News from the EC Clean Power for Transport

CIVITAS Initiative

On 24 January 2013, the European Commission adopted the Clean Power for Transport Package. It is composed of a European alternative fuels Strategy, a proposal for a Directive on the deployment of alternative fuels infrastructure and an Action Plan for the development of LNG in shipping.

Policy initiatives so far have mostly addressed the actual alternative fuels and vehicles. We are however not witnessing a sufficient market up-take and also need to consider fuels distribution. Alternative fuels are being held back by three main barriers: the high cost of vehicles, a low level of consumer acceptance, and the lack of recharging and refuelling stations. It is a vicious circle. Refuelling stations are not built be-cause there are not enough vehicles. Vehicles are not sold at competitive prices because there is not enough demand. Consumers do not buy the vehicles because they are expensive and the stations are not there. In the Directive on the deployment of alternative fuels infrastructure, the Commission has therefore proposed binding targets on Member States for a minimum coverage of recharging and refuelling infrastructure for electricity, hydrogen and natural gas (CNG and LNG), as well as common EU standards for the related equipment. It has also proposed mini-mum consumer information on the vehicle, in the vehicle manual and at the pump, about the compati-bility between the vehicle and the fuels. The development of alternative fuels is of particular relevance to cities where the negative impacts of fossil fuels are concentrated: greenhouse gas emis-sions, poor air quality and high noise levels. Alterna-tive fuels are not the only solution to those issues and attention must also be paid to sustainable urban mobility planning with the development of public transport, the environmental-efficiency of urban freight logistics, etc. But alternative fuelled vehicles are definitely part of the integrated mix of solutions and CIVITAS measures have precisely made this link between innovative technologies and ambitious pol-icy measures. The legislative proposal is currently under discussion at the European Parliament and at the Council. It is important to mobilise national authorities now to support its swift adoption. The main concerns that have been expressed around the legislative proposal are related to the mandatory targets, the costs and the timing. Binding targets would allow for EU-wide mobility of such vehicles, enhance economies of scale and avoid fragmentation of the market for alternative fu-els. Binding targets are a critical signal for invest-ments. The targets for electric vehicles stated in the proposal are based on a formula that takes into account both the projections of number of electric vehicles by Member States with targets in comparison to the total car fleet and the urbanisation rate. The targets are conservative in order to ensure minimum infrastructure coverage and Member States would have the flexibility to develop policy frameworks for the market development of alternative fuels in their national context. The investment needed for the deployment of the alternative fuels infrastructure has to be weighted with the potential benefits it will bring for the Euro-pean economy. Indeed, there is a huge market opportunity for the European car and equipment manufacturers, which figure among the world leaders, as well as for the energy distribution and service providers sectors. As a pro-growth initiative, the proposal relies primarily on private investments. Public-private partnerships are already being developed in a number of cities. The establishment of appropriate alternative fuel infrastructures and the consequent development of the market for the relevant vehicles would serve to promote economic growth and job creation in the Union, as well as reduce the EU's oil import bill which currently represents up to 1 billion euro a day, lead-ing to a significant deficit in the EU trade balance of around 2.5% of GDP. The EU has set itself ambitious targets for 2020 for the reduction of greenhouse gas emissions and of its dependence on oil through diversification. The 2011 Transport White Paper has set the goals of phasing out conventionally fuelled cars from cities and achiev-ing C02-free city logistics. The Union also has an ambitious air quality policy. The timing proposed is reasonable and we should not wait to address the situation. This is major opportunity for Europe to establish a strong position in a fast growing global market. Further information: ec.europa.eu/transport/themes/urban/cpt/index_en.htm.

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