Summary of the Workshop on Urban Transport and Green Propulsion

Brussels, 31 January 2007

Objective

A Technical Workshop on Urban Transport and Green Propulsion has been organised in the
context of the public consultation on the different aspects of urban transport on 31 January
2007. The main purpose was to launch a wide consultation on a possible new approach for
Commission action on the promotion of clean and energy efficient road transport vehicles.

Organisation

Stakeholders concerned with the Commission initiative on clean and energy efficient vehicles
had been invited, and a wide range of participants had registered (list of participants: Annex).
The Workshop had one session devoted to technological and economical aspects of clean and
energy efficient vehicles, and a second session to possible ways of political support for these
technologies.

Session 1: Technology and economics

In an introductory presentation, Mr. Karamitsos, Director for logistics, innovation, co-

modality, & maritime transport in the European Commission, gave an overview on European
transport policy in support of green propulsion. Green propulsion has become a core element
of European transport policy with the objective to contribute to sustainable mobility in the
future. The main challenges to be tackled are:
• To secure energy supply by reducing the dependence of transport on oil
• To protect the climate by reducing CO2 emissions from transport
• To improve air quality by decreasing pollutant emissions from vehicles

The European Commission therefore has taken action to improve energy efficiency in
transport, bend the growth of CO2 emissions, and lower the pollutant emissions from transport.

Specific policy measures have been taken

• to improve the energy efficiency and reduce the CO2 emissions of cars through voluntary
agreements between the European Commission and the automotive industry

• to promote the market development of alternative fuels through setting of targets and
providing the possibility of tax reductions and other economic incentives

• to reduce gradually the limits for polluting exhaust gases from vehicles through the EURO
emission standards.

Recent policy development on the European level has taken a strategically oriented, holistic
approach. Sustainable development has been integrated into sectoral policy. With this view,
green propulsion is evoked in the mid-term review of the White Paper on European transport
policy of June 2006, in the Energy Efficiency Action Plan of October 2006, and in the package
on a European energy policy of January 2007.
The previous proposal of the European Commission for a directive on the promotion of clean
vehicles through public procurement of vehicles meeting the Enhanced Environmentally
friendly Vehicle (EEV) standard has met opposition from different actors from different
reasons, while the objectives of promoting the market introduction of clean vehicles and
improving local air quality were broadly supported. A new approach should therefore be taken,
with an open examination of all options.

The automotive industry (Mr. Lücke, ACEA) presented the achievements in pollutant
emission reductions over the last 30 years through the introduction of new vehicle
technologies, as required by the gradually lower EURO emission standards. They also reported
on the introduction of fuel saving technologies and the market penetration of low-consumption
cars. For the future, they advocated an integrated approach, with all actors involved, industry,
policy makers, consumers, taking their responsibility, as developed in CARS 21, the pioneering
Commission initiative in this field. This also should help to reconcile the diverse and sometimes
conflicting requests on lower pollutant emissions, lower CO2 emissions, lower noise, higher
safety, and higher comfort for the users. Use of biofuels, eco-driving, and control of an
optimum tyre pressure were identified as major supporting measures. These additional
measures also could have a faster impact, as they would act on the whole vehicle fleet in
operation and not depend on long delays for the introduction of new vehicles. Optimisation of
infrastructure in view of improving transport efficiency was also suggested. Harmonised CO 2-
based vehicle and fuel taxation across the EU was strongly requested for reasons of increased
CO2 emission awareness and improved competitiveness through economies of scale. The
research and development projects under way in industry and funded by the Community
Framework Programme give a promising outlook into further possible reduction of energy
consumption, CO2 emissions, and pollutant emissions through technological improvements of
vehicles.

