Not cleared from scrutiny; further information requested
Proposal for a Regulation of the European Parliament and of the Council setting emission performance standards for new passenger cars and for new light commercial vehicles as part of the Union’s integrated approach to reduce CO2 emissions from light-duty vehicles and amending Regulation (EC) No 715/2007 (recast).
Article 192(1) TFEU; ordinary legislative procedure, QMV
(39203), 14217/17 + ADDs 1–4, COM(17) 676
4.1This European Commission proposal would recast two existing Regulations on emissions performance standards for new passenger cars and light commercial vehicles. It is part of the second phase of the Mobility Package—the European Commission’s set of initiatives seeking to establish a more integrated and sustainable EU transport system. The objective of the proposal is to set CO2 emission reduction targets for new light-duty vehicles up to 2030 and provide an incentive mechanism to increase the share of zero-low emission vehicles.
4.2An evaluation of Regulations (EC) 443/2009 and (EU) 510/2011 concluded that the Regulations are still valid and will remain so for the period beyond 2020. However, it also concluded that the New European Driving Cycle test cycle does not adequately reflect real-world emissions and there is an increasing discrepancy between the two.
4.3The proposed recast Regulation seeks to go beyond the current Regulations by, among other things:
4.4The Government informs us that it welcomes and supports the Commission’s broad approach in the proposal and that it considers it to be justified with regards to subsidiarity. The Government in particular welcomes the continuation of provisions for small volume manufacturers. The Government indicates it will consider the timeliness of removing the niche derogation for manufacturers registering between 10,000 and 300,000 as the small number of manufacturers that utilise it does not necessarily indicate its need.
4.5We note that the proposal would empower the Commission to make further changes under the proposed Regulation.
4.6The proposal also adds a strengthened monitoring obligation on Member States to ensure high quality CO2 data and co-operate with the Commission.
4.7The Commission’s Impact Assessment concludes that the proposal will increase manufacturing costs and that this will affect vehicle price for consumers. The Government is considering whether there is a need to produce its own impact assessment. The Department for Transport will be adopting a strategy on the pathway to zero emission transport in March 2018.
4.8We therefore request:
4.9We retain this proposal under scrutiny and request a response by 21 April 2018.
Proposal for a Regulation of the European Parliament and of the Council setting emission performance standards for new passenger cars and for new light commercial vehicles as part of the Union’s integrated approach to reduce CO2 emissions from light-duty vehicles and amending Regulation (EC) No 715/2007 (recast): (39203), 14217/17 + ADDs 1–4, COM(17) 676.
4.10Existing targets to 2020 for emissions performance standards for new passenger cars and light commercial vehicles are prescribed in Regulations (EC) 443/2009 and (EU) 510/2011.
4.11Furthermore, Regulation (EC) 715/2007 allows the Commission to set up an in-service conformity procedure for verifying CO2 emissions.
4.12An extensive evaluation of Regulations (EC) 443/2009 and (EU) 510/2011 was completed in April 2015 and a final report published. It concluded that the Regulations are still valid and will remain so for the period beyond 2020. However, it also concluded that the New European Driving Cycle test cycle does not adequately reflect real-world emissions and there is an increasing discrepancy between the two.
4.13The amendments in the proposal concern:
4.14Subject matter and objectives (Article 1)—the proposal would specify the EU fleet wide CO2 targets applicable to new passenger cars and new light commercial vehicles from 2020, 2025 and 2030. The proposed Regulation would apply from 2020 in order to ensure a coherent transition to a new target regime starting from 2025. It would therefore include the already established EU fleet wide targets for 2020 of 95g/km (NEDC based) for passenger cars and 147g/km (NEDC based) for light commercial vehicles, as well as new targets for 2025 and 2030.
4.15Starting from 2021, the specific emission targets would be based on the new emissions test procedure, the Worldwide Harmonised Light Vehicle Test Procedure (WLTP). Therefore, the 2025 and 2030 fleet wide targets, which are WLTP based, are expressed as percentage reductions compared to the average of the specific emission targets for 2021 determined for each manufacturer in accordance with section 4 of Annex I.
4.16Scope (Article 2)—the proposal would define the categories of vehicles by reference to the type approval legislation. It would also clarify that the de minimis exemption applicable to manufacturers responsible for fewer than 1000 new registrations per year would not apply where a manufacturer eligible for such an exemption nevertheless applies for and is granted a derogation.
4.17Definitions (Article 3)—the proposal would add new definitions for “EU fleet-wide targets”, “zero- and low-emission vehicles” and “test mass”.
