Yesterday the European Commission published a short Communication entitled “A European Strategy for Low-Emission Mobility”. For those familiar with the Europe’s developments in transport sector law and policy over the last few years (and in particular since the Transport White Paper in 2011) this strategy not only confirms previous direction and sentiment but provides a sense of added pace. The Strategy also suggests that Europe needs chiding for squandering its previous leadership. For those who are not so familiar, this Strategy neatly provides a short narrative of the transformation that Europe appears to be embarking upon. Added to this are the fascinating prospects of connectivity and automation which, together with the emissions agenda, could attract many diverse and disruptive players into the sector.
For those interested in the transport investment, infrastructure, energy, connectivity, manufacture, components, procurement, fleet renewal, logistics and insurance it would be prudent to consider the ramifications of this Strategy.
Below are some of the messages in the Strategy:
- Concentration will be in three broad areas: (1) greater efficiency in the transport system, (2) low-emission energy sources, and (3) low or zero emission vehicles.
- Initial focus will be on road transport because this subsector is responsible for the greatest proportion of greenhouse emissions, and air pollution, from the transport sector.
- The strategy recognises the conflict between the interests of incumbent transport players and low emission innovators.
- Actions to be taken at pan-European, Member State, regional and city level. The role of big cities will be very interesting.
- The EU Commission wants to see a swift and coordinated deployment of intelligent transport systems across Europe and the best use of digital technologies.
- Road transport pricing signals are to take account of externalities. Across the EU charging (including for passenger vehicles) should move towards distance-based road charging to reflect better the polluter pays and user pays principles, and the markets should be opened up to greater competition in the provision of tolling services. Generally interoperability and standardisation for cross border payments, electric charging, batteries etc. is to be promoted.
• The traditional internal combustion engine will still be needed but wide ranging policies will be considered to engage manufacturers and users to change to low or zero emission road vehicles. Fuel efficiency must increase and emissions decrease. More attention to be paid to trucks than previously was the case. Also attention to be given to domestic production of new generation electric battery cells and energy storage.
- A new road vehicle emissions testing regime to be introduced.
- Europe is to look at measures to reduce emissions from heavy duty road vehicles, it being felt that Europe is behind other parts of the world in this regard.
- The EU Commission is to looking at how best to provide strong incentives to innovate energy sources perhaps by setting targets for the alternative energy technologies (e.g. advanced bio-fuels, renewable electricity and synthetic fuels and perhaps natural gas for marine and trucks) or targets for reduction in greenhouse gas emissions. Food based biofuels to continue to fall out of favour.
- Public procurement of road vehicles is to be used as an instrument to promote change.
- Tax incentives are recognised as both barriers to change and instruments of change. Current incentives in favour of incumbent technology and fuels should be phased out in favour of incentives for low-emission vehicles and energy.
- In terms of research, innovation and competitiveness, there is an underlying message that Europe is endangering (and rather should enhance) leadership which it has or had in this area. The EU Commission boldly states “From now on resources should focus on innovative zero and low-emission options and their deployment” (at the expense of incumbent technologies and fuels).
- Member States to produce by November 2016 policy frameworks for roll out of publicly available electric recharging points and natural gas (optionally also hydrogen) filling stations.
- The EU Commission is looking into options to promote installation of electric charging points in public buildings.
- There is recognition that work needs to be done on the interface between the transport sector and the energy sector. Clearly it is intended that the transport sector will reduce its demand for fossil fuel. There will be increased demand for electricity which in turn may create additional pressure on the distribution networks and on decarbonisation of the power sector.
- Transport inter-modality to be promoted.
- The EU is to be fully committed to new international agreements on aviation and maritime emissions.
- To achieve the above there are a number of legislative and policy instruments intended over the short and medium term.
Various consultations in relation to the above will follow. Indeed yesterday two consultations in relation to the monitoring/reporting of emissions from heavy-duty vehicles and on the revision of the CO2 emission performance standards for light duty vehicles were launched alongside the Strategy. (A separate article on this will follow shortly).
Clearly changes will not occur over night and the EU Commission will require buy in from other EU institutions but nonetheless this is one more policy signal, in a consistent line of signals, which appears to suggest that law and policy thinking has shifted strongly in favour of innovators and disruptors.