EU 'green transport' plans to ignore CO2
7 July 2008
Despite the bloc's ambitious goal to slash greenhouse gas emissions by 20% by 2020, Commission proposals due to be unveiled tomorrow (8 July) would effectively prohibit governments from including the cost of CO2 emitted by road transport in their toll tariffs.
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Background:
The EU's first attempt at addressing the wide range of negative 'external effects' produced by transport was in 1993, when it put forward a directive enabling countries to introduce tolls on motorways in order to finance the cost of infrastructure deterioration caused by heavy road vehicles.
Known as the 'Eurovignette Directive', the law was revised in 2006 with a view to extending its scope to more roads and vehicles and to making it possible for governments to integrate other costs – such as congestion, accidents, noise and air pollution – into toll prices (see our LinksDossier on Eurovignette).
However, due to strong disagreements between member states and Parliament, the final text of the Eurovignette de facto excluded this very possibility until a "common methodology for the calculation and internalisation of external costs that can be applied to all modes of transport" is agreed. The Commission had been due to present a model before 10 June 2008, but this date was postponed slightly due to the switch in commissioner portfolios, which saw the Italian Antonio Tajani take over from Frenchman Jacques Barrot in mid-June 2008.-----------------------------------------------
The proposals will be part of a broad package on 'greening transport', which will include a general Communication on 'greening transport', a proposal for a review of the Eurovignette Directive and a 'Strategy for the internalisation of external costs' for each transport mode.
The review of the Eurovignette Directive aims to enable governments to charge truck drivers for the costs they impose in terms of congestion, noise and air pollution. http://www.eurotoll.fr/static/en/pdf/Directive-eurovignette.pdf
According to the latest draft obtained by EurActiv, such 'external cost' charges could come on top of those already levied in some countries to finance construction and maintenance work.
No obligations
Member states would not be obliged to impose such taxes but could choose to do so for vehicles weighing more than 3.5 tonnes, on any part of their road network, as of January 2012. Charges would be capped at maximum levels and would have to vary according to the time of day, the distance travelled and vehicles' Euro emissions class type – which takes account of the amount of NOx and poisonous particulate matter emitted (see LinksDossier on Euro standards).
Tolls with barriers would no longer be permitted and the collection of charges would have to be based on an electronic system so as to avoid hindrances to the free flow of traffic, although there would be a transition period up till January 2014.
CO2 costs excluded
Charging trucks for the CO2 they emit would remain forbidden. Indeed, in the draft communication, the Commission explains that although levying a specific CO2 tax on top of the air pollution and noise charges "could deliver additional benefits, it should better be addressed through a more coordinated approach at EU level to reduce greenhouse emissions based on either the Emission Trading System or a common fuel tax element in the Energy Taxation Directive".
Nor would governments be allowed to include accident costs in their road taxes, as the Commission finds that accident risks "are related not only to the distance travelled but also to complex factors such as speeding, driving under the influence of alcohol or failure to use seat belts, hence instruments like insurance rates might be a more effective tool".
Money for sustainable transport
In what is likely to become the main contentious issue with national governments, the Commission is proposing that revenues generated by external cost charges be earmarked towards measures aimed at reducing road transport pollution at source, improving CO2 and energy performance of vehicles and developing alternative infrastructure for transport users, the communication states.
Governments would nevertheless remain free to allocate revenues raised through infrastructure charges as they choose.
A five year wait?
The Commission says it will review the situation in 2013 to determine whether the option of charging truck drivers for the costs they impose on society should become an obligation. "The review will also assess whether the cost of CO2 emissions should be allowed to be included in tolls," states the communication.
But debates in Parliament could see a change in the proposals, as MEPs appear to be far from convinced by the plans so far (see positions).
Positions:
According to the Commission's communication, "the advantages and disadvantages of mandatory versus optional charging schemes for road freight transport were compared. It was found that while there are clear and immediate benefits to be reaped in member states with a lot of traffic, the financial viability of charging systems for external costs in member states with low traffic requires further studies".
Johannes Ludewig, executive director of the Community of European Railway and Infrastructure Companies (CER), told EurActiv that, though the Commission's plans were rather unambitious, the most important part was the acceptance of the principle of internalisation of external costs.
He nevertheless lamented the exclusion of CO2 from the plans, saying: "We are seeing the argument from the Commission saying that from a scientific point of view CO2 should be better internalised by taxes on gasoline or diesel and our view is that theoretically I can follow that, but in reality, seeing the price level of gasoline and diesel today, it is unrealistic that in the forseeable future any taxes on these two will be increased." He further pointed to the contradiction between going for an optional approach and excluding certain pollutants, such as CO2.
While Ludewig would rather have seen an obligation, he said "I think that is simply unrealistic".But Damian Viccars, in charge of social and fiscal affairs at the European office of the International Road Transport Union (IRU), insisted that a mandatory approach would go against subsidiarity.
He also welcomed the exclusion of CO2 from the plans, saying: "Don't forget that we already have a CO2 tax in the form of fuel taxation. In the majority of cases, we already pay over and above our infrastructure costs through fuel taxes and contribute hugely to government transport budgets," he stressed.
Viccars also felt that congestion charges would amount to another form of "double taxation". "We are already incurring the congestion cost simply by being forced to sit in traffic," he said, adding that the 'polluter pays' system proposed by the Commission is unlikely to have any real effect.
"We are not at liberty to travel when we want," he explained, pointing to consumer needs, night-time delivery constraints and working time restrictions. "The prescriptiveness of the approach will simply cause costs to be passed on to consumers," he said, arguing in favour of a 'Cheapest Cost Avoider Principle', under which it would be left to the party that can prevent or abate the damage at the lowest cost for the overall economy to take action.
Green MEP Michael Cramer told EurActiv that he was disappointed with the proposals: "The Commission's study excludes accident and CO2 costs – the climate costs which are 80% of all the costs that transport is generating," he lamented, adding that he hoped Parliament would vote to toughen up the directive.
"We want fair competition between the modes of transport at least," he said, saying railways were suffering from the fact that most roads are still not covered by the tolls although rail is, as well as the fact aircraft still do not pay kerosene tax despite rail having to pay diesel tax. "That is unfair competition in favour of the modes of transport that are harmful for the climate, and not the opposite," he lamented.
"I hope that the Parliament will vote in a strong way – stronger than the Commission, but the conservatives are against it," he concluded.
But in fact, German MEP Georg Jarzembowski, spokesman on transport for the EPP-ED, told EurActiv that his group thought it was "strange" that the Eurovignette Directive would remain voluntary. "If you want to internalise external costs because of the climate change issue, then all countries should do it," he said.
He further expressed his discontent with the fact that the directive only covers road transport.
"We are a little bit shocked that the Commission only proposes something for the road and is not preparing anything for the other modes of transport," he said.
But he agreed with the Commission that the costs of CO2 need not be included. "We have already today a spreading of the tariff according to Euro One to Euro Six standards – so the more polluting a truck is, the more it has to pay. This is already a type of CO2 criteria in the directive, because the tariff varies according to the pollution," he said, insisting that excluding CO2 from the scope of the Eurovignette does not go against the EU's climate goals.
To read the interview with Georg Jarzembowski in full, please click here.
Next steps:
8 July 2008: Commission to present its package on 'Greening Transport'.
31 Dec. 2010: Proposed deadline for member states to comply with the directive.
31 Dec. 2013: Commission to review progress under the directive and determine whether to introduce binding obligations and allow for the inclusion of CO2 in tolls.
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