An integrated view on the environmental and economic bill of the different fuels was presented
by a speaker of the European consortium (Mr. Mahieu, JRC Ispra), who has established a
comprehensive well-to-wheels analysis of all possible fuel pathways in a joint effort of the
European automotive, the oil industry, and the Joint Research Centre Ispra of the European
Commission. The parameters considered are energy consumption, CO2 emissions, and cost
arising along the fuel pathway. The result shows that there is no single solution for a fast move
to low-CO2 fuels. An optimised mix of different routes will rather be needed. More than with
the present single supply from oil, a holistic assessment will be required, taking fully into
account the emissions and the energy efficiency during the use of a vehicle, as well as for the
fuel path from the energy source to the tank on board a vehicle. The aim is to minimise
simultaneously energy use, CO2 emissions and cost. Such an integrated methodology could be
useful also for future legislation.

A speaker of the NGOs (Mr. Dings, T&E) showed examples of successful oil demand
reduction policies in the past, in reaction to strong oil price rises – and showed that such
policies had contributed to lowering oil prices in turn. CO 2 emission from cars could have been
reduced much more if progress in energy efficiency would not have been partly counteracted
by increases in weight and power, of vehicles. Biofuels could have big drawbacks and
alternative fuels policy should be based on their environmental performance – California's low
carbon fuel standard would be an example to follow and therefore one would be looking
forward to the adoption of a similar proposal in the EU. CO2 limits should be set on fleet
averages, not on individual vehicles. Public procurement should have two objectives, namely to

2
set an example, and to promote advanced technologies. Environmental criteria should ideally
cover all public concerns, such as air pollution, climate change, energy saving, safety, and
noise. The implementation should provide flexibility, and could be based on point score system,
where authorities can choose the criteria most appropriate for their specific conditions.
Overall, a minimum point score should be attained, and this minimum level could be raised
over time to stimulate technological development and strengthen the environmental gains. The
level of enforcement, be it on Member State level or on company level, would need to be
discussed. In addition to positive selection criteria, prohibition of certain features could also be
considered, such as exclusion of SUVs, of noisy vehicles, of high CO2 emitters. Life time costs,
if considered, would need a harmonised methodology of quantifying.

The summary discussion at the end of the session expanded on the main proposals and
brought in several additional suggestions.

A speaker of the European Aluminium Association proposed to consider CO2 emissions per
tonne-km transported freight as criterion for freight transport rather than just the distance
related emissions of an empty vehicle.

A representative of Transport for London welcomed the proposal of a point scoring system for
public procurement. He further asked for an integration of CO2 emission standards into the
EURO standards. He pointed out the importance of tough procurement standards, as new
vehicle would impact on the fleet performance for their life-time.

A representative from the Region of Flanders underlined the necessity of integrated transport
policies, covering vehicle technology as well as incentives for a shift to public transport. He
pointed out that the largest part of pollution emissions comes from a small share heavily
polluting old vehicles. He proposed to consider a scraping scheme designed as a smoking ban
for "heavy smokers", and alluded to an amendment proposed by Slovenia in the discussion on
the clean vehicle proposal in Council Environment Working Group.

A representative of the city of Bremen followed up on the large contribution of emissions from
old heavy duty vehicles in urban areas and pointed out the importance of ambitious clean
vehicle procurement particularly in this category. More attention should be given to the
introduction of hybrid technology in buses. While hybrid buses were already used in large
numbers in US cities, only few demonstration buses were running in Europe. European
industry would need to catch up. Market pull from demand in public procurement could be
supportive.

Session 2: Political support

The second session opened with a brief presentation on the Commission's initiative on the
promotion of clean and energy efficient vehicles through public procurement (Mr.
Söldner).

An initiative on the promotion of clean vehicles through public procurement was proposed by
the Commission in December 2005. Vice-President Barrot, in an intervention in the
Environment Committee of European Parliament in November 2006, suggested taking a new
approach. The objective should be a broad market introduction of clean and energy efficient
vehicles.

3
A possible way forward could include vehicle procurement on a voluntary basis of new Euro
standards, after these standards are adopted by Council and Parliament and before they have to
be applied on a general mandatory basis. Another element could be the introduction of life-time
costs for energy consumption, CO2 emissions, and pollutant emissions as award criteria for the
procurement of vehicles.

