Explanatory Memorandum to COM(2017)653 - Amendment of Directive 2009/33/EU on the promotion of clean and energy-efficient road transport vehicles

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dossier COM(2017)653 - Amendment of Directive 2009/33/EU on the promotion of clean and energy-efficient road transport vehicles.
source COM(2017)653 EN
date 08-11-2017


1. CONTEXTOFTHEPROPOSAL

• Reasons for and objectives of the proposal

The EU is committed to creating a sustainable, competitive, secure and decarbonised energy system. Achieving a sustainable transport is a key objective of the common transport policy. It also figures prominently in the Commission’s political priorities for 2015-2019, and most notably within the Energy Union1, and Jobs, Growth and Investment. The 2017 State of the Union address outlines a new industry policy strategy committed to making the EU a world leader in decarbonisation2.

These political priorities are underpinned by the Commission's European Strategy for Low-Emission Mobility, adopted in July 20163. It confirms that in order to meet the EU's commitments at the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCC) held in Paris in 2015 the decarbonisation of the transport sector must be accelerated and greenhouse gas emissions and pollutant emissions should also be firmly on the path towards zero-emission by mid-century.

The Commission's ‘Europe on the Move: an agenda for a socially fair transition towards clean, competitive and connected mobility for all’4 communication notes that increased production and uptake of clean vehicles, alternative fuel infrastructure and modern system services making use of the data economy in the EU offers multiple benefits: European citizens will benefit from safe, attractive, intelligent, seamless and increasingly automated transport solutions, which will provide industries with new sources of growth and competitiveness.

Around 95% of vehicles on Europe's roads still use fossil fuels. The European Strategy for Low-Emission Mobility makes clear that the deployment of low- and zero-emission vehicles will need to increase substantially in the future in order to meet the EU's emission reduction commitments. The strategy indicates the relevance of public procurement in this context. It notes that "to support demand the Commission is working […] on incentives in public procurement rules, in the context of the revision of the Clean Vehicles Directive."5

As was announced in the Commission's Communication"Europe on the Move: an agenda for a socially fair transition towards clean, competitive and connected mobility for all"6 this proposal forms part of a second package of proposals, which will contribute to the Union's drive towards low-emission mobility. This package is presented in the Commission's Communication 'Delivering on low-emission mobility - A European Union that protects the planet, empowers its consumers, and defends its industry and workers'. It includes a combination of supply- and demand-oriented measures to put the EU on a path towards low-emission mobility and at the same time strengthen the competitiveness of the EU's mobility eco-system7.

COM (2015) 80 final.

https://ec.europa.eu/commission/news/president-juncker-delivers-state-union-address-2017-2017-sep-13_en.

COM (2016) 501 final.

COM (2017) 283 final.

COM (2016) 501 final.

COM (2017) 283 final.

Contents

1.

COM(2017) 675 final


Directive 2009/33/EC on the promotion of clean, energy-efficient road vehicles, known as the Clean Vehicles Directive (or the Directive) complements the EU’s horizontal public procurement legislation8. By making it mandatory to account for operational lifetime energy and environmental impact in the public procurement of road transport vehicles, it seeks to stimulate the market for clean, energy-efficient vehicles, contribute to reducing CO2 and air pollutant emissions, and increase energy efficiency.

An ex-post evaluation carried out in 2015 showed that the Directive has serious shortcomings. Public bodies are on average not using public procurement well enough to help accelerate the market uptake of clean vehicles.9 It identified shortcomings in the Directive’s design, including an insufficient scope and lack of a definition. Provisions for vehicle purchase are either vague (technical specifications) or overly complex (monetisation of external effects).

The general objective of this initiative is to increase the market uptake of clean, i.e. low- and zero-emission vehicles, in public procurement and hence to contribute to reducing overall transport emissions, and to competitiveness and growth in the transport sector. Public procurement remains relevant as a demand-side stimulus, including in the field of heavy-duty transport vehicles where no legislative requirement for reducing CO2 emissions exists yet, though such legislation is under preparation. It helps further support market momentum in cars and van markets in Member States with a very low uptake of clean vehicles – in 2017, in 16 Member States the proportion of battery-electric vehicles in new car registrations was less than 1%, and in 10 Member States it was less than 0.5%. And it stimulates the uptake of clean vehicles in the heavy-duty market segment.

