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Kaarle Kupiainen

Effect of CO2-based car registration tax on traffic PM2.5 emissions in

Finland and future NTMs

Kaarle Kupiainen, Niko Karvosenoja, Jyrki Tenhunen, Jyri Seppälä

Finnish Environment Institute (SYKE)

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Kaarle Kupiainen

The new CO2 based registration tax in Finland

• New CO2 emission based registration tax came into force 1.1.2008• The purpose of the tax is to

– renew the old taxation system of vehicles– cut the CO2 emissions from traffic and – act as one measure to achieve the CO2 emission goals set up by the EU

• Lowest tax rate is 10 percent for a car emitting 60 gCO2/km• The tax rate rises by one percent per each 10 gCO2/km until it reaches 40 percent.

• Examples of approximate car price differences (before-after the tax reform):– Toyota Prius (104 g/km): -7 700 € (sales of Prius 4x higher in 2008 than in 2007)– BMW 320D (130 g/km): -7 700 €– Jeep Commander (370 g/km): +28 000 € – Land Rover Range Rover (350 g/km): +28 000 €– Porsche Cayenne (330 g/km): +28 000 €– MB SLR2007McLaren (348 g/km): +177 624 €– Ferrari 612 (475 g/km): +104 604 €

• Basic numbers about Finnish car fleet and sales:– Car fleet altogether 2.5 Million vehicles (2.1 Million gasoline, 0.4 Million diesel)– ~140.000 first registrations in 2008

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Kaarle Kupiainen

Behavioural changes motivated by the new tax

• New car sales dropped in 2007 after the tax renewal was published• Sales of diesel cars in 2008 rose to 49% of new registrations (before

the tax <20% for over a decade)• Sales of <160 gCO2/km vehicles doubled in 2008 compared with

2006 and 2007• Sales of >220 gCO2/km vehicles reduced significantly

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Data: Finnish Vehicle Administration AKE

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Kaarle Kupiainen

The behavioural change - CO2 emissions of first registered cars

• Average CO2 emissions of first registered cars:– 2006: 179 gCO2/km– 2007: 177 gCO2/km– 2008: 163 gCO2/km

• No requirements for air pollutant emissions!!– Euro5 into force 1.10.2009– How about PM2.5 before full

implementation of Euro5 (2008-2011)

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Kaarle Kupiainen

Effect of the CO2 based registration tax on PM2.5 emissions? – The NIAM calculation

• What are the future PM2.5 emissions in the situation after the tax reform if the sales of diesel vehicles remains on the 2008 level?

• How much larger are these emissions compared with the hypothetical situation in which the sales of diesel cars would have remained on the 2000-2007 level?

Euro-standards for PMEuro1 (1992): 140 mg/km Euro2 (1996): 100 mg/kmEuro3 (2000): 50 mg/kmEuro4 (2005): 25 mg/kmEuro5 (2009): 5 mg/km

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Kaarle Kupiainen

Calculation procedure and assumptions

Comparison of 2005 and 2011 emissions• Car fleet remains 2008-2010.• 150 000 new cars registered per year 2008-2010. • New diesel cars drive in average 33 500 km per year• 2011 emission were estimated for two scenarios

– Without tax reform: (20% of new cars diesel powered)– After tax reform (50% of new cars diesel powered)

• Year 2008 and 2009: 45 000 more diesel cars sold than before the tax. 50% (22 500) of the diesel cars do not have particulate filter.

• Year 2010: 45 000 more diesel cars sold than before the tax. 20% (9000) of the diesel cars do not have particulate filter.

Hypothesis during transition: more diesel, more PM emitted• Gasoline cars emit 0.005 g/km PM (Euro 5) (or below).• New diesel cars without particle filter emit 0.025 g/km PM (Euro 4).• New diesel cars with particle filter emit 0.005 g/km PM (Euro 5) (or

below).• For the time being we did not do any assumptions about changes in

import and sales of used cars and about consumer profiles.