The oil industry (Mr. Rose, CONCAWE) gave an overview on the development of standards
for clean vehicles and fuels, showing a substantial improvement of regulated pollutant
emissions until recently. They stressed the need to consider fuels and vehicle as a single system.
Further progress needs a close interlinkage of fuel and vehicle standards. The integrated view
of a well-to-wheels assessment was underlined also in this presentation. The prospects for
development of the different alternative fuels were qualified. Second generation biofuels should
receive high priority because of advantage in efficient use of resources and low CO2 emission
characteristics. Four main development lines were laid out, as improvement of conventional
engine systems, quality improvement of conventional fuels, development of alternative engine
systems, and introduction of alternative fuels. Significant potential for further reductions in fuel
consumption and emissions was projected and gave reason to believe that political actions in
support of clean and energy efficient vehicles are a worthwhile undertaking.

ADEME (Mr. Coroller), the French Agency for Environment and Energy Management, gave
an overview on their elaborate support programme for clean and energy efficient vehicles and
the progress in market penetration of these vehicles. Close co-operation with manufacturers
and real-life tests of new technologies were key for success. ADEME had developed a user-
friendly programme to determine the external costs for a specific vehicle in view of
internalising them in procurement decisions. Action on European level is proposed in the
following areas: A European certification scheme for alternative fuels should be developed on
a well-to-wheels basis. A definition of clean and energy efficient vehicles should be established
on European level as a basis for non-distorting state-aid. Support measures for clean and
energy efficient vehicles also should be harmonised in the European Union to avoid market
fragmentation. Accompanying measures at local level in urban transport could reinforce action
at European level. Economic incentives, in the form of purchase aids or tax rebates, should be
combined with non-economic incentives, such as access privileges or denials, and awareness
rising. A CO2 regulation for light-duty vehicles would appear necessary, as actions on
behaviour and on infrastructure would not be sufficient to attain the objectives set on reduction
of greenhouse gas emissions.

UITP (Mrs. Ollier), representing public transport operators, gave examples of local actions in
support of green procurement. A High Level Group of representatives of the main
stakeholders in the field has worked out recommendations for a model of harmonised tendering
based on lifecycle cost analysis, and including environmental impact and fuel consumption. The
need for public funding and fiscal incentives for clean energy use were underlined.

The Vice-President of Nantes Metropole (Mr. Durand) presented the successful experience of
his city with integrated transport planning, based on quality improvement of public transport,
together with offers for free parking at park+ride nods at the periphery and a reduction of
space for individual cars in the city centre. He was opposed to a city toll, as it would
disadvantage the poorer part of the population. In Nantes, green procurement for public
transport was initially facing problems of higher vehicle price and higher maintenance cost and
a long homologation process for vehicles not recognised by national authorities though already
approved in other Member States. EU support through CIVITAS was instrumental to arrive
4
finally at one of the most advanced public bus fleets in France. On EU level, Community action
could be supportive in several areas: Harmonised homologation should become mandatory; the
tendering rules for public procurement should be harmonised also in their content; joint
procurement of several cities (as explored by a projects supported in the frame of the STEER
programme of the European Intelligent Energy Agency) could improve the economics of green
procurement; harmonised standards for alternative fuels should be developed; harmonised
definitions for clean vehicles should be established.

In conclusion, broad support was expressed by the participants in the Workshop for action at
EU level to promote the market introduction of clean and energy efficient vehicles. Several
contributions considered public procurement an effective tool for this purpose.

The Commission made participants aware of the forthcoming internet consultation on the
preparation for the Urban Transport Green Paper, with specific questions on the initiative in
support of clean and energy efficient vehicles. Further contributions in the frame of this
consultation were invited. Information should also be provided for the impact assessment study
carried out by a consultant for the Commission. This impact assessment study would also be
reviewed with stakeholders, and a final review meeting with broad participation is planned for
July 2007.