The revision ensures that the Directive covers all relevant procurement practices, that it provides clear, long-term market signals, and that provisions are simplified and effective. It aims to increase the transport sector’s contribution to the reduction of CO2 and air pollutant emissions and to competitiveness and growth. It also supports better alignment, and hence greater market impact of, public procurement policies in Member States.

The revision widens the Directive’s scope. It sets a definition for clean light-duty vehicles based on a combined CO2 and air pollutant emissions threshold. It also makes it possible to adopt a delegated act under this Directive to adapt the same approach for heavy-duty vehicles after CO2 emission standards for such vehicles have been adopted at EU level in the future. It sets minimum procurement targets at Member State level following the definition and in case of heavy-duty vehicles based on alternative fuels until the adoption of the delegated act. Finally, it introduces a reporting and monitoring framework and discards the methodology for monetisation of external effects.

• Consistency with existing policy provisions in the policy area

EU law sets out minimum harmonised public procurement rules through Directives 2014/24/EU and 2014/25/EU. These minimum thresholds are conditions for the applicability of provisions under the Clean Vehicles Directive. The objectives of this revision are consistent with the Charter of Fundamental Rights10, in particular as a non-discriminatory approach is applied to single contracting authorities, entities and relevant operators. They are

10

2.

Directive 2009/33/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of clean and


energy-efficient road transport vehicles (EE L120, 15.5.2009, p.5) .

In 2009-2015, an approximate average of 4.7% of all new public passenger vehicle purchases (or ~2,7k vehicles), 0.4%

of all new van purchases (or 0,02k vehicles), 0.07% of all rigid truck purchases (or 0,006k vehicles), and 1.7% of all new

3.

buses (or 0,13k vehicles) purchased under the Clean Vehicles Directive were battery-electric, fuel-cell electric, plug-in


hybrid or natural gas vehicles.

ec.europa.eu/justice/fundamental-rights/charter

8

9

fully in line with the main objectives of other legislative and non-legislative initiatives aiming to reduce emissions of greenhouse gases and air pollutants and to support the use of clean, low- and zero-emission vehicles. The objectives of this initiative, and the measures proposed, are consistent with the proposed Regulation for CO2 emission performance standards post-202011. The revision complements a market push-and-pull approach of policy levers at EU level by creating an additional demand-side stimulus for clean vehicles. In this way, it helps implement CO2-emission-performance standards for cars and vans post-2020, as well as air quality legislation currently in place in the EU.

2. LEGALBASIS, SUBSIDIARITYAND PROPORTIONALITY

• Legal basis

The Directive is based on Article 192 of the Treaty on the Functioning of the European Union. The European co-legislators underlined the importance of public procurement to the achievement of long-term EU environmental, climate and energy as well as growth and competitiveness objectives with the adoption of Directive 2009/33/EC. It is also the same legal basis as the ones used for the adoption of Directives 2014/24 /EU and 2014/25/EU.

• Subsidiarity (for non-exclusive competence)

Member States and the EU share competences in transport, environment and procurement law. However, the sectorial harmonisation of procurement rules in the Internal Market is an EU competence. Problems linked to the Directive as it currently stands could not be addressed by Member States alone, since Member State jurisdiction ends at national borders.

The impact assessment shows that action under this initiative limits EU intervention to providing a common policy framework with minimum requiements for the procurement of clean vehicles, while giving Member States flexibility in implementation, including the choice of technology. The proposed measures do not encroach on the Member State competence to organise the provision of (public) transport, and they do not constraint the ability to choose the most appropriate technology.

Large-scale potential impacts of climate change justify action at all levels of governance; this is an accepted basis for policy making at EU level. It is also accepted that air pollution, though mostly a local urban problem, can be more effectively tackled if authorities can draw on the best clean technologies available, which is made easier by the existence of a common market. The cost of air pollution warrants collaboration and action at all levels of governance.

• Proportionality

In accordance with the principle of proportionality, this proposal does not go beyond what is necessary to achieve the objectives set. All measures are considered to be proportionate in terms of their impacts. They complement other policy levers such as the CO2 emission performance standards for cars and vans and support the implementation of EU air quality legislation. This initiative helps ensuring a clearer, better coordinated approach. They also do not constrain the ability to choose the most relevant technology. Rather they support with a minimum share approach the needed acceleration towards low- and zero-emission mobility.

