EUROPEAN COMMISSION

Brussels, 10.11.2022

SWD(2022) 359 final

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT REPORT

ANNEX 5-8

Accompanying the document

PROPOSAL FOR A REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on type-approval of motor vehicles and of engines and of systems, components and separate technical units intended for such vehicles, with respect to their emissions and battery durability (Euro 7) and repealing Regulations (EC) No 715/2007 and (EC) No 595/2009

{COM(2022) 586 final} - {SEC(2022) 397 final} - {SWD(2022) 358 final} - {SWD(2022) 360 final}

Contents

Annex 5: Evaluation Euro 6/VI emission standards

1.Introduction

1.1.Purpose of the evaluation

1.2.Scope of the evaluation

2.BACKGROUND TO THE INTERVENTION

2.1.Description of Euro 6/VI emission standards and its objectives

2.2.Baseline and points of comparison

3.Implementation / State of play

3.1.Current situation

3.2.Implementation Euro 6/VI emission standards

4.Method

4.1.Short description of methodology

4.2.Limitations and robustness of findings

5.Analysis and answers to the evaluation questions

5.1.Effectiveness

Evaluation question 1: To what extent and through which factors has Euro 6/VI made cleaner vehicles on EU roads a reality? Which obstacles to cleaner vehicles on EU roads remain taking into account possible unintended consequences on the environment?    

Evaluation question 2: How effective are the Euro 6/VI testing procedures to verify the emission standards?    

Evaluation question 3: What are the benefits of Euro 6/VI emission standards and how beneficial are they for industry, the environment and citizens?    

5.2.Efficiency

Evaluation question 4: What are the regulatory costs related to the Euro 6/VI emission standards and are they affordable for industry and consumers? Have Euro 6/VI achieved a simplification of vehicle emission standards?    

Evaluation question 5: To what extent has Euro 6/VI been cost-effective? Are the costs proportionate to the benefits attained?    

5.3.Relevance

Evaluation question 6: To what extent do the Euro 6/VI objectives of ensuring that vehicles on EU road are clean correspond to the current needs? Is there a demand/potential for cleaner vehicles on EU roads over their whole lifetime?    

5.4.Coherence

Evaluation question 7: Are the Euro 6/VI emission standards coherent internally and with other legislation pieces applying on the same stakeholders and with similar objectives? Are there any inconsistencies, overlaps or gaps?    

5.5.EU-added value

Evaluation question 8: What is the added value of Euro 6/VI compared to what could have been achieved at merely national level? Do the needs addressed by Euro 6/VI continue to require harmonisation action at EU level?    

6.Conclusions

Annex 6: Policy options

6.1.Policy option 1: Low Green Ambition

6.2.Policy option 2: Medium and High Green Ambition

6.3.Policy option 3a: PO2a and Medium Digital Ambition

Annex 7: Impact of the COVID-19 crisis in automotive industry on policy options

Annex 8: Alternative set of assumptions on emission limits and durability

8.1Alternative set of assumptions on emission limits

8.2Alternative set of assumptions on durability

Annex 5: Evaluation Euro 6/VI emission standards

1.Introduction

The Euro emission standards were put in place in order to address ongoing concerns for public health and the environment related to air pollution caused by road transport and to also address risk of fragmentation of the European Single Market by the adoption of national standards and restrictions introduced by Member States. Vehicle emission standards for light-duty vehicles (i.e. cars and vans) and heavy-duty vehicles (i.e. lorries and buses) were implemented since 1992 through a series of Euro emission standards reflecting technical progress while addressing the emerging air quality issues. These standards are part of the type-approval framework in which new vehicle models are tested and granted type-approval to meet a minimum set of regulatory and technical requirements before entering into service on the EU market. Over the years, not only the specific limits for air pollutants were tightened over the successive Euro emission standards, but also the testing procedures were gradually modernized.

The current Euro emission standards which entered into force in 2013 for lorries and buses (Euro VI) and in 2014 for cars and vans (Euro 6), are referred to as Euro 6/VI emission standards in the following 1 . In comparison to Euro 5/V 2 , the new standards introduced more demanding emission limits for some categories of pollutants (nitrogen oxide NOx, particulate matter (PM), hydrocarbon (HC)), while other pollutants remained at the same level. In addition, significant changes to the testing procedures for emissions have been introduced in the implementing Regulations.

In September 2015, it was revealed that some European car manufacturers were using illegal defeat devices which recognise that the car was being tested and changed the car’s behaviour to reduce emissions during the test, while on the road, the cars emitted much more. The scandal became widely known as Dieselgate and shook the confidence of the citizens in the Euro 6 regulations. Together with the European Parliament and the Member States, the Commission has since changed the European regulatory framework to restore the confidence of EU citizens in the type-approval system and in European car manufacturers and to include controls during market surveillance.  Regulation (EU) 2018/858 has introduced from September 2020 new related EU type-approval rules (better quality and independence of vehicle type-approval and testing authorities, more controls of technical services, more checks on the roads, new EU wide recalls and penalties). Important progress was also made with the adoption of implementing regulations to ensure that emissions of cars are tested not only in the laboratory (the Worldwide Harmonised Light Vehicle Test Procedure – WLTP) but also on the road (the Real Driving Emissions testing – RDE).

1.1.    Purpose of the evaluation

The purpose of this evaluation of the Euro 6/VI emission standards is to analyse to what extend the Euro 6/VI emission standards have achieved their specific objectives of setting harmonised rules on pollutant emissions from cars, vans, lorries and buses and improving the air quality by reducing pollutants emitted by the road transport sector and their operational objective of setting the next stage of emission limit values in a cost-effective way with specific focus on NOx, PM and HC 3 . In line with the Better Regulation Guidelines 4 , the evaluation examines the five evaluation criteria, namely: the effectiveness, efficiency, relevance, coherence and EU added-value of the measures established under both Euro 6 emission standards for cars and vans, and Euro VI emission standards for lorries and buses. 

This evaluation is being carried out following the presentation of the European Green Deal 5  in December 2019 as a new growth strategy that will foster the transition to a climate-neutral, resource-efficient and competitive economy and the move towards zero-pollution in Europe. To accelerate the shift to sustainable and smart mobility, transport should become significantly less polluting, especially in cities. The EU automotive industry must lead the global transition to zero-emission vehicles, rather than follow the lead of others. This will allow the industry to take advantage of the business opportunities offered.

Significant efforts have been made over the last 5 years to reduce emissions of air pollutants, in particular in the wake of the Dieselgate. The European Parliament Inquiry Committee into Emission Measurement in the Automotive Sector (EMIS) also made several recommendations in order to improve the compliance with emission rules as well as a recommendation to proceed with the development and proposal of new emission rules, i.e. Euro 7 6 . Most of the recommendations were also repeated in the Briefing Paper 7 of the European Court of Auditors on the EU’s response to the “dieselgate” scandal. 

In parallel, new power trains – battery electric and hydrogen – are emerging as an alternative to the combustion engine. However, although the roll out of such technologies is accelerating, it is still slow. In the meantime, more needs to be done to “clean” the combustion engine to ensure protection of human health in urban areas and to prevent the Single Market from fragmenting due to individual national initiatives (e.g. diesel bans, petrol bans). The European Green Deal roadmap therefore includes a proposal for more stringent air pollutant emissions standards for combustion-engine vehicles by 2021.

The Commission decided to follow a back-to-back approach in which the evaluation and impact assessment are conducted in parallel as a single process. The findings of the evaluation will be used to inform further reflection on whether the Euro 6/VI emission standards continue to provide the appropriate legislative framework to provide high level environmental protection in the EU and to ensure proper functioning of the Single Market for vehicles.

This back-to-back evaluation and impact assessment requires to work with all stakeholders involved in emission standards to gather lessons learnt and optimise future emissions standards for vehicles in a short period of time. A first stakeholder conference in October 2018 8  took place in order to frame the needs. The Commission put together an Advisory Group on Vehicle Emission Standards (AGVES) 9 , in which all relevant expert groups working on emission legislation involving industry, NGOs, academia and Member States were combined to discuss the Euro 6/VI emission standards and their future development. Potential issues or pitfalls of the back-to-back approach were identified continuously, such as the adjustment of problems identified and preliminary policy options following the evaluation, and subsequently targeted in the impact assessment of the Euro 7 initiative.

1.2.    Scope of the evaluation

The evaluation covers the Euro 6/VI emission standards and their respective implementing measures:

·Regulation (EC) No 715/2007 on type-approval of motor vehicles with respect to emissions from light passenger and commercial vehicles (Euro 5 and Euro 6) and its implementing Regulation (EU) 2017/1151;

·Regulation (EC) No 595/2009 on type-approval of motor vehicles and engines with respect to emissions from heavy-duty vehicles (Euro VI) and its implementing Regulation (EU) No 582/2011.

The evaluation covers the period since the entry into force of the regulations, namely 2014 for Euro 6 and 2013 for Euro VI, up until now (2020). Considering that the steps Euro 6d and Euro VI E have yet to enter into force for all vehicles, that Euro 6/VI vehicles on the market are expected to remain on EU roads for a significant period of time and that the vehicles fleet is expected to be composed out of 100 percent Euro 6/VI vehicles in 2050, the impacts of Euro 6/VI are expected to last until 2050. 10 Therefore, the evaluation also covers the expected impacts of the adopted measures in the future.

Geographically, the evaluation focuses on the achievements of Euro 6/VI emission standards in the European Union. Hence, the evaluation covers the EU-27 Member States and additionally considers the implementation in former Member State, the United Kingdom. However, the EU automotive sector is not an isolated sector, since many of the manufacturers and their suppliers selling vehicles on the EU market are global players. These players come in direct contact with similar requirements in terms of pollutant emissions on other major market, which will be taken into account throughout the analysis.

This evaluation addresses the following key topics: the effectiveness of the Euro 6/VI emission standards on clean vehicles on EU roads, the effectiveness of newly introduced testing requirements, the Euro 6/VI regulatory costs for automotive industry, public authorities and consumers and its proportionality to the achieved benefits, the current and future need for rules on vehicle emissions, coherence within the Euro emission standards and with other relevant legislation – such as the CO2 emission standards, Air Quality Directives and Roadworthiness Directives – and the continued need for harmonisation at EU level. Hence all relevant elements regarding effectiveness, efficiency, relevance, coherence and EU added-value are assessed.

This evaluation notably builds on a 18-week public stakeholder consultation carried out between 6 July and 9 November 2020 as well as a 14-week targeted stakeholder consultation on Euro 6/VI evaluation between 4 March to 8 June 2020, expert meetings between October 2018 and February 2021, see details in Annex 2, and extensive desk research.

This staff working document is supported by a study on post-Euro 6/VI emission standards in Europe - PART B: Retrospective assessment of Euro 6/VI vehicle emission standards, referred to as supporting Euro 6/VI evaluation study in the following, which was carried out from January 2020 to July 2021.

2.BACKGROUND TO THE INTERVENTION

2.1.    Description of Euro 6/VI emission standards and its objectives

The vehicle emissions standards in Europe, also known as the Euro standards, are guided by the overarching need to reduce air pollution emerging from road transport and subsequently minimise harmful effects on human health and environment. In addition, harmonised technical requirements over the Member States were considered essential to ensure the proper functioning of the Single Market for vehicles 11 . That way, the pathway for control of emissions has commenced in 1992 with the introduction of Euro emission standards and has gradually progressed over 28 years with more stringent provisions. 

While progress was made in the emission performance of vehicles moving from Euro emission standards 1/I to 5/V 12 , the concern for public health and environment in combination with the risk of the emergence of varying product standards across the EU and the imposition of unnecessary barriers to intra-EU trade continued to be relevant. In particular, particulate matter (PM) as well as ozone precursors such as nitrogen oxide (NOx) and hydrocarbons (HC) were considered problematic due to their adverse effects to the health and the environment. A wide range of different stakeholder groups were affected by the problem: EU citizens were affected by poor air quality, manufacturers and their suppliers by necessary development and introduction of better pollution-control devices, consumers by potential price changes of new vehicles and national authorities by granting new emission type-approvals for vehicles. 13

Figure 17 provides an overview of how these overarching needs or problems were translated into general, specific and operational objectives for the Euro 6/VI emission standards which were in line with the aims of both the Lisbon strategy 14 and the Sustainable Development strategy 15 . These objectives were on their turn translated into specific activities at EU level. That way, the Euro 6/VI emission standards aimed at ensuring the dual objectives of (i) ensuring the proper functioning of the Single Market for vehicles and (ii) providing high level of environmental protection in the EU. The intervention logic how Euro 6/VI standards were expected to work can be summarised along three main operational elements. 

