The EU Commission and the German government have agreed on a compromise on how new cars with combustion engines can be registered after 2035 as long as they run on climate-neutral fuel. The original regulation on the phasing out of internal combustion engines is not to be touched again, and the exceptions will now be worked out by autumn of 2024.

Germany had suddenly opposed the already voted regulation on banning ICE cars in Europe. The liberal German transport minister (FDP) Volker Wissing wanted e-fuel-burning ICE cars to be considered as an exception and zero-emission too.

According to the German Federal Ministry of Transport, the agreement was reached late on Friday evening. “In very detailed and constructive negotiations, we have succeeded in securing the element of technological neutrality within the framework of the regulation on fleet limits,” Volker Wissing is quoted as saying in his ministry’s statement.

“This clears the way for vehicles with internal combustion engines that only use CO2-neutral fuels to be newly registered even after 2035. With this, an important point from the coalition agreement has also been implemented.”

The minister went on to say that, above all, “concrete procedural steps and a concrete timetable have been fixed in a binding manner”. For example, a vehicle category e-fuels-only must be created first and then integrated into the fleet limit regulation. “We want the process to be completed by autumn 2024,” said Wissing.

Loose ends

According to an EU Commission’s statement, the introduction of the new vehicle category is to be initiated “immediately” after the adoption of the long-negotiated but currently blocked law by the Commission. This should establish a “resilient and circumvention-proof” approval procedure for vehicles that are fueled exclusively with synthetic fuels.

It is not yet known what exactly this should look like. The EU Commission had already presented a draft in the past few days that proposed that these vehicles should have sensors that prevent them from driving with conventional fuels. “If they are refueled with conventional fuels, such vehicles should be able to detect this and prevent the car from starting,” press agency Reuters quoted from the draft. However, according to information from the news magazine Der Spiegel, Wissing rejected this.

There are two potential stumbling blocks for the further process: On the one hand, the criteria could be very strict to ensure that only green electricity is used for the production of synthetic fuels without fossil origins whatsoever.

On the other hand, there’s also a legal issue: the proposal is to be made via a so-called delegated act.  Such a delegated act can be blocked by both the EU Parliament and the Council of Member States. This would mean that implementation would no longer be guaranteed.

According to the German magazine Tagesschau, this is exactly what it could come down to: “There are already concerns in the European Parliament as to whether the Commission is even allowed to issue a delegated act for this purpose, whether it is exceeding its competencies here. It is, therefore, possible that the whole thing will be reviewed before the European Court of Justice.”

Absurd

The reactions of climate-concerned organizations are scathing. Julia Poliscanova, senior director for vehicles and emobility at Transport & Environment, said: “Europe needs to move forward and give clarity to its automotive industry, which is in a race with the US and China. E-fuels are an expensive and massively inefficient diversion from the transformation to electric facing Europe’s carmakers. For the sake of Europe’s climate credibility, the 2035 zero-emissions cars deal needs to enter law without any further delay.”

What is clear in many reactions is that it seems to be quite absurd to use e-fuels in cars for two major reasons. Apart from the fact that e-fuels are still under development, it’s already obvious that they will be and remain very expensive because of the way they have to be produced. Secondly, because of this complicated production process, their energy efficiency only reaches about 15%, whereas electric propulsion climbs easily above 70%.

Thirdly, even when they are produced CO2 neutral, in their combustion, e-fuels are still producing emissions like NOx and others, although the amount is seriously reduced compared to fossil-based fuels.

As it will still take a while to be able to produce a sufficient amount of e-fuel, one should consider which means of transport need them most. For many analysts, it’s obvious that airplanes come first here, followed by long-haul truck transport in certain continents.

Concerning cars, it would be far more intelligent to use an eventually increasing amount of e-fuels in the future to drive already-produced ICE cars instead of allowing new ones to be introduced. As there are approximately some 2 billion cars driving around on earth today, it’s obvious that they won’t be totally replaced by zero-emission vehicles before 2050 or later. Letting those older ICE cars burn e-fuels would also make a large contribution to climate neutrality.

Only for the rich?

It is clear that the liberal German transport minister Volker Wissing has been listening very carefully to the all-important German car lobby. The most frequent argument heard here is that the German car industry makes the best ICE engines in the world but will lose this advantage in an electrically driven world. The question can be asked if, in the long term, it’s that good for the German industry to cling to passed and outmoded solutions.

It’s clear that even not all CEOs in the car industry are thinking in the same direction. People like Audi CEO Markus Duesmann, Renault boss Luca de Meo, Volvo head Jim Rowan, and many others are clearly pleading for an energy transition as soon as possible. Others are more reticent. It’s surely not a coincidence that many of these are premium or high-luxury car brands, especially when they produce sporty vehicles.

Ferrari, Porsche, and Lamborghini, for example, are big advocates of e-fuels, with Porsche already having established a try-out production of e-fuels in Chile. Apparently, these brands are afraid to lose clients with cars that make no abundant noise (also a kind of pollution) anymore. Here, of course, the price of the e-fuels is less important.

Is it because those cars wouldn’t be as performant being electric? Surely not. A ‘common’ sedan like the latest version of Tesla’s Model S, the Plaid, will outperform almost any of these supercars in acceleration. There are already electric hypercars that can outperform them in all fields except one: noise. So, because Ferrari and Porsche owners still want to invade the environment with noise to show (off) their wealth, they want e-fuels. A very poor argument for a very expensive folly.