EU, Germany reach car emissions deal that includes e-fuels

Germany reached an agreement with the European Union on a landmark regulation that requires new cars to be carbon neutral by 2035, resolving a dispute that threatened to undermine the bloc’s ambitious blueprint to reduce greenhouse gas emissions.

The agreement, which would allow some combustion engines beyond 2035, was quickly condemned by opponents.

The bloc and its largest economy had been at odds over the planned 2035 phase-out of CO2-emitting cars, but leaders signaled in recent days that they were close to a resolution.

Germany had wanted assurances that new combustion engine cars could be sold beyond the deadline if they ran on e-fuels — a request supported by Porsche and other parts of Germany’s powerful car industry.

“We have found an agreement with Germany on the future use of e-fuels in cars,” Frans Timmermans, head of EU climate policy, said on Twitter.

German Transport Minister Volker Wissing said “the way is clear” with the agreement reached late Friday.

“Vehicles with internal combustion engines can still be newly registered after 2035 if they fill up exclusively with CO2-neutral fuels,” he said in a post on Twitter.

The deal means that Germany can formally approve an agreement reached in October that requires new cars to be zero-emissions, a key pillar in the EU’s plans to achieve climate neutrality by 2050.

A vote this month, which was expected to be a simple procedure, was delayed due to objections from Wissing’s pro-business FDP party, the junior member of German Chancellor Olaf Scholz’s governing alliance.

The deal with Germany does not change the text of the regulation that was agreed between representatives of member states and the European Parliament last year. After the ministers sign off on it, the commission will provide more details on the next steps to implement the provision on e-fuels, according to an EU official.

That vote, which is now expected to take place on Tuesday when energy ministers meet in Brussels, should pass with Germany’s backing as the opposing countries will be unable to reach a sufficient minority enough to block the progress. Italy wanted further assurances, including how cars using biofuels could also be exempted.

“The battle on tech neutrality has been won, which is the precondition for the recognition of biofuels,” Italian Prime Minister Giorgia Meloni told reporters Friday after a summit of EU leaders. “We are also showing that biofuels are zero-emission, hence there is no need to go into the technical details. If the technology hits the target, then you can use it.”

A review scheduled in 2026 on how the bloc was progressing on zero-emission vehicles was seen as too late for some of the country’s automakers.

But environmental activists were angered by Germany’s decision to hold up the emissions plan and warned against changes that could distract from progress toward the broader use of electric and other zero-emission vehicles.

Benjamin Stephan of Greenpeace said the deal was a setback for climate protection.

“This stinky compromise undermines climate protection in transport, and it harms Europe,” he said.

It dilutes the needed focus of the auto industry on efficient electromobility, he said.

Pascal Canfin, the head of the European Parliament’s environment committee, called on the commission to make sure the upcoming rules on e-fuels respect the agreement reached last year on car-emissions standards. Even though the parliament’s role in the process of going forward is limited, it could still block the future regulation.

“The automotive sector has wholeheartedly embraced electric cars, rendering the previous debate on the matter absurd and damaging Germany’s credibility,” Michael Bloss, a German Green member of the European Parliament, said Saturday. “It is now time to make repairs.”