Figure 17 – Intervention logic of Euro 6/VI vehicle emission standards 16 , supplemented by the supporting Euro 6/VI evaluation study

The Euro 6/VI vehicle emission standards set emission limit values for new cars, vans, lorries and buses, in two separate Regulations for cars/vans and lorries/buses with an almost identical legal structure. The Euro 6/VI emission limits are compared to the previous Euro 5/V emission limits in Table 35 . Euro 6 introduced for cars and vans more demanding emission limits for NOx, HC and particulates - more stringent limits for particulate mass (PM) and new limits for particulate number (PN). Since the switch from Euro 4 to Euro 5 emission standards already resulted in significant reductions to the limits for gasoline cars and vans, the decrease in limits are mainly found in diesel vehicles. Also, Euro VI emission standards introduced for lorries and buses tighter limits for NOx, HC and particulates. Following the tightening of NOx, emission limits were introduced in Euro VI for ammonia (NH3) for diesel lorries and buses, to control the expected release of NH3 as by-product to the use of NOx pollution-control devices. In addition, methane (CH4) limits were tightened for gasoline lorries and buses.

The Euro 6/VI emission standards revised and subsequently defined appropriate and effective test procedures for controlling and verifying that the tailpipe and evaporative emissions are effectively limited (see Table   34) 17 . Through implementing legislation, significant changes were made compared to Euro 5/V to the testing procedures with the intention to reduce the gap between laboratory and real-world emissions. For cars and vans, this meant the replacement of the laboratory New European Driving Cycle testing (NEDC) by the laboratory Worldwide harmonised Light vehicles Test Procedure (WLTP) and introducing the Real Driving Emissions testing (RDE) on the road against temporary and final conformity factors 18 19 . For lorries and buses, off-cycle emissions (OCE), in-service conformity (ISC) and Portable Emission Measurement Systems (PEMS) testing were introduced in several steps 20 . In addition, Euro 6 emission standards revised the procedures for testing evaporative emissions, such as extension of the test procedure from 24 to 48 hours. That way, the Euro 6/VI emission standards were introduced in various steps, i.e. Euro 6 b-d(-temp) and Euro VI A-E.

Lastly, Euro 6/VI emission standards establishes appropriate provision and monitoring requirements to make sure that all new vehicles meet the standards. Depending on the specific vehicle type, the Euro 6/VI emission standards set or tightened requirements for manufacturers to check in-service conformity and durability of their vehicles for certain period or mileage. This ranges from five years or 100 000 km for cars and vans (no change compared to Euro 5) 21  up to 700 000 km or 7 years for heavy lorries and buses (500 000 km under Euro V) 22 . In addition, Euro 6/VI emission standards tightened the thresholds for the provision of information from on-board diagnostics (OBD) systems. These thresholds are intended to monitor the functioning of powertrain systems and components for reducing tailpipe emissions in order to identify possible areas of malfunction. In comparison to Euro 5/V emission standards, the OBD systems should be more sensitive to minor irregularities in the pollution-control devices. That way, malfunctions can be detected and corrected earlier.

Table 34 – On-road testing conditions set out in Euro 6d/VI E 23

Table 35 – Emission limits set out in Euro 5/V and Euro 6/VI emission standards (changes in bold) 24

A)Cars and vans

B)    Lorries and buses 26

2.2.    Baseline and points of comparison

Before Euro 6/VI emission standards came into place, pollutant emissions emerging from road transport had already been targeted since 1992 by five previous generations of standards. The Thematic Strategy on air pollution 27 already showed significant progress in the reduction of main air pollutants in 2000 for Europe. Nevertheless, road transport was still considered a significant source of pollution, as it was responsible for 43% of total NOx emissions and 27% of total volatile organic compound (VOCs) 28 emission in 2002. In addition, the total transport sector (which also includes shipping, aviation and rail) accounted for 29% of total PM2.5 emissions in 2000. 29  

In a baseline scenario in which Euro 6/VI emission standards were not implemented, the previous Euro 5/V emission standards would have remained in place. Therefore, the performance of Euro 6/VI entails the additional or marginal effects of the intervention against a scenario in which Euro 5/VI was still in full force. In addition, the baseline scenario assumes that in the absence of the Euro 6/VI emission standards no further changes would have been made to the Euro 5/V emission limits and relevant testing procedures for the emission type-approval of new vehicles. 30  Next to this baseline scenario, an alternative baseline scenario is considered for cars and vans that assumes that the RDE test procedure was not introduced (i.e. effects of implementation of Euro 6 up to Euro 6c compared to Euro 6d). Hence, this alternative baseline scenario aims at evaluating and comparing the performance of Euro 6 emission standards before and after the implementing legislation introducing on-road RDE testing (see chapter 1.1).

The new Euro 6/VI emission limits have triggered a change in pollution-control devices compared to Euro 5/V, as manufacturers do not voluntary fit additional pollution-control devices to improve the pollutant emissions performance of their vehicles beyond those required to comply with the Euro 5/V emission standards. 31  Although the Roadworthiness Directives 32 have objectives similar to Euro 6/VI, they primarily aim at detecting and removing from circulation vehicles which are over-polluting due to technical defects. Hence, the Roadworthiness Directives could not have triggered the use of additional pollution control devices in new vehicles.

In order to assess the reduction of pollutant emissions from new vehicles until 2020 and further until 2050 when the combustion-engine vehicle fleet will consist of Euro 6/V vehicles only, other external factors or relevant developments that could have potentially affected these pollutant emissions are taken into account as counterfactual. The CO2 emission performance standards for cars, vans, buses and lorries 33 34 might have played a role through the introduction of requirements that led to the adoption of new technologies to achieve fuel efficiency and reductions in CO2 emissions. The adoption of such technologies may positively (e.g. more electric vehicles) or negatively (i.e. potential trade-offs for combustion-engine vehicles) affect the effectiveness of certain technologies used for combatting air pollutant emissions. That way, the quantitative analysis presents the maximum that can be assigned to the Euro 6/VI emission standards and takes into account the possibility that other external factors have played a role. These CO2 standards affect the vehicle fleet and in particular the penetration of zero- or low-emission vehicles (e.g. electric vehicles, hybrids) in Europe. To fully account for the impacts of these climate policies on the air pollution emission resulting from road transport, the resulting vehicle fleets are taken into account for assessing Euro 6/VI effectiveness and efficiency.

In 2005, the Thematic Strategy on air pollution for 2000-2020 forecasted what was expected to happen in a scenario where no further policy action related to air pollution was taken. With no policy changes related to air pollution and its respective sources after 2005, health impacts from air pollution across the EU were still projected to be considerably high in 2020. Without further reductions of ozone (which is formed by reaction between HC and NOx), the health impacts related to this pollutant were expected to result in 20 000 premature deaths in the year 2000. Figure 18 demonstrates that for particulates, the average loss in statistical life expectancy without further EU action was expected to reach five months by 2020.

Apart from the impact of no further action on public health and the environment from pollutants from new vehicles, also the Single Market for vehicles would have been at risk without the introduction Euro 6/VI emission standards. In a scenario where emissions from road transport emitted by new vehicles remained an issue, the use of other measures by Member States, such as bans on certain types of vehicles entering urban areas or low emission zones were expected to become widespread. That way, the proper functioning of the Single Market for vehicles could have been hampered. 35

Figure 18 – Effects of particles on mortality in 2000 and 2020 (with fixed 2005 policies) 36

On the other side, the Euro 6/VI impact assessment estimated the expected results of the preferred policy options for the Euro 6/VI initiative. 37  The new Euro 6 limits for cars and vans were expected to result in a 24% reduction in NOx emissions and no further reduction in PM and HC emissions, compared to Euro 5 by 2020. For Euro VI for lorries and buses, the new limits were expected to deliver a 37% reduction in overall NOx emissions, 22% reduction in PM emissions and no further reduction in HC emissions, compared to Euro V by 2020.

3.Implementation / State of play

3.1.    Current situation

In order for the Euro 6/VI emission standards to have an impact on air pollution, vehicles type-approved under these standards should have a larger penetration in the European fleet of vehicles. Therefore, the Euro 6/VI evaluation considers not only the current situation in 2020 but also the further evolution of the penetration of Euro 6/VI vehicles in the fleet by estimating the sales of Euro 6/VI vehicles until 2050.

The Euro 6/VI impact assessments suggested that the monitoring of the effect of the Euro 6/VI emission standards should be undertaken by type-approval authorities who oversee the compliance processes to ensure that requirements of the regulations are met. However, no such reporting requirements or specific monitoring indicators have been included in the Euro 6/VI emission standards. Therefore, data from the SIBYL model, complemented by data from type-approval authorities and vehicle sales statistics, was applied. 38 The SIBYL model is a vehicle stock, activity and emissions projection tool that allows to make estimations and projections up to 2050 and will be further discussed in Sections 4 and 5. The number of emissions type-approvals reflects the compliance with the respective vehicle pollutant emissions. The estimation from the SIBYL model for the projected development of the European vehicle fleet is represented in Figure 19 .

Figure 19 – Projected development of EU-27+UK 39 vehicle fleet 40  

A)Cars and vans (Euro 6 pre- and post-RDE), Source: CLOVE based on data from SIBYL model

B)Lorries and buses (Euro VI), Source: CLOVE based on KBA, 2020 41

According to Figure 19 , the penetration of Euro 6 cars and vans is still limited to 20% of the total fleet in 2020. This indicates that the introduction of Euro 6 vehicles – and particularly of vehicles type-approved to the latest two steps including RDE testing – is still at its initial stages. However, by 2026 the cars and vans fleet is expected to consist of 50% Euro 6 type-approved vehicles, from which the large majority will be subject to RDE testing. This includes both diesel- and petrol-fuelled combustion-engine vehicles, but also alternative-fuelled vehicles. As can be seen in Figure 19 , the latter are expected to take over the European combustion-engine fleet in the long run.

While the SIBYL model suggests a rather fast uptake of RDE tested vehicles in the Euro 6 fleet with a share of over 50% by 2018, observed evidence from the Netherlands and Germany where RDE Euro 6 vehicles only represent a small share of vehicles on EU roads indicates that the SIBYL estimate might be an overestimation. 42  

For Euro VI lorries and buses, SIBYL model suggests that their share in the total fleet across the EU will reach 34% by the end of 2020. As shown in Figure 19 , lorries and buses type-approved to Euro VI are expected to completely take over the fleet by 2040. Data from Germany (KBA) on vehicle registrations and stock of vehicles for 2013-2018 confirm the rapid uptake of newer Euro VI vehicles since 2017, reaching 17% of the heavy-duty fleet by 2018. 43

3.2.    Implementation Euro 6/VI emission standards

The Euro 6/VI emission standards outline the responsibilities of different actors, including for manufacturers to ensure that their vehicles meet the emission limits and durability requirements, and for Member States’ type-approval authorities to grant type-approval if the requirements are fulfilled. Since the Euro 6/VI emission standards are legislated through Regulations 44 , these requirements are binding in their entirety and directly applicable in all Member States. The actual implementation of Euro 6/VI emission standards is characterized by the gradual development of testing procedures and technical requirements introduced in the implementing Regulations through different steps, i.e. Euro 6b-d(-temp) and Euro VI A-E summarised in Table 36 .

As already outlined in chapter 1.1, Dieselgate has occurred as important unexpected event during the implementation of the Euro 6 emission standard for cars. At the same time Euro 6d(-temp) was introduced with on-road Real Driving Emissions (RDE) NOx and PN testing with temporary and final conformity factors.

Table 36 – Overview of the implementation of Euro 6/VI emission standards

A)Cars and vans (Euro 6)

B)Lorries and buses (Euro VI)

Since the Euro 6/VI emission standards were implemented in different steps, the standards are characterised by different application dates for Euro 6b-d(-temp) and Euro VI A-E. Furthermore, there are different application dates for new types of vehicles and new vehicles, which can be found in Annex I, Appendix 6 of Regulation (EC) 2017/1151 for cars and vans and in Annex I, Appendix 9 of Regulation (EU) 582/2011 for lorries and buses. Table 37  attempts to summarise the main dates for the implementation roadmap for Euro 6/VI emission standards. It shows that the most recent steps of Euro 6 (Euro 6 d) and of Euro VI (Euro VI E) have yet to be implemented for several vehicle categories.

