Green Mobility Policy Briefing June 24, 2022

Covered in this week’s Green Mobility Policy Briefing: £43 million in funding is awarded to UK projects developing low-carbon automotive technology; the Council of the European Union and the European Parliament reach an agreement on a new corporate sustainability reporting directive; fears of a dilution to EU legislation aimed at phasing out of combustion engine cars increase; and Trade Unions call for social sustainability and a just transition.

E-motorbikes and delivery trucks among various projects awarded funding to develop low-carbon automotive technology. The Advanced Propulsion Centre (APC) in conjunction with both the UK government and the automotive industry awarded a collective £43 million in a move to expedite the industrialisation of net-zero-emission vehicles. Despite prominent global supply chain issues over recent years, demand for battery electric and plug-in hybrid cars has soared by more than 50 per cent. According to Ian Constance, chief executive of the APC, the announced funding demonstrates this, further supporting the reimagination of “not just vehicles, but transport in general”. Of those awarded funding, Project Zero Emission Norton received £8.5 million to support the development of an e-motorcycle that delivers an effective race performance and touring range. Likewise, the OX Delivers CLEAN project was allocated £8.5 million to assist the development of an all-terrain electric delivery truck powered by long-life batteries. The APC also directed funding towards 19 additional studies, focusing on advancing research in UK lithium production, fast charging, and battery recycling. The Department for Business, Energy and Industrial Strategy predicts a 27.6 million tonne reduction in carbon emissions following the projects’ implementation, equivalent to the lifetime emissions of 1.1 million cars. In a press release, Lord Grimestone, the Minister for investment, boasted that this support for strategically important technologies paves the way “for our electric vehicle sector to compete on a global scale, driving jobs and growth nationwide whilst also creating cleaner, more sustainable modes of transport.” – By Georgia King 

Corporate sustainability reporting: new provisional agreement announced by the European Council and Parliament. The Council of the European Union and the European Parliament reached a provisional political agreement on a new corporate sustainability reporting directive (CSRD), aimed at addressing existing issues regarding the disclosure of non-financial reporting. Under the new rules, large companies will be required to report on sustainability and ESG issues and will be expected to certify and make reporting accessible in a dedicated section of company management reports. The new rules, which will be introduced by the European Financial Reporting Advisory Group (EFRAG), will apply to all large companies and undertakings listed on regulated markets. SMEs listed on markets will be required to comply with the regulations. However, the requirements will be tailored to their unique characteristics and SMEs will be able to opt-out until 2028. Non-EU companies who generate a net turnover of €150 million within the EU or with subsidiaries in the EU will also be required to comply with the regulation. Speaking on the matter, Bruno le Maire, Minister for economic affairs, finance and digital sovereignty, said “this agreement is excellent news for all European consumers. They will now be better informed about the impact of business on human rights and the environment. This means more transparency for citizens, consumers, and investors”. He went on to suggest that through greater transparency the issue of greenwashing could be effectively tackled. The proposed directives will cover transport operators, OEMs, and financial services firms serving the transport industry. – By Thomas Hayden-Lefebvre

EU phase-out of combustion engine cars hits a stumbling block, raising fears of diluted legislation. “Germany is not going to agree to a ban on combustion engines”. These were the words of German Finance Minister Christian Lindner as he spoke in Berlin, at a conference organised by the BDI, an industrial lobbyist. He was referencing the European Parliament’s recent vote to adopt revisions to CO2 standards in automotive manufacturing, effectively banning the sale of new combustion engine vehicles from 2035. Central to its ‘fit for 55’ package, the European Commission envisioned the move accelerating the bloc’s electrification plans. However, reinforcing the argument made by Volker Wissing, the FDP transport minister, in the immediate aftermath of the vote, Lindner cites the impact on the competitiveness of German manufacturing as a key reason for the FDP’s opposition. Speaking a fortnight ago, Wissing suggested that the legislation would not spell the end for the combustion engine in Europe, as manufacturers elsewhere would fill the gap, inadvertently costing the jobs of those who “depend on the combustion engine”. These concerns have been echoed by automotive lobby groups. Wissing added that Germany should aim to amend the EU’s plans, targeting an exemption for engines running on synthetic fuels. Environmental groups have reacted angrily to the FDP’s position, with the German Federation for the Environment and Nature Conservation suggesting that by refuting the Commission’s proposal, “Germany would be doing a disservice to the corporations that have long since set out on the path to a battery electric future”. Crucially, the Green party, who are part of the ruling coalition, are advocates for the Commission’s proposal. Steffi Lemke, a spokesperson for the Green Environment Minister, hastily rejected the FDP’s position, reaffirming the German government’s support for the 2035 proposal. – By Sam Phelps

Trade Unions Call for social sustainability and a just transition. The International Transport Workers’ Federation along with IndustriALL, ETF, and IndustriALL Europe, have published a joint statement “demanding concrete measures to ensure a just transition and a fair transformation of the sector which is inclusive and maintains and creates decent jobs.” According to the unions, there exists a “need for a coordinated industry-wide response from airlines, airports, governments, and unions to rectify capacity shortages, flight delays and beleaguered service levels that have plagued the industry for months”. Moreover, the unions warn that the aviation and aerospace industries’ long-term decarbonisation and sustainability efforts, like any major industrial shift or reform, will require labour’s participation. The joint statement comes at a turbulent time for industrial relations across the transport sector, and amid rising costs for both employers and employees. In Belgium, trade unions ACV, ACLVB and ABVV undertook industrial action, affecting public transport and rail services across the country, whilst a strike amongst security staff at Brussels airport forced the cancellation of all outgoing flights on Monday. Similarly, in the UK, National Rail services and public transport services in London were disrupted following industrial action by the National Union of Rail, Maritime and Transport Workers and Transport for London employees. Airport and aviation staff in France, Portugal, Spain, Denmark, Sweden, and Norway have similarly announced their intentions to strike throughout the summer. – By Thomas Hayden-Lefebvre