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Connie Hedegaard

European Commissioner for Climate Action

Transport emissions and infrastructure

European Parliament Transport Committee meeting

Brussels, 10 November 2011

Chairman, Members,

While I had the opportunity to exchange views with you, Chairman, and with other Members of the Committee already in bilateral meetings, it is the first time that I address your committee as a whole hopefully not the last time during my mandate. I would like to thank you for the opportunity to address some issues, which are of relevance for both sides.

[Current situation of transport emissions]

Transport is the second biggest source of GHG emissions in the EU with the sector being responsible for about a quarter of all emissions. Road transport is the main source, accounting for around 70% of the transport emissions.

The Commission's Roadmap to a competitive low carbon economy by 2050 shows that, where GHG emissions from other sectors are steadily decreasing (compared to 1990 levels), emissions from transport have increased by more than 30% between 1990 and 2005. With business as usual, the transport sector will rapidly become the main source of GHG emissions.

Business as usual is therefore not a realistic option. Reductions are needed by all actors in the transport sector, if we as EU want to meet our agreed overall GHG reduction targets.

Reducing GHG emissions from transport is therefore an essential part of the EU's climate strategy. I therefore welcome that the transport committee wants to be ambitious in terms of reducing emissions from transport, in the context of its deliberations on the Commission's White Paper on Transport.

In the White Paper we have added, to the already existing targets of the climate and energy package, indicative goals which have various intermediate targets for 2020 and 2030, notably a reduction of GHG emissions to around 20% below their 2008 level by 2030. We would welcome if the EP endorses this goal together with the - 60% for 2050 (with respect to 1990), which is cost effective.

Let me now focus on what could be done in the short term. I would like to highlight three concrete and transport-related policy initiatives, which my services are currently working on.

Firstly: we are working on addressing maritime transport emissions

The growth of GHG emissions in the maritime sector is undermining the EU efforts to reduce its overall GHG emissions. Indeed, between 1990 and 2007, the EU in total has reduced its GHG emissions by some 380 MtCO2eq, whereas the international maritime sector has increased its emissions by around 400 MtCO2.

This diverging trend will become unsustainable, as the GHG emissions of all sectors of the EU economy, except international shipping, are capped by the ETS directive or by the effort sharing decision.

According to International Maritime Organisation (IMO) figures, implementing the existing low-carbon technical or operational measures could lead to US$ 46-125 billion of annual fuel cost savings by 2020, but these net benefits are not taken by the industry probably due to market barriers.

So, we are seriously considering the opportunity for the EU maritime sector to take the first mover advantage of achieving these annual fuel cost savings. The Commission is therefore initiating –as we have been asked for by EP and Member States – work to make a proposal to address GHG emissions from the maritime sector next year, in case no international agreement has been approved by the end of 2011.

An agreement at the global level remains the best way to address this issue. However, despite our significant efforts at international level, emissions of existing ships remain unaddressed.

Secondly, we are preparing the review of the legislation on CO2 from cars and vans

Emission reductions from cars, vans and heavy duty vehicles are essential to achieving our goal to reduce transport emissions by 60% by 2050. The White Paper notes that increasingly tight emissions standards form a vital part of the approach.

As you know, we already have Community Regulations setting new vehicle CO2 emission targets for cars and vans. And I am glad to say that our legislation is delivering: CO2 emissions from passenger cars are now decreasing at a higher rate since the introduction of the mandatory CO2 performance standards. Emissions from new cars were reduced by more than 20gCO2/km between 2006 and 2010 compared to a 10g reduction between 2000 and 2006.

With the rate of reductions that we have seen in 2009 and 2010, it is fair to say that the automotive industry is on the right track and that the CO2 targets for passenger cars set for 2015 (130g CO2/km) and for 2020 (95gCO2/km) are realistic and can be met.

