The automotive industry will have a greater incentive to invest in new technologies that reduce CO2 emissions from new cars, under legislation adopted by the European Commission on 25 July 2011. <br/><br/>
The Regulation enables motor manufacturers to receive CO2 emission credits if they fit new cars with approved "eco-innovations" which reduce emissions. The credits will help the industry meet the European target of limiting CO2 emissions from new cars to an average of 130 grams/km by 2015. Eco-innovations will count for up to 7 g CO2/km towards the target. Under the Regulation, a technology can qualify as an eco-innovation if it is new to the market, contributes to significant CO2 savings and is not otherwise taken into account in determining the level of CO2 emissions from vehicles. The technology should also aim at improving vehicle propulsion or the energy consumption of devices that are mandatory, without compromising vehicle safety. This means, for instance, that solar panels converting sunlight into electric energy could potentially qualify as an eco-innovation but an energy-efficient in-car music system would not.