Eco-innovations

Credits in the proposed EU CO2 legislation

for 2012

Anders KärrbergExecutive Director

Governmental AffairsVolvo Car Corporation

What is an eco-innovation?

Technical innovations that

• reduce CO2 outside the homologation test cycle

• are additional to the Commission´s list of ’complementary measures’*

• give CO2 credits at the individual car level

• are approved by an independent and authorized process

* gear-shift indicators (GSI), energy-efficient air-conditioning (MAC), low rolling resistance tyres (LRRT), tyre pressure monitoring systems (TPMS)

Why credit eco-innovations?

• Industry innovations should not be limited by closed list of defined eco-innovations – stimulates further innovations.

• CO2 reductions are reached more cost efficiently both for industry and car customer

Examples of eco-innovations

Examples of eco-innovations

Fuel economy indicator 1 % ACEA

Adaptive cruise control 3-12 % Dutch study, AMS

Off-cycleCO2 reduction Source

Adaptive Cruise Control

Examples of eco-innovations

Fuel economy indicator 1 % ACEA

Adaptive cruise control 3-12 % Dutch study, AMS

Eco-mode button 3-6 % ACEA

Bi-Xenon or LED lights 1,5 % Magneti Marelli

Off-cycleCO2 reduction Source

• Reduced electrical energy consumption vs traditional bulbs, in particular in countries requiring daylight running lights

• Reduced heat generation -> reduced maintenance

• Contributes to reduce size (and weight) of the alternator

LED – Light Emitting Diode

Examples of eco-innovations

Fuel economy indicator 1 % ACEA

Adaptive cruise control 3-12 % Dutch study, AMS

Eco-mode button 3-6 % ACEA

Bi-Xenon or LED lights 1,5 % Magneti Marelli

High efficiency alternator 2 % VALEO

Flexible fuel vehicles (E85) 30-80 % (wtw) EUCAR/JRC/Concawe

Off-cycleCO2 reduction Source

Why credit flexible fuel vehicles?

• Facilitates major off-cycle CO2 reductions 30-80% w-t-w (EUCAR)65% (EPA of Sweden)

• Reduces dependency on oil in transport sector (97%)

• Insurance against possible future oil price peaks and shortages

How to credit flexible fuel vehicles?

Proposal:

• 5% reduction of the homologated CO2-value ~ technology cost for E85 compatibility @ Euro5

• Increase to 20% when 10% of the filling stations in a country offers E85 that meets the EU sustainability criteria

Flexible fuel vehiclesMarket share development in Sweden

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Benefits from flexible fuel vehiclesin Sweden

At current growth rate, flexible fuel cars will by 2015 annually reduce CO2 by 2 Million tons*.

Assumptions: - 50% flexfuel market share of new cars sales- 30% of the car park flexfuel capable,- with today´s car technology- with today´s 1st gen production technology for sugarcane feedstock- with today´s E85 fuel usage level- petrol cars are displaced

Benefits from flexible fuel vehiclesin Sweden

At current growth rate, flexible fuel cars will by 2015 annually reduce CO2 by 2 Million tons*.

Corresponding CO2 reduction from only E10 low blending is~ 700.000 tons.

Assumptions: - 50% flexfuel market share of new cars sales- 30% of the car park flexfuel capable,- with today´s car technology- with today´s 1st gen production technology for sugarcane feedstock- with today´s E85 fuel usage level.

Benefits from flexible fuel vehiclesin Sweden

At current growth rate, flexible fuel cars will by 2015 annually reduce CO2 by 2 Million tons*.

Corresponding CO2 reduction from only E10 low blending is~ 700.000 tons.

We should do both.

Assumptions: - 50% flexfuel market share of new cars sales- 30% of the car park flexfuel capable,- with today´s car technology- with today´s 1st gen production technology for sugarcane feedstock- with today´s E85 fuel usage level.

Summary

• Accept the concept of eco-innovations

• In the proposed CO2 legislation, reward CO2 reductions from eco-innovations by reducing certified CO2 values at individual car level.

• Accept flexfuel cars as an eco-innovation

• Reward flexfuel cars by • 5% reduction of cert CO2 • 20% once sustainable E85 fuel is available