Happy Thursday friends! Here’s my weekly take on the five most interesting developments in LCFV trends over the last week.
The media and “Twitterverse” were both set aflame this week following a report in Germany’s Der Spiegel and Forbes that Germany’s Bundesrat, the federal council that represents the country’s 16 states, are advocating a ban on the ICE starting in 2030. The council passed a bipartisan resolution calling on the European Commission to take action, allowing only ZEVs would be allowed on the roads.
The resolution (translated into English) calls on the Commission to “evaluate the past tax and duty practices of the Member States on their effectiveness with regard to the promotion of emission-free mobility … so that only emission-free passenger cars are permitted at the latest from 2030 onwards.” On its own, the resolution has no binding effect. As most of you know this is regulated at the EU level.
However, that’s not how it was interpreted. Mainstream and specialty media outlets, especially those in favor of such a ban and progressive on issues such as electric vehicles, reported that Germany would ban the ICE by 2030. Forbes noted, “Nevertheless, headlines about an ICE ban in Germany raced around the globe, and the story still keeps ricocheting through Twitter.” Even Elon Musk cheered from his vantage point in the Twitterverse. However, the German Minister of Transport was quoted as saying in response to the coverage, “Utter nonsense…a complete end of the internal combustion engine from 2030 on would be totally unrealistic.” And, of course, he’s right.
What’s so special about this article and why would I include it? First, while this story was misreported such ICE ban proposals have been and are being considered; for example, in the Netherlands (it has not succeeded). Moreover, consider a recent comment from the Intergovernmental Panel on Climate Change (IPCC) that in order to meet Paris Agreement targets coal and the ICE would need to be banned. And that is going to fuel (no pun intended) the flames on this issue. My bet is that more countries will at least consider policies such as this in the coming years.
Second, this is a rather disturbing example of confirmation bias in action that is not particularly helpful when grappling with these kind of complex and profound environmental, policy, market and technology issues facing governments, the auto and energy industries, and other stakeholders. But I think we will see more of this down the road.
This report, released this week from the Institutional Investors Group on Climate Change is “intended to enable investors to engage with the boards of automotive (and component supply) companies about their efforts to address climate change risk and place sustainability at the heart of the industry’s future.” The report notes:
“The expectations in the guide go much further than suggesting automotive companies should support compliance with the Paris Agreement. They also address engagement with suppliers, governments and industry peers to innovate for zero emissions vehicles and supporting infrastructure, efforts to close the gap between real world and emissions testing, the development of long-term decarbonization strategy and mobility services, investment in sustainable driving technologies and product pipelines, the use of meaningful targets and metrics to cut greenhouse gas emissions in manufacturing, fleet and supply chains.”
This is reflected in the graphic below.
Key findings in the report include:
There are five key expectations that investors have of automotive companies, according to the report:
The state has a goal: put 1.5 million ZEVs on the road by 2025. How are they going to do it? By implementing actions under these broad goals:
Achieving mainstream consumer awareness is the top priority under the plan. The report states:
“Despite the wide variety of light-duty ZEVs available today, most consumers have not considered these vehicles for purchase or lease. According to a recent study, only 19% of Californians have investigated ZEV ownership, test driven a ZEV, or actually own a ZEV. Only 17% of Californians surveyed are aware that the state offers rebates for vehicles.”
The portion of Californians who are aware that ZEVs exist and are available must increase significantly to achieve market transformation. In fact, achieving Governor Brown’s goal of 1.5 million ZEVs in California requires that 15%—or one out of six—of new car purchases must be ZEVs by 2025. To date, ZEVs have reached up to 3%—one out of approximately 30—of new car purchases. Between 2040 and 2050, nearly 100% of new passenger vehicles sold in California must be ZEVs in order to meet the state’s long-term climate goals.”
Different agencies in the state government will implement more than 25 specific actions to build consumer awareness, including:
Delivering high-speed rail across the state, which has been controversial, is another action item under this category. The timeframe for most of these actions is 2016-2018.
With respect to bolstering ZEV growth outside of California, the state has committed to:
Economies have needed less energy to grow in recent years, especially in China and other developing countries, but more vigorous policies are needed to achieve climate targets, said IEA in its Energy Efficiency Market Report released this week. This includes fuel economy, and IEA even put a good word in for electric vehicle policies. Read more about it here.
Yesterday the European Climate Foundation and its stakeholder partners put forward policy recommendations to the European Commission on how better to support the development of advanced biofuels in the EU. Among other findings, the group has called for prioritizing support for advanced alternative fuels while those biofuels that do not deliver on climate targets should be phased out. Read more about it here. I’ll be talking to one of the key members of this project, Dr. Chris Malins of Cerulogy, about this, Biofrontiers and other questions on the future of biofuels, advanced biofuels and advanced alternative fuels in Europe in a forthcoming podcast. Look for it!