Revised EU emissions test fuels CO2 tax uncertainty
02 December 2014
Author: Daniel Puddicombe
Fleets are facing uncertainty over future CO2 and benefit-in-kind ratings due to a new European-wide engine emissions testing procedure that is intended to produce more realistic emissions assessments.
The European Commission, the Department for Transport, and the Department for Food, Environment and Rural Affairs are currently drawing up the Worldwide Harmonised Light-duty Test Procedure (WLTP). The EU-level of legislation is due to be signed off by the first half of 2015.
The European Commission told BusinessCar it "represents much better real-world driving and therefore reflects the real in-use fuel consumption and CO2".
The Society of Motor Manufactures Traders said it accepted the need for a more suitable testing process.
"The current tests cannot, and were never intended to, represent the infinite variations of real-world driving," said an SMMT spokesman.
"It is important that the WLTP is developed properly so as to be robust for comparison between vehicles."
However, based on a fleet's average three-year cycle, any cars chosen by fleets in 2014 and 2015 could receive an unexpected bump in BIK costs due to a knock-on effect in higher CO2 figures from the new test, depending on how the Government applies an updated tax regime for cars bought between 2013-15, and means fleets cannot plan with any degree of certainty.
ACFO chairman John Pryor fears the changes could be unfair on fleets. "If the new test means changes to CO2 taxation it will be grossly unfair if firms are penalised for choosing cars based on the system which was in place at the time," Pryor told BusinessCar.
His feelings were echoed by leasing industry body the BVRLA.
"We believe the Government should support changes to the tests to support accuracy, but any changes the test will make to the tax regime must be clearly signposted," said a spokesman. "Businesses must be given ample time if there are changes to CO2 taxation and the Government should not allow the new test to make changes to the tax regime retroactively on cars people have already chosen."
As with the current regime, the new procedure also involves a laboratory test but is complemented by a separate on-road test, where on-board portable systems measure fuel consumption, and CO2, PN10 and NOx levels during the "normal use of vehicles".
NOx and NO2 emissions limits will remain the same as the current testing procedure. However, the European Commission says respecting these limits will be a lot harder than at present and therefore it will "ensure better environmental protection".
The commission has proposed that the test should apply from 2017 but that car makers have until 2019 to comply.