It allows authorities to adopt, within specified timeframes, all measures needed to facilitate the use of clean vehicles in order to address European, national and local policy objectives. It also allows for flexible interaction between national, local and regional public bodies within

COM(2017) 676 final

11

the context of the overall broad minimum procurement targets set at national level. The territorial impact assessment of the proposal showed that effects are predominantly positive and are relatively equally distributed throughout the EU.

Choice

of the instrument

As this proposal amends an existing Directive, an amending Directive is the most appropriate instrument. Most of the stakeholders who took part in the public consultation supported this position and rejected the repeal option and the option to change the Directive into a Regulation, in spite of the shortcomings of the current legislation. It was noted that a Regulation does not allow for the flexibility needed to address regional and local differences.

3. RESULTS OF EX-POST EVALUATION, STAKEHOLDER

CONSULTATIONS AND IMPACT ASSESSMENT

• Ex-post evaluation of existing legislation

The ex-post evaluation concluded that the Directive has not stimulated the public procurement of clean, energy-efficient vehicles. Public procurement has had little effect on market uptake of clean vehicles across the EU and therefore also very limited impact on reducing

greenhouse gas and air pollutant emissions. It has also had no visible impact on the sector’s

competitiveness or growth.

The evaluation noted the f oll owi ng as key reasons behind the Directive’s limited impact:

• The limited range of contracts covered by the Directive: due to limited provisions on its scope, the Directive does not cover practices other than direct purchase by public bodies. For example, it does not address the renting, leasing or hire-purchase of vehicles. Furthermore, it does not cover transport service contracts other than for public passenger transport.

• The lack of clear provisions for vehicle purchase: the Directive does not clearly define clean vehicles, nor does it include clear purchase provisions for them.

• The complicated provision on using the monetisation methodology: the evaluation noted that public bodies rarely use this methodology because it is so complex.

• Lack of align ment of Member States’ public procurement policies: in recital 15, the

Clean Vehicles Directive notes that "procurement of vehicles for public transport services can make a significant impact on the market, if harmonised criteria are applied at Community level . Such harmonised criteria are not in place yet.

The ex-post evaluation concluded that the Directive should remain in place. Public procurement has the potential of helping increase market uptake of clean vehicles and contribute to the economies of scale that will lead to lower production costs and lower prices. In turn, this should help stimulate private demand for clean vehicles: greater visibility can increase consumer trust. A repeal would send the wrong policy signal in the context of the EU s transition to ow-emission transport. Contracting authorities and entities would find it more difficult to justify the purchase – horizontal public procurement law does not set these specific requirements. At the moment, there are also no alternative policy measures available to stimulate the market for cleaner heavy-duty vehicles.

The ex-post evaluation recommended a series of amendments to the Directive, including to broaden its scope and change the provisions for vehicle purchase to include a definition and related action requirements. It also noted the need to improve the level and quality of


information and data available to support future monitoring of the effectiveness and efficiency of the Directive.

Stakeholder consultations

As part of the impact assessment, stakeholders were consulted in:

• an open public consultation from 19 December 2016 until 24 March 2017: it confirmed the need for revision; broadening the scope and introducing a definition and related minimum action requirements found majority support;

• stakeholder interviews carried out between December 2016 and March 2017; they noted particularly the need for flexibility in the implementation of the Directive;

• a public stakeholder meeting on the public consultation on 28 April 2017, discussing the needs and relative benefits of approaches to broadening the scope of the Directive, setting up a definition and related procurement requirements;

• meetings with Member State representatives on 8 February, 5 April and 28 April 2017, underlining the relevance of policy consistency and the benefits of an emission-based approach to defining clean vehicles.

• Collection and use of expert ise

The drafting of the impact assessment report started with the ex-post evaluation of the Directive . Most of the information used was provided by stakeholders in stakeholder consultation activities. This was complemented by information that stakeholders provided to the Commission on an ad hoc basis.

Further sources of information included work by an expert group under DG MOVEs Sustainable Transport Forum Sub-group on Alternative Fuels in Cities. Information generated for the revision of the Commission's Green Public Procurement Criteria was also used. The impact assessment relies to a considerable extent on an accompanying study carried out by Ricardo AEA. Overall, the sources used to draft the impact assessment report are numerous, largely exhaustive and representative of the various stakeholder groups.

The Commissions also organised a meeting with experts fro m diff erent cities and regions on the territorial impact assessment of this legislative proposal on 11 May 2017.

