The automotive industry will be eligible for carbon credits if it invests in new technologies aimed at reducing CO2 emissions from new cars. The European Commission adopted a regulation to this effect, on 25 July, with the aim of giving the European automotive industry an incentive to invest more in eco-innovation.

The new regulation enables automobile manufacturers to receive CO2 emissions credits if they fit new cars with approved «eco-innovations» that reduce emissions. The credits allocated will help the industry meet the European target of limiting CO2 emissions from new cars to an average of 130 g CO2/km by 2015. Eco-innovations should count for up to 7 g CO2/km towards the target.

Under the proposed regulation, a technology can be considered an eco-innovation if it is new to the market, contributes to significant CO2 savings and is not otherwise taken into account in determining the level of CO2 emissions from vehicles. The technology should also aim to improve vehicle propulsion or the energy consumption of mandatory equipment, without compromising vehicle safety. This means, for example, that solar panels converting sunlight into electric energy could potentially qualify as an eco-innovation but that an energy-efficient in-car music system would not.

The Commission will assess applications submitted by car manufacturers and component suppliers and adopt decisions approving the eligible technologies. Real CO2 savings for each car will be certified as part of the vehicle type-approval procedure. The Commission will draw up detailed technical directives on how companies should prepare applications to have their eco-innovations recognised.

Background

Regulation (EC) 443/2009 establishes performance standards for CO2 emissions from new passenger cars. It requires a reduction by 2015 to 130 g/km in CO2 emissions for all new passenger cars registered in the EU, ie around one fifth below 2007 levels. The target will be phased in: 65% of each manufacturer’s newly registered vehicles must comply in 2012, 75% in 2013, 80% in 2014 and 100% by 2015. From 2012, manufacturers whose fleet average exceeds the limit will have to pay a penalty for each car registered. The penalty will also be progressive, but will amount to €95/g of excess CO2 in 2019.