Table 37 – Simplified implementation roadmap Euro 6/VI emission standards

A)Cars and vans

B)Lorries and buses

As of these application dates, manufacturers of vehicles are responsible for ensuring that their vehicles meet the pollutant emission limits set out in the Euro 6/VI emission standards. To make sure that the vehicles actually comply with the Regulations, the emission tests are performed at several phases and monitored by national type-approval authorities, as follows:

Firstly, type-approval testing is done on pre-production vehicle models to ensure that the set emission limits are met and is granted by type-approval authorities in the Member States in collaboration with technical services acting on their behalf. The latter either carries out the testing at their facilities or supervises it at the manufacturers’ facilities. That way, Certificates of Conformity (CoC) are granted for all vehicles for which the pre-production model has confirmed compliance with the emission limits.

Secondly, testing in the Conformity of Production (CoP) procedure aims at ensuring that the newly produced vehicles continue to comply with the limits as required by the legislation. Concretely, the manufacturer has to select a sample of vehicles from the production facility (i.e. not registered vehicles) that will undergo the same testing procedure as for type-approval. The type-approval authority audits the relevant tests performed by the manufacturers for which it may bring in a technical service.

Thirdly, In-Service Conformity (ISC) is applied to make sure that the emissions remain below the Euro 6/VI limits over the normal lifetime of the vehicles. For this compliance check, the manufacturer is generally responsible for performing the relevant tests, while the respective granting type-approval authority is required to test a number of selected vehicle types each year and is responsible for enforcement. Moreover, in the wake of Dieselgate, ISC testing by independent and accredited third parties is possible.

Lastly, Market Surveillance (MaS) should be performed by authorities that are independent from the authorities responsible for type-approval. These market surveillance authorities should assess the continued conformity with the limits, by testing registered vehicles against all the requirements of the Regulation. However, until 2020 Market Surveillance checks by Member States were not required by the Regulation. From 1 September 2020, the new EU vehicle type-approval framework 46 is applicable that demands Member States to test a minimum number of vehicles and requires that the market surveillance authorities reserve sufficient funds to perform the checks. Hence, Market Surveillance checks have been improved fundamentally.

Member States have the discretion to decide on penalties to infringements by manufacturers and technical services, including the level of penalties, and recalls of vehicles if they do not comply with the Euro 6/VI emission standards. Typically Member States have introduced a range of penalties levels depending on the type of infringement of the Regulations. What level of sanctions is applied within that bracket is at the Member State's discretion and is decided case by case.

In the wake of Dieselgate, the Commission has coordinated recalls of vehicles equipped with illegal defeat devices 47  organised by the Member States since January 2018 through the Platform on Recall Actions related to NOx emissions 48 . Since then, the Commission has been regularly monitoring progress of recall actions and remind Member States of their obligation to recall the vehicles with illegal defeat device and to bring them into conformity with the type-approval rules. From 1 September 2020, the new EU vehicle type-approval framework empowers also the Commission to initiate EU-wide recalls and impose fines of up to €30 000 per non-compliant vehicle if no fine is being imposed by the Member State. In addition, the Commission may also fine technical services if they fail to carry out the test rigorously. The level of fines depends on an assessment of the gravity and extent of the non-compliance and are specified by a Commission delegated act. 49 The existing obligation for Member States to lay down rules for effective, proportionate and dissuasive penalties is maintained. With the new EU vehicle type-approval framework, Member States have to report to the Commission every year on the penalties they have imposed in the preceding year, and the Commission shall elaborate each year a summary report on the penalties imposed by Member States and submit it to the Forum for Exchange of Information on Enforcement composed of representatives appointed by the Member States representing their approval authorities and market surveillance authorities.

4.Method

4.1.    Short description of methodology

The evaluation of the Euro 6/VI emission standards was carried out in 2020-2021 by the Commission and guided by a combined evaluation roadmap and inception impact assessment 50 that described potential issues in the Euro 6/VI emission standards and how the evaluation will provide a detailed analysis on the basis of the Better Regulation evaluation criteria. For this purpose, eight overarching evaluation questions were formulated to assess the regulations’ effectiveness (three questions), efficiency (two questions), relevance (one question), coherence (one question) and EU-added value (one question). To inform the responses to these eight evaluation questions, a supporting Euro 6/VI evaluation study carried out by CLOVE consortium in 2020-2021 51 analysed a total of fourteen evaluation (sub-) questions which have been summarized into the eight questions considered here. Table A.1 in Appendix shows how the responses to the sub-questions in the supporting study have been re-aggregated in the Staff Working Document.

The supporting Euro 6/VI evaluation study helped collecting evidence and data through different channels, including several means for gathering stakeholder views and expertise.

As a first step for the evaluation an extensive literature review and analysis of data were undertaken through the supporting Euro 6/VI evaluation study focussing on the impacts of pollutant emission from new road vehicles. This included literature reviews of and data from the Euro 6/VI impact assessment 52 , the study on post-Euro 6/VI emission standards in Europe carried out by the CLOVE consortium compromising key experts in Europe from the Laboratory of Applied Thermodynamics of the Aristotle University of Thessaloniki (LAT) (GR), Ricardo (UK), EMISIA (GR), TNO (NL), TU Graz (AT), FEV (DE) and VTT (FI) 53 , other relevant studies and databases, and automotive market studies 54 . The literature review contributed to establishing the baseline and to collecting information on all evaluation questions.

As presented in Annex 2, the public and targeted stakeholder consultations in 2020 and AGVES expert meetings from 2019-2021 collected evidence and views from a broad range of stakeholders, in order to assess the relevance, effectiveness, efficiency, coherence and EU added value of the Euro 6/VI emission standards. In total, 32 contributions were received from public authorities, 6 from type-approval authorities, 8 from technical services, 38 from vehicle manufacturers, 64 from component suppliers, 80 from other industry stakeholders (including associations and fuel and energy industry), 11 from consumer organisations, 17 from environmental NGOs, 64 from citizens and 12 from other stakeholders to the targeted and public consultations regarding Euro 6/VI evaluation.

Nevertheless, limited data were provided by stakeholders during the targeted consultation on the evaluation. For the assessment of Euro 6/VI’s effectiveness and efficiency (and to a lesser extent relevance), additional data from publicly available sources, namely the EEA NECD database6 OECD statistics8, the handbook on external costs and emission factors of Road Transport9 and data on structural business statistics from Eurostat10; additional data on emission type-approvals from 10 type-approval authorities 55 and on Euro 6/VI vehicle sales in the EU-28 from IHS Markit 56  and cost estimations by CLOVE experts validated by key stakeholders 57  were therefore of great importance to supplement the limited data provided in the stakeholder consultation.

The assessment of Euro 6/VI’s effectiveness and efficiency and the quantification of the impacts of the Euro 6/VI emission standards were supported by the use of the COPERT and SIBYL model. The SIBYL and COPERT model were updated with the data collected, latest emission factors and literature reviews as outlined in the previous paragraphs. More details on the COPERT and SIBYL model are provided in Annex 4.

For this evaluation, no case studies were conducted. Reason for this being that in view of the limited data provided by stakeholders during the stakeholder consultation (only 3 manufacturers contributed, no contributions from automotive associations or suppliers), no representative stakeholder from the most important stakeholder group, the automotive industry, could be identified to carry out a case study. Instead, the comprehensive data collection procedures outlined above were chosen as the best way forward.

4.2.    Limitations and robustness of findings

The evaluation of the Euro 6/VI emission standards entails certain limitations that might have certain implications on the validity of the conclusions. This section will discuss the main limitations, the related repercussions and how the issues are addressed.

The main limitation in the analysis is related to the efficiency criterion. A limited provision of cost data occurred during the targeted stakeholder consultation with data from 3 manufacturers and 3 approval-authorities only, which were not representative for EU-28. The shortcoming was tried to overcome without success by follow-up interviews and extension of the consultation by 6 weeks, also due to COVID-19. This lack of cost information had implications on the robustness of findings from Euro 6/VI’s efficiency and hampered the credibility of the answers on the efficiency questions and related conclusions. This potential weakness has been addressed through the additional collection of data from numerous public sources and the Commission requested additional data from type-approval authorities and bought additional data on Euro 6/VI vehicle sales. Furthermore, cost estimates have been developed based on scaled-up desk research and input provided by CLOVE experts to fill in the remaining gaps and have been validated by key stakeholders. By these means, robust conclusions could be achieved on the efficiency criterion.

A second limitation is related to discrepancies that have occurred between different information sources. While limited data from type-approval authorities have been made available in the first place, these data were not always in line with the estimations provided by the SIBYL model. For example, when it came to the penetration of Euro 6/VI vehicles in the vehicle fleet, the SIBYL estimations seemed to overestimate the uptake of the most recent steps of Euro 6/VI vehicles and the related timing. Since this inconsistency could give wrong impression on the effectiveness of the Euro 6/VI emission standards, the SIBYL model was updated with new data on emission type-approvals from 10 Member States and vehicle sales in the EU-28 from 2013-2020 provided by IHS Markit. This approach is considered as appropriate mitigation measure.

A third limitation is the lacking implementation of monitoring requirements in the Euro 6/VI emission standards as suggested by Euro 6/VI impact assessments. Thus, neither Member States have reported on the compliance processes to ensure that requirements of the regulations are met, nor specific monitoring data on type-approval of vehicles, air pollution levels and epidemiology on health impacts from road transport were available. This problem was tried to overcome with the above-mentioned data collection, including existing data on air quality from the European Environment Agency (EEA), and literature review in 2020 and use of the updated SIBYL and COPERT model but could not fully compensate the non-availability of monitoring data for Euro 6/VI emission standards.

Overall, and despite the limitations presented above, the analysis underpinning this evaluation is sufficient to formulate answers to the evaluation questions. As regards to the monetised cost for industry and type-approval authorities, it is unlikely that further analysis based on available data would yield considerably different results or would significantly influence the overall findings.

5.Analysis and answers to the evaluation questions 

5.1.    Effectiveness

Effect of Euro 6/VI emission limits on cleaner vehicles on EU roads

Since providing a high level of environmental protection is one of Euro 6/VI’s objectives, the impact of the Euro 6/VI emission standards 58 on actually achieving cleaner vehicles on EU roads is an important measure for its effectiveness. In this context, the overall impact of the Euro 6/VI emission standards should depend on both the emission performance of Euro 6/VI vehicles and on their share in the fleet. 

Emission levels per vehicle:

Following the introduction of Euro 6/VI limits 59 , large reductions in NOx emissions were realised compared to Euro 5/V vehicles and with the Euro 6/VI vehicles becoming progressively cleaner towards Euro 6d and Euro VI E 60 . Evidence from PEMS tests and remote sensing 61 , comparing Euro 5/V and Euro 6/VI vehicles, has demonstrated that NOx emissions from Euro 6 diesel cars have reduced by more than 50%, while NOx emissions from diesel vans have almost reduced by 70%. 62 63  Also, the NOx emissions from Euro VI lorries and buses have reduced significantly in comparison to their Euro V counterparts with the actual reduction depending on the specific heavy-duty category (between 58 and 88%). 64  Additionally, large reductions in PN emissions were realised for Euro 6 petrol vehicles with the introduction of PN limits making the use of Gasoline Particulate Filters (GPF) for Gasoline Direct Injection (GDI) vehicles inevitable. 65  This introduction in combination with more stringent PM limits also resulted in significant PM reductions for petrol cars and vans, while the changes are less evident for diesel vehicles. 66 Also, PEMS measurements on a bus in urban operation found PM to be approximately 85% lower. 67  

For the other pollutants CO, THC, NMHC and CH4 no similar information was found in the literature. 68  For this reason, the COPERT model 69 was used to estimate potential reductions to learn whether vehicles have become less polluting. 70  For THC and NHMC, these results indicated emission reductions of 38 and 33% for Euro 6 vehicles and 30 and 30% for Euro VI vehicles. Also for CO emissions from Euro 6/VI vehicles considerable decreases were found in comparison to the emission from Euro 5/VI vehicles. While CO limits did not change for Euro 6/VI, Euro 6 vehicles were found to pollute 70% less CO in comparison to 86% less for Euro VI vehicles. These reductions can be explained by the introduction of diesel particulate filters (DPF). CH4 emissions for new lorries and buses decreased by 27% with the introduction of Euro VI. For NH3 emissions, however, Euro VI buses were found to emit 70% more NH3 and Euro VI lorries even 75% 71

Overall, this evidence is largely supported by all stakeholder groups that participated in the targeted consultation: close to all stakeholders from automotive industry, Member States and civil society 72  strongly agreed that Euro 6/VI standards have led to cleaner vehicles on the market. 73  Similar results were found for the public consultation in which the stakeholders from all groups including citizens indicated that air pollution originating from new vehicles decreased slightly or even significantly over the past 10 years. 74  

Fleet Emission levels:

While the Euro 6/VI emission standards have succeeded in progressively making new vehicles cleaner, these benefits are not yet fully felt on the EU roads. 75  In 2020 less than half of the EU vehicle fleet is type-approved to the Euro 6/VI emission standards (20% Euro 6 cars and vans, 34% Euro VI lorries and buses) 76 . Hence, the actual contribution of the Euro 6/VI emission standards towards realizing cleaner vehicles on EU roads appear to be a work in progress that will depend on the rate of uptake of cleaner Euro 6/VI vehicles replacing more polluting Euro 5/V vehicles.

