THE ENERGY INDUSTRY TIMES - MAY 2018
Industry Perspective 13
A strategic approach to
decarbonising transport
The decarbonisation of European
transport is a growing challenge
for the EU. Today, transport
is responsible for about a quarter
of EU greenhouse gas emissions and
is almost exclusively dependent on
oil products for fuel. It is also the
only major sector in the EU in which
GHG emissions are still rising (+16
per cent since 1990) with cars and
vans accounting for around 75 per
cent of EU transport emissions. Reversing
this trend and creating a sustainable
transport sector is mandatory
if Europe is to meet its commit-
ment to the Paris Agreement.
Meanwhile, the European electricity
sector has committed to becoming
carbon-neutral well before 2050 in its
new vision statement, calling for decarbonisation
at an accelerated pace.
The transformation of the power sector
is in full swing, making electricity
an increasingly attractive option as an
energy carrier in transport. To achieve
the needed emission cuts in transport
and allow the EU to meet its Paris
Agreement commitments, the electrification
of road transport will have to
play a crucial role.
With sales of electric vehicles
(EVs) increasing, battery costs falling
sharply (-80 per cent 2010-2016),
Europe holds the key to entering the
era of electro-mobility. The first three
quarters of 2017 saw around 40 per
cent more plug-in vehicles sold
across Europe compared to the same
period in 2016.
But while transport emissions are
on the rise, the EU’s regulatory master
plan to drive and lead the global
shift to electric transport is still being
discussed. What is needed now is
concrete and ambitious action from
European policymakers to speed up
the development and roll-out of zero
emission vehicles including electric
mobility; otherwise Europe will miss
its commitments made under the
Paris Agreement, as well as its global
competitiveness in a key sector of
our economy.
In recent months, several countries
joined a growing movement to force
the phase-out of vehicles that run on
fossil fuels. France and the UK announced
plans to ban new diesel and
petrol cars by 2040; Norway confirmed
its plan to phase them out by
2025, and the Netherlands by 2030.
Meanwhile China, the world’s largest
car market, announced ambitious
sales targets as of 2019, having introduced
a 10 per cent mandatory sales
quota of low- and zero-emission vehicles
for 2019, rising to 12 per cent
in 2020.
This movement has triggered an
avalanche of announcements from
car companies about their intention
to produce more EVs. The number
of models is expected to grow rapidly:
Volkswagen Group announced 80
new electric models by 2025; BMW
will boast 12 different EVs by 2025;
and new models launched by Volvo
from 2018 onwards will be partially
or completely battery-powered.
Considering that EVs are getting
ready for mass deployment, policymakers
and industry players must
ensure that these technologies live up
to their potential.
These industry announcements are
to a large extent driven by vehicle
manufacturers realising that the
world is going electric. In the marketing
and commercial battle ahead,
being a technology driver will be a
must in order to not lag behind international
development.
However, the regulatory frameworks
will play a crucial role in this
transition. With the Chinese electric
vehicle sales quota, and a similar
system promoting low and zeroemission
vehicles in California, important
regions of the world are
pushing manufacturers to deliver
specific numbers of clean vehicles.
Meanwhile in Europe, in November
last year the European Commission
published its proposals for emission
standards proposals for new cars
and vans until 2030. These targets
suggest a 30 per cent emission reduction
compared to 2021 levels. Unfortunately,
they fail to include a mandate
for the sale of low- and
zero-emission cars, which has proven
very effective in other markets. If
adopted, the Commission’s plans
will certainly bring more electric vehicles
onto European roads, but the
lack of ambition would mean that
Europe will continue to lag behind
other markets such as China.
Equally important, the proposals
lack the ambition required to reduce
the European transport sector’s emissions
by 60 per cent in 2050 compared
to 1990 levels. This is a serious
problem, as any solution to limit
global warming to 2°C above pre-industrial
levels, requires sharp emission
reductions in the transport sector.
With clean technologies for
aviation and maritime transport only
emerging slowly and being relatively
expensive, road transport will have
to deliver the major part of these
emission reductions, at least in the
short to medium term.
For many EU Member States, the
low level of ambition in the European
Commission’s proposal might
prove to be a serious problem. The
emission reductions from cars and
vans constitute an important contribution
to their national Effort Sharing
Regulation targets.
These national targets legally
oblige Member States to reduce
emissions from those sectors not
falling under the EU’s Emissions
Trading Scheme, the EU ETS, (including
transport, agriculture and
building sectors). Under the current
Effort Sharing commitment Spain,
for example, has set itself a target of
10 per cent GH reduction until 2020.
Road transport has significant potential
to reduce emissions, usually
at lower costs than other sectors like
agriculture and buildings. Having
vehicle manufacturers produce less
emitting vehicles is also one of the
cheapest options for Member States
to reach their emission reduction
goals.
Although CO2 standards for cars
are crucial, they are not the only relevant
legislation for the electrification
of transport. The Renewable Energy
Directive, currently also under
legislative review, proposes to oblige
fuel suppliers (including electricity
suppliers) in the transport sector to
deliver a certain share of renewable
fuels in their fuel mix. Until now,
this target was put on Member
States, with poor results. Most Member
States will not reach their target
of 10 per cent renewables in transport,
and those who will achieve it
will do so almost exclusively with
the help of first generation biofuels.
Such biofuel is produced directly
from food crops and thus stands in
direct competition to edible crops.
While biofuel can certainly bring
part of the solution going forward,
electricity holds a much larger potential
to scale up clean mobility.
A fuel suppliers’ obligation or target,
combined with a flexible trading
system where under-achievers have
to buy credits from over-achievers,
would deliver emission savings in
transport fuels at the lowest cost possible.
The share of electricity from
renewable energy sources in Europe
is already at 30 per cent today, and
electricity is to play a key role in
greening Europe’s transport fuels.
Eurelectric, the European electricity
association, has repeatedly called
on the European Commission to
propose ambitious emission reduction
objectives for all road transport
segments for 2030, having in mind
the deep decarbonisation required of
light road transport by 2050 at the
latest. The sector has also called for
the introduction of mandating sales
quotas on vehicle manufacturers in
order to ensure that a proportion of
their car sales stems from zero-emission
vehicles.
The electricity sector has come a
long way in its transformation towards
low carbon generation. In
2016, 59 per cent of all the EU’s
electricity was generated from carbon
free sources and this share continues
to increase every year. The
European power industry also announced
in 2017 that it would not invest
in new-build coal fired power
plants after 2020.
Allowing EV batteries to load and
store sustainable electricity will in
addition allow a higher share of renewables
to be utilised. This socalled
“smart charging” can be done
with existing technology, and in fact,
many EV charging point manufacturers
offer smart charging points.
This allows electro-mobility service
providers to offer customer contracts
that ensure that charging is done
when renewable sources generate
and electricity prices are low.
Finally, clean mobility is an opportunity
for the European Union
and its industry to send a bold and
clear signal of its commitment to
the Paris Agreement. With electricity
set to be decarbonised well-before
2050, the sector will be a key
enabler to accelerate the decarbonisation
of the transport sector. However,
the EU needs to present a serious
work plan on EV deployment,
for consumers and investors to be
confident to step into the new age of
sustainable transport.
Henning Häder is Manager of Energy
Policy, Climate and Sustainability,
Eurelectric.
Decarbonising
transport is essential
if the EU is to meet
its climate change
targets. Eurelectric
argues that the
electricity sector
has a crucial role to
play in these efforts.
Henning Häder
Häder: concrete and ambitious action is needed from European
policymakers to speed up the development and roll-out of zero
emission vehicles including electric mobility