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German bid to tweak EU gas car phase-out peeves partners

Ella Joyner
March 21, 2023

Berlin wants last-ditch changes to the landmark EU law spelling the demise of the combustion engine from 2035. It’s not a good look on the international stage, observers in Brussels warn.

Close-up of the back end of a running car, with a cloud of smoke coming from its exhaust. Stock photo, undated.
Internal combustion engines that run on fuels like petrol and diesel contribute to global warmingImage: Marijan Murat/dpa/picture alliance

When negotiators from the EU member states, European Commission and the European Parliament struck an ambitious deal to stop selling internal combustion engine cars by 2035 one evening in October, Frans Timmermanns — the bloc's top climate official — was among many tweeting to celebrate. "Let's go full speed ahead!" the European Commission vice-president wrote.

Fast forward five months and the bill, which was set to have been given the final formal green light in the past few weeks, has hit a roadblock.

German Transport Minister Volker Wissing — part of Germany's center-left coalition and himself from the pro-business Free Democratic Party (FDP) — made a last-minute bid last month to include an amendment allowing internal combustion engine cars to be sold after that date if they run on climate-neutral, synthetically created e-fuels.

It's a potential opening for carmakers to keep selling traditional rather than electric cars, and one that Wissing argues is necessary to support the development of e-fuels and the automotive industry.

Bumpy road to climate neutrality

Germany went on to win backing from a handful of other EU member states, and the vote to confirm a bill that was several months in the making was suddenly delayed.

Now, the European Commission and the German Transport Ministry are apparently engaged in a ping-pong match of proposals and counter-proposals ahead of an EU summit later this week. Meanwhile, Germany's EU partners are left asking when it became ok to reopen the box on laws that are supposed to be done and dusted.

"It is indeed very unusual for a member state to raise concerns so late in the legislative process," one EU diplomat told DW on condition of anonymity. In their view, German worries about exemptions for e-fuels and Italian concerns about sports car production had been addressed during negotiations, the source stressed.

France has been particularly critical of the attempt to tweak the law, which sets a 100% CO2 emission reduction target on new cars and vans, essentially banning diesel and petrol engines after 2035. Finance Minister Bruno Le Maire said earlier this month that it sent mixed messages to the car industry: that they must put everything into electrification, but also that there would be some exemptions.

This was economically contradictory and industrially dangerous, Le Maire said in comments carried by Reuters news agency. "That's not in the interest of our national manufacturers and, above all, it's not in the interest of the planet."

E-fuels role in future transport contested

Wissing's demands are controversial because few see e-fuels as a viable solution to reducing passenger car emissions, Elisabetta Cornago, an EU climate policy expert from the Centre for European Reform, told DW on Tuesday. "Studies indicate that e-fuels in 2035 would be able to power less than 5% of the EU fleet, proving to be a distraction from the electrification of transport," she said. At present, the EU does not generate enough renewable power to produce e-fuels on top of its other energy needs.

The attempt to seek an exemption also appears to be straining relations with the FDP's senior coalition partners, the center-left Social Democrats and the environmentalist Greens, who are keen to tout their climate credentials internationally. The German coalition government, in power since Chancellor Olaf Scholz took over Angela Merkel in late 2021, has been repeatedly criticized for slow and squishy decision-making — for example on the question of whether to send tanks to Ukraine to fend off Russia.

German Economy Minister Robert Habeck of the Green party said Tuesday it was "high time" that a conclusion was reached, according to dpa news agency. "It's now also hurting Germany," Habeck said, adding that the fight could undermine broader EU climate goals.

Bad example from a big player

Cornago said it was not a good look for Berlin. "There's reputational damage for Germany itself in the sense the largest country in the EU is now basically walking back on an agreement," she said. "What people are worried about here in Brussels is that if Germany can do this, then plenty of other countries can start to do it too," she said, pointing to the example of Italy's new right-wing government and of Poland.

The proposal seemed like an attempt to score to political points, she continued. "What the FDP is doing is trying to make its voters believe that it can sort of freeze the [energy] transition and that you can find some ways to bypass the full electric transformation of vehicle sector." This, she said, is not credible.

A survey released last week by German broadcaster ARD showed that the majority of Germans oppose banning combustion engines in new cars in the EU.

Are e-fuels really eco-friendly?

The EU diplomat with whom DW spoke said European lawmakers had wanted to see the "ambitious text" already agreed to pass, but they didn't see the entire bill in jeopardy. "We shouldn't make this bigger than it is," the source said, though the incident did highlight the dangers of internal politics spilling over into EU policy.

The row may well be raised by individual member states — France, for example — at this week's summit, though EU officials appear to be keen to keep it off the official agenda, the diplomat added. It is not clear when a vote on the engine bill itself could be scheduled.

Edited by: Jon Shelton

While you're here: Every Tuesday, DW editors round up what is happening in German politics and society. You can sign up here for the weekly email newsletter Berlin Briefing.

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