Taking into account these findings per vehicle, the COPERT model 77 has quantified the expected level of total emissions from all vehicles until 2050 78 and the emission saving achieved to determine the impact of Euro 6/VI emission standards on the total level of emissions of the regulated pollutants. Given the emission reductions per vehicle and the fleet composition, considerable reductions in emission levels for NOx have been realized, in particular for diesel vehicles. 79 For cars and vans, NOx emission levels decreased by 22% between 2014 and 2020, while for lorries and buses a decrease by 36% was realised between 2013 and 2020. Figure 20 presents the emission savings resulting from Euro 6/VI in comparison with the previous Euro standards with its specific focus on NOx, PM and HC. It shows that the emission reductions for Euro 6 have been mainly realised after the introduction of RDE testing, in the wake of Dieselgate. Significant savings have been also realised for PM emissions emerging from cars and vans , especially for exhaust PM emissions (28%). The emission savings achieved from lorries and busses were slightly less with a 14% decrease in exhaust PM emissions which is normal considering the low PM levels already achieved. For cars and vans, THC and NMHC emission levels have decreased by 13 and 12%, while for lorries and buses THC decreased 14%. 80  

Although the emission limits were not changed for CO, significant savings have been realised for CO emissions which were linked to the use of DPF. Following the new limit for NH3 in Euro VI, emissions from this pollutant emerging from road transport actually increased by approximately 30%. The emission limit seems not to be strict enough to reduce NH3 emissions effectively. 81

In the targeted stakeholder consultation on the evaluation, stakeholders across all groups 82 considered that the Euro 6/VI limits were highly or somewhat successful in reducing actual pollutant emissions with only two stakeholders disagreeing on the success of the limits for cars 83 . Similarly, among the respondents to the public consultation almost everyone indicated that the standards have been appropriate for reducing pollutant emissions from road transport. 84  In particular, the new PN limit was considered an important step to better regulate fine particles and for Europe to take a leading role in this. Nevertheless, there still seems to be room to lower the limits for solid particles without large investment costs nor significant technical modifications. 85 When the stakeholders were asked in the public consultation whether the Euro 6/VI limits are sufficiently strict, the majority of Member States’ and civil society stakeholders somewhat or completely disagreed. 86 Especially the limits for NOx and PM/PN were considered not sufficiently low by the respondents that expressed discontent about the strictness of the limits. 87  

Figure 20 – NOx, PM and HC savings for Euro 6 cars and vans, and Euro VI lorries and buses 88  

Effect of other Euro 6/VI factors on cleaner vehicles on EU roads

When considering other factors than Euro 6/VI emission limits that positively affected the achievements of cleaner vehicles on EU roads, the enhanced Euro 6/VI testing procedures appear to have contributed the most.

In-service conformity (ISC) testing including RDE testing for cars and vans and PEMS testing for lorries and buses are widely reported effective in ensuring low emissions. 89 During the EMIS committee 90 , the JRC emphasised the ability of ISC testing and market surveillance to ensure compliance and subsequently emission reduction. 91  In addition, stakeholders from most groups generally consider RDE and the introduction of conformity checks through PEMS to be very successful and effective. Several environmental NGOs expect that third party ISC testing will have a significantly positive impact for tackling emissions but argue that it is too early to assess this for cars and vans. 92

The introduction of cold-start emissions to testing procedures is also considered highly effective in ensuring that most emissions are accounted for cars, vans, lorries and buses. Before these emissions were regulated, the first five minutes of a trip – in which emissions are generally higher – were excluded from the data and hence not accounted for. When adding cold-start to the PEMS data, the importance of this aspect of testing becomes very clear. 93  While diesel cars can contribute up to 38% more to the total NOx emissions when cold-start is included, cold-starts contribute up to 86% of PN emission of petrol vehicles without a particulate filter. 94  

Unintended consequences and obstacles of Euro 6/VI to cleaner vehicles on EU roads

While the Euro 6/VI emission standard aims at reducing the regulated pollutant emissions from new vehicles, evidence suggests that emissions of other unregulated air pollutants could be affected by Euro 6/VI and the related changes in emission control technologies. There is no NH3 emission limit for cars and vans, despite the fact that cars are actually the largest contributors to NH3 emissions from transport in Europe. 95  The reason is that emission control technologies used to restrict NOx emissions in line with the Euro 6 requirements cause an ammonia slip due to dosing of urea. 96 As a result, the use of ammonia slip catalysts (ASC) has been increased in recent Euro 6d diesel vehicles, in which N2O may be produced as a by-product. For gasoline vehicles, particularly high NH3 and N2O emissions have been observed on positive ignition (PI) engines equipped with three-way catalysts. 97 Additionally, aftertreatment systems to reduce NOx in Euro 6/VI have increased the NO2 to NOx ratio of vehicle exhaust. 98 However, this effect seems to have been mitigated in the latest Euro 6/VI steps. These unintended consequences on the environment by new NH3, N2O and NO2 emissions will be further discussed under the relevance criterion (see chapter 5.3).

Some obstacles of Euro 6/VI emission standards to cleaner vehicles on EU roads have been detected in the targeted stakeholder consultation on the evaluation 99 :

·Threshold OBD – While many industry stakeholders consider the threshold for on-board diagnostics (OBD) to have been successful, non-industry stakeholders (e.g. public authorities, technical services, environmental NGOs) identified that problems still exist with OBD due to unclear requirements for monitoring and occurring failures in identifying malfunctions resulting in high emissions. In addition, the majority of respondents from all stakeholder groups to the public consultation indicated that the limited effect of OBD at least contributes somewhat to an increase in pollutant emissions. For industry, however, 28 of the 57 respondents indicated that the limited effect of OBD only contribute very little or not at all to this increase. 100  

·Differences in Euro 6/VI limits based on technology and fuel – Differences such as different limits for diesel, petrol and CNG cars did not have the positive effect that was envisaged, but it actually prevented greater achievements 101 . In the public consultation, 87 of 124 stakeholders from all groups indicated that developing fuel- and technology-neutral limits would be (very) important to improve the effects of emission limits for vehicles 102 . 

·Different application dates for the stepwise Euro 6/VI approach and for new vehicle types and new vehicles – Industry stakeholders were the most sceptical regarding these different application dates, indicating that it is important to introduce common dates to ensure regulatory planning reliability. This concern was emphasised in public consultation were 101 out of 128 stakeholders from all groups indicated that the different application dates for the stepwise approach were considered complex or very complex. For the different application dates for new types and vehicles, 88 out of 128 from all groups indicated that this feature of the legislation is at least somewhat complex. 103

·Complexity of Euro 6/VI emission tests – Stakeholders from all groups, except environmental NGOs, indicated in the targeted consultation that the complexity of emission tests has played a negative role as it resulted in errors in performing the emission tests and calculations and significantly increased the capacity needed by manufacturers to comply with the Regulations, which in its turn increased prices and slowed down the uptake of Euro 6/VI vehicles. Moreover, the introduction of temporary and final conformity factors 104  are expected to have had a negative effect on the achievements of Euro 6/VI so far. This result was also confirmed in the public consultation where 98 out of 126 respondents from all stakeholder groups considered that the standards are complex or even very complex. 105 Especially the procedures of the emission tests and the number of emissions are considered (highly) complex by most respondents. Only civil society was less convinced of the complexity related to the number of tests, which they consider appropriate to achieve effective emission standards. 106  

·Tampering – Stakeholders from all groups indicated that the Euro 6/VI provisions taken to prevent tampering 107 with the emission control computer, odometer or other vehicle control unit are not effective and are expected to have had a negative effect on the achievements of Euro 6/V so far. A similar result was found in the public consultation in which a substantial majority across all stakeholder groups indicated that tampering still contributes to an increase in emissions. 108

The response to evaluation question 1 already indicated that the enhanced Euro 6/VI testing procedures have been of great importance for making cleaner vehicles on EU roads a reality. In particular, ISC testing with RDE and PEMS testing, and the introduction of cold-start emissions to testing procedures are considered to be important factors for making cleaner vehicles on EU roads a reality. Now, this question evaluates the new Euro 6/VI testing procedures to check whether they reduced the gap between real-world emissions and type-approved emissions and whether they are actually representative for real-world driving cycles and conditions of use.

Gap between real-world emissions and type-approved emissions

For cars and vans, before Euro 6 emission standards, and in particular before the introduction of RDE testing, significant levels of deviation between real-world and type-approved emissions were reported. The JRC demonstrated that pre-RDE Euro 6 diesel vehicles (Euro 6b) emit on average almost three times as much NOx emissions and 40% more CO emissions than the respective emission limits allow. 109 This level of deviation decreased somewhat with the introduction of WLTP testing (Euro 6c) 110 and much more with the introduction of RDE testing (Euro 6d-Temp). 111 The impact of RDE testing on the gap between real-world and type-approved emissions is demonstrated in Figure 21  for NOx and PN emissions.

Figure 21 – NOx and PN emissions on a sample of vehicles before and after the introduction of RDE testing 112  

Except for some reservations due to incompleteness in the RDE coverage for urban driving conditions, the majority of stakeholders from all groups participating in the targeted consultation agreed with the above findings for Euro 6 emission testing stating that the introduction of RDE testing reduced the gap between type-approval and real-world emissions. However, in the public consultation only a majority of industry and citizen respondents indicated that RDE testing ensures that cars and vans are compliant with the pollutant limits in all driving conditions. 113 In addition, a majority across all stakeholder groups, excluding industry, indicated that shortcomings in the existing on-road test at least contributed somewhat to an increase in emissions. 114  

For lorries and buses, the introduction of new Euro VI testing procedures and on-road testing procedures - WHTC, WHSC and PEMS testing - had limited positive results in reducing the existing gap between real-world and type-approved emissions. In particular for NOx emission, the large gaps in low-speed driving conditions and idle vehicles with low loads identified for Euro V vehicles continued in Euro VI vehicles. 115 Thus, the driving cycle coverage proves to be insufficient and the margin for optimisation of vehicle’s engine to the test remains.

However, stakeholders from all stakeholder groups broadly agreed in the targeted stakeholder consultation on the effectiveness of the Euro VI new testing procedures, which is not fully in line with the above findings. Especially for the introduction of on-road testing procedures for in-service conformity testing (i.e. PEMS), this is perceived to have reduced the gap between type-approval and real-world emissions by 44 out of 45 stakeholders that answered this question. 116 Also in the public consultation a majority of industry and citizen respondents indicated that PEMS testing ensures that lorries and buses are compliant with the limits in all driving conditions. 117 Hence, progress was reported towards narrowing the gap between real-world emissions and type-approved emissions. Nevertheless, stakeholders - mostly from Member States and civil society - replied to the public consultation and the Combined Evaluation Roadmap/Inception Impact Assessment 118 by saying that there is still a wide gap, especially in urban driving conditions, which confirms the above findings on WHTC, WHSC and PEMS testing.

