No time to lose for the European Commission to make plug-in hybrid CO2 emission values more realistic — and no need to wait!

A recent study by my colleague Georg Bieker and Fraunhofer ISI showed that real-world CO₂ emissions of the average plug-in hybrid vehicle (PHEV) in Europe are two to four times higher than the official values determined during type-approval. The difference between real-world and official CO₂ emissions is attributable to an incorrect assumption made in the European Union (EU) type-approval regulation about how frequently PHEV drivers would charge their vehicles and therefore by implication how often they would use the combustion engine when driving.

This is not just an interesting factlet. It turns out to be a significant problem for the EU’s climate policy. Not only do PHEVs help manufacturers meet their CO₂ targets under EU regulations while contributing little to reducing real-world CO₂ emissions. They are also subsidized by many member states as an allegedly climate-friendly alternative to conventional vehicles, which boosts their sales numbers and compounds the harm to the climate that these vehicles actually do.

The European Commission is proposing to correct the current, too optimistic, PHEV usage assumptions in an upcoming revision of the type-approval regulation, according to a presentation to member states that was recently leaked. Good news there is that real-world data on how PHEVs are actually driven has been recorded from all vehicles since January 2021, and this data will soon be available to provide a sound basis for determining more representative CO₂ emission values during type-approval. Bad news, though, is that the European Commission is hesitant to move quickly and is seriously considering delaying the correction based on this data until 2030, while fast action is both possible and necessary.

To understand the situation, it’s helpful to have some backstory. Today’s procedure for type-approval of PHEVs in the European Union was developed in 2014, at a time when virtually none had yet been sold. With no better data available, driving statistics of conventional combustion-engine-only vehicles were used to develop the procedure, and assumptions had to be made about how PHEVs would be used in real world. The 2020 study mentioned above showed that these assumptions were too optimistic. In particular, the analysis revealed that users recharge their vehicles less frequently and also drive longer daily distances. But why is this an issue?

The 2014 assumptions were the basis for developing a utility factor describing the share of the total distance a PHEV is driven using mainly power from the battery. The utility factor is then used to calculate the official PHEV CO₂ emissions under the regulation. If a vehicle is actually charged less frequently and therefore drives less on the electric motor than assumed, the real-world utility factor is lower than the one used for type approval. Unrealistically high utility factors lead to vehicles being certified as emitting unrealistically low amounts of CO₂.

A utility factor reflecting actual PHEV usage can ensure that the official CO₂ emission values are representative of emissions during real-world operation. This would have several important benefits. The contribution of PHEVs to the total CO₂ emissions and therefore to climate change could then be calculated more accurately. Member states could reallocate spending intended to subsidize climate change mitigation strategies away from fostering PHEV sales that have little effect on lowering CO₂ emissions and toward more effective measures. Member states would also recapture sales and ownership tax revenue that’s currently lost because taxes on PHEV CO₂ emissions are being calculated on official emissions values that are too low. And the official, advertised CO₂ emission values of conventional vehicles and PHEVs would be similarly representative of their real-world emissions, giving consumers an accurate basis on which to make informed purchase decisions considering expected cost of ownership and effects on climate change.

From the data perspective, a speedy update of the utility factor is possible. The 2020 study mentioned above examined user data from 100,000 PHEVs, of which about 15,000 were registered in the EU — over 10 times more than the 1,400 conventional vehicles used to develop the utility factor in 2014 — and on that basis a revised utility factor was proposed by Fraunhofer ISI in 2021 that is much more representative of real-world usage.

And even more real-world data will be available soon. The EU light-duty vehicle CO₂ regulation made on-board fuel and energy consumption monitoring (OBFCM) devices mandatory in all new passenger and light commercial vehicles beginning in January 2021. OBFCMs permanently record fuel and electric energy consumption, and that data can be used to calculate the actual utility factor during real-world driving.

OnStarting in April 2022, manufacturers must report the OBFCM data of the preceding year to the European Commission, collected from the vehicles through telemetry or during repair and maintenance, as shown in Figure 1. The data will then be processed by the European Commission and published each year in December in aggregated form. Since manufacturers require their vehicles to be serviced every 12 to 24 months, the volume of OBFCM data collected during repair and maintenance will increase continuously over time, and consequently the utility factor will become more representative of the vehicle fleet. As soon as the end of 2023, real-world data from most vehicles registered in 2021 and some of the vehicles registered in 2022 and 2023 will be available. The real-world utility factors published in December 2022, 2023, and 2024 can be used to estimate future official PHEV CO₂ emissions.

In addition to the OBFCM data reported by manufacturers, member states will collect OBFCM data during the periodic technical inspection (PTI) of vehicles. The first PTI of a new vehicle may not occur for up to four years after sale in some EU member states, so OBFCM data on a significant share of the fleet will not become available for the first time until calendar year 2024. But by using this data to complement and verify the values reported by the manufacturers, a representative and trustable utility factor will be available at the latest in December 2025.

Figure 2 presents a feasible timeline for updating the utility factor, starting with the European Commission introducing an interim utility factor from 2023 onwards based on the 2020 study. The interim utility factor would prevent the continued sale of PHEVs with unrepresentatively low official CO₂ emission values until 2026, when a reality-based utility factor derived from OBFCM data can be introduced.

To ensure that the CO₂ emissions of PHEVs are correctly accounted for, the European Commission should close the huge gap between average real-world and official PHEV CO₂ emission values by updating the utility factor used for type approval. It has both the opportunity, in the process already underway to amend the regulation, and the supporting data. The time to act is now, not ten years from now.

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