The Zero-Emission Vehicle (ZEV) Mandate: The Complete Guide For The UK

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What is the Zero-Emission Vehicle (ZEV) Mandate?


The climate crisis continues to remain centre stage on the global narrative, as governments and other stakeholders implement new legislation and deploy new technologies to combat the environmental crisis. Among key technologies deployed to protect our environment, are environmentally-friendly zero-tailpipe emission electric vehicles (EVs), that have a far lower negative impact on the air quality and environment, compared to conventional petrol and diesel vehicles.

Transportation is a significant contributor to greenhouse gas emissions (GHG). As of 2021, vehicles on our roads contributed to 18% of the UK’s greenhouse gas emissions. Internal combustion engine (ICE) petrol and diesel cars and vans have been largely responsible for the increased GHG’s and also the worsening air quality in our cities, towns and villages.

In sharp contrast, battery-electric vehicles (BEVs) and fuel-cell electric vehicles (FCEVs), also referred to as ‘all-electric’ cars/ vans or ‘pure electric’ cars/ vans, emit zero-tailpipe emissions and result in 81% less emissions (manufacturing and life-cycle), compared to internal combustion engine (ICE) petrol and diesel cars.

Let us put this in perspective: in the UK there are nearly 2 million new passenger cars registered annually, and if we then add all other forms of road transport vehicles (van, buses, trucks etc), the annual total is significantly more. Currently, there are 33.48 million cars, 4.70 million LGVs, 0.54 million HGVs, 1.47 million motorcycles and 0.14 million buses on our roads in the UK. A staggering volume of vehicles!

The majority of them are either petrol or diesel vehicles (ICE). In fact, the emissions from internal combustion engine (ICE) commercial vans have increased by 40% in the past 30 years. Domestic transportation carbon dioxide emissions was a whopping 107.5 million tonnes in 2021!

In terms of air pollution, road transportation emits gases and other pollutants that has significant detrimental health consequences. Some of these dangerous pollutants emitted by petrol and diesel vehicles include: nitrogen oxides (NOX) and particulate matter (PM). Road transportation contributes to nearly 30% air pollution in the UK.

All-electric cars have come a long way since the introduction of modern electric cars, in particular, the pure electric Nissan Leaf in 2010. The uptake of modern electric cars was further galvanised by entrepreneurs like Elon Musk, the co-founder of Tesla, Inc. Electric vehicles (EVs), like the Tesla Model X and Tesla Model 3 are now household names!

Today, pure electric cars are available in all body styles and prices, with a choice that would have been hard to imagine in 2010. The EV market has matured significantly, and this is clearly evident in the level of uptake of new electric cars globally and in the UK. In the UK, BEVs already account for a market share greater than 15% of new car registrations. In markets like Norway, electric cars account for over 80% market share.

The zero-emission vehicle (ZEV) mandate has been introduced after extensive consultation with a number of key stakeholders, to include: vehicle manufacturers, trade associations, chargepoint/ infrastructure operators, energy providers, fleet operators, engine/ drivetrain manufacturers, transport operators and others. The key objective of the mandate is, ‘to deliver substantial carbon savings, enabling the UK’s transition to a zero-carbon economy by 2050’.

The ZEV Mandate is a legal requirement for automotive manufacturers. It requires 80% of new cars and 70% of new vans sold in the UK to be zero-tailpipe emission by 2030, to be further increased to 100% by 2035.The mandate further sets annual targets for both new cars and vans sold. The target increases annually till it reaches 100% in 2035 for new cars and vans. You will recall the announcement in 2023 by Rishi Sunak to delay the ban on the sale of new diesel and petrol cars from 2030 to 2035.

For each non-ZEV sold, the OEM (automotive manufacturer) must have a ZEV allowance. For those manufacturers that sell more ZEVs than their target, the manufacturer will be allowed to ‘sell, bank or convert’ the excess allowances. Those manufacturers that are unable to meet their ZEV targets, will be allowed to ‘buy, borrow, use banked allowance or convert CO2 emissions allowances’ to comply with their obligations.

For any non-ZEV sold that are not compliant with the above, a £15,000 fine will be levied by the government (£9,000 for vans). Automotive manufacturers like Polestar, Tesla, MG Motors, Tesla, Nissan and others are expected to easily meet with the requirements of the mandate, given their current portfolio of electric vehicles (EVs).


Targets: Cars (Annual %)Targets: Vans (Annual %)
2024: 22%2024: 10%
2025: 28%2025: 16%
2026: 33%2026: 24%
2027: 38%2027: 34%
2028: 52%2028: 46%
2029: 66%2029: 58%
2030: 80%2030: 70%
2031: 84%2031: 76%
2032: 88%2032: 82%
2033: 92%2033: 88%
2034: 96%2034: 94%
2035: 100%2035: 100%
Source: UK Government

Despite the delay in the ban of the sale of new petrol and diesel cars in the UK, a number of automotive manufacturers have already announced their commitment to only sell pure electric cars from 2030.

We encourage both consumers and manufacturers to continue to migrate rapidly to zero-tailpipe emission electric driving, irrespective of the UK Government annual targets. The sooner we can achieve 100% ZEVs on our roads, the better! The switch to electric cars and electric vans is the largest single driver of future emissions in the UK’s Net Zero pathway, a view also echoed by the Society of Motor Manufacturers and Traders (SMMT).



