The EU amends its law to ban combustion engine cars from 2035 with a key exception
The European Union's climate regulation takes a significant turn. Although the ban on the sale of new combustion engine cars for 2035 is maintained, the final text introduces an unexpected flexibility. Now it will be allowed to register vehicles that only use emission-neutral synthetic fuels, an emerging technology. This change seeks to balance green objectives with the industrial and political realities of the bloc. ⚖️
A bloc of countries halts the absolute ban
The initial stance of a total ban faced firm resistance led by Germany and Italy. These countries, with powerful traditional automotive sectors, argued that battery technology does not cover all use cases and that alternatives like e-fuels must remain on the table. The European Commission was forced to negotiate and modify the proposal to avoid stalling the entire climate legislation.
Key arguments from the opposing bloc:- The infrastructure for electric vehicles and battery range are not ready for all segments, such as heavy or long-distance transport.
- Keeping the door open to synthetic fuels protects investments and jobs in the internal combustion engine industry.
- Advocates for technological neutrality, where the goal is to reduce emissions, not impose a single technical solution.
The final amendment requires that new combustion engines after 2035 can only run on carbon-neutral fuels.
The backdoor of synthetic fuels and its challenges
The clause on synthetic fuels or e-fuels acts as a safety valve in the regulation. However, this alternative raises considerable practical doubts. Currently, these fuels are scarce, extremely expensive to produce, and require massive amounts of renewable energy for their manufacture. Critics warn that betting on this path could divert resources and slow down the mass electrification of the vehicle fleet, considered by many the most efficient and direct route to decarbonize.
Main challenges of e-fuels:- Producing them on a large scale requires a huge expansion of renewable energy capacity, which must first decarbonize the electricity grid.
- Their cost per liter is much higher than that of fossil fuels or electricity for an equivalent battery vehicle.
- The overall energy efficiency of the process (from renewable electricity to fuel and then to motion) is significantly lower than using that electricity directly in an electric vehicle.
The green transition also has a tax bill
Beyond ecology, the transition poses an economic challenge for states. Taxes on hydrocarbons are a crucial source of revenue that will decline. To compensate, some governments are already planning to tax electricity used for charging vehicles or implement urban toll systems. Ensuring that sustainable mobility also pays for infrastructure maintenance is an essential, though less discussed, component of this transformation. 💰