CO2 penalties: a cliff in 2020 ?
Will new 2020 CO2 targets be a major challenge ?
With the deployment of the “95 grams goal”, 2020 heralds a new era in CO2 emissions from passenger cars, with likely consequences on the price of cars, but also on the product offering of battery electric and plug-in hybrid vehicles. Independent from the EU, the swiss automotive market is a fascinating laboratory for the observation of these dynamics.
Switzerland first introduced on July 1st 2012 prescriptions on CO2 emissions from new passenger cars. While not a member of the European Union, Switzerland aligned on the goal to curb CO2 fleet emissions down to 130 g/km by 2015. This measure also served as a work-around to the anti-SUV ballot initiative instigated by the Young Greens party. This initiative, launched in 2008, targeted to outlaw all cars weighing more than 2.2 tons or with emissions exceeding 250 g/km. Political realities ended up prevailing over ideology, the swiss Parliament approved the 2011 Federal Act on the Reduction of CO2 Emissions, and the Young Greens withdrew their initiative.
In summary, this law requires:
1) payment of a penalty for exceeding a target CO2 emissions
2) computation of a CO2 fleet average for “large importers” (more than 50 new cars per year)
3) car by car payment for the small or individual importers of new cars
Implementation was staged:
1) staged phase-in: fleet emissions computed on the lowest emission part of the fleet: 65 % in 2012, 75% in 2013, 80% in 2014 then 100% in 2015.
2) increasing penalties over time.
The statute initially covered 2012 to 2018 and called for:
– 7.50 CHF per car for the first gram in excess,
– 22.50 CHF for the second,
– 37.50 CHF for the third and
– 142.50 CHF from the fourth gram above the target onward.
Article 13 however required that the Federal Council review the penalty schedule each year and shall base its decision on the amounts applied in the European Union and the exchange rate. The strength of the swiss franc against the euro resulted in CO2 sanctions being lowered several times.
For instance, the statute was revised on September 21st 2018 to:
– 2017: 5.50 CHF up to the first gram, 16.50 CHF for the second, 27.50 CHF for the third, then 104.50 CHF beyond, or 154 CHF for the first 4 grams of excess CO2 per km
– 2018: same but 103.50 CHF from the third gram
– 2019: 111 CHF flat per gram
The statute was again revised September 16th 2019:
– for 2020, the penalty is lowered to 109 CHF per gram in excess of the importer’s target