UK Accelerated ICE Car Ban to Hasten Oil Decline

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As governments increasingly sharpen their focus on transport emissions, more and more are setting end dates for conventional vehicle sales that will hasten the decline of liquid fuel demand in these markets. The UK this week signaled its intention to accelerate the start of a ban on selling new conventional gasoline and diesel cars and vans by five years to cars to 2035, or earlier if a faster transition is feasible, subject to consultation. The ban is also being extended to include hybrid cars for the first time -- potentially further denting oil demand. Similar bans, some more stringent than the UK's, have been proliferating across the world in the last few years (see table), with a growing number of jurisdictions looking to follow suit, including oil-consuming giant China (NE Jan.2'20). There is growing support in Europe for an EU-wide internal combustion engine (ICE) phaseout strategy, and India is among the developing countries considering bans on the sale of two- and three-wheel vehicles that use ICEs. Action is happening as well at the subnational and local levels, including the US states of California and Washington, British Columbia in Canada, and in many cities, particularly in Europe. Bringing the UK ban forward to 2035 could reduce overall UK road fuel demand for passenger cars by a further 10% by 2040, equivalent to over 40,000 barrels per day, according to Iain Mowat, principal analyst at Wood Mackenzie. The policy would also require electric vehicle (EV) sales reach about a third of all new sales by 2025 and over two-thirds by 2030, more than twice the share anticipated by current EU rules, according to campaign group Transport & Environment (T&E). But with current demand for EVs still just a fraction of all sales, accelerating an already "very challenging ambition" will require better support from the government, suggests Mike Hawes, CEO of auto trade association the Society of Motor Manufacturers and Traders. Urging the government to safeguard industry and jobs and allow people from all income groups and regions to adapt and benefit, Hawes criticized the notion of banning "today's low emission technologies, including popular hybrids, all of which are essential to deliver air quality and climate change goals now." He argues it is "extremely concerning that the government has seemingly moved the goalposts for consumers and industry on such a critical issue." The fate of hybrids had been uncertain since the 2040 ban was originally announced, but it had been hoped that plug-in hybrids might be spared. "Manufacturers are also spending billions on developing state-of-the-art hybrids which are zero emissions for many journeys but these will also be excluded from sale. This seems a very backward step that could backfire by encouraging drivers to hold on to older more polluting vehicles," said Edmund King, president of UK auto group AA. Others however support the move to ban hybrids, arguing that they are an unnecessary bridge that don't deliver enough. "It is right that hybrid vehicles should be excluded," said Nina Skorupska, chief executive of the Renewable Energy Association (Rea). T&E also welcomed "the clarity that there is no long-term role for so called 'self-charging' or 'plug-in' hybrids in the future and that, by the mid-2030s, all new vehicle sales should be zero emission at the tailpipe." There's one thing most industry campaigners and experts agree on: more government support is needed. "Achieving this target will require further supportive policy from government which encourages the deployment of a world-class charging infrastructure network," said Rea's Skorupska (NE Jan.23'20). Clarity is needed, too, on the future of a clean car grant worth £3,500 ($4,550) per vehicle, "the most significant driver of EV uptake" that's currently due to expire end-March, SMMT's Hawes noted (NE Jan.9'20). It would be "schizophrenic" to allow the plug-in grant to end "just as the market is taking off and the government is legislating to phase out cars with engines," said T&E UK Director Greg Archer. Ronan Kavanagh, London Planned ICE Vehicle Bans Country Announced Commences Costa Rica 2019 2050 France 2017 2040 Iceland 2018 2030 Ireland 2018 2030 Israel 2018 2030 Netherlands 2017 2030 Norway 2017 2025 Slovenia 2017 2030 Sri Lanka 2017 2030 Sweden 2018 2030 Taiwan 2018 2040 UK 2020 2035 Only includes most advanced plans.

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