The government should develop a new system for rating vehicle emissions, that takes into account both tailpipe emissions and indirect emissions from power generation, according to a new report by Policy Exchange. The thinktank said the current system is becoming “increasingly inaccurate and misleading”.

The report’s authors’ also recommended the following actions:

• Government needs to develop a new strategy to clean up road transport and deliver the carbon targets set out in the Fifth Carbon Budget. At the same time, there needs to be closer integration between policies to reduce greenhouse gas emissions and policies to clean up air pollution.
• Motorists should not be unduly penalised for the vehicles they have bought in good faith – a diesel scrappage scheme should be introduced to take more polluting vehicles off the road.
• Government should scrap the European target for 10% renewable transport fuels by 2020 and avoid setting targets for the number of ultra-low emission vehicles on the road. The uptake of ultra-low emissions vehicles should be decided by market forces rather than government decree.
• Government should signal a phase out of grants for Battery Electric Vehicles and Plug-In Hybrids by the early 2020s, by which time they are expected to be cost competitive with conventional vehicles.
• Government must ensure that electric vehicle charging is smart and controllable to minimise the impacts on the power system.
• In the long term, Government should consider moving from the current system of taxing fossil fuels and carbon emissions to a system of road user charging (e.g. toll roads, charges per mile, or congestion charges in cities).

Richard Howard, Policy Exchange’s head of energy and environment and the lead author of the report, said: “The new government needs to take more assertive action to address the twin problems of carbon emissions and air pollution from road use. As it stands, there is no overarching Government strategy to deliver the required reduction in greenhouse gas emissions, and the latest plan to reduce NOx emissions is inadequate.”

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