The European Commission laid out a broad new strategy to substantially cut carbon dioxide emissions from cars over the next five years by improving vehicle technology.
Industry Commissioner Guenter Verheugen
The rules would see new legislation requiring carmakers to reduce carbon dioxide (CO2) emissions from new cars by 18 per cent to an average of 130 grams per kilometer across the fleet by 2012. Current levels of roughly 163 grams per km.
The strategy follows a report by CARS 21, a high level group, which brought together the main stakeholders - including consumer and environmental organisations - to advise on future EU policy.
The strategy is based on an integrated approach, involving engine technology, technological improvements and the increased use of bio-fuels.
Industry Commissioner Guenter Verheugen said the rules are designed to reduce emissions without distorting competition among European car-makers.
"It is a balanced solution. It makes Europe clearly the frontrunner in CO2 reduction for cars," Mr Verheugen told reporters today.
The Commission's strategy paper said legislation would be designed to "ensure competitively neutral reduction targets which are equitable to the diversity of the European automobile manufacturers."
The rules would "avoid any unjustified distortion of competition between automobile manufacturers," it said.
However, Germany has expressed concern that such laws would unfairly penalise its industry, which specialises in larger, higher class cars, while environmental campaigners have accused Brussels of climbing down to manufacturers.
But one German luxury carmaker, BMW, gave the EU move a cautious welcome. A company spokesman spoke of "the first steps in the right direction."
Environment Commissioner Stavros Dimas had proposed the entire burden of cutting emissions to 120 gram per kilometre be borne by carmakers themselves but was forced to compromise with Mr Verheugen, who originally opposed any binding targets.
Mr Verheugen said he did not rule out having different goals for different sizes of cars, requiring higher-polluting vehicles to make bigger percentage cuts in emissions than smaller, more fuel efficient cars, for example.
He stressed that no decision on the actual legislation had yet been made, including discussion of possible penalties for non-compliance by carmakers.
"Penalties are something that we have not discussed," he said. The Commission will carry out impact assessments and propose draft laws later this year or by mid-2008 at the latest.
Brussels will also encourage the EU's 27 member states to give tax incentives to consumers to buy more environmentally friendly cars. Fergus O'Dowd, Fine Gael environment spokesman, welcomed the EC plans.
However, the emissions cut is "only a step and must be augmented in Ireland by Fine Gael's plan to charge heavy polluting vehicles a higher rate of VRT . . . I believe that a carrot and stick approach is needed to confront these polluters," he added.