• Im pact assessment

The impact assessment was submitted to the Commission’s Regulatory Scrutiny Board on 26

July 2017. The Board issued a positive opinion with reservations on 13 September 2017; it considered that the final report should fully explain the value added by the initiative compared to other initiatives that affect road transport emissions, and also in view of increasing vehicle uptake. It noted that the report needed to more clearly explain the reasoning behind the shift in the Directives governance relative to the principle of technological neutrality, and furhter descri be details of the policy options design. The opinion further noted that the short-term and long-term net benefits of the policy options should be clearer and that the implementation of the approach and its REFIT implications should be explained in more detail.

4.

The final impact assessment report includes a comprehensive description and assessment of


the initiative’s value added and its links with other policy initiatives in sections 1.2, 3.3, 3.4

12 See https://ec.europa.eu/transport/sites/transport/files/facts-fundings/evaluations/doc/2015-09-21-ex-post-evaluation-directive-2009-33-ec.pdf.

13 SWD(2017) 366 final

and 4.3. Knock-on effects on private purchase decisions have been qualitatively described in section 2.1. A detailed description of the policy options has been included in section 5, building on the description of the process of pre-screeni ng all possible measures in section 4. It includes the reasoning behind discarding the external cost internalisation approach, mainly due to its limited use in practice. A comprehensive analysis of the impacts of all options is presented in section 6 and includes an analysis of trade-offs, to the extent possible. The impact assessment also includes information on the sensitivity of the baseline relative to other policy initiatives. The executive summary of the impact assessment and the opinion of the

Regulatory Scrutiny Board can be found on the Commission’s website14.

Policy options

Option 1: Repeal of the Directive

This policy option repeals the Directive. The specific objectives of the Directive would be addressed through different non - legisl ati ve instruments, including awareness raising and promotion of the use of the voluntary green public procurement criteria established by the European Commission. Existing EU financial guidelines for moving towards low- and zero-emission vehicles could be revised. Voluntary action of market actors would be encouraged.

Option 2: Providing a definition of clean vehicles and requiring Member States to set up national policy plans or use the monetisation methodology

This policy option proposes a number of moderate changes. It does not change the scope of the Directive but requires Member States to choose one of two principal approaches:

• use a common definition of clean vehicles on the basis of tailpipe emissions as defined in the amended Directive and, based on this, develop a national policy framework towards a long-term target; or

• require all public bodies to procure vehicles based on their monetised internal and external costs, for which the use of the revised monetisation methodology under the Directive would be binding.

Option 3: Providing a definition of clean vehicles based on emission thresholds and setting up minimum procurement targets for light-duty vehicles, while increasing the scope

This policy option thoroughly revises the Directive. It makes it more ambitious and changes its principal governance approach. In particular, this option:

• introduces a common definition of clean vehicles based on an emissions-based threshold (tank-to-wheel) for light-duty vehicles, combining CO 2 and air pollutant emissions;

• adds a minimum procurement target for public bodies, defined at Member State level for light-duty vehicles following the thresholds set under EU procurement law, for 2025 and 203016;

• introduces measures to extend the scope of the Directive; and

5.

14 15 16


[Insert weblink when available].

SWD(2013)27.

6.

2025 proivdes sufficient time for preparation and adjustment of public procurement processes, while enabling


market signals in the short-term. A staged apporach towards 2030 also provides the opportunity to increase

the ambition of the Directive to drive forward innovation in procurement of vehicles.

• removes the monetisatio n methodology.

Option 4: Providing a definition based on alternative fuels and setting up related minimum procurement targets for all vehicles, while increasing the scope

This policy option adopts the same general approach to revising the Directive as policy option 3, but with several differences. It:

• introduces a common definition of clean vehicles based on alternative fuels for plug-in hybrid, battery-electric, fuel-cell electric and natu ral/b iom ethane gas light- and heavy-duty vehicles;

• adds a minimum procurement target for public bodies, defined at Member State level for light- and heavy-duty vehicles following the definition and thresholds set under EU procurement law for 2025 and 2030;

• introduces measures to extend the scope of the Directive; and

•

removes the monetisation methodology.