4.18Specific emission targets (Article 4)—the proposal would set out the general obligation for a manufacturer to ensure that the average CO2 emissions of its fleet of newly registered vehicles in a calendar year do not exceed its annual specific emissions target. That target is manufacturer specific and is calculated as a function of the applicable EU fleet wide target, the limit value curve, the average mass of the manufacturer’s fleet and the reference mass (M0 or TM0). The mass calculation is based on mass in running order until 2024 inclusive. From 2025 the vehicle’s test mass, which is closer to the real mass of the finished vehicle, would be used instead. The formulae for the calculations of the specific emission targets for the period from 2020 to 2030 are set out in Parts A and B of Annex I. The target calculations applicable in 2020 to 2024 would be those set out in existing legislation.
4.19From 2025, the specific emissions target for a manufacturer would be calculated taking into account the share of zero- and low-emission vehicles in the manufacturer’s fleet. For the calculation of that share, the zero- and low-emission vehicles would be counted based on a weighting of the emissions of each vehicle. Where the share exceeds the EU fleet-wide benchmark, the manufacturer would benefit from a higher specific emissions target.
4.20In the case of light commercial vehicles, a distinction would be made in the distribution of the effort between manufacturers of light commercial vehicles with an average test mass exceeding the average reference mass (TM0) and those with an average test mass lower than TM0. For the first group, the slope of the limit value curve would be kept constant over time, while in the latter case the same approach as for passenger cars would be used, i.e. the slope is modified according to the EU fleet wide target.
4.21Super credits for the 95g CO2/km target for cars (Article 5)—the proposal would keep this provision unchanged and apply it until 2022 inclusive.
4.22Pooling (Article 6)—the proposal would keep the provisions on pooling for connected undertakings and independent manufacturers unchanged. However, an empowerment would be added for the Commission to clarify the conditions for pooling arrangements between independent manufacturers, in particular with regard to competition rules.
4.23Monitoring and reporting (Article 7)—the proposal would keep the general provisions on the monitoring of CO2 data from Member States unchanged. However, a strengthening of the obligation on Member States to ensure high quality data and co-operate with the Commission would be added.
4.24A mechanism would be added to introduce a procedure for in-service conformity checks of the CO2 emission values in type approval legislation. Type approval authorities would report any deviations detected, and the Commission would take those into account when checking manufacturers’ compliance with their targets. The provision would include an empowerment for the Commission to provide the details for such a procedure by way of an implementing act.
4.25Excess emission premium (Article 8)—the proposal would set out the formula for calculating the financial penalties in case a manufacturer exceeds its target. The excess emission premium from the existing Regulations is maintained.
4.26Publication of performance of manufacturers (Article 9)—the proposal would list the data that the Commission will publish with regard to manufacturers’ annual target compliance (i.e. the annual monitoring decision). Test mass would be added as a data parameter to be published, in view of its use as utility parameter from 2025 onwards, as well as a vehicle’s electric range.
4.27Derogation for certain manufacturers (Article 10)—the proposal would keep unchanged the possibility for small volume manufacturers (i.e. those responsible for 1,000 to 10,000 registrations for cars, and 1,000 to 22,000 registrations for vans) to apply for a derogation from their specific emissions targets.
4.28For niche manufacturers of cars, i.e. those responsible for between 10,000 and 300,000 new registered vehicles, the possibility to benefit from a derogation from the 95g CO2/km target would also remain. However, with effect from 2025 this group of manufacturers would have to meet the specific emission targets calculated in accordance with Annex I.
4.29Eco-innovations (Article 11)—the proposal would provide for manufacturers to continue to benefit from lower average emissions by fitting their vehicles with eco-innovations. In order to take into account the changes in eco-innovation savings that may occur as a result of the change in the regulatory test procedure, an empowerment would be added for the Commission to adjust the 7g CO2/km cap set on the CO2 savings that a manufacturer may take into account for reducing its average emissions. This empowerment would apply from 2025 onwards.
4.30The eligibility criteria for being considered an eco-innovation would remain unchanged until 2024 inclusive. From 2025 the removal of the reference to the integrated approach measures would allow mobile air-conditioning equipment to be eligible as an eco-innovation.
4.31Real world CO2 emissions and energy consumption (Article 12)—the proposal would provide an empowerment for the Commission to monitor and assess the real world representativeness of the WLTP test procedure and to ensure that the public is informed of how that representativeness evolves over time. The Commission would have the power to request real world data to be collected and reported by Member States and manufacturers.
