European Commission publishes study on impacts of CO2 regulation
Mon 06 July 2009
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The European Commission has published a new report on the impacts of CO2 regulation, particularly on the car industry. The report, prepared for the EC by AEA Technology of the UK looks at the feasibility and costs of reaching sub-100g CO2/km emissions for new cars.
The report explicitly addresses the issue that projected costs of meeting a technical target are almost always higher than proves to be the case after regulations have been introduced. The authors suggest that car makers are able to learn more cost effective ways of meeting regulatory targets through experience and that these are almost always lower than the prior estimates.
To meet an 80g CO2/km target, for example, the report says that without learning the average extra costs per car to the consumer would be €5,691. However, with medium learning the costs would be only €2,443. In many scenarios, moreover, the extra costs of production are more than compensated for by reductions in lifetime fuel costs.
For the full report, please follow the associated link.
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