EU CO2 Emissions Deal Stalls

Germany is blocking the European Union’s preliminary agreement reached Tuesday that would allow the European Commission to introduce a 95 g/km of carbon-dioxide emissions target by 2020 for new light vehicles sold in the region.

With a nod to German luxury-car makers, the deal included a provision to continue the use of “super-credits” within the emissions measurement formula for green vehicles such as hybrids and electric vehicles that can bring down the average CO2 emissions level assessed for manufacturers of cars with higher emissions.

The compromise deal was brokered by the Irish government, which currently holds the EU’s rotating presidency, but reportedly failed to meet German auto makers’ expectations as it appeared to favor smaller cars with lower emissions.

The text was delivered Thursday to a committee of high-ranking EU diplomats representing the 27 member states and, if approved, was to be sent to the parliament and council for final votes.

The postponement came after Chancellor Angela Merkel, who faces re-election in September, interceded, arguing Germany is delaying the deal in order to protect jobs in its automotive sector, which includes luxury brands Mercedes-Benz, BMW, Porsche and Audi.

"At a time when we are spending days talking about employment, I think we need to ensure that in our drive to protect the environment we are not damaging our own industrial base," Merkel is quoted telling reporters at a 2-day summit in Brussels focused on economic growth and unemployment.

Reuters says in a report today EU sources earlier this month told the news service German politicians had contacted member governments to warn them German auto makers could scale back or scrap production plans in their countries unless they supported Berlin's efforts to weaken the emission rules.