EU Discussing Which Vehicles Should Be Covered Under Emissions Law

EU also in talks to set limit of 120 grams of CO2 per kilometer by 2012.

BRUSSELS, Belgium (AP) – The EU’s executive arm said Monday it was still trying to decide what vehicles should be covered by a proposed new law to cut cars’ carbon dioxide emissions, as German automakers said mandatory limits would force them to cut jobs.

As the auto industry is likely to miss a voluntary target to cut average CO2 emissions for new cars, the European Commission has threatened to draft rules that would set a legally binding limit of 120 grams of CO2 per kilometer by 2012.

But the EU seemed to back off last week when it postponed a decision on the new law amid pressure from German car makers, citing job cuts and a split in its own ranks between environment and industry officials.

Just weeks ago, the EU embraced a “low-carbon economy,” saying it would lead the way in the fight against climate change by shifting away from imported oil and natural gas. But rising CO2 emissions from transportation – both road and aviation – jeopardize the EU’s efforts to cut the amount of greenhouse gases that the region releases.

EU spokesman Johannes Laitenberger insisted Monday that the EU needed the law but signaled that there could be some wiggle room.

“What is now under discussion…is to debate and to decide on what exactly should be covered by the legislation,” he said.

The EU would examine carefully the economic, social and environmental impact of the new rules before it makes a decision, he said. He did not say how long that study would take.

But he shrugged off a claim by the German car industry that the law would force it to shed more jobs as it copes with rising costs and a tougher consumer market.

“Normally jobs are not lost when you proactively embrace change,” he said. “We need to equip Europe for globalization and our industry for the future. The best way to do this is to embrace and anticipate change, not to resist it. Neither globalization nor climate change will go away.”

The overall level of carbon dioxide emissions from road transport has risen 22 percent since 1990 as the number of cars on the road rises and drivers travel greater distances. Passenger cars and vans made up 14 percent of Europe’s carbon dioxide emissions in 2004, the European Environment Agency said.

To combat this, the car industry and the EU executive arm agreed to cut emissions from new cars to 140 grams of carbon dioxide per kilometer by 2008. A year before that midterm target, the current average is around 163 grams.

Car makers have cut emissions by nearly 13 percent, they say, but they blame “persistent lack of consumer demand for fuel efficiency” for not hitting the target. Small cars or hybrid-fuel models are simply not selling.

They are calling for governments to influence buyers’ choices with “CO2-related taxation.” Currently, taxes in many EU nations favor diesel over emission-friendly alternatives such as biofuels or hydrogen.

But the European Commission has very little power to influence how member nations decide to impose taxes.

“Demand does play a significant role. You can’t continue putting the focus on the supply side,” said Sigrid de Vries of the European Automobile Manufacturers Association. “Putting the burden on the car industry is the most expensive and least effective way.”

An independent report for the European Commission – based on data from car manufacturers – claimed that reaching the 2012 target would cost each auto company an extra $2,193 per car compared to 2002. That would push up the retail price by $3,160.

More in Operations