Option 5: Adopting a Regulation to use the monetisation methodology as the sole approach to informing vehicle procurement, while increasing the scope

This policy option completely changes the governance framework of clean vehicle procurement. It replaces the current Directive with a Regulation on the promotion of clean vehicles, and prescribes that vehicles be procured based on their energy and environmental impacts, which should be monetised according to the revised monetisation methodology. It also increases the scope of the Directive.

Option 6: Providing a definition of clean vehicles based on emission thresholds and setting up minimum procurement target for light-duty vehicles and combining it with a definition based on alternative fuels and setting up minimum procurement targets for heavy-duty vehicles

This option combines elements of policy options 3 and 4. It acknowledges the advantage of an emissions-based approach to defining a clean vehicle. The approach from option 3 is used for light duty vehicles. For heavy-duty vehicles it uses the approach of option 4 and enables the Commission to adopt an delegated act to change this approach to an emissions-based threshold approach, once CO2-emission performance standards for heavy-duty vehicles have been adopted at EU level.

Option 6 has been chosen as the preferred policy option for the revision of the Directive. It improves consistency with the use of CO2-emission performance standards for cars and vans at EU level. Both initiatives concern the same type of vehicle through a combination of market push- and-pull levers. Option 6 ensures the adaptability of the Directive to an emissions-based approach applied in the field of heavy-duty transport vehicles in the future. It also guarantees immediate impact on market uptake in the area of heavy-duty transport. Finally, it sets a clear path forward, providing market actors with long-term certainty, while providing flexibility and discretion in implementation.

• Regulatory fitness and simplification

Regulatory fitness and simplification of the Clean Vehicles Directive will be achieved if a clear definition is set, if related minimum procurement targets are established, and if the complex monetisation methodology is abandoned. If the Directive’s current approach was to be continued, trade-offs between better defining clean vehicles (and related purchase provisions) and improving the monetisation methodology would prevail and hamper the objective of creating stronger market signals and more effective procurement procedures.

Implementation of the preferred option are likely to yield an initial increase in administrative burden because of the need for target implementation and reporting. But these are outweighed by the overall socio-economic benefits but also the longer-term simplification gains under the proposed approach of clear provisions. The implementation in Member States leaves the possibility to flexibly combine local and regional procurement initiatives according to capacity and maturity of market. The effective use of the completed common procurement vocabulary (CPV) codes and registrations in the tender electronic daily database will support and simplify reporting and monitoring. The impact assessment report shows that the benefits of simplification will increase over time, with the Directive’s implementation.

4. BUDGETARYIMPLICATIONS

The proposal does not have any implications for the EU budget.

5. OTHERELEMENTS

• Implementation plans and monitoring, evaluation and reporting arrangements

This proposal addresses the current lack of reporting obligations. Member States will have to report on the implementation of the Directive every three years, starting with an intermediate report in 2023 and full reporting in 2026 on the implementation of the target for 2025. common codes for low- and zero-emission vehicles should be introduced in the EU’s common procurement vocabulary, to enable easy notification in the tender electronic daily database. Moreover, the Commission will support the implementation of the revised Directive through continued work under the European Commission's sustainable transport forum.

• Detailed explanation of the specific provisions of the proposal

7.

The proposal for a Directive amending the Clean Vehicles Directive is based on policy option


6. The Directive is amended as follows:

– the scope of the Directive as set out in Article 3 is extended to forms of procurement

other than purchase, namely vehicle lease, rent or hire-purchase, and to public service contracts for public road transport services, special purpose road transport passenger services, non-scheduled passenger transport and hire of buses and coaches with driver according to their common procurement vocabulary codes listed in the Annex;

– definitions under the Directive are amended in Article 4 i by adding a reference to

the minimum procurement targets for Member States, listed in the Annex;

– the provisions for the purchase of clean vehicles under Article 5 are revised to set out

minimum targets for the procurement of clean vehicles, differentiated by Member State and by vehicle segment categories according to combined CO2-air pollutant emission-thresholds (light-duty vehicles) and alternative fuels (heavy-duty vehicles), as included in the Annex and as set from the dates specified there;

8.

the current


Article 6 is deleted;

a new Article 7 on the exercise of delegation of power is introduced and Article 9 on the exercise of implementing powers is adapted;

9.

Article 10 is adapted in order to introduce reporting obligations for the Member States and to align the Commission's reporting obligations with Member States'


reporting, with intermediate reporting in 2023 and full reporting in 2026 on the implementation of the targets for 2025 and every three years thereafter.