Policy recommendations
The findings support the following policy considerations:
The phaseout of new ICEV, HEV, and PHEV registrations by 2035 would align sector emissions with EU climate targets.
When running on the EU average fuel and electricity mix, only BEVs offer a large-scale reduction in life-cycle GHG emissions. To achieve a similar emissions reduction potential, FCEVs would need to be restricted to the use of renewable electricity-based hydrogen. For ICEVs, HEVs, and PHEVs, meanwhile, the development of the average mix of fossil fuels and biofuels that can be expected from current policies and market developments would not allow vehicles of these powertrain types to meet EU climate targets. While vehicles running solely on e-fuels could, in theory, achieve life-cycle GHG emissions similar to BEVs, the future availability of e-fuels for the road sector is uncertain while costs are expected to remain high.
Complementary policies: Decarbonizing all components of the life-cycle emissions of passenger cars could be achieved by complementary policies.
Alongside tailpipe CO2 emission standards and a phaseout of powertrain types that lack large-scale decarbonization potential, complementary policies can decarbonize vehicle production emissions. Examples include the battery production carbon footprint provisions in the EU Battery Regulation and sustainability criteria for vehicle purchase subsidies. Improvements in the energy efficiency of BEVs could be achieved through energy efficiency standards, and decarbonization of the EU power sector can be achieved with the Emissions Trading System.
Emissions regulations based on life-cycle emissions could be effective in the long term but come with high uncertainties and administrative burdens and take several years to be developed.
This analysis shows that comparing the life-cycle GHG emissions of vehicles with different powertrain types is highly sensitive to methodological choices. Basing vehicle regulations on life-cycle emissions thus risks disproportionally benefiting powertrain types that do not offer a sufficient long-term decarbonization potential. Moreover, it would require extensive administrative effort for companies and governments to trace, report, and verify emissions for each step of vehicle production, as well as time to build sufficient capacities and effective cross-industry data sharing platforms. Further, introducing LCA-based regulations would require several years of reporting and negotiation to establish both a baseline and an emissions threshold curve that decreases over time.
Vehicle life-cycle assessment methodologies should consider the development of the fuel and electricity mix during the lifetime of the vehicles, fuel and electricity consumption values that are representative of average real-world usage, and a full vehicle lifetime.
Our analysis of the impact of methodological choices on the estimation of life-cycle emissions illustrates the need to harmonize methodological guidelines. As presented in this study, attaining representative results requires considering projected changes in the fuel and electricity mix during the lifetime of the vehicles, fuel and electricity consumption in real-world driving conditions, and the full lifetime of passenger cars.