Non-paper on Cars/Vans CO2 Regulation proposal: Additional assessment of higher
ambition levels for the targets and ZLEV benchmarks
Introduction
This non-paper complements the Impact Assessment accompanying the legislative proposal
setting CO2 standards for cars and vans post-2020. It analyses the impacts of additional
scenarios1 using the same methodological approach as in the Impact Assessment.
The assumptions made for the target levels and the incentive for zero- and low-emisison
vehicles (ZLEV) for cars and vans under the additional scenarios considered in this non-
paper are summarised in the table below.
Scenario
CO2 Targets
ZLEV Incentive2
2025
2030
Type
Mandate/Benchmark level
2025
2030
45%_40%ZLEV
20%
45%
Two-way
20%
40%
crediting system
50%_30%ZLEV
25%
50%
Two-way
15%
30%
crediting system
50%_50%ZLEV
25%
50%
Two-way
25%
50%
crediting system
75%3
45%
75%
ZEV Mandate
15%
-
Table 1: Targets and ZLEV incentives levels in the additional scenarios
Fleet composition
The table below provides the projected market shares of ZLEV in 2030 in the new cars fleet
under the different scenarios.
Projected market shares in 2030 in the new cars fleet
Plug-in hybrid
Battery Electric
Fuel Cell
Scenario
Total ZLEV
vehicles (PHEV)
Vehicles (BEV) vehicles (FCEV)
30%
11%
7%
2%
20%
40%
16%
10%
2.5%
29%
45%_40%ZLEV
22%
23%
5%
50%
50%
22%
13%
3%
38%
50%_30%ZLEV
13%
18%
5%
36%
50%_50%ZLEV
4%
43%
5%
52%
75%
29%
45%
9%
83%
Table 2: Projected market shares in 2030 in the new cars fleet
1 The non-paper presents the results of these additional scenarios together with the results of scenarios already
analysed in the Impact Assessment, i.e. Scenarios 30%, 40% and 50%
2 The definition and the accounting rule for ZLEV are as in the Commission proposal, except for scenario 75%
where a mandate is set for zero-emission vehicles only
3 Scenario 75% also assumes that the target is set at 0 g CO2/km starting from 2035
1
As illustrated in the table above, in the case of more ambitious targets and benchmark levels,
the shares of ZLEV in the 2030 new car fleet would increase drastically compared to 2017
(1% ZLEV). Higher benchmark levels lead to a shift towards more BEV at the expense of
PHEV in the case of the 50% benchmark with BEV reaching a 43% market share of new cars
in 2030, i.e. 6 times higher than in case of a 30% target without ZLEV benchmark.
As shown in the table below, the projected number of new ZLEV registrations in 2030
increases significantly under the different scenarios with respect to 2017, when around
96,000 BEV and 120,000 PHEV were newly registered4.
Projected number of newly registered ZLEV in 2030 (thousands of cars)
Fuel Cell
Plug-in hybrid
Battery Electric
Scenario
vehicles
Total ZLEV)
vehicles (PHEV)
Vehicles (BEV)
(FCEV)
30%
2,162
1,420
380
3,962
40%
3,157
1,962
514
5,633
45%_40%ZLEV
4,266
4,468
1,166
9,900
50%
4,440
2,607
671
7,718
50%_30%ZLEV
2,703
3,567
1,066
7,336
50%_50%ZLEV
677
8,287
1,046
10,010
75%
5,836
8,930
1,762
16,528
Table 3: Projected number of newly registered ZLEV in 2030
As shown in the table below, the projected absolute number of ZLEV in the
total car stock in 2030 also represents a significant increase with respect to 2017 (around 300,000 BEV and
370,000 PHEV5). The projected number of ZLEV ranges between around 30 million vehicles
in circulation under a 30% scenario up to nearly 100 million vehicles under the most
ambitious scenario.
Projected number of ZLEV in the stock of cars in 2030 (thousands of cars)
Fuel Cell
Total Zero and
Plug-in hybrid
Battery Electric
Scenario
vehicles
Low Emission
vehicles (PHEV)
Vehicles (BEV)
(FCEV)
Vehicles (ZLEV)
30%
16,494
9,780
2,762
29,036
40%
21,331
12,256
3,607
37,194
45%_40%ZLEV
35,906
27,086
7,838
70,830
50%
27,584
15,394
4,615
47,593
50%_30%ZLEV
29,008
23,481
7,811
60,300
50%_50%ZLEV
10,768
49,499
8,040
68,307
75%
61,035
27,158
7,840
96,033
Table 4: Projected number of ZLEV in the stock of cars in 2030
4 Source: European Alternative Fuels Observatory (EAFO) :
http://www.eafo.eu/eu#summary_anchor
5 Idem
2
Recharging and refuelling infrastructure
The number of ZLEVs on the market will inevitaby influence the speed of deployment of
charging stations, which ultimatively have to be deployed anyway to decarbonise the
transport sector. Assuming that one public charging point is necessary per 10 electric cars
(BEV and PHEV), the number of public charging points required in 2030 would range
between 2.6 million under the 30% scenario and 8.8 million for the most ambitious scenario.
