NGV Global

Comment and Analysis by Jeffrey Seisler, CEO, Clean Fuels Consulting, in collaboration with Kevin Leydon Associates (Brussels). First published in Fleets and Fuels Magazine.

The wide-ranging Climate and Energy package adopted by the European Parliament on 17 December 2008, is an ambitious attempt to lay out a comprehensive, long-term plan to reduce greenhouse gas emissions from 1990 levels by 20%, to have 20% of the EU’s total consumption made up of renewable energy and to achieve 20% saving through energy efficiency by 2020.  The ‘package,’ a collection of six Directives, affects all energy sectors.

For the transportation sector and alternative fuels the package is a somewhat disjointed compilation of mandates and incentives that will have varying impacts – both positive and negative — on the different fuel groups and technologies. Liquid biofuels receive the most attention and support.  Electric vehicles are on-going favorites and hydrogen fuel cells still represent the long-term vision. The other gaseous fuels – natural gas, and liquefied petroleum gas (LPG), are highlighted and included mostly throughout the directives by definition only. Renewable biomethane, included under the banner of biofuels, is recognized for its low CO2 contribution but is seen more likely to generate electricity than fuel natural gas vehicles (NGVs). On balance there is not much ‘balance’ in the European AFV approach. Implementing the transport elements of this amorphous Energy and Climate Package will be fraught with pitfalls, loopholes, and derogations.  Nevertheless, there are many European policy makers who are committed to developing various petroleum alternatives so even incremental steps that can be achieved will be in the right direction. 

The Energy and Climate Package directives include:

•    CO2 and Cars, which requires CO2 reductions to 120 gram per kilometer by 2015 and  95 g/km by 2020, with financial incentives for E-85 in Member States where 30% of the fuel stations sell E-85. Vehicle manufacturers can receive a ‘supercredit equal to 3.5 cars for each registered flex-fuel vehicle emitting less than 50 g/km CO2., The incentive drops to 1.5 cars by 2014 and ends after 2015.  To date, only electric vehicles can reach such low CO2 limits.
•    The Fuel Quality Directive tightens environmental quality of fuels and introduces a phase-in of 10% ethanol in gasoline;
•    The Promotion and Use of Energy from Renewable Sources includes a mandatory target of a 20% share of renewable energies in overall Community energy consumption by 2020 and a mandatory 10% minimum target for the share of biofuels in transport petrol and diesel consumption by 2020.  After a long debate to define ‘sustainable’  biofuels due to concerns over food-chain products, amongst others, limits were set on CO2 savings required for each biofuel: 35% to 2017 and 50% CO2 reduction thereafter for existing biofuel production and 60% for new plant start-ups after 2017.  Current generation European biofuels such as ethanol from sugar beets cannot achieve the 50% so the levels will be subject to review.
•    Shared Effort to Reduce Greenhouse Gas Emissions assigns each European member state an emissions reduction objective for construction, road and maritime transport, services, agriculture, waste, and small industrial installations. These are sectors omitted from the EU Energy Trading Directive, another part of the package, which requires other large energy and industrial sectors to reduce their emissions by 10% by 2020 (in comparison to 2005 emissions). Each country’s specific obligation to reduce emissions in the transport sector is yet-to-be-established.
•    The last element of the package, the Carbon Capture and Storage, sponsors demonstrations programs sequester CO2 emissions mostly from large industries and does not involve the transport sector.

Another directive outside the ‘package’, the Clean and Efficient Vehicles Directive, mandates government agency use of alternative fuel vehicles (AFVs), which could be an important market stimulus coupled with the other requirements of the Energy and Climate Package.

Jeffrey Seisler is the CEO of Clean Fuels Consulting. Kevin Leydon is the CEO of Kevin Leydon Associates.  Both are based in Brussels.

 

Print PDF