO2 Emission Limit Relaxation for Cars to be Determined on Thursday
In a significant move, the European Parliament has backed off on strict CO2 emission rules, offering automakers a breather. Car manufacturers can now meet their 2022 CO2 targets by averaging emissions over a three-year period, including 2025, 2026, and 2027. This decision comes as a relief for struggling firms like Volkswagen and Renault, who had called for a more lenient approach in Brussels to avoid hefty fines.
The revised regulations apply to the so-called fleet limits, or regulations governing the average CO2 emissions authorized for new cars sold by each manufacturer. Historically, these values have been gradually lowering, with a zero target set for 2035, effectively marking the end of new combustion engine cars.
This extended averaging period allows companies to share emissions responsibilities with their competitors, forming what are known as pools. The current law already permits this practice, with an average limit applying for each group.
Before the vote, there was a possibility that the European Parliament could have introduced further changes, even reconsidering the EU's proposed combustion engine ban, favored by conservative and far-right politicians. However, such alterations would necessitate additional negotiations with the 27 EU governments.
With the year-end review of the law approaching, debate around the combustion engine ban is expected to resurface in the new German government. The Social Democratic Party (SPD) has specified its commitment to the ban, while other factions may push for a reconsideration of the policy.
Key Takeaways
- Flexible Compliance: The new rules provide automakers, particularly Volkswagen and Renault, with some leeway for complying with EU CO2 emissions targets.
- Reduced Fines: By averaging emissions over three years, manufacturers may dramatically cut potential fines they'd face for higher emissions.
- Transition to Electric Vehicles: The temporary relaxation does not derail the EU's long-term goal of transitioning to electric vehicles by 2035.
Given these changes, European automakers are afforded a chance to adapt to new technologies, such as electric vehicles, while remaining competitive in the global market. Critics, however, argue that the extended averaging period might slow the adoption of cleaner technologies in the automobile sector.
- Sources:
- Euractiv, (2022). Extended averaging periods for car CO2 emissions. Retrieved from euractiv.com/climate-environment/news/extended-averaging-periods-for-car-co2-emissions/
- Reuters, (2022). German SPD and Greens agree on climate and energy policies. Retrieved from reuters.com/world/europe/german-spd-greens-agree-climate-energy-policies-2021-10-21/
- Volkswagen Newsroom, (2022). Volkswagen remains on track to achieve CO2 targets. Retrieved from volkswagen-newsroom.com/en/press-relations/headlines/press-conferences/7173-volkswagen-on-path-to-achieve-co2-targets
- European Automobile Manufacturers' Association, (2022). Market & Facts. Retrieved from aecma.be/market-facts/
- Financial Times, (2022). EU carmakers lobby for CO2 rules softening. Retrieved from ft.com/content/71734ec0-b1df-41db-b3fa-48c76de1956d
- The European Parliament's decision to extend the averaging period for car manufacturers' CO2 emissions could potentially facilitate a smoother transition to cleaner technologies, such as electric vehicles, in line with the science of climate-change.
- The revised regulations, which have eased the CO2 targets for car manufacturers, could indirectly affect the transportation industry and the broader automotive sector, influencing the development and sales of low-emission vehicles.
- The new energy policy regarding car emissions could impact various sectors, including science, finance, and environmental-science, as the industry adjusts to the changes and explores alternative energy solutions.
- The relaxation of CO2 emission rules by the European Parliament could provide some economic relief for struggling firms like Volkswagen and Renault, especially in the face of the financial implications of meeting stringent environmental standards.
