Oettinger tells Volkswagen he relaxed new CO2 targets

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EU Energy Commissioner Günther Oettinger has written to Volkswagen CEO Martin Winterkorn, reassuring him that proposed EU regulations to cut vehicle CO2 emissions will not harm the German automobile giant because of relaxed rules for "supercredits". EurActiv reveals the content of the leaked letter.

In the missive, obtained by EurActiv, Oettinger spelled out that proposed new limits on car CO2 emissions had been loosened before the Commission's proposal was presented in July.

The Commission proposals, he continued, “reflected not insignificant changes compared with the initial plan”, in what will be seen as an attempt to assuage industry fears that the regulations would hit jobs and competitiveness in Europe.

The draft new rules set a limit of 95 grams of CO2 per km (g/km) for all new European cars from 2020. A standard of 130g/km has already been set for 2015. 

But under the Commission proposal, carmakers will be allowed to continue producing gas-guzzling cars by making use of “super-credits” earned from manufacturing electric vehicles.

The base comparison year for emissions had also been set as 2009 and not 2006, so that less reductions would be needed.

Oettinger told Winterkorn that “the discussion about our CO2 policy for cars after 2020 will be completely open”.

In an annex to the proposals, he expressed  satisfaction that there was “no indication, let alone obligation, to come forward with new binding targets” by 2014 for the post-2020 period.

Asked Thursday about the existence of the letter, Oettinger's spokeswoman Marlene Holzner told AFP news agency that there was nothing unusual in it.

But Franziska Achterberg, an EU transport policy adviser at Greenpeace Europe, told EurActiv that loosening of the supercredits regulation would "significantly weaken the target" for 2020 carbon emission reductions.

Regulations good for employment

Meanwhile the Dutch environmental consultancy CE Delft released a literature review yesterday (11 October) saying industry was “likely” to benefit from the proposals, even without the freedom of supercredits.

The paper, published by green pressure group Transport & Environment (T&E), claimed that industry could sleep sound as studies showed that auto fuel efficiency increases for internal combustion engines could spur direct employment in the car industry.

This, it said, would be “due to the application of additional or more expensive components and through an increase in domestic and foreign demand”.

The report also said there could be indirect benefits to investing in greener cars such as the money saved through lower levels of fuel consumption, offsetting the higher price of hybrids and electric cars.

A carbon target of 95g/km, CE Delft said, would mean savings of over €500 per person each year.

“The switch to fuel efficient cars and advanced powertrains can be done in such a way that the total costs of car owner-ship (purchase costs and mileage costs) are reduced”, CE Delft said, adding that this would induce a rise in consumer spending in other sectors of the economy.

The findings were in keeping with a European Commission impact assessment which accompanied the recent proposals.

In light of the review, Greg Archer, a clean vehicles specialist at T&E, urged the European Parliament and Council to improve on the Commission proposal before adopting it “by setting more ambitious targets and closing loopholes”.

'Uncertainties'

But the CE Delft report conceded employment could fall in areas related to traditional car manufacturing, such as refining and fuel distribution.

Any gains would be dependent on the competitiveness of the EU car industry, which T&E said could benefit from tapping into the demand for advanced, emissions-saving technology.

Shifting consumer preferences - as well as changes to oil price, carbon credit restraints and the response of foreign competitors - would either strengthen or weaken this impact.

CE Delft said a switch to electric vehicles was likely to reduce direct employment in some areas due to the “lower labour-intensity of the manufacturing process as compared to traditional manufacturing”.

A need for new, more capital-intensive plants and battery imports could have a negative impact on employment, but this would likely be outweighed by fuel efficiency gains, the report said.

Despite its wide range of sources, the consultancy said its review had been “hampered by the fact that none of the 23 studies has taken a traditional economic analytical perspective”.

Therefore, it said the current literature should be regarded as “partial, fragmented and rather weak in its economic argumentation”, adding that “uncertainties” surrounded some of the results.

The European Automobile Manufacturers’ Association told EurActiv it had not seen the report yet but did not believe there was a direct link between increased fuel-efficiency and employment.

A recent case study by the Organisation for Economic Co-operation and Development said investment in renewable energy was an "important source of growth and jobs for many rural regions".

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