New EU vehicle emission standards represent a pivotal moment for electric cars

As negotiations for a new CO2 emissions law come to a head, EU lawmakers are facing resistance to plans to phase out petrol and diesel vehicles in Europe
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By Artiom Ialama

Artiom Ialama is a consultant at Dods EU Political Intelligence

27 Oct 2022

Last year, the European Commission announced plans to ban the sale of new CO2-emitting cars and vans by 2035 as part of its wider Fit for 55 package to tackle global warming. EU lawmakers have backed the Commission’s proposal, which is seen as an effort to turbo-charge the market for electric vehicles (EV), and are aiming to conclude the debate on the legislation by the end of the year.

Representatives of the Parliament, the Council and the Commission have scheduled a trilogue – a round of informal talks – for 27 October and will meet again in December if they fail to reach an agreement. However, some stakeholders are pushing back with arguments about the role of other green vehicle types and fuels, the high cost of EVs and insufficient charging infrastructure.

The role of e-fuels

The European Parliament and Council have adopted negotiating positions on the Commission proposal. However, Germany, the EU’s largest automobile manufacturing country, has asked the Commission to prepare a report by 2026 to consider the role of technologies such as plug-in hybrids and CO2-neutral fuels.

Legislators are debating whether synthetic or e-fuels, derived from the combination of hydrogen, electricity and CO2 captured from industrial processes, could provide a viable green alternative to electric vehicles or help the transition to electric.

“There are more than a billion existing vehicles worldwide. They will be on the roads for decades to come. E-fuels are an effective, complementary solution in this regard. They can enable all vehicles to play a role in reducing C02 – regardless of the powertrain type,” Oliver Blume, the CEO of Porsche, said in July.

Environmental activists and NGOs have dismissed e-fuels as an attempt to undermine Europe’s EV transition and argued that they are expensive, energy-consuming and emit as much nitrogen oxide as fossil fuels.

Clean transport lobby group Transport & Environment (T&E) has also argued that by 2035 there would only be sufficient synthetic fuels available to power around two per cent of Europe’s cars.

“Lawmakers should close the door to this Trojan Horse for the fossil fuel industry,” Yoann Gimbert, an e-mobility analyst at T&E, said in a statement in early October.

The high costs of EVs

Industry figures have raised concerns about the purchase price and running costs of EVs.

Arnaud Deboeuf, the chief manufacturing officer of Stellantis – maker of brands such as Citroen, Opel and Fiat – warned in June that unless electric vehicles become more affordable, “the market will collapse.”

The European Automobile Manufacturers’ Association (ACEA) has argued that a mix of technologies and fuels – internal combustion engines, hybrids, battery electric and hydrogen vehicles – should play a role in the transition to zero-emission vehicles.

Analysts have also warned of the threat to the EV market from soaring electricity costs stemming from the war in Ukraine.

“If electric cars become more expensive to use, the surge in electric mobility is in danger of collapsing, because hardly anyone is going to buy an electric car,” automobile economist Stefan Bratzel, the founder of the Centre for Automotive Management (CAM), was quoted telling German media in September.

In a joint letter published by the FuelsEurope industry group in late September, a group of auto and parts makers and fuel manufacturers called on the EU to reconsider its push for full electrification of new cars from 2035.

“Since the publication of the Commission’s proposal for CO2 standards in cars and vans in July 2021, the geopolitical landscape has changed dramatically, with implications for energy and raw material dependencies,” it said

Insufficient charging infrastructure

Although the Commission’s proposal on the deployment of alternative fuels infrastructure (AFIR), which was presented with the CO2 emission standards for cars proposal, aims to improve Europe’s charging infrastructure, industry groups and analysts remain concerned about both the distribution and quality of charging points.

ACEA has said almost half of the EU’s public electric vehicle charging points are concentrated in just two countries, the Netherlands (29.4 per cent) and Germany (19.4 per cent). The Netherlands also has almost 1,600 times more charging points than Cyprus, which has just 57. Recent research by the industry association also shows that only one in seven European charging points is “fast” charging.

“If we want to convince citizens all over Europe to switch to e-mobility in the coming decade, charging these cars should be as easy as refuelling is today,” ACEA Director General, Sigrid de Vries, said in a statement. “People should not have to travel for miles to find a charger, nor should they have to wait ages to charge their vehicle.”