This represents an increase by a factor 20 to 75 compared to the 120,000 publically available
charging points currently available in the EU6 .
This estimate does not capture further developments in battery capacity and recharging speed,
nor scale effects as it assumes a constant ratio between the number of cars and the
corresponding number of public charging points required. Both battery capacity and
recharging speeds will reduce the number of necessary charging points. Nevertheless, it gives
an indication of the additional effort needed with respect to the current situation.
The abovementioned figures do not include the necessary hydrogen refilling stations. These
will require a substantial increase of the currently available stations to be able to cover the
needs of the projected 2.8 million fuel cell vehicles under a 30% scenario and 8 million
vehicles under the most ambitious scenario. Today only few hydrogen refilling stations exist
in the EU7.
Projected number of EV and number of public electric charging points
in 2030 (thousands)
Battery
Plug-in hybrid
Number of public
Electric
Total PHEV
Scenario
vehicles
charging points
Vehicles
+ BEV
(PHEV)
(thousands)
(BEV)
30%
16,494
9,780
26,274
2,627
40%
21,331
12,256
33,587
3,359
45%_40%ZLEV
35,906
27,086
62,992
6,299
50%
27,584
15,394
42,978
4,298
50%_30%ZLEV
29,008
23,481
52,489
5,249
50%_50%ZLEV
10,768
49,499
60,267
6,027
75%
61,035
27,158
88,193
8,819
Table 5: 2030 Projected number of EV and number of public electric charging points
The investments required for developing the necessary recharging and refuelling
infrastructure (electricity and hydrogen), both private and public charging points, are
estimated in the table below for the different scenarios. They are expressed as cumulative
annualised costs over the period 2020-2040.8
6
http://www.eafo.eu/electric-vehicle-charging-infrastructure
7
See http://www.eafo.eu/infrastructure-statistics/hydrogen-filling-stations - The data are currently under review
and will be updated soon
8 The calculations for BEV and PHEV are based on the assumption of 1 private charging point for each vehicle,
and 0.1 public charging points for each vehicle; actual ratios are likely to differ depending on the type of
charging (slow or fast), developments in battery and charging technology, and scale effects . For hydrogen
refuelling, country specific utilisation rates are assumed (cars serviced per filling stations), which progressively
3
Recharging/refuelling infrastructure investments - cumulative annualised costs
2020-2040 (million euro)
Scenario
Total cost
Difference compared to
the baseline
Baseline
50,329
0
30%
81,479
31,150
40%
102,534
52,205
45%_40%ZLEV
162,890
112,561
50%
130,100
79,771
50%_30%ZLEV
142,219
91,890
50%_50%ZLEV
161,918
111,589
75%
241,613
191,284
Table 6: Investment costs in recharging/refuelling infrastructure
Economic impacts
Following the same methodological approach as in the Impact Assessment, the direct
economic impacts have been assessed by considering the net changes (i.e. changes compared
to the baseline) in capital costs, fuel costs, and operating and maintenance (O&M) costs for
an "average" new car9, registered in 2030.
For the analysis of the economic impacts, as in the Impact Assessment, the following
indicators were used10:
Net economic savings over the vehicle lifetime from a societal perspective
This parameter reflects the change in costs over the lifetime of 15 years of an
"average" new vehicle without considering taxes and using a discount rate of 4%.
Net economic savings from a consumer perspective
This parameter reflects the change in costs over the lifetime of 15 years of an
"average" new vehicle. In this case, given the end-user perspective, taxes are included
and a discount rate of 11% is used.
From a societal perspective, a 30% target and to a lesser extent a 40% target, lead to net
economic savings for a new 2030 average car. Higher ambition levels lead to net economic
costs.
increase to conventional petrol filling stations utilisation/service ratios. Cost assumptions are based on the
ASSET project:
https://ec.europa.eu/energy/sites/ener/files/documents/2018_06_27_technology_pathways_-
_finalreportmain2.pdf
Both in the baseline and other scenarios, the investment costs for the electricity recharging and hydrogen
refueling infrastructure are calculated in the analysis as annuity payments for capital, with a discount rate of 8%.
The cumulative costs in the period 2020-2040 are therefore presented, to capture the impact of the 2030
investments.
