EU Alternative Fuel Infrastructure Regulation Proposal (AFIR)
The European Union is now finalizing the regulation on the deployment of alternative fuel infrastructure which will support all modes of transport in Europe.
AFIR proposal is expected to play a crucial role in driving the growth of the alternative fuel vehicle market
The European Union is currently working on the revision of its climate, energy, and transport-related legislation under the ‘Fit for 55’ package to align current laws with the 2050 objective of achieving climate neutrality and 2030 goal to reduce carbon emissions by 55% compared to 1990 levels.
The Commission has presented the proposal for a Regulation on the Deployment of Alternative Fuel Infrastructure on July 14, 2021 (AFIR) which will repeal Directive 2014/94/EU (AFID). The proposal outlines plans for the deployment of alternative fuel infrastructure to support all modes of transport and includes binding targets for infrastructure deployment. While the proposal addresses many different sectors, it identifies the electrification of transport as key instrument in decarbonization. It also tackles interoperability and improves user friendliness.
The proposed legislation sets mandatory national targets for recharging infrastructure rollout at the member state level and hydrogen refueling infrastructure for road transport.
The new Regulation will ensure direct implementation of a minimum charger-to-vehicle ratio for EU countries. Fleet-based targets will ensure infrastructure growth goes hand in hand with EV uptake, whereas distance-based targets will reassure users across the continent that the infrastructure to support them is sufficient. The change of the regulatory instrument is expected to play a crucial role in fostering growth and development of the alternative fuel vehicle market. This will also drive innovation in the years to come. The European Commission expressed its objective to reach 1.5 million recharging points by 2025 and 3.5 million by 2030. It is expected that the final regulation will also include mandates for higher power output.
The legislation does not provide funding. Nonetheless, most member states, cities and regions and the EU itself are providing incentives and grants to accelerate the adoption of EVs across the continent. Most notably, the Connecting Europe Facility Transport program is aimed at transport infrastructure specifically. Member states are also leveraging funding from more flexible EU programs like Recovery and Resilience Fund and InvestEU to build charging infrastructure for meeting the targets outlined in the AFIR. More information on national incentives is available under Additional Resources.
The EU faces the following interlinked problem: on the one hand, vehicle uptake will be constrained until charging infrastructure is available, while on the other, investments in infrastructure require more certainty of vehicle uptake levels. As it currently stands, the lack of provisions for minimum coverage may slow down the opportunity to significantly boost charging infrastructure across the entire continent. Overcoming these obstacles in the forthcoming negotiations before final adoption of the Regulation will shape the extent of future opportunities for U.S. businesses in the development of next-generation vehicles, including the supply chain and supporting projected increasing volumes through servicing and the aftermarket. In addition, the charging infrastructure rollout itself provides opportunities for companies that can supply charging technology, support build outs of new grid and transmission requirements, software providers, and energy companies.
The proposed legislation includes specific prescriptive payment methods for ad-hoc charging for EV charging stations, in particular requirements for credit card readers. It also requires price transparency and comparability.
The Regulation would also impact legal requirements for existing charging infrastructure in the EU, unless specific transition period or exemptions granted by the legislative text. EU Regulations enter into force 20 days following their publication in the Official Journal of the European Union and are directly applicable in member states.
The proposal does not include harmonized requirements across Europe about the planning, permitting and procuring of charging infrastructure. The complexity of the approval process and the time it takes to obtain the necessary permits can vary considerably by member state and region.
In terms of the legislative process, the proposed Regulation will be voted in the European Parliament in October 2022 and then go into the Trilogue negotiations (the European Commission, the European Council and the European Parliament) in fall-winter 2022. Final adoption is expected to take place early 2023.
For more information contact the U.S. EU Commercial Service.
Proposal on alternative fuels infrastructure
Fit for 55 package: Council adopts its position on three texts relating to the transport sector, press release, 2 June 2022
EV charging infrastructure incentives in Europe 2022
AVERE reaction paper to the proposal for a new Alternative Fuels Infrastructure Regulation (AFIR)