4.32Adjustments of M0 and TM0 (Article 13)—the proposal would distribute among manufacturers the CO2 reduction effort on the basis of the average mass of the vehicle fleet over a certain period. That reference value is expressed as M0 or TM0 depending on whether mass in running order (M) or the vehicle test mass (TM) is used. The proposal would clarify the process for adjusting the reference mass value to ensure that the specific emission targets continue to reflect the EU fleet wide target. With effect from 2025, the frequency of those adjustments would increase from every three years to every second year. A more frequent adjustment would allow changes in the average test mass and their effect on the positioning of manufacturers on the limit value curve to be taken into account earlier.
4.33Review and report (Article 14)—the proposal would include a requirement for the Commission to provide a report on the effectiveness of the Regulation, where appropriate accompanied by a further proposal. The report would need to be submitted in 2024 to align it with the review and reporting provisions proposed under the Effort Sharing Regulation and the Emissions Trading Directive. Provisions on the review of the type approval test procedure as well as the empowerments for taking into account changes in the regulatory test procedure would remain.
4.34Comitology and delegation of powers (Articles 15 and 16)—the proposal would include provisions on the committee procedure and the delegation of powers.
4.35Amendment to Regulation (EC) 715/2007 (Article 17)—the proposal would introduce a legal basis in Regulation (EC) 715/2008 (Euro 5/6 Emissions Type Approval Regulation) for the Commission to set up an in-service conformity procedure for verifying CO2 emission.
4.36Repeal and entry into force (Article 18 and 19)—the proposal would repeal Regulations (EC) No 443/2009 and (EU) No 510/2011 with effect from 1 January 2020. Entry into force would take place within 20 days of publication of the act.
4.37Annex I—this sets out the formulae for calculating the annual specific emissions targets that should be achieved by the average emissions of the manufacturers’ fleets of newly registered vehicles. Part A covers passenger cars, while Part B covers light commercial vehicles.
4.38Annex II and III—these set out the monitoring data parameters that are needed for the calculation of the targets and for checking target compliance. Annex III, covering light commercial vehicles, also makes reference to the need to consider the specificities of vehicles that are type approved in multiple stages.
4.39Annex IV—this lists the legal acts covered by the recast, i.e. the two basic Regulations (EC) No 443/2009 and (EU) No 510/2011 with their respective amending acts.
4.40Annex V—this provides the correlation table.
4.41Finally, the proposal is accompanied by an Impact Assessment on the proposal and an Executive Summary of the Impact Assessment.
4.42The Parliamentary Under-Secretary of State at the Department for Transport (Jesse Norman) informs us that the Government considers the proposal to be justified with regards to subsidiarity.
4.43The Explanatory Memorandum states that the Government welcomes and supports the Commission’s broad approach in the proposal. It welcomes the approach to continue monitoring tailpipe CO2 emissions and to set a minimum sales benchmark for new ultra low and zero emission cars in 2025 and 2030. It notes that the Government’s recent Clean Growth Strategy set out a pathway to meet the UK’s Carbon Budget 4 targets that suggested at least 30% of new car sales were expected to be ultra low emission vehicles by 2030 and that this matches the minimum benchmark put forward by the Commission in that year.
4.44The Government also welcomes the continuation of provisions for small volume manufacturers. The Explanatory Memorandum indicates the Government will consider the timeliness of removing the niche derogation for manufacturers registering between 10,000 and 300,000 as the small number of manufacturers that utilise it does not necessarily indicate its need.
4.45The Government argues that a continued focus is needed on strengthening the controls on vehicle CO2 emissions. It also considering whether there is a need to produce its own impact assessment.
4.46The Explanatory Memorandum notes that as the UK leaves the EU, the Government will pursue an approach that offers certainty to industry and is at least as ambitious as that of the EU. The Department for Transport will set out more detail on how this will be achieved in its strategy on the pathway to zero emission transport due in March 2018.
4.47Furthermore, a targeted consultation was launched in February 2018 in the wider context of improving air quality and safety for road vehicles.
4.48The Explanatory Memorandum notes that the Commission’s Impact Assessment concludes that the proposal will increase manufacturing costs and that this will affect vehicle price for consumers. Estimates range from €400 to €2,700 for cars and €400 to €2,400 for light commercial vehicles.
4.49Negotiations at working group level began on 4 December 2017. The Council of Ministers has yet to discuss the proposal. The European Parliament appointed a Rapporteur on 16 January 2018.
23 European Commission Proposal for a Regulation of the European Parliament and of the Council setting emission performance standards for new passenger cars and for new light commercial vehicles as part of the Union’s integrated approach to reduce CO2 emissions from light-duty vehicles and amending Regulation (EC) No 715/2007 (recast) ().
24 Explanatory Memorandum from the Minister, DfT, to the Chairman of the European Scrutiny Committee ()
Published: 27 March 2018