9 An "average" new vehicle of a given year is defined by averaging the contributions of the different segments of
small, medium, large vehicles and powertrains by weighting them according to their market penetration as
projected. For more information, see Commission Staff Working Document SWD(2017) 650 final
10 For more information, see Commission Staff Working Document SWD(2017) 650 final
4
This effect is explained by the significant increase of the additional upfront costs for an
“average new car” under the more ambitious scenarios assuming that consumer preference
remain identical.
The analysis shows that the economic impacts depend on the combination of the target and
the ZLEV benchmark levels, which drives the composition of the fleet of new vehicles in
terms of powertrains and segments. Of course the decision of buying a car is not rational and
heavily influenced by the marketing strategy of OEMs. High ZLEV benchmark levels for a
given target may lead to an increase in the net economic costs, both from a societal and
consumer perspective. This is particularly evident in the scenario 45%_40%ZLEV
50%_50%ZLEV, where an increased share of PHEV and of larger conventional vehicles
may be observed, with negative impacts on the net savings. With the increased penetration of
ZLEV driven by the high benchmark level, less effort will be needed in improving the
efficiency of the conventional vehicles to meet the proposed fleet-wide CO2 target. This
Formatted: Subscript
results in a projected shift towards larger segments for conventional vehicles leading to an
increase in the costs.
Net economic savings (+) or net economic costs (-) per new 2030 average car
Scenario
Societal perspective
Consumer perspective
30%
+800 €
+1,400 €
40%
+560 €
+1,000 €
45%_40%ZLEV
-1,450 €
- 1,050 €
50%
-2 €
+390 €
50%_30%ZLEV
- 40 €
+400 €
50%_50%ZLEV
-800 €
-200 €
75%
-1,200 €
-430 €
Table 7: Net economic savings or net economic costs per new 2030 average car
Furthermore, the net economic costs of the 45%_40%ZLEV scenario are projected to be
Formatted: Not Highlight
higher compared to the scenario 50%_50%ZLEV as a higher PHEV share is projected in
Formatted: Not Highlight
comparison with BEV, leading to relatively lower fuel savings. This higher share of PHEV is
observed in particular in the smaller segments of the market leading to higher manufacturing
costs compared to other powertrains in the same segment.
Formatted: Not Highlight
The net economic costs of the 45%_40%ZLEV scenario are also projected to be higher
Formatted: Not Highlight
compared to the 75% scenario as the increase in manufacturing costs is higher in the 75%
scenario but the increase in fuel savings is even higher.
Employment impacts
The same modelling approach as for the Impact Assessment has been used to analyse the
employment impacts of the additional scenarios. From a macro-economic perspective, target
levels incentivising ZLEV lead to small positive impacts in terms of overall employment.
Increased consumer expenditure, increased investment in infrastructure, reduction of oil
imports, and expansion in the battery sector in the EU are all positive drivers for total jobs
creation. Reduction of air pollution and related economic benefits of lower loss of GDP due
to health and lost working days is not factored in this calculation.
5
The projected increase in overall EU-28 employment in 2030, compared to a 'business as
usual' scenario, is shown in the table below. This takes account of the targets set for both cars
and vans. For each scenario, results are presented for two variants: (1) assuming that batteries
for electric vehicles are imported from outside of the EU, and (2) assuming that they are
produced in the EU. The change in employment does not only include direct effects, but also
second-order effects in sectors of the economy benefitting from increased consumer
expenditures for goods and services with a high domestic content due to consumers’ savings
from lower fuel bills. None of the analysed scenarios include the risk of the so-called Kodak
moment, i.e. when consumers opt for a new product from outside the EU.
Total EU employment in 2030 (compared to baseline)
Scenario
batteries imported
batteries produced in EU
Baseline (thousands)
230,207
230,233
Percentage
Additional
Percentage
Additional
additional
number of jobs
additional
number of jobs
jobs
(thousands)
jobs
(thousands)
30%
0.02%
46
0.03%
69
40%
0.03%
69
0.04%
92
45%_40%ZLEV
0.02%
47
0.07%
151
50%
0.02%
51
0.04%
101
50%_30%ZLEV
0.02%
56
0.06%
145
50%_50%ZLEV
0.01%
20
0.07%
154
75%
0.03%
69
0.1%
221
Table 8: Total EU employment in 2030
The transition towards zero-emission mobility also leads to differences between individual
sectors. The overall employment increases up to 69,000 and 221,000 in the 75% target
scenario (in the variants assuming batteries are imported and batteries are produced in the EU
respectively) in 2030 compared to the baseline. To the contrary, existing jobs (related to
combustion engine) risk being lost in the automotive sector if the transition is too fast, as
illustrated in the table below.
