The EU Clean Power Strategy: A Bumpy Road Ahead

Antonio Neves-Costa and Diego Llorens EchegarayAntonio Neves-Costa and Diego Llorens Echegaray are based in APCO’s Brussels office.

The development of clean fuels for road transport, a fundamental step to decarbonise Europe’s economy, has so far proven challenging. The uptake of electricity, hydrogen and natural gas in this sector is being held back by a lack of alternative refuelling stations, low consumer acceptance, and high prices. These three factors have created a vicious circle that the European Commission now wants to break.

As part of its objective to put Europe’s road transport on an environmentally sustainable path, the Commission’s Clean Power Strategy aims to encourage the development of a pan-European network of alternative fuelling stations. The hope is that focusing policy efforts on alternative fuels infrastructure will lead to higher consumer acceptance and result in lower prices for vehicles, thus breaking this vicious circle. The Commission argues that this should give road users a real alternative to conventional petrol-fuelled vehicles.

The package of measures presented consists of legally-binding targets for the development of an alternative fuel infrastructure. Each Member State would have to ensure that a minimum number of electricity charging points are available on its roads by 2020. This number, which depends on the size of the country’s car fleet, ranges from 1,000 (Estonia and Luxembourg) to 150,000 (Germany). The proposal also includes common standards for interoperability, calling for a single common plug for recharging electric vehicles.

As the fleet of hydrogen powered fuel-cell vehicles is currently smaller than that of battery electric cars, so is the number of hydrogen refuelling stations. The Commission proposes to create a network of publicly available hydrogen refuelling stations with maximum distances of 300 km. Regarding the use of natural gas for road transport, the proposal includes requirements to install liquefied natural gas (LNG) refuelling stations every 400 km along the Trans-European Transport Core Network; and compressed natural gas (CNG) refuelling stations every 150 km of road.

The proposal does not include mandatory targets for gas-to-liquid (GTL) and biofuels, as these can be mixed with conventional fuels and so do not require entirely new infrastructure. In the case of liquefied petroleum gas (LPG), there is already a network of 28,000 filling stations in the EU.

Environmental groups have applauded the Commission’s proposal as a small but ambitious first step towards the decarbonisation of Europe’s roads. The European Parliament, which is also likely to sympathise with its objectives, is on a probable collision course with the EU Council, where national governments will seek to water down the proposal’s provisions and targets. Under the current macroeconomic conditions, the need to solve Europe’s economic and financial challenges has taken priority over issues such as tackling climate change and modernising Europe’s energy system.

Not surprisingly, Europe’s automobile manufacturers have not defined a clear, industry-wide position on this issue. Although the European Automobile Manufacturers’ Association (ACEA) has welcomed the proposal, they are focusing on the standardisation of plugs for electric vehicles and avoiding the issue of increasing the number of charging points –a key element in the proposal. A clear distinction between manufacturers that have invested in new energy technologies and those lagging behind is likely to keep the industry divided over this issue.

Indeed, the Commission’s vision for the future of Europe’s road transport requires nothing short of a revolution within the sector, and a radical change within the environment in which automobile manufacturers operate. Having developed internal combustion engines for nearly a century, many of these manufacturers will naturally oppose change, particularly in light of the current low levels in car sales. On the other hand, those who have invested in the development of cleaner energies will see this legislative process as an opportunity to make the most of their first-mover advantage.

The Clean Power Strategy faces a rocky legislative path, or a bumpy road ahead. Radically opposing views from different institutions and stakeholder groups will translate into a long and complex negotiation process. Defenders and opponents across the EU will have to hold their corners whilst at the same time seeking to build up consensus – otherwise the proposal seems destined to break-down.

Posted on February 20, 2013 By APCOForum.com
Categories  Energy & Clean Tech, EU Policy and tagged , , , ,
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