Coverage of actual real-world driving cycles and conditions of use

Moving from Euro 5 emission testing with laboratory NEDC testing to Euro 6c with laboratory WLTP testing and Euro 6d-TEMP with a combination of WLTP and RDE testing, gradual progress has been made towards increasing the level of representativeness of the considered driving cycles and hence conditions of use and the robustness against defeat strategies. This follows from the shift in requirements through RDE testing requiring the inclusion of urban, rural and motorway driving cycles and expanding boundary conditions by accounting for differences in ambient temperature and altitude which deviates from the repeatable and reproducible testing cycles of NEDC and WLTP testing. Nevertheless, despite these improvements, important emissions remain unaccounted under Euro 6/VI emission testing. The test boundaries for cars and vans still exclude short trips, high mileage and high altitude circuits, and severe temperature conditions. Since pollutant emissions are generally higher in such driving cycles and conditions of use, a large part of the overall emissions remains unaccounted for. 119   Figure 22 illustrates how driving cycles with a very low average speed – and hence not covered in RDE testing – tend to result in NOx emissions far above the current emission limit for petrol cars.

Figure 22 - Emission performance of Euro 6d vehicles for NOx for different average speeds (NOx limit for petrol cars = 60 mg/km) 120  

Moving from Euro V emission testing with ESC/ETC/ELR testing to Euro VI A with WHTC/WHSC testing and Euro VI D with the addition of PEMS testing to ISC testing, improvements were made to the reliability of testing for lorries and buses. New driving cycles and hence conditions of use include urban, rural and motorway operations and cover a wide range of load and speed operations. In addition, the new requirements hamper defeat strategies by manufacturers through removing the possibilities for prior-calibrating the emission control system to meet the limits. Nevertheless, the test boundaries still exclude important emissions measured at low loads, low speed and idle times that are of great importance for lorries and buses operating in urban areas. In addition, an important level of tampering is still reported under Euro VI, following lacking third-party verification and the fact that ISC is undertaken by the manufacturer. 121

Hence, a complete coverage of real-world driving cycles and all conditions of use is still missing in Euro 6/VI emission standards. As the cycles and conditions that are not yet included also result in extensive pollutant emissions, it is of great importance for human health and environment to review the testing boundaries.

Benefits for industry

1)Impact on harmonised rules on the construction of vehicles

A specific objective for the creation of Euro 6/VI emission standards was to achieve harmonised rules on the construction of motor vehicles to limit distortions in competition across Europe that would be realised by the Member States. That way, this harmonised approach should benefit industry.

While there is an overall understanding amongst most stakeholders groups 122  that the introduction of the Euro 6/VI emission standards has resulted in a level of harmonisation that would not have been achievable at the level of the Member States, several concerned industry representatives do not agree that Euro 6 emission standards have ensured harmonised rules (7 out of 30). 123  They report discrepancies in the form of differences in interpretations of the Regulations by different type-approval authorities. For example, there would still be differences in interpretations in the authorisation to disable pollution-control devices to protect components and in measurement devices’ errors. This situation makes it possible for manufacturers to select the type-approval authority with the least stringent interpretation of existing rules. 124 125  Overall a small majority of respondents to the public consultation indicated that the complexity in the current standards leads to misinterpretation amongst type-approval authorities. Especially stakeholders from civil society seem to be convinced of the occurrence of such misinterpretations. 126  Due to these reported differences in interpretation, full harmonisation on the construction of motor vehicles seems not to be achieved yet.

2)Impact on competitiveness of the EU automotive industry

a.Impact on cost and price competitiveness 

For cars and vans, the introduction of Euro 6 emission standards resulted in significant equipment costs for emission control technologies (see detailed cost assessment in section 5.2). In particular, the introduction of RDE testing required improvements of existing equipment and installation of new equipment. Moreover, the introduction of the new standards also entailed considerable other costs during implementation phase for vehicle testing and type-approval (see detailed cost assessment in section 5.2). While there is uncertainty surrounding the exact rise in costs, it is clear that the actual regulatory costs were higher than initially anticipated 127 128 .

The transmitted regulatory costs by change in vehicle prices for consumers is less clear. For cars, real prices have on average increased since 2014. While this increase could be linked to the increase in regulatory costs associated with the Euro 6 emission standards, it could also be the result of various other factors affecting prices (e.g. difficult economic conditions, increased installation of comfort equipment or changes in fleet composition towards more heavy and expensive vehicles). 129 130  Stakeholders from all groups participating in the targeted consultation suggest that Euro 6/VI has resulted in a small increase in vehicle prices with industry respondents generally indicating a more extensive rise in prices. Similar input was provided to the public consultation where 121 out of 139 respondents from all stakeholder groups (including citizens) considered that Euro 6/VI has led to an increase in the prices of cars, vans, lorries and buses. 131

The profitability of the EU automotive sector was analysed. However, it is difficult to determine whether the increased regulatory costs have affected the respective profit margins and the overall profitability. According to industry stakeholders, the introduction of Euro 6/VI emission standards had a significant or limited negative impact on the profitability of the EU automotive sector. Since the Euro 6/VI emission standards apply to all vehicles sold on the EU internal market, the regulatory costs do not necessarily imply a direct negative impact on the competitiveness of the EU manufacturers compared to non-EU competitors, as the latter are faced with similar costs. Therefore, competitive disadvantages referred to by EU manufacturers are expected to be rather indirect through the relatively higher compliance costs for EU manufacturers in comparison to their competitors in lower cost countries. 132

b.Impact on international competitiveness

To ensure the competitiveness of the EU automotive industry, it is of great importance that stricter Euro 6/VI emission limits and testing procedures help to ensure access to external markets for European manufacturers. When comparing the emission requirements in Europe today with those in place in other key markets (i.e. the United States and China), however, the EU appears to be lagging behind its main competitors. Figure 23 demonstrates that with the exception of PM emissions, both the United States and China have adopted more ambitious limit values for cars and vans. Also when it comes to the testing procedures, the United States currently takes the lead through the creation of detailed standards and OBD enforcement mechanisms that eliminate loopholes. 133

Figure 23 – Comparison of latest emission limits in the EU, United States and China for light-duty vehicles, Source: ICCT, 2019 134  

Hence, the more stringent emission limits introduced in Euro 6/VI are not sufficient to result in competitive gain for the European manufacturers given that their global counterparts are implementing stricter standards. 135  Nevertheless, the Euro 6/VI emission standards are expected to have an impact on the access to markets by reducing the emission reductions required to sell vehicles on other markets with even stricter requirements. 136  In addition, the stakeholders from all groups participating in the targeted consultation widely indicated that the Euro 6/VI emission standards have actually realised a positive effect on the EU automotive industry’s competitiveness, with industry being slightly hesitant in their reply. Feedback from the ICCT indicated that without the Euro 6/VI emission standards, European manufacturers could have lost the ability to develop and produce desirable vehicles for the US and Chinese market.

c.Impact on the capacity to innovate 

Considering the number of R&D projects directly linked to Euro 6/VI emission standards, it is expected that the standards had a positive impact on research activities in the EU. 137  For example, the European Investment Bank (EIB) confirmed that loans amounting to €13.6 billion were provided to car manufacturers for the development of pollution-control devices between 2005 and 2015. 138  These research activities were mainly focussed on improvements in existing technologies rather than on the development of completely new technologies. These findings are confirmed by all the stakeholder groups participating in the targeted consultation: 64 of 73 respondents across all groups indicated that the Euro 6/VI emission standards have provided an incentive for research activities towards the development of new clean vehicle technologies. In addition, multiple stakeholders, mostly from civil society, stress that for Euro 6, there was an acceleration in R&D activities following the introduction of RDE testing. On the other hand, some stakeholders from industry suggested that most of the technologies were already available on the market and the standards only fostered innovation through improving existing technologies and subsequently decreasing their costs. 139  In a similar way, there are now technologies available on the market allowing for further emission reductions than currently required under the Euro 6/VI emission standards. 140

Although emission control technologies similar to the ones required for the Euro 6/VI emission standards were already adopted in other major markets, their adoption in Europe would most likely not have happened at a similar rate without the introduction of Euro 6/VI emission standards in Europe. While the technology was largely available, its voluntary uptake in Europe would have depended on costs and customer demand. With emission control technologies only adding costs with little perceived value for consumers, it is clear that manufacturers would most likely not have voluntarily adopted the technology required under Euro 6/VI. 141

To encourage technology advances and improvements following the introduction of Euro 6/VI emission standards, support instruments were put in place at EU and Member State level. At EU level, manufacturers and suppliers were able to make use of Horizon 2020 projects focusing on the development of cleaner engine and aftertreatment technologies. Next to that, EU support instruments – such as the above-mentioned loans from the European Investment Bank - were available to finance related R&D activities. Member State support occurred either through nationally funded R&D support projects or through financial incentives. With 16 out of 30 industry stakeholders indicating in the targeted consultation that they made use of national projects, this support mechanism has been employed most frequently. Financial incentives by Member States, which have been encouraged in the Euro 6/VI emission standards 142 , have only been used by 6 out of 25 industry stakeholders that responded to this question in the targeted consultation. 143 In general, the responses to the public consultation suggest that the standards have encourage the development of innovative technologies for cleaner vehicles, as this was indicated by more than 90 percent of the respondent with no remarkable differences between the stakeholder categories. 144  

These mixed results on the competitiveness of the automotive industry are reflected in the responses to the public consultation. Most respondents from all stakeholder groups considered that Euro 6/VI had at least somewhat of an impact on reinforcing the competitiveness of the industry, while the majority of respondents from Member States believe Euro 6/VI to be a great or very great contributor here. 145  

Benefits for environment

A specific objective for the creation of Euro 6/VI emission standards was to improve air quality by reducing pollutants emitted by the road transport sector. In addition, the Euro 6/VI impact assessments 146 indicated that monitoring data on air pollution levels and the epidemiology on health impacts (see below ) will point to the wider success of the policies.

Euro 6/VI vehicles have realized large emission savings for NOx and particulate (PM and PN) emissions, in combination with small savings for CO, HC (THC and NMHC) and increasing emissions of NH3 (see evaluation question 1). All these pollutants are regulated under the National Emission Ceilings Directive (NECD) 147 , which requires Member States to set national emission reduction commitments. That way, the emission savings brought by Euro 6/VI emission standards for road transport sector have contributed to efforts for achieving the NECD targets from all sectors. However, no changes are observed in the share of road transport emissions to total emissions from all sectors6. This result could be influenced by the increasing trend in the number of motor vehicles on EU roads, increasing mileage per vehicle or decreasing emission levels in other polluting sectors. 148  Most stakeholders from all groups agree that the Euro 6/VI emission standards have improved air quality. However, one environmental NGO stresses that road transport is still an important contributor to the total emission in the EU, which limits the Euro 6/VI objective to improve air quality by reducing pollutants emitted by the road transport sector.

Next to directly achieving benefits for the environment, the Euro 6/VI emission standards could also benefit the environment by raising public awareness on vehicle-related air pollution problems and in that way, influencing public attitude. Nevertheless, the direct contribution of the Euro 6/VI emission standards in this context appears to be limited. While the last Eurobarometer survey 149 , which was conducted in 2017, illustrated that the public seems to be more aware of air pollution issues and the role of motor vehicles in creating those, it is possible that other trends might have a larger impact. In particular, the growing use of Low Emission Zones (LEZs) in urban areas are likely to have positively affected public awareness in this context. 150  While the creation of LEZs could have also taken place in the absence of the Euro 6/VI emission standards (i.e. continuation of Euro 5/V emission standards), the further development of LEZs does depend on the continuation of the Euro standards as Euro 6/VI vehicles allow local authorities to impose access restrictions on up to Euro 5/V vehicles. That way, the introduction of Euro 6/VI could have raised awareness on air pollution issues through allowing cities to strengthen their LEZ. However, it is not possible to quantify this possible benefit.

