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Germany–EU Spat Over E-Fuels Ends Amicably — For Now

E-fuels have been at the heart of a dispute between Germany and the European Commission but it seems the problem has been solved … for now.

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The European Union thought it was gliding down the highway toward a future without the sale of new internal combustion cars — which would be banned beginning in 2035 — until Germany threw a monkey wrench into the EU’s plans a few weeks ago by insisting that some cars with conventional engines be allowed to be sold if they run on carbon-neutral e-fuels. No doubt, that stipulation was inserted at the behest of certain German carmakers who can feel the clock ticking and are desperate to keep their primary business from being legislated out of existence.

The German auto industry is a crucial part of that country’s economy when you add in all the parts suppliers, sales staff, insurance companies, tire companies, and repair facilities that are an essential part of the industry. In fact, it accounts for 5% of the country’s GDP and 820,000 jobs, according to the Financial Times. Volkswagen may be spending billions to transition to making electric cars, but it also needs to keep selling conventional cars to help pay for it all. BMW is also intent on bringing more electric cars to market but is hedging its bets by designing cars that can be fitted with multiple powertrains.

But now, all is sweetness and light — almost. After a marathon negotiating session, German transportation minister Volker Wissing said in a statement: “In very detailed and constructive negotiations, we managed to ensure the element of technology neutrality within the framework of the regulation of fleet limits. This paves the way for vehicles with combustion engines that only use CO2-neutral fuels to be newly registered after 2035. This also implemented an important point from the coalition agreement.

“Concrete procedural steps and a concrete schedule were fixed in a binding manner. In a first step, an e-fuels-only vehicle category is to be created and then integrated into the fleet limit regulation. We want the process to be completed by autumn 2024. I would like to thank everyone involved for the recent good and goal-oriented discussions. It was always a question of making the dialogue process more concrete, namely the issue of openness to technology, which is so important for the entire European Union. In doing so, we are opening up important options for the population towards climate-neutral and affordable mobility.”

A Simple E-Fuels Solution

According to Germany’s Tagesschau, one of the sticking points in the negotiations was the lack of a mechanism in the German proposal that would prevent drivers who purchased cars designed to run on e-fuels from simply motoring on down to the nearest Gas ‘N’ Go and filling the tank with good old-fashioned dino juice. That loophole may have been closed by a provision requiring  sensors that will prevent the engine from starting if it detects the presence of a non-approved fuel.

That’s the easy part, although there has never been an electronic sensor made that can’t be defeated by a determined individual. There are devices that can be inserted into seatbelt latches to trick the car into thinking a seatbelt has been fastened, and you can buy weights online that wrap around the steering wheel to fool Tesla’s Autopilot into thinking the driver has a hand on it. However, according to information from Der Spiegel, Minister Wissing rejected this.

A second part of the negotiations involved defining just exactly what an e-fuel is. According to Tagesschau, the EU Commission is to make a proposal “without delay” by this fall “on how pure e-fuels vehicles would contribute to the CO2 reduction targets.” This creates two potential stumbling blocks for the future of the process. These criteria could be very strict to ensure that only green electricity is used for the production of synthetic fuels. Such standards are necessary to ensure that hydrogen and carbon dioxide used to make e-fuels do not use fossil fuels as precursors. Otherwise, the so-called e-fuels would be anything but, which would have a massive impact on the EU’s climate initiatives.

Nothing is 100% Guaranteed

Despite all this sturm und drang, the agreement supposedly reached is not yet set in concrete. The European Commission is guided by a legal process that is as Byzantine as it is opaque. Think of it as playing 4-dimensional chess. Tagesschau says that in the event that the EU Parliament or the Council of Member States reject the proposal, the next step is already outlined in the agreed statement by the Commission. The Brussels authorities will then take another legal route, possibly involving a rethinking of the carbon dioxide fleet limits.

That is up to the Commission, but would entail a new legislative process. “The bottom line is there can be no such thing as a 100 percent legally binding agreement. However, the understanding that has now been reached seems to be enough for the transport minister. Everyone involved should hope that, at least for the moment, there will be calm in the dispute over the combustion engine end. On Tuesday, EU energy ministers could give the final green light to the law, which is a key part of the EU’s Fit for 55 climate package,” Tagesschau says.

Dejá Vu All Over Again

This whole schemozzle apparently stemmed from different interpretations of a draft policy promulgated by the EU Commission last fall to ban the sale of combustion engine vehicles by 2035. After it was announced, Germany negotiated an addition to the agreement which called for the EU Commission to submit a proposal on how vehicles that only run on e-fuels could be approved after 2035. The EU Commission always assumed the e-fuels provision would apply to special vehicles such as ambulances or fire engines, but Berlin saw things differently and insisted the e-fuel exception should apply to all vehicles. A confirmation of the agreement by the EU states, which was planned for early March, was therefore initially prevented by Germany.

It may be that this disagreement will be resolved amicably at some point, but Germany’s decision to hold up the entire process over the e-fuels exception has left a bad taste in the mouth of some EU Commission members. Latvian Prime Minister Krisjanis Karins spoke of a “very, very difficult sign for the future.”

The nub of the dispute is that e-fuels mean different things to different people and the fossil fuel industry is already trying to insinuate itself into this new and growing field. It could well be that the final, final word on the internal combustion ban and e-fuels in Europe may still be a year or two away.

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Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."


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