On Wednesday the 7th of December, PubAffairs Bruxelles hosted a debate on Sustainable Mobility, Energy and Innovation with Mr Nikolaus von Peter, Member of the Cabinet of Commissioner Violeta Bulc, Ms Henna Virkkunen MEP (EPP/Finland), Ms Valentina Infante, Head of small scale LNG businesses, Edison, Mr Clément Chandon, Responsible for Gas Business Development, Iveco and Mr Antoine Aslanides, Advisor on Innovation at EDF EU Affairs Department. The event was moderated by Hughes Belin, freelance journalist.
Mr von Peter, a member of the Cabinet of Commissioner Violeta Bulc, held a keynote speechin which he described the European Commission’s legislative initiatives in the realm of sustainable mobility, as well as the Commission’s rationale behind them. He began his contribution by stating that sustainable mobility is a complex subject because it includes a fair amount of uncertainty in terms of both advancement of technology, consumer behaviour and political commitment, as for example the twenty eight Member States have all different policy frameworks, consumer preferences and infrastructures. In adopting its strategy the Commission decided not to be too prescriptive but instead to provide clear directions proposing an action plan and presenting the most important elements under three pillars, namely the organization of transport in a more efficient way, low and zero emission vehicles and vessels and alternative energies. In Mr von Peter views, the aspects of the Strategy which are most important are the systemic and market based approach as well as the integration of transport and energy systems.
Mr von Peter explained that first of all a “systemic” approach entails the need to think as much about technology as about the actual use of it and consequently embed technology into sustainable mobility concepts, multimodality being the core of these concepts. Also, a “systemic” approach means to look at push and pull factors where CO2 standards are the pull and procurement rules are the push. As for the market based approach, Mr von Peter explained that consumers must be well informed to form their preferences and for this reason the European Commission is working on rules on fuel labelling, fuel price comparison, rules on car labelling and procedures to test fuel consumption. Furthermore, as the market fails to internalise negative externalities such as CO2 or air pollution, road charging is very important to the Commission. In this respect Mr von Peter highlighted that a proposal for an EU framework for interoperable electronic tolling, which will consider inter alia differentiation of road charges based on CO2 emissions, will be presented in Spring 2017. Furthermore, there is, the speaker noted, a need for establishing technical conditions which would allow price signals to work and would ensure fair competition, as well as market access for new technologies and business models. As for the integration of energy and transport, it was noted that transport consumes 30 percent of energy consumed and it competes with other sectors for renewable energy, notably from biomass, while at the same time becoming more and more integrated. As for the Energy Union Winter Package, Mr von Peter explained that the Electricity Market Design has brought further flexibility for the energy system that will help consumers to become more active while with the Renewable Energy Directive the European Commission has adopted rules to deal with competing uses of biomasses.
Hughes Belin, the debate’s moderator introduced the speakers and asked as a first point of discussion if the European Union is close to a sustainable transport system.
Ms Virkunnen started her intervention by saying that the European Commission’s initiatives, namely the Communication for de-carbonisation of the transport sector and the recently published Winter Package, are steps in the direction of ensuring sustainable transport and green investment for Europe. According to the MEP, these steps will compensate for the lack of EU action in the sector over the past years. In her opinion, cooperation in the road transport sector is achievable, since this is a more EU-specific sector, whereas reaching an agreement on aviation and maritime transport, where global action is required, is a more challenging task. She added that the technology for promoting sustainable solutions is available but Europe is lagging behind in implementation. Therefore, Ms Virkunnen said, political institutions should encourage a technology-neutral approach, by fostering the development of alternative fuels, while it should be left to the industry to find the most cost-efficient way. She finally reminded the audience that Finland is a pioneer in investment in advanced biofuels for transport usage, which should cover 55% of the fuel energy mix in urban transport in the country by 2030.
Mr Chandon expressed his optimism on the fact that Europe is close to a solution to accomplish the sustainable transport challenge through biomethane. In his opinion, the transport sector is faced with two main problems: on the one hand, how to incorporate externalities coming from transport emissions and, on the other hand, how to deal with the “thirst” of modern vehicles for refuelling. Therefore, Mr Chandon continued, biomethane technology, which notably produces energy from waste with a minor environmental footprint, together with the commercial availability of light, medium and heavy duty gas trucks – which are able to conduct almost 90% of all transport in Europe – will provide a comprehensive solution. Mr Chandon stated that there is enough biomethane capacity in Europe to fuel all heavy-duty vehicles, and if this technology will receive adequate support, it will bring revenues for farmers whilst creating job growth and energy independence. He concluded the first part of his contribution by saying that, despite its high cost, the biomethane production has already expanded in member states such as Sweden and France and there is the potential to expanding its use further.
