European Commission Greenlights €837m Spanish State Aid for EV Batteries as EU & UK Argue Over Post-Brexit EV Tariffs: GMPB.

Covered in this week’s Green Mobility Policy Brief: Brexit: UK and EU automakers calls for a stop on electric car tariffs; European Commission greenlights €837 million state support to produce electric vehicle batteries; UK-US partnership set to soar with sustainable aviation summit and collaborative approach; Urban mobility should embrace green and digital solutions, say MEPs.

Brexit: UK and EU automakers call for a stop on electric car tariffs. Under a temporary waiver in the Trade and Cooperation Agreement (TCA), up to 70% of an electric battery’s components can come from outside the EU or UK before tariffs must be followed. However, this will reduce to 40% on January 1st, 2024. Electric carmakers say they are not ready and need more time before this reduction under the TCA. Director General of the European Automobile Manufacturers’ Association (ACEA), Sigrid de Vries, has stated that “the European battery industry is simply not taking off quickly enough to keep in line with more restrictive rules.” The increase of battery components sourced in either the UK or EU is a core part of the Brexit trade deal, to “ensure that value chains are not offshored to third countries.” Discussions have been ongoing between UK Foreign Secretary James Cleverly and Vice President of the European Commission Maroš Šefčovič to attempt to resolve this issue. Meanwhile, carmakers have been putting pressure on both sides to ensure their concerns are being heard. – Zoe Picton  

European Commission greenlights €837 million state support to produce electric vehicle batteries. To foster its transition to a net-zero economy, the European Commission has approved an €837 million Spanish scheme, which will support the production of batteries for electric and connected vehicles. This will partially be funded through the Recovery and Resilience Facility (RRF), which is a temporary recovery instrument, in the form of direct grants and loans. This aid has been approved under EU State Aid rules, on the basis that it is necessary and important to endorse the Green Deal Industrial Plan. Notably, the funding has been adopted under the European Commission’s new Temporary Crisis and Transition Framework, which supports the transition to net-zero. The aid can be granted by any member state and provides the following: limited amounts of aid; liquidity support in the form of state guarantees and subsidised loans; aid to compensate for high energy prices; measures accelerating the rollout of renewable energy; measures facilitating the decarbonisation of industrial processes; measures aimed at supporting electricity demand reduction; and of course, measures to further accelerate investment in the transition towards a net-zero economy. Executive Vice-President in charge of competition policy, Margrethe Vestager, has said that this funding scheme for Spain “is an important step in the transition to a net-zero economy.” – Zoe Picton 

UK-US partnership set to soar with sustainable aviation summit and collaborative approach. With a UK target of at least 10% of jet fuel coming from sustainable fuel by 2030 and the Jet Zero Strategy aiming for a zero-emission sector by 2050, Transport Secretary Mark Harper met counterparts of the USA, Canada, and Singapore on the 15th of May in an attempt to decarbonise the aviation industry. Harper claimed that ‘we’ve never been more aligned with the USA on the future of aviation and what that entails’. Harper will co-chair the Sustainable Aviation Fuel (SAF) Investor Summit in Detroit, joined with both the US and Canada to aid discussion on overcoming future sustainable transition barriers within the international sector. SAFs are fuels made from waste materials or by-products, which can reduce greenhouse gas emissions by up to 80% compared to fossil fuel-based alternatives. Major organisations such as JP Morgan Chase, the International Air Transport Association (IATA), and United Airlines will be in attendance as unlocking private investment to aid economic growth and create more jobs in the sustainable aviation sector is crucial. An Advanced Fuel Fund promising £165 million will help set the industry on the path to a sustainable transition, with 5 projects already chosen to receive funding. Furthermore, the UK and US will work together to see how SAF plants can start working at a large enough scale to create enough jobs and skills for future generations. At current, it is estimated the sustainable aviation industry can create as many as 60,000 jobs and a £10 billion boost to the UK economy. – Hannah Santry 

Urban mobility should embrace green and digital solutions, say MEPs.  Just two months ago, the European Commission adopted a Recommendation designed to help the 430 major cities along the European transport network develop their Sustainable Mobility Plans. The Commission recommended new national programmes that would aid mobility implementation, with support including guidance materials, training programmes, capacity building, technical expertise, and financial support. The resolution on the new EU urban mobility framework highlights that urban mobility is vital to improve people’s quality of life and the economy. MEPs stress the importance of creating an inclusive green transition in the transport sector, considering special needs. MEPs also want more awareness of efforts of sustainable transitions calling for the Commission to establish an ‘EU car-free day’. Congestion and noise pollution have devastating effects on people, especially those living in urban areas. Artificial intelligence and digitalisation can significantly improve the efficiency of transport by shortening travelling times and relieving traffic congestion. MEPs further recognise that autonomous vehicles could lead to the reduction of accidents and deaths, however, test runs, and appropriate safety must be met. Furthermore, the resolutions highlight that 22,600 people lose their lives on EU roads annually, resulting in MEPs calling the Commission to help strengthen road safety, considering more speed limits in residential areas and other solutions such as increased walking and cycling. – Hannah Santry