Glossary
BEV (Battery-Electric Vehicle):What is a battery-electric vehicle? Also referred to as a ‘pure electric car’, ‘only-electric vehicle’, ‘all-electric vehicle’, ‘fully-electric car’, ‘100% electric car’, is an electric vehicle (EV) that does not have an an internal combustion engine (ICE), fuel tank or exhaust pipe. Yes, you read it correctly. These environmentally-friendly electric vehicles produce zero tailpipe emissions, and run only on a rechargeable onboard EV battery, coupled with a fully-electric drivetrain (electric motor). The onboard EV battery is charged via an external outlet, usually via a dedicated EV charging station. For home electric car charging, an example of an EV charger is the myenergi zappi smart EV charger. The all-electric Mercedes-Benz EQS SUV and the best-selling Tesla Model 3 are good examples of a BEV. Bottom-line, walk around the BEV, if you cannot see an exhaust pipe it is a pure electric car!  Some BEVs can achieve a range over 400 miles on a single charge, however, most BEVs have a range capability between 200 and 300 miles.
EV (Electric Vehicle) : What is an electric vehicle? An EV is any vehicle that uses ‘electricity’ or an ‘electric motor’ to power the vehicle. An EV is usually referred to any vehicle that is primarily powered by an electric motor. The electric motor derives its power from a rechargeable onboard EV battery. In other words,  EVs are less dependent on petrol or diesel as fuel, and in the case of pure electric cars (BEVs), not dependent at all.  EVs encompasses all types of electric vehicles, to include: battery-electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), extended-range electric vehicles (E-REVs) and fuel cell electric vehicles (FCEVs).  
FCEVs (Fuel-Cell Electric Vehicles):What is a FCEV? Fuel cell electric vehicles, also known as hydrogen fuel cell vehicles, is a type of EV. These vehicle use hydrogen to produce electricity, and do not require to be recharged (like BEVs). As long as there is hydrogen filled in the vehicle, electricity will be produced to power the vehicle. An FCEV is classed as an ultra-low emission vehicle (ULEV), as the vehicle has zero-tailpipe emissions. The only discharge from the tailpipe is water vapour. FCEVs have a small onboard battery. Hydrogen is a chemical element and mostly bonded with other other elements. For example H2O (water). The fuel cells in an FCEV convert chemical energy into electrical energy. The Hyundai ix35 Fuel Cell vehicle is an example of a FCEV.  
ICE (Internal Combustion Engine): An ICE is an engine, that uses fuels, like petrol or diesel, along with air, to produce combustion. The process of combustion or ‘burning’ within the engine combustion chamber, releases energy that is used to create motion. The expanding hot gases cause movement by engaging with pistons and rotors. ICE is seen in all forms of transportation, to include, road transportation. Internal combustion engine vehicles emit tailpipe pollution, and the sale of new ICE cars, will be banned from UK roads from 2030 onwards. 
ZEVs (Zero-Emission Vehicles):A zero-emission vehicle is any vehicle that does not emit any harmful pollutants from the exhaust. Battery-electric vehicles, like the Tesla model X and S are examples of electric cars that are zero-emission. Of course, all petrol and diesel cars release significant health and environment damaging pollutants and are not zero emission vehicles.  Zero-emission vehicles also include other forms of road transportation to include electric vans, e-bikes, e-scooters etc.

While e-zoomed uses reasonable efforts to provide accurate and up-to-date information, some of the information provided is gathered from third parties and has not been independently verified by e-zoomed. While the information from the third party sources is believed to be reliable, no warranty, express or implied, is made by e-zoomed regarding the accuracy, adequacy, completeness, legality, reliability or usefulness of any information. This disclaimer applies to both isolated and aggregate uses of this information.


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Author

Ashvin Suri

Ashvin has been involved with the renewables, energy efficiency and infrastructure sectors since 2006. He is passionate about the transition to a low-carbon economy and electric transportation. Ashvin commenced his career in 1994, working with US investment banks in New York. Post his MBA from the London Business School (1996-1998), he continued to work in investment banking at Flemings (London) and JPMorgan (London). His roles included corporate finance advisory, M&A and capital raising. He has been involved across diverse industry sectors, to include engineering, aerospace, oil & gas, airports and automotive across Asia and Europe. In 2010, he co-founded a solar development platform, for large scale ground and roof solar projects to include, the UK, Italy, Germany and France. He has also advised on various renewable energy (wind and solar) utility scale projects working with global institutional investors and independent power producers (IPP’s) in the renewable energy sector. He has also advised in key international markets like India, to include advising large-scale industrial and automotive group in India. Ashvin has also advised Indian Energy, an IPP backed by Guggenheim (a US$ 165 billion fund). He has also advised a US$ 2 billion, Singapore based group. Ashvin has also worked in the real estate and infrastructure sector, to including working with the Matrix Group (a US$ 4 billion property group in the UK) to launch one of the first few institutional real estate funds for the Indian real estate market. The fund was successfully launched with significant institutional support from the UK/ European markets. He has also advised on water infrastructure, to include advising a Swedish clean technology company in the water sector. He has also been involved with a number of early stage ventures.

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