Government has unveiled a new net zero plan today called “Powering up Britain”
The government was forced to publish this strategy after the High Court judged last July that its current plan was not detailed enough to show how the UK would meet its goal to reduce its greenhouse gas emissions to net zero by 2050. The announcement can be found here.
Policies that affect the automotive industry:
Charging Infrastructure fund:
Government has launched a £381 million Local Electric Vehicle Infrastructure (LEVI) fund alongside an additional £15 million for the On-Street Residential Charging Scheme (ORCS)
ZEV Mandate:
The ZEV mandate will be the lever to deliver legally required reductions in carbon emissions from light-duty road transport. Each year, manufacturers will receive allowances to sell non-ZEV vehicles up to a given percentage of their fleet of new cars and vans, with the intention that ZEVs account for the remainder of sales. Any excess non-ZEV sales must be covered by purchasing allowances from other manufacturers, by using allowances from past or future trading periods (banking or borrowing) during the initial years of the policy or by offsetting with credits.
Starting next year, this will set the minimum annual targets for the percentage of new car and van sales that must be zero emission.
Overview:
- Only vehicles with a zero-emissions range of over 120 miles will be covered by the mandate.
- Smaller-scale OEMs which sell less than 2,500 vehicles a year will remain exempt from the legislation until 2029.
- Banking of ZEV allowances will be allowed, subject to some limits and restrictions.
- Borrowing of ZEV allowances will be allowed between 2024 to 2026, subject to caps on the amount that can be borrowed and with interest payable on the deficit.
- To qualify as a ZEV, new cars and vans will need to meet certain minimum eligibility criteria. Manufacturers will have the possibility of earning additional credits for deploying ZEVs for use in specific applications, such as car clubs.
- During the years 2024 to 2026, any overachievement against the minimum requirements of the new non-ZEV CO2 emission targets can be used to offset non-compliance with the ZEV mandate, though this will be capped.
Cars:
The proposed minimum ZEV target trajectory for new cars sold begins at 22% in 2024, increasing to 80% in 2030 and reaching 100% in 2035.
Vans:
The proposed minimum ZEV target trajectory for new vans sold begins at 10% in 2024 and reaches 70% in 2030 on the way to 100% in 2035.
The new consultation will be seeking views on the final design of the UK’s Zero Emission Vehicle mandate and C02 emissions regulation for new cars and vans.
The final proposals are currently being consulted upon in a new consultation. These involve:
- the level of ZEV uptake (trajectories)
- how allowances and credits could be allocated and used
- flexibilities including banking, borrowing and transfers between schemes
- derogations and exemptions
- how to regulate the non-ZEV portion of the fleet
- how the ZEV mandate and non-ZEV CO2 regulation interact
The link to the consultation can be found here.