Benefits for citizens 

1)Reduced impact on health

By reducing pollutants emitted by the road transport sector, the Euro 6/VI emission standards provided also a benefit to citizens by curbing health impacts from road transport emissions that could cause respiratory and cardiovascular diseases upon inhalation, for example bronchitis, asthma or lung cancer. Combatting such health impacts from road transport could result in a reduction in the external costs, that means, medical treatment costs, production losses due to illnesses and even deaths. 151  

Table 38 shows the analysis carried out by the SIBYL model (see Annex 4), confirming that the Euro 6/VI emission standards generated a decrease in external costs through the reduction of health impacts originating from road transport. Euro 6 has resulted in a €31 billion decrease in external costs up to 2020 through the reduction of NOx and PM emissions from cars and vans. While the largest share of the benefits were realized in the early steps of Euro 6 following the new emission limits, additional benefits were realized through the introduction of RDE testing and these benefits are expected to increase significantly when more Euro 6d vehicles will be sold after 2020. With a total of €67 billion, health benefits of a different scale were realised with the introduction of Euro VI, mainly from reduction of NOx emissions from lorries and buses. While health benefits have already been realised at this point, they are expected to increase exponentially over the next thirty years, exceeding external cost savings of €1.8 trillion. 152  

These positive health impacts are validated in the responses to the public consultation. A majority of stakeholders from industry, citizens and especially Member States indicated that Euro 6/VI contributed to protecting human health. 153 Next to that, these impacts are largely confirmed in the literature 154 , remaining health risks related to certain regulated and unregulated pollutant emissions remain a concern. Mainly emissions during regeneration at short intervals, especially for PN emissions 155  or emissions of unregulated yet hazardous pollutants, such as NO2, present serious health risks.

Table 38 – Reduced health impact of Euro 6/VI emission standards: Changes in external costs (in € billion) 156

2)Direct impact on employment

Employment in the automotive industry, both for manufacturers and suppliers, could have been positively and negatively affected by the Euro 6/VI emission standards. However, there is no compelling evidence suggesting that Euro 6/VI has had a positive or negative impact on employment.

The introduction of Euro 6/VI emission standards could have resulted in a short-term increase in labour costs, induced by the requirements to implement emission control systems. Since the regulatory costs would have diminished over the application and hence evaluation period, the short-term negative employment effects would follow this trend and could even be transformed into a positive long-term employment effect. This was demonstrated in the GEAR 2030 Strategy 2015-2017 study 157 which used modelling to understand the impact of EU regulations on the wider economy. The results from this exercise showed that small changes in the industry’s composition of GDP, of development of wages and labour productivity over time can change employment numbers, while the total wage ratio remains constant. That way, employment effects can turn significantly positive. Nevertheless, it should be stressed that the effect caused by the Euro 6/VI emission standards cannot be disentangled from other factors that may have affected labour costs in the automotive sector, including other environmental and safety legislations.

In addition, positive employment effects could have been realised in the automotive sector and in the type-approval authorities through the creation of new jobs in R&D related activities or in activities associated with the implementation of the Euro 6/VI emission standards. This assumption was confirmed by a number of type-approval authorities and manufacturers that participated in the targeted stakeholder consultation. 158 159

5.2.    Efficiency

Regulatory costs for automotive industry

In order to analyse the regulatory costs of Euro 6/VI emission standards borne by automotive industry, different cost categories were identified in accordance with the Better Regulation guidelines 160 (see  Table 39 ).

Table 39 – Description of cost categories, based on CLOVE, 2022 161

The costs for automotive industry were collected through questionnaires and interviews in the first targeted stakeholder consultation on the evaluation and CLOVE expert estimates (for more information on data collection, see method chapter 4) and have been analysed in a bottom-up approach. That way, the cost per unit (e.g. per vehicle or engine) were first verified for each cost category. 162 These costs were then scaled up to estimate the cost for the whole stakeholder group using relevant data including new vehicle registrations per year, number of manufacturers affected, number of engine/model families and number of emission type-approvals. 163  

In this context, the evaluation on the efficiency was faced with certain limitations (see Chapter 4). In particular, the limited provision of cost data during the targeted consultation – only 3 manufacturers and 3 type-approval authorities provided data – has been an implication. However, major efforts have been made to tackle this problem through extending data sources and estimating costs through a scaled-up desk research using input provided by CLOVE experts. These cost estimates were then sense checked using data at the sector level (e.g. total turnover, total R&D expenditure) to ensure that the estimates were plausible and to assess to which extent the regulatory cost are reasonable for the respective stakeholders. Next to that, a conservative approach was adopted using broad cost ranges allowing for a higher margin of error. Lastly, the main assumptions on the unit costs per cost category were presented to the stakeholders participating in the AGVES meeting of 26 November 2020, including more than 100 industry participants. Three industry stakeholders, one manufacturer, one supplier and one association, reacted after the meeting and provided further input that has been reflected in the analysis. Hence, robust conclusion should be achieved for the efficiency section. 164

The analysis focused on identifying and quantifying the costs generated through the new requirements of Euro 6/VI emission standards. Hence, the evaluation considered the incremental change in regulatory costs related to Euro 6/VI in comparison to those related to Euro 5/V. Additionally, for cars and vans the change in regulatory costs moving from the first steps of Euro 6 to the later steps including RDE testing, i.e. Euro 6d(-temp), is considered. For Euro 6 (cars and vans), the variation in the costs per vehicle type is accounted for by differentiating the costs for petrol vehicles and diesel vehicles. 165  To account for the variation incurred depending on the vehicle type, size and manufacturer (higher/lower end), different cost ranges (low/moderate/high) were considered. 166  

1)Costs for vehicle manufacturers

Table 40  presents estimates of costs borne by vehicle manufacturers with the introduction of Euro 6/VI emission standards, as net increases in the different costs for manufacturers in total and per unit (vehicle or model/engine family).

Table 40 – Estimates of costs borne by vehicle manufacturers with the introduction of Euro 6/VI emission standards, compared to Euro 5/V 167

Equipment costs - Hardware costs

To comply with the Euro 6/VI requirements, manufacturers had to introduce and integrate new emission control technologies. To estimate the hardware costs that were realised moving from Euro 5/V to Euro 6/VI, typical technology packages used to meet the new requirements were considered. 169   Table 40  shows that for Euro 6 diesel cars and vans, the hardware costs were significant at the pre-RDE steps. This was mainly driven by the introduction of the selective catalytic reduction (SCR) emission control technology. With the introduction of RDE testing, hardware was also required for a share of petrol vehicles, including the use of gasoline particulate filter (GPF) which introduced with €69 moderate costs per vehicle. Thus, the hardware costs for cars and vans mostly increased as a result of the introduction of RDE testing. 170

Next to the hardware cost per vehicle, Table 40  also presents the net increase in total hardware cost. In comparison with the other cost categories presented in the table, it becomes clear that for cars and vans the rise in hardware costs is the most extensive. For cost per vehicle in comparison to Euro 5, the costs of hardware installed in the most recent Euro 6d vehicles are estimated at €228-€465 for petrol and at €751-€1 703 for diesel vehicles. These estimates are higher than the estimation of the Euro 6 impact assessment 171 , in which the weighted average cost per diesel vehicle was estimated at €213 (€280 in 2020 prices). This follows from the fact that analysis in the Euro 6 impact assessment only focused on the cost of the key technology expected to be needed to comply with the limits (SCR or LNT) and did hence not cover other aspects such as the costs of sensors and other supporting hardware (e.g. Lambda or NOx sensors) 172 . In addition, RDE testing was not yet taken into consideration, meaning that the estimates from the IA are only comparable with the Euro 6 pre-RDE costs. 173  

For lorries and buses, however, the hardware cost per vehicle is estimated to be between €1 798 and €4 200, which is comparable to the estimates of the Euro VI impact assessment which were in the range of €2 539-€4 009 (€2 817-€4 419 in 2020 prices). 174  

Equipment costs - R&D, calibration, facilities and tooling costs

Estimating R&D, calibration, facilities and tooling costs was challenging considering the limited availability of relevant data and the fact that R&D projects for the development of new vehicles rarely focus on just one legal requirement such as the Euro 6/VI emission standards. However, uncertainty has been addressed in the estimates by allowing a wide cost range for which the high cost estimates were based on the input from a high-end manufacturers and the low cost estimates stem from the literature. 175  The combined cost estimations are presented in Table 40 .

For Euro 6, the costs for R&D, calibration, facilities and tooling costs is estimated at €36-€108 per vehicle for petrol and at €43-€156 per vehicle for diesel. In total, this makes up for a cost ranging from €3.1 to €10.7 billion for the period 2014-2020. Calibration costs, which should be considered as recurrent costs since new models brought to the market will have to be calibrated to ensure compliance, are expected to represent more than 50% of the total R&D cost estimate for cars and vans. 176  

For Euro VI, it is assumed that only part of the reported R&D costs by manufacturers through the targeted consultation are directly linked to Euro VI, since the R&D activity was also relevant for the US EPA 10 standards 177 . Hence, the R&D costs related to Euro VI are estimated at €1.1 billion for large manufacturers and €0.3 billion for smaller ones. The total R&D, calibration, facilities and tooling costs are presented in Table 40 , together with the costs per vehicle. The estimates suggest that the total costs in this context are comparable to the total hardware costs incurred in the period 2013-2020. On a per vehicle basis, they represent a cost of €1 900 and €3 800 per vehicle sold in this period. While this high cost per vehicle in comparison to the cost for cars and vans can be expected given the smaller volume of lorries and buses sold in the internal market, these estimates based on data from manufacturers 178 seem to be on the higher side compared to results from an ICCT study 179 , which suggested this cost to be 8 to 12 times lower. 180  Similar to Euro 6, the calibration costs have also increased moving from Euro V to Euro VI. In particular, expert estimates indicated that calibration costs have increased from €1.8 million to €3.5 million for a lead engine application. 181  

Costs during implementation phase – Testing and witnessing costs

The introduction of the Euro 6/VI emission standards has led to some changes to the testing requirements and procedure for granting type-approval – including type-approval, ISC and CoP – that were not applicable under Euro 5/VI (see chapter 3). As such, the sixth generation of Euro standards is associated with net increases in the testing costs, as well as increases in the time and effort type-approval authorities spend on witnessing these tests. In this context, increases in testing activity and the number of emission type-approvals is closely linked to the stepwise introduction Euro 6/VI. Moreover, a manufacturer indicated that the level of effort in this context and the associated costs for testing doubled between Euro 5 and Euro 6 pre-RDE, while it increased by a factor 5 between Euro 5 and Euro 6d. The introduction of Euro VI for lorries and buses, on the other hand, has increased the time and effort needed for testing and witnessing by a relatively lower extent of 50%. 182

On the basis of the information made available by manufacturers and type-approval authorities during the targeted stakeholder consultation on the evaluation, the cost estimates for the testing and witnessing costs following the introduction of Euro 6/VI emission standards are summarised in Table 40 . 183 Since not every vehicle needs to go through the implementation procedures explained above, not the costs per vehicle are relevant in this context, but the cost per model family for cars and vans, and per engine family for lorries and buses. For Euro 6, the testing costs per model family are estimated at €0-€34 thousand before the introduction of RDE testing and at €138-€286 thousand after the introduction. For Euro VI, these costs per engine family are expected to be between €93 and €227 thousand. As can be seen in the table, the increase in witnessing costs moving from Euro 5/V to Euro 6/VI are expected to be less important. 184  

Costs during implementation phase – Type-approval fees

Type-approval authorities participating in the first targeted stakeholder consultation provided input on the fees they charge on vehicle manufacturers, excluding the costs to cover witnessing discussed above. Their input suggested that the fees charged by authorities are generally very small ranging from €0 to €2 000 per type-approval to Euro 6 and ranging from €0 to €460 per type-approval to Euro VI depending on the specific authority. Table 40 presents the changes in the fees moving from Euro 5/VI to Euro 6/VI. There is no indication that these fees have systematically increased as a result of the introduction of Euro 6/VI. However, a small increase has been detected in the total cost associated with the fees for type-approval due to an increase in the number of emission type-approvals to the Euro 6 standard. 185 The Euro 6 requirements and the changes in specific aspects of the testing procedures meant that manufacturers had to re-test and request new type-approvals for existing models, while the introduction of CO2 related monitoring and reporting obligations based on WLTP have led to an increase in the number of type-approvals. 186

Administrative costs

Detailed input on administrative costs in the form of costs for reporting and to fulfil other information provision obligations as part of the process for granting type-approval is not generally available. The administrative costs are estimated at €20 to €64 thousand per type-approval to Euro 6 and at €17.5 to €27.5 thousand per type-approval to Euro VI (see Table 40 ). Given the limited input provided by manufacturers, however, there is uncertainty which is partly covered in the range of the upper and lower cost estimates in the calculation. Further to that, the significant increase in administrative costs moving from Euro 5/V to Euro 6/VI still represent a relatively small share of the total costs.

