INSIGHT
The transition to low-carbon vehicles offers economic benefits to Europe if it adapts to the challenge
Jon Stenning, Associate Director, Cambridge Economics
Electro-mobility is coming to Europe. While the US Federal government is seeking to repeal emissions standards, risking a slide back towards large, inefficient vehicles, and China is rolling out huge number of electric cars and buses, Europe’s proposed post-2020 emissions standards put it on a steady progressive path between the two. The costs of electric vehicles (EVs) are coming down, and these vehicles are now expected to be cost-competitive with internal combustion engine vehicles during the 2020s.
The question for policy makers and for industry has shifted from what if to what do we do now. When EVs arrive in greater numbers, what are the implications for producers, for component manufacturers, and for those that supply and sell fuel?
Cambridge Econometrics was commissioned by the European Climate Foundation to examine this issue, and the broader socioeconomic impacts of the transition to low-carbon passenger car technologies.
The deployment of technologies that achieve greater fuel efficiency in all powertrains and the roll-out of advanced powertrain vehicles (including pure battery electrics, plug-in hybrids and fuel cells) have potentially large economic and environmental benefits. However, there are transitional challenges that must be addressed to maximise those benefits.
There are clear environmental benefits from the transition. In 2016, the transport sector eclipsed the power sector as Europe’s biggest source of CO2
megatonnes (Mt) in 2018 to 70 Mt in 2050, and emissions of NOx and PM10s are reduced from 1,300 kilotonnes (Kt) and 28 Kt respectively in 2018 to 70 Kt and 0.75 Kt in 2050
There are also clear economic benefits for Europe: • Imports of petroleum are reduced, leading to less leakage of money out of the European economy.
• There is increased demand for electricity and hydrogen (produced in Europe) to fuel the vehicles.
• The purchase price of vehicles increases (as vehicles with fuel efficient technologies and advanced powertrains are more expensive than current combustion engine vehicles), but running costs are lower.
• The total cost of ownership of advanced powertrain vehicles is expected to reach parity with internal combustion engines during the 2020s; beyond this, Europeans will be spending less on mobility, freeing up household income to be spent on other things.
These changes lead to increases in output and value-added (GDP) in the European economy and create jobs. However, there are winners and losers from the transition within Europe, as compared to a ‘business as usual’ scenario.
,
while the European Environment Agency estimates that over 85% of the population have been exposed to air pollutant concentrations above World Health Organization guidelines for fine particulate matter (PM2.5). In our central scenario, CO2
emissions from Europe’s passenger cars are reduced from 605 42 LUBE MAGAZINE NO.147 OCTOBER 2018
There are some jobs lost in manufactured fuels (oil refining), due to the fall in demand for petroleum; however, this industry does not employ many workers in Europe and so the number of jobs lost is small. In the motor vehicles industry, employment is likely to increase slightly in the short- to medium- term, as more complex fuel-efficient ICEs and PHEVs require more labour input. However, beyond 2030, when pure BEVs take a large share of sales, there are fewer jobs in the sector, reflecting the fact that these vehicles require less labour input to manufacture.
Continued on page 42
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72