Our Regulations request the Commission to review the modalities of achieving the 2020 cars and vans targets by the end of 2012. These two reviews are proceeding in parallel, although the car work is more advanced. A public consultation has been launched recently whose results will feed into the Commission's Impact Assessments and subsequent proposals end of 2012.

Thirdly, we are preparing a strategy for reducing CO2 emissions from heavy-duty vehicles

It is estimated that heavy-duty vehicles (HDVs) account for about 26% of CO2 emissions from road transport in the EU, which is roughly equivalent to the sum of air and water transport CO2 emissions and accounts for about 5% of the EU's total CO2 emissions. The demand for freight transport is growing continuously and road haulage forms the biggest share of inland freight transport.

Reducing total HDV CO2 emissions is therefore an essential element of the EU's action to reduce its GHG emissions, and contribute to the EU's low carbon economy strategy. In the absence of vigorous action, CO2 emissions will continue to increase, even with improved HDV fuel efficiency.

To address this, the Commission has said that it will prepare a more specific strategy to reduce HDV CO2 emissions from both trucks and buses. This work is under way and is my intention to present a comprehensive strategy in 2013. It is needless to say that, also here, we have close consultations with stakeholders.

But, of course, we also implement our existing legislation. And one of our pieces of legislation has been in the international spotlight in recent weeks: the inclusion of aviation in the EU's Emission Trading System (ETS).

While this legislation was agreed, with very large majorities, in Council and in the EP in 2008, third countries led by the US have been continuing to put pressure on the EU against it. However, in terms of implementation, it is worth noting that all commercial carriers with significant operations to or from the EU are in compliance.

The Advocate General's opinion on the litigation by US airlines came out on 6 October and rejected all the claims by US airlines.

As the legal case against the law seems to weaken, those opposing its application are seeking to increase the political pressure. In this context it is very important that we as EU stand firm in respect of this non-discriminatory legislation and express that we have no intention of amending it. Both the Transport and Environment Councils have recently confirmed their support and the Member States are fully behind the Commission and this united EU position was also clear in the ICAO-Council last week, where Member States firmly defended the EU position. I hope that I can also count on your support when it comes to defend our legislation.

Economically, impacts are expected to be around €2 for a transatlantic flight. This is smaller than, for example, costs of Air Passenger Duties or Taxes levied by countries including US and India. Opposition is primarily political, rather than based on economic grounds.

The Commission has been having a continuing dialogue with many third countries and at ICAO. Meetings have taken place with the US, Russia, China and India among others. As we have the flexibility through implementing legislation to exempt arriving flights from third countries, when the countries develop their own equivalent measures, this provision is the focus of our discussions with third countries.

Let me stress that the EU is not only willing but also committed, through its legislation, to work on a meaningful global framework to address aviation emissions (including through ICAO and UNFCCC) and to engage constructively with third countries.

It is disappointing that ICAO discussions once again focus on what States should not do instead of what they should do to curb growing aviation emissions.

Finally, let me also briefly address the issue of transport infrastructures.

Smart, sustainable and fully interconnected transport networks are a necessary condition for the completion of the European single market and delivery of the EU's "20-20-20" climate and energy targets.

Transport networks have a very important role to play in the decarbonisation of Europe's economy in the longer term towards 2050. It is therefore essential that the EU budget fully contributes to the decarbonisation of the transport sector. This is a key element of the Commission's proposals for the next Multi-annual Financial Framework (MFF), which – with a share of at least 20% of the total budget contributing to Climate Action – sent a strong signal that the EU budget should be aligned with the objectives of the Europe 2020 Strategy and, in particular, the objective to prepare the transition to a low carbon economy.

The proposed transport infrastructure regulation will improve connections between different modes of transport thus facilitating a substantial shift of passengers and freight from road to rail and other transport modes.

Investing now to modernise our economies by reaping multiple benefits in terms of growth and jobs creation will bring more value for money. Our proposals on the structural funds and on infrastructure clearly reflect this ambition.

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