Job losses in the automotive sector in 2030 (compared to baseline)
Absolute number of jobs
Scenario
Percentage
(thousands)
30%
-2
-0.1%
40%
-12
-0.5%
45%_40%ZLEV
-59
-2.4%
50%
-26
-1%
50%_30%ZLEV
-46
-2%
6
50%_50%ZLEV
-85
-3.5%
75%
-92
-3.7%
Table 9: Employment in 2030 in the automotive sector in the EU
The table above shows the projected job losses in the automotive sector in 2030, compared to
a ‘business as usual’ scenario11. The projections assume that between the baseline and the
different scenarios there is no further automation of production, no loss of market shares to
new EV models from 3rd countries. With these assumptions a 30% target leads to a gradual
transition to ZLEV with a nearly stable number of jobs in the automotive sector because a
high number of plug-in hybrids continues to be produced in the existing factories and the
share of pure battery electric cars stays below a 10% market share in 2030. In the scenarios
with higher targets leading to a rapid increase of BEV market penetration, job losses are
observed for the automotive sector.
Greenhouse gas emissions
The figure below shows the projected CO2 emissions in road transport under the different
scenarios. Scenarios with a stricter target level yield more emission reductions.
Under the baseline, greenhouse gas emissions in road transport reduce by around 17%
between 2005 and 2030. Under the EUCO3012 scenario, emissions from road transport are
projected to reduce by 25% in 2030 with respect to 2005, as a result of the implementation of
a full set of additional policies with respect to the baseline.
A 30% target, as proposed by the Commission, is projected to lead to a reduction of 21-22%.
The reduction levels increase up to around 26-27% for a 50% target, and up to 35% for a
75% target.
11 The projections assume that between the baseline and the different scenarios there is no further automation of
production, no loss of market shares to new EV models from 3rd countries .
12 The EUCO30 scenario underpinned the analytical work carried out to support the Effort Sharing Regulation
Proposal.
7
Figure 1: CO2 projections in road transport
Air pollutant emissions
Due to the change in fleet composition under the different scenarios, also the emissions of air
pollutants are affected. With a 30% target, the NOx emissions from road transport in 2030 are
projected to be 40% lower than in 2020. With increasing targets and benchmark levels, the
reduction is higher, ranging from 42% to 52%. Concerning PM2,5, a 30% target leads to a
32% emission reduction in 2030 compared to 2020. With increasing targets and benchmark
levels, the reduction goes up to, ranging from 36% to 53%.
Battery market
As illustrated in the table below, the post-2020 CO2 standards for cars and vans are of key
importance in determining the pace of EV battery demand growth in the EU, as this depends
on the market uptake of electric and plug-in hybrid vehicles.
Scenario
EU minimum EV battery demand
in 2025
(GWh/year)
30%
66
40%
100
50%
130
Battery cell production can be located close to end markets as car manufacturers have just-in-
time supply chains and prefer suppliers close to their factories.By supporting industry-led
projects to build an innovative, sustainable and competitive battery value chain in Europe, the
EU Battery Alliance is facilitating key investments in battery cells, and ensures Europe
remains a global centre for automotive manufacturing.
8
A key risk is the potential dependency on production of batteries outside Europe, and
possibly issues related to security of battery supply and costs. Key raw materials like Cobalt
or Graphite are e.g.currently concentrated in a few countries outside Europe.
Within this context, recovery and recycling of raw materials becomes important and offers
new business opportunities.13 Already today, more recycling of end-of-life batteries in
consumer electronics could provide substantrial amounts of secondary raw materials for new
batteries.
However, given the recent introduction of EVs on the European market, and taking into
account the average lifetime of EV components, a significant number of EVs have not yet
reached end-of-life.
Under current circumstances, the EU recycling infra-structure targeting EV batteries should
still be adapted to the expected increase of EV battery flows and to recover specific materials.
Large-scale recycling of EV batteries is not expected before 2020 and should only be more
effective beyond 2025.
Further research and development is also required to address technological and economic
challenges related to the more efficient use, recovery and recycling of EV batteries.
As part of its
strategic action plan for batteries14, the Commission has therefore adopted a set
of concrete measures with sustainability requirements and circularity at its core - ranging
from research and innovation, to raw materials policy, sustainable processing and production,
second use and recycling.
Sensitivity – higher battery costs
To take into account the risk that higher battery material prices would counter projected cost
reductions in batteries associated with economies of scale, a sensitivity analysis was
conducted on one scenario, assuming no reduction of battery prices would occur with respect
to the baseline. In this case, higher net economic costs are observed for an average car, both
from a societal and consumer perspective, as presented in the table below.
Net economic savings per new 2030 average car (EUR)
Scenario
Societal perspective
Consumer perspective
50%_50%ZLEV
-800 €
-200 €
50%_50%ZLEV (high battery costs)
-2250 €
-1950 €
14 COM(2018) 293 final
9