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Future Energy

6. Future Energy for Transport

The Action Plan on Energy Efficiency singled out the transport sector as having great potential for improvement, as it is almost entirely dependent on fossil fuels and accounts for nearly 20 percent of total energy consumption in Europe. So far, the EU has proposed a tax regime for vehicles based on CO2 emissions, improving urban transport and including aviation in the CO2 trading scheme. In addition, the EPE proposed an increase in the use of biofuels 10 percent by 2020 and the development of more energy efficient and hydrogen cars.

Biofuels

Biofuels are supplements to petrol made from agricultural products like corn, sugarcane and soy beans. The Road Map refers to biofuels as “the only large scale substitute for petrol and diesel in transport.” Thus the EU, in an effort to offset the pressures of oil importation, has set increasingly larger targets for biofuels as a percentage of petrol since 2003. They were 2 percent by 2005 and 5.75 percent by 2010 and 10 percent by 2020, the last from the EPE. In 2005 only a 1 percent share of petrol was biofuels, although there were extenuating circumstances to this, including an excess of petrol and an “underdeveloped” EU regulatory framework for biofuels.

The EU recently scaled back subsidies for biofuels after the program proved too popular. There are also some concerns within the EU about biofuels displacing farmland used for food production in Europe and abroad. Indeed, much of the land receiving subsidies was formerly used for food production. There are also concerns about environmental degradation, especially tropical rainforests in South America. In September, the Organisation for Economic Cooperation and Development (OECD) released a report stating (pg. 10, 1.2) that without subsidies, biofuels were not competitive and will drive food prices up “between 20% and 50% by 2016.”

Green Cars

An EU opinion poll of July 2007 revealed that 22 percent of European citizens would give up their cars “under no circumstances,” even when considering environmental factors. Thus it seems that cars will compose a portion of the transportation mix into the foreseeable future.

In 1998, the Automobile Manufacturers Association agreed to a voluntary target of 140 grams per kilometre of emissions by 2008. Although incremental progress was made, the car manufacturers are expected to miss their targets, and thus the Commission is expected to introduce legislation on the matter. The strategy was to set a binding target of 120g/km by 2012, although the European Parliament, in October 2007, extended the deadline for car manufacturers to cut CO2 emissions by three years to 2015.

The Commission, in October 2007, put forth a proposal to “simplify the market approval of hydrogen cars” and another establishing a Joint Technology Initiative on Fuel Cells and Hydrogen. The hydrogen JTI will have a budget of 470 million Euro over six years and the hydrogen industry has committed matching funds although, according to Commissioner Gunter Verheugen, the technology won’t have an impact for “the next 10-15 years.”

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