As Member States are haggling in Brussels over a proposal from the Commission to set an emission goal of 95 grams of carbon dioxide per kilometer (g/km) as an average for new vehicles sold in Europe from 2020 – which Germany in particularly finds too demanding for its car industry – new research by consultancies Ricardo-AEA and Cambridge Econometrics published on Monday shows that “decarbonizing” cars could generate 500,000 to 1.1 million net additional jobs by 2030 and lead to between €58 and €83 billion a year in fuel savings.
Fierce lobbying is going in Brussels at the moment around proposals of the European Commission to set a standard of 95 grams CO2 per kilometer emitted as an average for new cars to be sold in the EU from 2020. At this moment average emissions across the EU are 132 grams. German-made cars emit on average 147 grams, which explains why Germany is trying hard to mitigate the proposals. Last week Germany came up with the suggestion to allow carmakers to offset high emissions of some cars with “supercredits” earned from manufacturing very low-emission vehicles, but this was rejected by the other Member States. A new German proposal, referred to as the “multiplier”, would buy time for German manufacturers in yet a different way.
But no matter how this particular struggle will end, what is certain is that the “decarbonisation” of European-made cars has started – although no one will know yet where this process will end. According to a new report – Fuelling Europe’s Future: How auto innovation leads to EU jobs – released not coincidentally on Monday when the fight for the new emission standard was coming to a head, by a consortium of transport sector stakeholders, “low-carbon cars” can kill five birds with one stone: they can lead to significant reduction of CO2 emissions, reduce air pollution, stimulate economic growth, reduce import dependency and lead to the net creation of up to 1.1 million new jobs in Europe over the next 15 years.
These are the main finding s of the report, which was commissioned by the European Climate Foundation (ECF) and prepared by Ricardo-AEA (technical analysis) and Cambridge Econometrics (economic modelling):
- Jobs are created by increased spending on vehicle technology, but more importantly by a shift in spending away from imported fossil fuels and back towards other areas of the European economy.
- In scenarios in which the Internal Combustion Engine is either optimized or hybridized, the yearly cost of running and replacing the EU car and van fleet is reduced by €36 billion and EU-wide employment increases by 500,000 to 660,000 in 2030. This takes account of jobs lost in the transition, such as in refining.
- In scenarios in which Europe moves rapidly to a fleet of advanced hybrid, battery-electric and fuel-cell vehicles, EU-wide employment increases by 850,000 to 1.1 million in 2030. By 2050, jobs increase by 1.9 million to 2.3 million in all low-carbon scenarios examined.
- The fuel bill for Europe’s car and van fleet is reduced by €58 – 83 billion in 2030 by a shift to low-carbon vehicles, and by €115 – 180 billion in 2050. (excluding taxes and duties)
- While jobs are created and spending on oil imports is reduced in all low-carbon scenarios, CO2 is also cut by between 64 per cent and 97 per cent in 2050. Air quality is significantly improved, with emissions of health-damaging particulates down by 73 – 95 per cent by 2050.
- Demand is reduced for a small fraction of auto sector professions, and some skill shortages also emerge during the transition. The pace of change is likely to allow time for the development of the relevant new skills in Europe, if industry, governments and academic institutions start planning now.
The conclusions of the report are welcomed by a broad range of parties in the automotive sector, such as the European Association of Automotive Suppliers (CLEPA), the electricity industry body Eurelectric, the European Aluminum Association, the European Trade Union IndustriAll Europe and the organisation for battery manufacturers Eurobat. The oil companies were not asked to comment. Nor apparently were German car manufacturers. It would be interesting to hear what they have to say about this study, which surely deals with a crucially important matter for the future of the European company.