British prime minister bracing for trade clash after delaying electric car emissions cuts

LONDON — British Prime Minister Theresa May’s minority government is bracing for a possible rebellion by her MPs over her announcement on Sunday that proposed emergency cuts to COVID regulations on electric cars would…

British prime minister bracing for trade clash after delaying electric car emissions cuts

LONDON — British Prime Minister Theresa May’s minority government is bracing for a possible rebellion by her MPs over her announcement on Sunday that proposed emergency cuts to COVID regulations on electric cars would be delayed while lawmakers considered alternatives.

The planned COVID change was put forward as part of government plans to reduce Europe-wide clean-air restrictions that will come into force in April. Ministers argue that the environmental rules are too lax and are driving up the cost of the most expensive electric cars.

The BBC, quoting unidentified MPs, reported that Environment Secretary Michael Gove’s proposal to exempt large cars from the requirement to be at least 0.62 miles per gallon below the European average would be “stopped in its tracks” at least until opposition Labor Party MPs see details of the coalition’s proposed alternative, known as the “business-first” review.

The Federation of Small Businesses welcomed the proposed changes. It said that the COVID requirements were driving up the cost of electric cars in a way that “places huge strain on small businesses that have no choice but to maintain and introduce such vehicles.”

“Around 20 percent of new electric cars sold in the UK last year were sold in direct response to the COVID rules,” said FSB Chief Executive Mike Cherry. “We are calling on Government to back proposals for an exemption for business and simpler charge zones.”

There is currently only one electric car registered for every 1,500 British cars, compared with a British car ownership rate of 1 to 1.2 vehicles per 1,000.

Federation figures show that only one in 40 new cars that are registered actually uses their on-board charger for long periods.

Experts say the proposed delay to COVID will exacerbate the market challenge facing the electric car industry.

The EU’s COVID requirements are a key element of the clean-air legislation that targets a more harmonized single European market to help lower pollution. Under the current system, cars that are below standard COVID could face a €10,000 penalty ($12,670) fine.

By postponing the planned COVID adjustment until after the summer and after the country exits the EU, the British government says it will increase incentives to encourage more electric cars.

Michael Hughes, head of electricity and renewables policy at KPMG, said that the British government’s move suggests it is “somewhat more flexible than they are letting on.” He said that an exemption from the COVID standard would make the difference between a manufacturer selling 100 vehicles versus 400 vehicles.

Tim Knox, the FSB’s Scotland policy director, said the delay would “carry some irony” given that two-thirds of Scotland’s population lives in Scottish municipalities that have already adopted stricter regulations than the UK government is now proposing.

“It is hard to see how the Scottish Government is helping manufacturers stay competitive to the benefit of both the nation and the people living in Scotland when they do not even have more stringent local operating targets,” Knox said.

May’s Conservatives enjoy an unusually slim majority of 17 in the 650-seat House of Commons. They have promised to make the COVID policy more stringent but, as with other controversial issues, expect to face strong opposition from other parties.

Fears that the government could be weakened by the political fallout from possible defections and a fall in her approval ratings led to a run of well-timed Cabinet resignations this week.

The government would also be weakened by the loss of support from seven Conservative MPs to cross-party initiatives such as the Stop Brexit bill.

Junior energy minister Claire Perry is said to be close to resigning over the COVID proposals, as well as over the government’s support for May’s proposed changes to EU trade rules at the World Trade Organization, which were rejected by EU leaders in a summit in Buenos Aires earlier this month.

May’s government is currently working on proposals to reduce energy use in the National Grid. There are fears that insufficient investment in low-carbon energy could jeopardize national security.

On Sunday, in a statement, May said she was seeking to “take forward the right work with Scottish ministers, securing their approval for the COVID adjustments.”

She added: “The success of electric vehicles has been one of the standout achievements of our emissions standards since 2010. I welcome the opportunity to build on this achievement.”

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