Tax breaks and incentives make Europeans buy cleaner cars while trucks and buses are expected to cause increased emissions

Taxes, subsidies and other incentives to purchase low or zero emission vehicles have contributed to a drop of carbon dioxide emissions from new passenger cars. Recent data published by the European Environment Agency showcase that its member countries (EU Member States plus Iceland, Liechtenstein, Norway and Switzerland) increasingly adopt strategies to promote the purchase of cleaner vehicles.

The study includes case studies from seven countries exploring the different approaches used for taxation and incentives: France, Germany, Greece, Ireland, the Netherlands, Norway and Poland. It found that consumers are more ready to buy low emitting cars with larger and targeted taxes and incentives in place. Leading among the EEA Member Countries is Norway, where the average CO2 emissions of new cars has already passed the EU target for 2021 of 95 g CO2/km; in Norway, new cars sold in 2016 had an average of 93 g CO2/km. This reflects that the highest number of incentives promoting electric vehicles are in place in Norway.

The main obstacles for electric car purchase remains the supply of charging facilities. These are however needed to reassure potential purchasers, who are concerned about the range limitations of battery powered cars. The EEA study states, in this respect, that only 11 of its 32 member countries had specific incentives in place to increase charging facilities. Large efforts still need to be taken to comply with the objective of 95 g CO2/km EU-wide. While between 2001 and 2016, a decline of 30% was achieved, a further drop of 20 % is necessary to comply with the target.

The main challenge to reducing CO2 emissions from road transport are emissions from trucks and buses, so-called heavy-duty vehicles. This category of vehicles includes all vehicles used for goods transportation above 3,5 to and all buses and coaches used for passenger transportation with more than 8 seats. About a fourth of all transport related emissions come from these vehicles. The emission of CO2 from these vehicles are estimated to increase by 10% between 2010 to 2030, which would be a continuation of the increase in emissions between 1990 to today of 25%. This forecasted increase clearly points out the necessity for actions to mitigate the emissions from heavy-duty vehicles. Unlike for new passenger cars and vans, there is not yet any mandatory monitoring and reporting of emissions and fuel consumption for heavy-duty vehicles. Mandatory CO2 emissions limits for these vehicles is expected to be proposed, for at least some of these vehicles, later this year.

Links for further reading:

EEA briefing ‘Appropriate taxes and incentives do affect purchases of new cars'

EEA briefing ‘Carbon dioxide emissions from Europe's heavy-duty vehicles'