Ms Infante focused her commentary on upstream infrastructures and Liquefied Natural Gas development for road heavy duty and maritime transport. Concerning the LNG landscape in Italy, she said that the regulatory framework is in place to facilitate the incorporation of LNG and that Edison is investing in developing the necessary infrastructure and logistics. She mentioned that investment is particularly required in LNG infrastructure for small-scale vessels and for developing the coastal deposit facilities. After expressing the view that LNG is not the most suitable fuel for urban mobility for technical reasons, she stated that this fuel has a valuable role to play for extra-urban transportation, as well as for specific sectors, such as waste removing.
Mr Aslanides expressed his belief that we are close to a sustainable transport system in Europe and, by focusing on the electric possibilities of transport, he built his argument upon three main axes. Firstly, as regards technology innovation, he said that batteries are constantly increasing their capacities, fact which allows vehicles to reach a 200 km-300 km range. Secondly, he stated that infrastructure is being expanded while reminding the audience that EDF has deployed a number of charging points, whose number reached 15,000-17000 for urban centres in France. At the same time, two hundred high-speed charging stations on highways have also become available. Lastly, on the regulatory front, Mr Aslanides stated that the 2014 Directive on alternative fuel is paving the way for properly standardising the field while encouraging state-incentives for buying an electric vehicle, as it is the case in France.
A second point of discussion concerned the most promising alternative fuels that should gain priority of investment in order to deliver reasonable results, and the hurdles that need to be overcome.
Mr Aslanides said that electric vehicles are the most promising alternative for road transport due to the fact that they require reasonable charging infrastructure as most charging events, roughly 90% of them, take place at home or at the workplace, thus avoiding the need for huge investments. Additionally, the cost of electrically refuelling is around 4-5 euros for 200km. The corollary being that, in order to make the business profitable for the infrastructure operators, there is an absolute necessity to widen the market by adding more cars. Indeed, an average of 7-8 cars recharging from each available station is a prerequisite to make the investment profitable. Concerning the barriers for the development of the market of electric vehicles, Mr Aslanides said that they are constantly being removed, as well as that taxation for electric vehicles is gradually levelling off. However, he mentioned that the main obstacles in this domain are constituted by both the lack of interoperability across European borders, due to the different billing, and the lack of compatibility between different providers.
On the same question Ms Infante emphasised the absence of a large market in the south Mediterranean for LNG-fuelled ships, comparing it to the road transport market and explaining why infrastructure and individual investment go hand-in-hand. She provided the example of Sardinia, a region almost exclusively dependent on fossil fuels for its energy needs, in order to demonstrate the room for investment in new markets. In her opinion, the fact that Italian authorities encourage end-users to buy new trucks and vessels that are friendly to the new technology is a promising step. She expressed her belief that the regulatory framework will be a principal driver for market structuring by elaborating from the example of the maritime sector: as the International Maritime Organisation decided that the 0,5% global sulphur cap should take effect in 2020, this development will speed up the change in the technology of ship fuelling. Furthermore, she said that the value of the investments is also affected by fiscal conditions and she mentioned how global low oil prices often disincentivise a turn to alternative fuels. She concluded by saying that technology is another parameter that will affect positively the market thanks to the increasing use of this technology and the reachable economies of scale.
Mr Chandon provided some technical details on LNG-friendly trucks, saying that 90% of the component is common with Diesel trucks but the engine, fuel storing system and exhaust gases after treatment system, are very different. He expressed the view that a market for LNG trucks is present in the Western part of Europe and less in the Central, also due to heavy excise duties on gas. Mr Chandon showcased the importance of cooperation between the different stakeholders in the production and transport chain and said that a re-fueling station for a large fleet is necessary to enable a functioning market from which smaller vehicles and customers can also benefit. He continued by using some statistics from France, which is the first market in Europe for compressed natural gas and LNG trucks. As far as interoperability is concerned he said that the situation is satisfactory across Europe and for CNG vehicles particularly there is compatibility between all refilling stations. However, as Mr Chandon noted, the experience of refueling in LNG, which is closer to the industrial process, needs to become more accessible to vehicle drivers. Overall, Mr Chandon said that the main advantages of the LNG technology – clean, silent, CO2-neutral – are already there and that the higher comfort of the gas truck is appreciated by the truck drivers themselves.
Ms Virkunnen closed the debate by saying that the commitments that member states undertook as part of the Paris agreement will boost sustainable transport for the benefit of the environment. She stressed the burgeoning importance of advanced biofuels for aviation and the maritime transport, as well as the importance of electricity recharge for urban transport. With a view to the future of sustainable transport, she noted that the digitalisation of energy will help re-design the urban landscape and will affect the different practical uses of collaborative economy, as well as the effectiveness of intermodal transport.
The final part of the debate, a Q&A session, also covered the following issues: biomethane and its benefits, battery- swap systems and next generation batteries, the prospects of car sharing, industry incentives for electric vehicles, nuclear energy, the need for a uniform framework for excess duties, the importance of open data for efficient transport.
Do you want to go further into the issues discussed in our debate? Check our list of selected sources which we have provided for you