A new analysis by the Delft, Netherlands-based consultancy group TNO, has argued that equalising carbon dioxide emissions limits for vans with those of cars in the EU would save fuel costs for operators.
The European Commission recently announced proposals for binding 2020 carbon dioxide limits for cars and vans, which will be debated by member states over coming months. It is also expected to issue a policy document around the end of 2012 to prepare for limits beyond 2020.
The Commission so far has a CO2 emissions target of 147g/km for vans (135g/km originally proposed) and of 95g/km for cars and has estimated that technological improvements applied to achieve the 147g/km van target would increase the purchase price by just 2.5% while improving the fuel economy by some 20%, relative to 2010 values.
The report by TNO, commissioned by T&E, a transport and environment campaign group, calculated the true equivalent of the car target for vans – requiring them to be the same as cars (taking account of extra weight) – was 118g/km. It calculated that setting a target of 118g/km would double annual fuel cost savings to around €825 (US$1,069) per year (at current oil prices, excluding VAT). The payback period for a 118g/km target would therefore be less than three years (assuming operating a van typically costs around €2,400 a year in diesel alone) – saving the first owner money. Better van fuel economy would also be expected to translate into better resale value, further reducing the total costs of ownership.
Although some industry participants have complained that the proposed targets would prove an extra burden at a difficult time, environmental campaigners in general say the cost of meeting the proposed regulation has been exaggerated and the benefits of using less fuel include lower costs, as well as lower emissions of greenhouse gases. Campaigners are particularly concerned about vans, which have a more lenient target than cars and are a growing source of emissions.
The TNO report calculated that the tougher target for vans (118g/km) would almost double savings from €440 (US$570) to €825. Equally, that would double CO2 reductions to an additional 2.7 million tonnes per year, as emissions are directly linked to fuel use.
TNO acknowledged that technology improvements would add €2,000 to the initial purchase price of a van, but asserted reduced fuel bills would mean the extra purchasing cost would be recovered in less than three years, assuming a conservative crude oil price of US$95 per barrel.
T&E believes annual fuels costs for a typical delivery van range from €1,800 to €3,000 per year depending upon the size and use of the van and that business users are primarily concerned about the total costs of ownership rather than just the purchase price, and any additional purchase price, resulting from applying CO2 reducing technologies, will be offset by lower fuel bills. A typical new van buyer is estimated to keep the vehicle for about five years, so a payback within this period reduces overall costs of ownership.
T&E has said the current proposal (for a 147g/km target) could lead to a potential “technology graveyard” for vans as OEMs reduce investment in and fail to deploy available technology. This is despite fuel efficient technologies for vans being effectively the same as those used in cars. T&E asserts a target of 118g/km (equivalent to 95g/km for cars) would not require electric vehicles or hybrids but can be achieved through technologies such as downsized engines, lightweight materials, aerodynamics improvements, and reducing driveline friction.
A simple and very cost-effective way to improve fuel economy which has been put forward is the optimisation of the engine power of vans. It is claimed that after decades of increasing engine power, today many vans are overpowered and that this overpowering increases the performance and speed of vans but does little to improve their utility (vans are mostly used for urban distribution). A 2010 study by TNO found engine power optimisation could cut fuel consumption and CO2 emissions by between 6% and 16% at minimal cost.
To encourage the partial hybridisation and electrification of vans, T&E believes the European Commission would need to set targets that are significantly more ambitious than 110g/km. It believes a sub-100g/km target should be envisaged for 2025, equivalent in strength to the 60g/km that it proposes for cars.
Jean-Marc Gales, Chief Executive Officer of CLEPA, which is involved in consultations with the European Commission, has said the existing targets struck the right balance between cost and emissions cuts for now. But looking beyond 2020, Gales said vans needed particular attention.
“We’re going to take a much closer look at vans,” Gales was quoted by Reuters as saying, adding: “I’m absolutely determined for 2025/2030, we will have a much closer look at the van targets.”
Gales also acknowledged that although vans make up only a small percentage of EU new registrations (around 12%), they are driven much greater distances than cars – sometimes up to 100,000 km per year, compared with 10,000-12,000 km for the average car. They also have a longer life and are likely to be increasingly popular because they are cheaper than trucks.
