The European Union has been in the forefront of the fight against climate change, led on by the likes of China. Globally, the Union has not only actively implemented policies and initiatives in order to help transition the region towards sustainability through policies such as the Fit for 55 package, multiple carbon-rebatement legislations, participation in global movements and organizations such as COP26 and the foundational Paris Climate Agreement, but has also aided the efforts towards carbon-neutrality through initiatives set by OEMs such as Daimler AG, Volvo, and Volkswagen.
In lieu of furthering these very attempts, the Union has recently announced targets to phase out internal combustion engines (ICE) by 2035. The Union Parliament’s Environment Committee has voted in favor of the EU Commission’s proposed de facto ban on internal combustion engines from 2035 for new passenger cars and light commercial vehicles in the European Union as part of the Fit for 55 climate package. As part of the legislation, the committee has called on manufacturers to to reduce their average fleet emissions by 20 per cent by 2025 compared to 2021, by 55 per cent by 2030 and by 100 per cent by 2035. However, the demands for a new interim target for 2027 for ICE phase out and a higher target of 75 per cent CO2 reduction for 2030 were rejected in the meeting.
The Fit for 55 climate package, revealed back in July 2021, divided the EU states with the de facto ban on internal combustion engines. Some states proposed the usage of synthetic fuels in order to aid in the transition towards EVs, however, it was argued that even with synthetic fuels, new cars would be CO2-neutral in balance sheet terms, but the vehicles themselves continue to emit CO2 and other pollutants as a combustion product. Several states, including the Czech Republic, spoke out in favor of not implementing the regulation. The Environment Committee has now approved the package anyway – with 46 votes in favor, 40 against and two abstentions.
Synthetic fuels have been recognized by the committee as loophole fuels that cannot further or help carbon neutrality targets in any way. As part of the legislation, the Commission has also been called to present a report by the end of 2023 detailing the need for targeted funding to ensure a just transition in the automotive sector, to mitigate negative employment and other economic impacts. It also calls for a common EU methodology by the Commission, by 2023, for assessing the full life cycle of CO2 emissions of cars and vans placed on the EU market, as well as for the fuels and energy consumed by these vehicles.
Even though the new 2035 target is monumental in increasing EV uptake and reduction in EV costs, it has been recognized that the exponential increase in EV uptake will not be possible at current electrification rates. In order to reach climate targets set for 2030, which have been set by most EU countries, certain legislators and policy makers have emphasized on the need to implement interim targets for 2027.
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