Total regulatory costs for vehicle manufacturers

The total regulatory costs for manufacturers resulting from Euro 6 and Euro VI are presented in Table 40 . The Euro 6/VI emission standards have resulted in a total regulatory cost estimated at €31-€76 billion. When looking into how these regulatory costs will develop after 2020 and considering a social discount rate of 3.8% 187 and a learning effect 188 , the total net cost associated with the Euro 6/VI emission standards up to 2050 are estimated at €97-€222 billion. The weighted average of the total regulatory cost for the period up to 2020 is estimated at around €357-€929 per diesel vehicle and by €80-€181 per petrol vehicle for Euro 6 (cars and vans). For Euro VI for lorries and buses, the weighted average of the total regulatory costs is €3 717-€4 326 per vehicle. 189

2)Costs for component suppliers

Next to the cost implications for vehicle manufacturers, the regulatory costs for component suppliers are also expected to be affected by Euro 6/VI emission standards. In general terms, these costs may include R&D costs to ensure that components are in compliance with the new requirements. In the case of aftertreatment technologies, this would mean development and testing costs to ensure that technologies guarantee that vehicles will be able to meet the new requirements. In the case of suppliers of engines requiring type-approval, certain costs during implementation phase will also be applicable. 190  

Suppliers participating to the targeted stakeholder consultation on the evaluation reported varying levels of costs 191 , while in general higher costs were identified for the larger suppliers. Nevertheless, the feedback from three important suppliers to the targeted consultations shows that these costs for suppliers should be largely – if not fully – reflected in the increased costs for equipment paid by their client, the vehicle manufacturers. The increased costs for manufacturers, capturing also the costs for suppliers, were already presented in Table 40 . 192  

Regulatory costs for type-approval authorities

Apart from automotive industry, type-approval authorities are targeted by the Euro 6/VI emission standards as they are in charge of granting type-approval. Therefore, these authorities are expected to have been confronted with the following costs during implementation phase 193 :

-One-off costs for investment in new facilities and equipment as well as preparatory action taken in the form of training, development of guidance documents or other system updates.

-Recurrent costs associated with the increased need for human resources following the introduction of Euro 6/VI emissions standards, including the time needed for witnessing of type-approval, ISC and CoP tests and for reviewing documentation provided by vehicle manufacturers.

Input from type-approval authorities to the targeted stakeholder consultation on the evaluation showed that these authorities were faced with an increase 194 in costs during implementation phase following the introduction of Euro 6/VI emission standards. 195 Similar to the case for component suppliers, the costs for authorities are expected to be largely covered by vehicle manufacturers in the form of costs for witnessing the type-approval, presented in Table 40 .

Indirect regulatory costs for consumers, including citizens and business users of vehicles

In evaluation question 3, the transmitted regulatory costs and its potential effect on the vehicle prices for consumers, either being professional (business users such as transport companies) or private, were already discussed. While it was difficult to identify evidence showing that the observed increase in prices of cars is directly linked to the Euro 6 emission standards, it is generally expected that manufacturers would have passed on the costs to consumers in the long term considering the monopolistic competition characteristics of the automotive market. 196  Assuming that manufacturers indeed pass on the full cost to consumers through increased prices, the relative impacts of this can be examined by comparing the vehicle prices with the net increase in costs per vehicle to assess what share of a vehicle price they actually represent. In order to do this properly, the lower cost estimates of Table 40 were compared to the weighted average of prices of vehicles in the smaller size segments, while the high cost estimates were compared with prices of vehicles in the higher segments.

As can be seen in Table 41 , the estimated total costs per vehicle (2014-2020) in most cases represent less than 2% of the average price for cars and vans. For the most recent step in Euro 6, the share of the cost for small segment cars and vans is found to be significantly higher in the case of diesel vehicles (4.3% for the small segment vehicles, compared to 2.7% for the large segment vehicles). This is mainly driven by the higher hardware costs linked to the technologies to ensure compliance with Euro 6d. For lorries, these costs are in the range of 4.2-5% for the average lorry price and for the typically more expensive buses, these costs should represent no more than 3% of the total purchase price. 197  

Table 41 – Regulatory costs of Euro 6/VI in comparison to average purchase prices per vehicle segment 198

In all, there is no evidence suggesting that the impact of the regulatory costs associated with Euro 6/VI are not affordable for consumers. When stakeholders were asked in the public consultation to indicate what was the impact of Euro 6/VI on vehicle prices, the large majority of respondents from all stakeholder groups – industry, Member States, civil society and citizens – indicated that there has been an increase in the vehicle prices for all categories (cars, vans, lorries and buses). However, when asked if they agree that EU legislation makes cars unduly expensive a majority over all groups disagreed or even strongly disagreed. Hence, the impact on vehicle prices and consumers is not expected to have been significant or disproportionate. 199  

Are the costs affordable and justified?

While the affordability for consumers was already described above, also for automotive industry the costs are generally expected to be affordable. As the regulatory cost will be passed on to consumers to a great extent, any cost implication will only be for a short period until manufacturers manage to recover the extra costs through increased prices. But even in the absence of such a recovery, the total cost estimate for the period 2013-2020 as a combined result of Euro 6 and Euro VI represents no more than 2% of the total turnover of the sector (estimated at around €3.5-€4 trillion). 200  This is partly confirmed by the results of the public consultation: the majority of respondents from Member States and civil society indicated that the costs of complying with the Euro 6 limits and tests are affordable. Overall, industry seems to be more sceptical on the affordability. When splitting the industry group further, the majority of respondents from component suppliers and LNG fuel industry disagree with the affordability of the Euro 6/VI standard. The majority of manufacturers does not provide a clear answer as they neither agree nor disagree with the standards being affordable. 201 Nevertheless, the costs related to the legislation might be a challenge to some manufacturers with small production volumes who may only be able to recuperate these costs over a longer period. 202  

The rise in costs is seen as a result of the multiple stages in the introduction of RDE testing and the increasing complexity in the legislation. One manufacturer, for example indicated that the changes to the testing provisions often come at short notice leading manufacturers to change type-approval projects, leading to duplication of effort and increases in the type-approval activity since 2017, resulting in higher costs. Thus, it can be argued that some of these costs were unnecessary and could have been avoided if a more streamlined approach had been adopted, possibly over a longer period. However, this should be balanced against the benefits from the introduction of the RDE testing in decreasing vehicle pollutant emissions. 203

Was simplification achieved by Euro 6/VI emission standards?

The description of the implementation of the Euro 6/VI emission standards in chapter 3.2 already gives a strong indication that the legislation is quite complicated. Hence, no tangible simplification has been achieved moving from Euro 5/V to Euro 6/VI. On the contrary, the legislative text has built on the previous texts adding new elements and additional requirements which has resulted in a text of more than 1 300 pages with multiple references to other pieces of legislation. In addition, the Euro 6/VI emission standards consist of several pieces of legislation, that are separate for light-duty (cars and vans) and heavy-duty vehicles (lorries and buses). That way, requirements have been introduced in various steps (Euro 6b-d(-temp) and Euro VI A-E) with different application dates depending on the vehicle types. Next to that, the complexity has increased as result of the new and more demanding testing requirements. In addition to the numerous lab-based test, on-road testing of vehicles has been introduced in Euro 6 in four different pieces of legislation via different enforcement mechanisms (type-approval, CoP, ISC). 204  

These observations indicating that Euro 6/VI emission standards have not led to simplification are widely supported by stakeholders from all groups. This is illustrated by the responses to the public consultation in which 98 out 128 stakeholders considered Euro 6/VI as very complex or complex.  205  A majority across all stakeholder groups considered the emission test procedures to be complex. Also, the number of emission tests were perceived to be complex or even very complex across a majority of stakeholders. However, civil society representatives consider the more demanding emission tests and in-service conformity requirements as justified in view of the need to ensure that vehicles are clean. Lastly, 101 out of 128 stakeholders from all groups indicated that the different application dates for the stepwise Euro 6/VI approach, as described above, are complex to very complex.  206  

This identified complexity of Euro 6/VI emission standards is also seen in Table 40  as contributing to the costs during implementation phase for type-approval testing and witnessing, which increased between €153 000 and €368 000 per model family moving from Euro 5 to Euro 6 for cars and vans and between €95 700 and €232 000 per engine family moving from Euro V to Euro VI for lorries and buses. 88 out of 117 respondents to the public consultation from all stakeholder groups agreed or strongly agreed that complexity leads to significant costs 207 .

The evaluation question 4 analysed the regulatory costs related to the introduction of Euro 6/VI emission standards and the related benefits of the intervention in terms of emission savings and reduced environmental health impacts were discussed under effectiveness (see chapter 5.1). In the following both will be compared to determine whether the intervention has achieved its operational objective of setting the next stage of emission limit values in a cost-effective way with specific focus on NOx, PM and HC 208 . Hence, it will be determined whether the costs are proportionate to the benefits attained.

Since the benefits of the Euro 6/VI emission standards will continue in the future with the further penetration of Euro 6/VI vehicles in the European vehicle fleet, the analysis of the cost-effectiveness considers the period from the entry into force of Euro 6/VI in 2013/2014 until 2050, while considering a social discount rate of 3.8% 209 . On the basis of the damage costs for air pollutants 210 , the benefits have been monetised for the main pollutants NOx, PM and NMHC. The proportionality of these benefits to the costs for these three pollutants have been analysed using two indicators: the net present value 211  and benefit-cost ratio 212 . In addition, a third indicator - abatement cost per tonne of most dominant NOx emissions avoided 213 - is used to further evaluate the cost-effectiveness of the realized NOx savings over the discussed period.

Table 42  shows the results of the cost-effectiveness analysis. For Euro 6 and especially for Euro VI, high net present values are realised when comparing to Euro 5/V emission standards, meaning that the net present value of the benefits realised through Euro 6/VI outweigh the net present value of the costs. When looking into Euro 6, this appears to be driven by the high benefits associated with the emission savings for diesel cars and vans resulting in benefit-cost ratio of 2.5-5.9. The cost-effectiveness of the final steps of Euro 6, which introduced RDE testing, is found to be lower (2.5-4.7 for diesel vehicles and 1.6-3.1 in total). This is mainly a result of the higher costs associated with the RDE testing (see Table 40 ), (part of which are expected to continue in the future) as well with the significant emissions savings already achieved with the introduction of Euro 6 before RDE. 

Table 42 – Analysis of cost-effectiveness of Euro 6/VI emission standards 214  

*Not including benefits related to savings of PN emissions

While the cost-effectiveness indicators showed that the benefits achieved by the Euro 6/VI emission standards generally outweigh the costs for stakeholders, the analysis shows that this is not the case for petrol cars and vans. This is a reflection of the fact that the analysis does not capture the benefits of reduced PN emissions due to the absence of relevant data on emission factors, while it does take into account the moderate hardware costs for the related gasoline particulate filter (GPF) technologies (see above ). As such, the monetised benefits for petrol cars and vans have been underestimated. Next to that, these petrol vehicles only realise limited NOx emission savings under Euro 6 since the emission limits for petrol cars and vans remained unchanged in Euro 6. As a consequence, the negative net benefits are expected to underestimate the benefits for these vehicles. On this matter, other literature sources performed ex-ante analysis on the cost-effectiveness of the GPF technologies 215  from which we can reasonably expect that the total cost-effectiveness is higher than what is presented in Table 42 , even though it might still be the case that the net benefits are negative, which means that the costs might not be proportionate to the benefits achieved for petrol cars and vans. 216

The overall conclusion of a positive cost-effectiveness of Euro 6/VI emission standards is also supported by the targeted and public consultation. When asked in the targeted stakeholder consultation to evaluate the costs of Euro 6/VI emission standards in proportion to the benefits for human health and environment, a large majority across all stakeholder groups – industry, Member States and civil society – considered that the costs were quite or very low. Environmental NGOs, national authorities, a consumer organisation and a research institution argued that the benefits for human health and environment from the reduction of emissions are so great, that the regulatory costs, even if relatively high, are very well justified. In addition, two environmental NGOs stressed that considering the large external costs of air pollution from road transport in the EU-28 – calculated at around €49 billion for cars and vans and at €18 billion for lorries and buses in 2019 217 – reported in the Handbook on the external costs of transport 218 , any emission savings can lead to significant reductions in the total external costs of air pollution to society. 219  