21.0

4.23

Finnish Regional Emission Scenario (FRES) model

www.environment.fi/syke/pm-modeling

55 - 2020 - 5050 - 200200 - 800

800

PM2.5 SO2 NOx

Anthropogenic emissions 1990, 2000, 2005, 2010, 2020, 2030, 2050 (several projections)

Comprehensive and congruent calculation for primary PM and gases•primary PM (TSP, PM10 - 2.5 - 1 - 0.1, chemical composition in size classes)•SO2, NOx, NH3, NMVOCs•GHGs (in progress)

Abatement technologies and costs

Aggregation: 154 sectors, 15 fuels (GAINS compatible)

Large point sources (>200), area emissions (1 1km2)

Several emission heights

Dispersion with s-r matrices (10 10km2 and 1 1km2)

LRT from EMEP

Databases of population and critical loads

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Kaarle Kupiainen

Share of car traffic emissions in Finnish total PM in 2005 (FRES)

• 18% in PM10

• 8-9% in PM2.5 and PM1

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Other sources

Other traffic (incl. Off-road)

Cars

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Kaarle Kupiainen

PM emissions from car traffic in Finland in 2005 (FRES)

• Most of the PM10 is from non-exhaust (including resuspension),

• In PM2.5 ja PM1 exhaust emissions become more important.

• Suspension and exhaust PM have different size distributions.

– Exhaust mostly PM1 – Non-exhaust (suspension) mostly

larger than PM1

• PM2.5 emissions of car fleet exhaust was approximately 1200 tons in 2005.

• Share of exhaust in car fleet total PM emissions

– 66% PM1

– 13% PM10

• 80% of exhaust emissions emitted by diesel cars

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Cars, gasoline, exhaust

Cars, diesel, exhaust

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Kaarle Kupiainen

Road dust vs. exhaust PM

Mineral particle(road dust)

Diesel exhaust particle(s)

5m 90nm (0.090m)

Kuvat: Kupiainen 2000, Jokiniemi 2003

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Kaarle Kupiainen

PM2.5 emissions from car traffic in Finland in 2011 (FRES)

• PM2.5 emission from car exhaust are estimated to decrease by 60% compared with 2005 emissions in both scenarios due to renewal of the vehicle fleet

• In the ”After tax reform” scenario the PM2.5 emissions are estimated to be 35 tons higher than in the ”Without tax” scenario, which means:

– 7 percent higher in car fleet PM2.5 exhaust emissions,

– 1,3 percent highrer in car fleet total PM2.5 emissions,

– 0,7 percent higher in transport sector total PM2.5 emissions and

– 0,12 percent higher in Finnish total PM2.5 emissions

• Conclusion: The tax reform has increased the traffic PM emissions but the effect is relatively minor

• Note! Non-exhaust emissions are at the moment estimated to increase with traffic amounts

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Kaarle Kupiainen

Population exposure and the tax reform

• The model combines the population distribution and exposure with the PM2.5 emissions and resulting concentrations

• Traffic emissions have a relatively larger impact on population exposure than other emission sources

• Population exposure in 2011 due to car fleet exhaust PM2.5 emissions is relatively low (few percents of all Finnish emissions)

• Car tax reform increases population exposure by less than 1%

Kaa

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Kaarle Kupiainen

Summary and Conclusions

• The CO2 based car registration tax that came into force in 1.1.2008 has led to significant changes in consumer behavior in Finland

• It has increased the sales of diesel vehicles and <160 gCO2/km emitting vehicles in general. Sales of >220 gCO2/km vehicles has reduced significantly

• The tax reform can be criticised for not taking into account emissions of air pollutants, especially in the period before Euro 5 is fully in force (2011) (e.g. our study was conducted after the reform)

• The tax reform increases PM2.5 emissions and exposure, but the effect is relatively small, because:– Already in 2008 a major share (50%) of new registered vehicles were

estimated to meet the Euro 5 PM requirement– The transition period is only three years, during which 150000 new cars

are expected to be registered (only 6% of the whole car fleet)– However, this increment could have been avoided!

• Non-exhaust emissions are an important emission source in Finland that are not well controlled at the moment.

Kaa

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Kaarle Kupiainen

Future non-technical measures in the transport sector in Finland

• Biofuel use (CO2 driven)– 2nd generation biodiesel (e.g. Neste Oil product: NexBTL)

(reduces PM, NOx and HC)– Ethanol (according to EU goals) (low effect on air pollutant

emissions)

• City of Helsinki is planning:– Parking incentives to promote the use of low emission vehicles

• Planned LEV criteria: diesel&gasoline <110gCO2/km, EVs, natural/biogas

– Low emission zone (Euro2 restriction of >3.5 ton vehicles)– We are interested to hear experiences of implementing and

managing these (e.g. cost information)?

Kaa

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Kaarle Kupiainen

Thank you!

Kaarle Kupiainen

Senior researcher, Ph.D.

Finnish Environment Institute (SYKE)

Research Department for Global Change

Kaarle.kupiainen@ymparisto.fi