The role of carbon standards on passenger cars towards the reduction of GHG emissions in EU: A model-based scenario analysis

The European Commission introduced carbon dioxide emission standards on cars as an obligation to manufacturers in an aim to reduce carbon footprint of passenger cars in EU transportation. Car industry adjusting to a standard targeting 95 gCO2/km by 2020 is already marketing increasingly low CO2 emitting technologies. In the context of a strong emission cut strategy until 2050 the EU could adopt CO2 car standards at the levels of 20 gCO2/km. The aim of this paper is to explore more optimistic CO2 targets on passenger cars in the medium and the long term by using the PRIMES-TREMOVE energy economic transport model covering the EU-27 countries. In our study, we quantify two policy scenarios implementing more optimistic carbon emission targets at a different pace and we derive policy conclusions in terms of costs, emissions and energy by comparing them with a Reference scenario. The analysis shows a restructuring of the EU car fleet, leading to significant reductions in CO2 emissions and fuel consumption driven by a high penetration of advanced vehicle technologies in the long term. We find that if policymakers intend to pursue more optimistic carbon emission standards then the advanced vehicle technologies will prevail, albeit at an increase in user costs. CO2 emission targets can potentially be a key policy towards sustainable low carbon EU road private passenger transportation, if a decarbonisation strategy is employed.