Fit for 55: T&E fears PHEVs will slow down EV sales
Lobbying organization Transport & Environment (T&E) is worried the EU Commission’s Fit for 55 plans to reach zero emissions by 2050 will gain momentum too slowly, and the rollout of electric cars will be curbed before 2030. They’d liked to see stricter targets by 2025 already.
Flexibilities and ‘loopholes’ in the regulation will allow carmakers, according to T&E, to slow down EV roll out and rely longer on hybrid solutions still using a combustion engine with plug-in hybrids (PHEVs). As the favorable credits system stays in place only another 2% of additional CO2 reduction is needed before 2025.
The question is whether a stricter 2025 timeframe would be realistic with the fierce discussions ahead to get the proposal through the Parliament and the Council of Europe, where all member states have to agree with it too.
Right now, says T&E in its latest briefing, “EVs have entered the mass market much faster than previously expected, reaching 10,5% of new sales last year, and leading to an unprecedented drop in CO2 emissions of new cars by 12%.”
As cheap as ICE cars
Analysis by Bloomberg New Energy Finance (BNEF), in a study T&E, commissioned with the research firm, show falling battery prices, and the development of optimized EV platforms will make full-electric sedans and SUVs from the C and D segments as cheap to produce as the versions with an internal combustion engine by 2025-2026. Small cars from the B-segment will follow no later than 2027. By then, Europe will be ‘hitting the EV inflection point’
That’s an idea that is supported to some extent in the car industry as well, as Audi CEO Markus Duesmann pointed out lately, saying, “In two to three years, our battery-electric cars will be just as profitable as the ones with combustion engines.”
But to get the proposed 55% CO2 reduction by 2030 (up from 37,5% previously), 67% of new cars sold should be zero-emission vehicles (ZEV) by then, T&E says. And that implicates these ZEVs (mostly battery-electric cars and vans) need to hit 22% in 2025 already and 37% in 2027. This would drive costs down to build EVs and lower prices for the end consumer too.
PHEVs part of the problem
But today, PHEVs are part of the problem and threaten to slow down battery-electric car development and sales, the NGO says. The problem with PHEVs is that they offer low CO2 emissions on paper, but in reality, they only come close to those figures if they can be driven electrical most of the time and only use their combustion engine sparsely.
It’s no secret that many early PHEV drivers – mostly large SUVs owned by companies- didn’t even bother to plug in their car and drove on gasoline all the time, earning them the label of ‘fake hybrids’. Recent studies showed in real life, those PHEVs often emit three to four times more than their official CO2 WLTP test results.
But the benefit for the carmakers is that the EU will award them favorable credits (0,37) for each car staying officially under 45 g CO2/km, due to the PHEV ZLEV credits system using a multiplier of 0,7 in the calculations of the total level of CO2 emission of all new cars sold by a manufacturer.
PHEV sales are still skyrocketing in Europe, with half a million sold last year alone. T&E calls upon the EU to restrict the multiplier to 0.1 from 2025 on, to force carmakers to bet on zero-emission vehicles more.
High real-world emissions
“PHEVs today have high real world emissions largely due to their poor design; small batteries, underpowered electric motors, and no fast charging, which make it hard for users to drive predominantly in zero-emission mode,” says T&E.
For T&E, making the credits system stricter would force carmakers to improve their PHEVs with electric motors matching the combustion engine’s performance, larger batteries offering at least 80 km of autonomy purely electric, and enabling fast-charging up to 50 kW to encourage the drivers to use it as intended.
No mercy for alternative fuels
Advanced fuel and synthetic fuels get no mercy from the environmental organizations as an intermediate solution. “The Commission was right to resist pressure from the oil and gas industry by not introducing a crediting system for advanced and synthetic fuels (e-fuels) in the new Regulation.”
“Policymakers must keep e-fuels out of the car (and van) CO2 standards, which would only serve to delay electrification in road transport, prolong the life of polluting engines, hit drivers in their pockets, and postpone the economy-wide decarbonization by diverting these fuels from where they are really needed (shipping, aviation, and heavy industry).”