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EU Sees Lobbying Frenzy Ahead Of Car CO2 Vote

This article is more than 5 years old.

Tomorrow, the European Parliament will vote on one of the most closely-watched EU policy files this year – new CO2 limits for cars and vans after 2020.

In the days before the vote, lobbyists from the various sides are banging on the doors of MEPs with urgent messages about how high to set the target. They are warning of a loss of competitiveness to other areas of the globe.

The vote comes in the context of the Trump administration’s decision this summer to scrap CO2 targets in the US after 2021. EU lawmakers have said Trump’s decision should not impact the EU’s pending legislation, and that in fact it represents an opportunity for European automakers to develop a competitive edge over their US counterparts by getting a lead in the development of electric vehicles.

The European Commission proposed last year new average fleet limits requiring a 30% emissions reduction by 2030. But last month the European Parliament’s environment committee voted to increase the ambition and raise this to a 45% reduction.

Tomorrow, the full parliament will vote on whether to back the environment committee’s call to raise the target. They are expected to do so.

The final reduction requirement will depend on a vote by the European Council, the EU’s upper chamber made up of representatives of each of the 28 member governments. 17 EU countries have come out in favour of the idea of increasing the Commission’s proposed reduction target for 2030.

Austria has floated the possibility of the Council adopting a position that raises the target to 35%, which would then likely be raised during negotiations with the parliament.

Lobbyist pressure

However the auto industry is sounding the alarm over the dangers of raising the Commission’s proposed target. “The more aggressive the CO2 reduction targets are, the more disruptive the socio-economic impacts will be, especially in member states and regions where the sector’s share of industrial output is high,” says Erik Jonnaert, secretary general of the European auto industry association ACEA.

Future CO2 reductions are largely dependent on the development of electric vehicles, he says, whose market uptake remains rather weak and fragmented across the EU, representing only 1.5% of EU car sales last year. The timeframe being proposed by the parliament is simply not feasible, he says.

“The stakes of Wednesday’s vote are extremely high for the entire sector, which accounts for over 6% of the EU employed population and 27% of all private EU investment in research and development,” he cautioned.

Clean transport advocates say these warnings are fear-mongering, and that the auto sector is perfectly capable of quickly developing more electric vehicles if they wanted to – or were forced to.

A recent poll by Ipsos Mori for the NGO Transport & Environment (T&E) found that 40% of EU citizens say it is likely the next car they’ll buy or lease will be electric or fuel cell powered. Nearly two-thirds of Europeans think that carmakers are not doing enough to sell electric vehicles by attractive marketing, pricing and offering enough choice.

“The clear message from this survey is that citizens expect their government to be far more ambitious about driving the shift to low and zero-emission vehicles than what the European Commission and the German government are proposing,” says T&E’s Greg Archer.

It isn’t just environmentalists supporting the higher ambition. Eurelectric, the industry association representing Europe’s electric utilities, is also calling for the parliament to support 45% tomorrow. “MEPs should seize this opportunity to answer the call of citizens to preserve climate and to be offered a real choice between fossil fuelled and electric mobility”, says Kristian Ruby, Secretary General of Eurelectric.

Ruby says the target is “ambitious, but realistic”, and wants to dispel perceptions about the lack of public charging infrastructure - an argument often used by the auto industry. Public charging infrastructure will soon be sufficient to supply the 10% of users charging outside of home or work, he says. Electricity generation will also be sufficient to cope with the vast deployment of electric vehicles. Electric utilities have seen an opportunity in the transition from combustion engines to electric vehicles.

A German ‘dirty deal’

The stakes were raised last week when German Chancellor Angela Merkel unexpectedly came out strongly and publicly against raising the Commission’s 30% proposed target.

Her comments were suspiciously timed just before the announcement of a deal with German automakers to have them pay for hardware retrofits for diesel vehicles involved in the dieselgate scandal, announced this morning after intensive all-night talks.

Environmentalists have accused Merkel's government of making a "dirty deal" with automakers - offering to oppose raising the CO2 target in exchange for having them agree to pay for diesel vehicle retrofits.

According to Parliament sources, Merkel has instructed her German conservative MEPs to vote against the 45% proposal tomorrow, and her government will vote against any raising of the target in the Council – even against an Austrian proposal to raise the target to 35%.

Meanwhile, the Commission has behind the scenes been fighting a rearguard battle against these proposed changes to its proposal. In an unusual move, last week it distributed a paper to MEPs saying that its internal analysis has concluded that the parliament’s proposed raise could result in significant job losses for Europe’s auto sector.

This has enraged members of Parliament. "The Commission's active lobbying work against ambitious CO2 standards for cars clearly contradicts the EU's commitment to the Paris climate targets and is an outrageous move we have not seen before,” says Dutch Green MEP Bas Eickhout.

The Commission could, in theory, veto the legislation if the final reconciled version agreed by the parliament and council contains a target higher than 30%. However, such a move to withdraw a proposal at the last moment is extremely rare.

In addition to all the lobbying pressure, MEPs and national governments are under time constraints as well. The current parliamentary term will end in March next year, when MEPs will begin campaigning for May’s European Parliament election. Any legislation left pending before they adjourn may have to start from the beginning.

The time pressure of Brexit, also scheduled for March next year, means that the Council position may also become invalid after this time – because the loss of the UK’s votes could mean the majority support for the agreed position is lost. The Council would then also have to start over, risking a delay to the legislation that could leave the EU with no CO2 reduction targets for several years after 2020.

This would, ironically, put it in the same position as the United States – even though nobody in Europe is calling for car CO2 targets to be scrapped entirely.