Overview and evaluation of eco-innovations in European passenger car CO2 standards

The eco-innovations mechanism rewards innovative technologies that produce real-world CO₂ savings beyond what is measured over the standardized test cycle during vehicle type approval. Because CO₂ savings from eco-innovation technologies count toward manufacturers’ CO₂ targets, manufacturers have an incentive to develop and deploy cost-effective eco-innovations to meet CO₂ standards. In theory, providing credits to manufacturers for technologies that reduce real-world emissions can both reduce the cost of complying with the CO₂ standards and increase total real-world reductions. However, if estimated eco-innovations CO₂ savings exceed the amount of real-world reductions, or if credits are given that double-count CO₂ reductions on the type-approval test, they can become a loophole and erode the benefits of the CO₂ standards. Thus, it is critical to properly account for the real-world benefits of eco-innovations.

While 25 eco-innovations for passenger cars have been approved to date, less than half have made it to market. Fleet-average CO₂ savings from eco-innovations remained low in 2017, at less than 0.04 g/km. This value is likely to underestimate CO₂ savings due to approximately half of EU member states not providing reliable monitoring data on eco-innovations; however, fleet-average CO₂ savings were still likely well below 1 g/km. Nevertheless, select vehicles achieved CO₂ savings upward of 4 g/km, and future targets are expected to accelerate eco-innovations uptake. In addition, a recent amendment to the eco-innovation regulation simplifies the process of approving eco-innovations, incentivizing vehicle manufacturers and component suppliers to market more technologies.

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