Stakeholders were less positive when asked to compare the regulatory cost of Euro 6/VI with the benefits for their own organisation. For cars and vans, 6 industry stakeholders (including 4 manufacturers and 2 component suppliers), 3 Member States and 1 research institute out of the 27 respondents perceived the cost-effectiveness of Euro 6 for their organisation as negative. For lorries and buses, this were 4 respondents from industry (including 2 manufacturers and 2 component suppliers) and 2 from Member States out of the 19 stakeholders consulted. 220

When comparing the regulatory costs of Euro 6/VI with the benefits realised for consumers, in the context of cars and vans 3 manufacturers and 2 suppliers were somewhat sceptical, while for lorries and buses this was 1 manufacturer. One component supplier and a research institution indicated that consumers do not really appreciate a direct benefit from pollutant emissions reduction and the respective improvements in aftertreatment technologies in vehicles, in contrast to the situation for fuel efficiency. That way, they indicate that consumers would not consider higher prices of vehicles related to Euro 6/VI as justified. In contrast, several stakeholders over all groups considered that the regulatory costs are justified by the benefits. One environmental NGO pointed out that the introduction of RDE testing has also been significant in addressing the important issue of consumer trust, which was severely affected in the wake of Dieselgate. This result was also found in the public consultation in which the majority of stakeholders across all groups – industry, Member States, civil society and citizens – indicated that Euro 6/VI at least contributed somewhat towards ensuring consumer trust in the type-approval system. 221  In addition, local initiatives in the form of restrictions for access to urban areas, such as Low Emission Zones, are also expected to change consumer perception of the importance of a vehicle’s emissions performance. 222

5.3.    Relevance

Today’s relevance of the objectives of Euro 6/VI emission standards

1)Improving air quality by reducing pollutants emitted by the road transport sector

Creating a toxic-free environment is of great importance to protect Europe’s citizens and ecosystems. To realise this, it is vital to clean and remedy pollution, such as air pollution, but also to take action to prevent pollution from being generated in the first place. According to the World Health Organization (WHO), air pollution still represents the biggest environmental risk to health as it is still responsible for many premature deaths. 223  In 2018, PM concentrations were responsible for around 379 000 premature deaths in EU-28, NO2 for 54 000 and O3 for 19 400 deaths. 224 225  Since most activities that actively increase air pollutant emissions are situated in urban areas, they also suffer from higher ambient concentrations and greater exposure to such pollutants. While air quality in European urban areas has improved over the last decade, in 2017 a significant proportion of the urban population was still exposed to concentrations above the threshold defined by the Ambient Air Quality Directive (AAQD) 226 . When considering the more stringent guideline values of the WHO, an even larger proportion of people were exposed to exceeded levels, while these levels will be even higher with the revised 2021-WHO guidelines.  Table 43 presents the significant, but still insufficient progress, towards diminishing the populations exposed to air pollution. In addition, road transport is still a major cause of this pollution, particularly when looking into NO2 and NOx emissions. In a JRC study focussing on European urban areas, the contribution of road transport to overall NOx emissions was found to be 47% on average. 227  While a minimum contribution of 20% percent was found in Lisbon, maximum values of more than 70% were found in Athens and Milan.

Table 43 – Percentages of the EU urban population exposed to air pollution levels exceeding the AAQD thresholds or the previous WHO guideline values in 2008 and 2018, based on data from EEA, 2020 228

On the other hand, pollutant emissions from road transport have decreased considerably for key pollutants over the last two decades 229 , even though gradual increases in transported passenger and freight volumes were realized during this period.  230  The majority of stakeholders from all groups – including industry, Member States and civil society – consulted through the targeted consultation considers emission standards to be a relevant mechanism to encourage a reduction in vehicle emissions that offsets potential increases in the demand for transport. 231

Amongst the stakeholders, there is a wide consensus when it comes to the general relevance of air pollution issues and the respective role of road transport. 56 of 61 stakeholders from all groups confirm that there are ongoing issues, while 57 agree that there is an ongoing need to limit vehicle emissions from vehicles. When looking into the relevance of Euro 6/VI emission standards to reduce vehicle emissions, a majority across all stakeholder groups strongly agrees that there is a further need to set and enforce Euro emission standards. These stakeholders argue that air pollution is an externality that is not captured in the economic incentives of consumers and producers. If not for the Euro 6/VI emission standards, there would be no incentives for the development and deployment of pollution-control devices. Nevertheless, 5 stakeholders – mostly from industry – disagree that there is a further need for Euro emission standards to reduce vehicle emissions. These stakeholders point to other needs in this area, including the need to promote fleet renewal by Euro 6/VI vehicles and the need to ensure the interplay between pollutant and CO2 emission standards. 232  

2)Setting harmonised rules on the construction of motor vehicles

As the previous Euro emission standards, Euro 6/VI sets and enforces emission standards in a harmonised way across the EU. This approach was considered necessary to prevent the emergence of different product standards across Member States as they would negatively affect the Internal Market. Through the creation of barriers to intra-EU trade, individual national emission standards are expected to result in the fragmentation of the Internal Market for vehicles. Up until now, no changes have occurred to the operation of either the EU internal market or the automotive sector that would suggest that a harmonised approach in setting and enforcing vehicle standards is no longer relevant. 233  

Stakeholders of all groups that participated in the targeted consultation widely confirm the relevancy of tackling vehicle emissions in a harmonised manner. The majority indicated that both the effectiveness and strictness of standards would be lower if they were not developed at the EU level. According to three environmental NGOs, rules on emissions would be less strict if set by each Member State individually, as they would be incentivised to decrease the cost of compliance for their home industry and hence drive a race to the bottom. In addition, stakeholders confirm the need for harmonised rules to allow industry and public authorities to take advantage from economies of scale. One supplier emphasised that a harmonised approach allows for efficiency of development and certainty for product planning, while individual rules by Member States would have led to a patchwork of initiatives requiring industry to manage their emission technologies and fleets accordingly. 234  

Developments affecting the relevance of Euro 6/VI emission standards

Considering the recent policy developments at EU level, the relevance of the Euro 6/VI emission standards has not been compromised. On the contrary, the European Green Deal 235 presented in December 2019 is a new growth strategy that will foster the transition to a climate-neutral, resource-efficient and competitive economy and the move towards zero-pollution in Europe. It includes key elements on a zero pollution ambition for a toxic-free environment and on accelerating the shift to sustainable and smart mobility. To protect Europe’s citizens and ecosystems, more action is required to prevent pollution from being generated as well as measures to clean and remedy it. Transport should become drastically less polluting, especially in cities. The European Green Deal roadmap therefore includes a proposal for more stringent air pollutant emissions standards for combustion-engine vehicles by 2021. These policy developments underline that it is still relevant to improve air quality by reducing emissions from road transport as they remain an issue for the EU. The New Industrial Strategy for Europe 236  presented in March 2020 lays the foundations for an industrial policy that will help Europe’s industry to make this ambition a reality and further emphasises the relevance of setting and enforcing the environmental rules in a harmonised manner across the EU. This follows from the need for EU industry to become more competitive as it becomes greener.

The policy developments at local level also stress the relevance of the Euro emission standards. This is shown by the adoption of Low Emission Zones (LEZs) in more than 250 European cities for which a large proportion use the Euro emission standards as a basic criterion for granting access or determining the charge to be applied. Some cities (e.g. Amsterdam, Brussels, London, and Paris) go even further with their zero-pollution ambitions and have already announced different forms of Zero Emission Zones (ZEZs). For example, there are ideas to tighten the restriction rules in certain high-traffic zones that will result in a ban of diesel and petrol vehicles through a combination of access restrictions and charging for non-zero emission capable vehicles. Both applications by local authorities confirm the usefulness of Euro emission standards for kind of “labelling” purposes in access regulations. Additionally, the ambition for ZEZs in certain cities suggests that there is actually a need to update the Euro emission standards in line with a zero-pollution target. 237  

Next to these developments, the EU’s climate ambitions have been progressing over the last years leading to the recent 2030 Climate target plan 238 presented in September 2020, which put forward an increase of the climate target for 2030, to reduce greenhouse gas emissions by at least 55% by 2030. For road transport, CO2 vehicle standards have proven to be an effective policy tool. By June 2021, the Commission will therefore revisit and strengthen the CO2 standards for cars and vans for 2030. 

This climate policy development goes hand in hand with the most relevant technological and market development that potentially affects the relevance of the Euro emission standards: the increasing uptake of electric and other alternative fuelled vehicles 239  that contribute to the decarbonisation of transport. Some of these vehicles (i.e. electric and hydrogen fuelled vehicles) do not generate CO2 and tailpipe pollutant emissions, which makes them very important for reaching zero-emission targets. Hence, the uptake of such vehicles has been actively encouraged through a number of policy initiatives, including the Alternative Fuels Infrastructure Directive 240 , the Clean Vehicles Directive 241 and CO2 emission standards for new road vehicles 242 . Since the entry into force of Euro 6/VI emission standards, there has been a clear rise in the share of electric and hybrid cars and vans sold in the EU. This increase is illustrated in Table 44 and according to data reported by ACEA 243 for the third quarter of 2020, these percentage are still on the rise with almost 1 in 10 cars sold in the EU being battery electric or plug-in hybrid. Also for buses there is a clear trend towards alternative fuels with electric and CNG buses being already widely deployed in many EU cities. Electric and hydrogen lorries, compared to CNG/LPG lorries, are still in the development and testing phase, with commercial solutions expected in the coming years with the pace depending vehicle operations and weight. 244   245  

Table 44 – Share of electric vehicles in new vehicles registered in the EU, based on data from European Alternative Fuels Observatory, 2020 246

Considering this technological and market development, one might raise the question as to whether the need to introduce cleaner combustion engine vehicles through stricter emission standards is still relevant when a large proportion of the fleet emits no tailpipe emissions. When asked about this, stakeholders across all groups widely indicated that cleaning combustion engine vehicles is relevant to protect the environment and reduce air pollution (59 out of 64). Only 2 stakeholders from industry believed that the emergence of electric vehicles made the need for cleaning combustion engine vehicles irrelevant. 247  

While the market is changing fast, internal combustion engine vehicles are still expected to remain a significant part of the European fleet for several years, not only for heavier long-haul lorries. Therefore, the zero-pollution ambition for a toxic-free environment, introduced by the European Green Deal, can only be achieved with more stringent emission standards for these vehicles. As long as vehicles equipped with internal combustion engines - including hybrids (HEV, PHEV), CNG, LNG and any other alternative fuel - are sold, there will still be a need to make them as clean as possible in order to avoid adverse effects to human health and environment.

Changing needs for air pollutants and the considered lifetime of vehicles

The required coverage of air pollutants limits has potentially changed since the adoption of Euro 6/VI emission standards more than a decade ago. The air pollutant limits covered in the Euro 6/VI emission standards are presented in Table 35  (see section 2). While many pollutants are covered, some new pollutant emission species are arising with the introduction of new engines, exhaust aftertreatment technologies, fuels and additives. 248  In addition, the majority of respondents from all stakeholder groups, including industry, Member States, civil society and citizens, to the public consultation agreed that the Euro 6/VI emission limits do not cover all relevant pollutant. 249 This majority, however, is less convincing amongst industry respondent. 23 out of 68 industry respondents disagreed that not all relevant air pollutants are covered in the legislation. Industry stakeholders were especially reticent when asked whether there are currently unregulated pollutants emerging from road transport. While in total, the majority of stakeholders agree with this statement, 19 out of 52 industry stakeholders disagree and 16 neither agree nor disagree. 250

Table 45  presents an overview of air pollutants that are not covered in the Euro 6/VI emission standards, while being harmful for health or environment. Some of these pollutants are aggregated in regulated wider pollutant categories and should be assessed separately if more precise pollution control is necessary (e.g. NO2, NMOG and HCHO). Others pollutants, such as NH3, ultrafine particles, brake emissions, evaporative emissions and CH4 require new measurement methods. Many of these pollutants also came up in the public consultation, in which respondents that indicated that the current list of regulated pollutants is insufficient were asked which air pollutants should be added. 61 stakeholders answering this question from all stakeholder groups indicated that adding brake and tyre emissions, ultra-fine particles and NH3 and CH4 for cars and vans is most relevant. While also N2O was pointed out by the majority of stakeholders answering this question, NO2, HCHO and NMOG were considered less relevant. 251  

Table 45 – Non-regulated pollutants related to road transport relevant to health and environment 252