German auto lobby recommends ending all fossil fuel sales by 2045

The main lobby group of the German automobile industry has recommended that all fossil fuel sales should be ended in Germany by 2045, but it’s still advocating for less-efficient e-fuels over rapid electrification.

The news comes from a new position paper (source in German) released by the the Verband der Automobilindustrie (VDA), the trade group representing some 600 automobile-related companies in the country where the automobile was first invented.

The lobby group, in stark contrast to how American lobbyists often operate, said that the European Union’s guidance on fuels do not go far enough, and need to be stricter if it wants to reach the goal of climate-neutral road traffic by 2045.

The criticism relates to the EU’s Renewable Energy Directive III (RED III), adopted last year. It sets out goals for renewable energy deployment in various realms, including the adoption of low-carbon fuel sources for road transport.

The VDA spends much of its time advocating in its position paper for “renewable fuels of non-biological origin” (RFNBOs), which is an umbrella term for both green hydrogen (generated through electrolysis of water via renewable energy) and e-fuels produced by combining green hydrogen with other chemicals to create synthetic liquid fuels.

These fuels would be beneficial for certain heavy-duty applications for which batteries are currently too heavy, as they can be more energy dense than batteries. And as VDA points out, there are currently tens of millions of combustion vehicles on the roads in Germany whose impact could be reduced immediately via the application of sustainable fuels.

But their application has been controversial, because it is thought of as a way to maintain current auto industry practices rather than quickly reforming the whole auto industry around electrification. It’s also much more energy intensive than directly fueling vehicles with electricity, even when the most green methods are used for e-fuel production. As a result, environmental organizations typically recommend that e-fuels shouldn’t have a place in road transport, rather more in aviation and shipping.

Further, EU member nations were able to water down RED III’s targets on e-fuel adoption (with Germany being one of the main advocates for this stipulation, though there was debate among German automakers).

VDA claims that bonus incentives for e-fuels, and particularly for hydrogen, should be retained for some time before ramping down, in order to incentivize nascent enterprises focusing on their production. And that long-term targets with higher mixes of these fuels should be adopted now – VDA wants to see renewable fuel use rise to 60% by 2035, 90% by 2040, and 100% by 2045.

But after stating this target, VDA says its most interesting sentence, from which this article got its title: “In the interests of climate protection, fossil fuels should no longer be allowed to be sold at German petrol stations from 2045 onwards.”

In context, VDA is arguing that gas stations should still remain open and still sell fuel, but that that fuel should be entirely renewable. But it is a rather stark statement, and one that might not be expected from an auto industry lobbyist – a recognition of climate change and the huge amount that road transport contributes to it, and a rapid end to the primary way that road transport fuels climate change.

Electrek’s Take

We have seen various efforts to stop the sale of new combustion-engined vehicles by 2035 (which we have repeatedly argued should be sooner, and some countries indeed have targeted earlier timelines), but this might be our first time hearing an auto lobbyist call for an end to fossil fuel sales.

That said, the context of arguing in favor of greater e-fuel adoption means that this call by the VDA isn’t as entirely ambitious as it might originally seem.

While VDA is correct that current vehicles will remain on the road for a long time, and that a solution that allows them to decarbonize would be beneficial, we share the worry that e-fuels are simply a way to maintain current industry practices.

The recent history of advocacy for e-fuels by German firms does give us the feeling that there is an undercurrent of some companies trying to forestall industry electrification. Much in the same way that focus on hydrogen, or on predictions of future battery improvements, have been used by Japanese firms to convince the market that now is not the time for fully-electric vehicles.

So we have to be skeptical of this to some extent, because it would be a shame if a call like this resulted in less momentum for industry electrification, which is an objectively less energy intense step for decarbonization. The IEA (and… everyone else) acknowledges that electrification of transport is one of the most important strategies for reducing CO2 emissions.

But regardless, we must say – naturally, we agree with the VDA that fossil fuel sales need to end by 2045.

Frankly, earlier would be good – there’s genuinely no time too early to end fossil fuel sales, and no pace too quick to reduce them. The magnitude of the harm that climate change will otherwise cause, and the cost of trying to reduce it which will only increase as time goes on, dictate this.

And to see an auto industry organization at least acknowledge that fossil fuels sales need to end by 2045 completely in order to hit Germany’s 2045 carbon neutrality goal (and EU’s 2050 goal) is quite striking. We’re used to industry organizations whining about every little thing – even rules they claim to support – so it’s nice to see a step in the right direction.

But hopefully, German and EU regulators go even further than what VDA has asked, and don’t rely so heavily on e-fuels to get to carbon neutrality, and rather to increasing ambitions around electrification, public transport, and micromobility.

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