Report: PHEV Real-World Emissions Six Times Higher Than Official Figures
T&E analysis shows freezing the 2026 utility factor correction would underestimate emissions by 56% and hurt BEV sales.
New analysis of 2024 data reveals that plug-in hybrid electric vehicles (PHEVs) are emitting nearly six times more in real-world conditions than their official WLTP test values suggest. The findings, released by Transport & Environment (T&E), highlight a widening gap driven by heavier, higher-power models that rely disproportionately on combustion engines.
What Happened
According to the report, PHEVs sold in 2024 operate in pure electric mode only 27% of the time on average. The discrepancy between official and real-world emissions has grown as the average electric range of these vehicles increased from 58 km to 75 km between 2021 and 2024. Longer-range models with insufficient electric motor power were responsible for more than half of the 2024 emissions gap. The analysis indicates that PHEVs with a 25% higher electric-to-combustion power ratio emit 95 gCO₂/km, which is one-third of the average PHEV’s real-world emissions. Additionally, the report notes that current tax systems in most EU Member States do not distinguish effectively between high-emitting and best-performing PHEVs, with 24 out of 27 states offering preferential tax treatment.
Why It Matters
The findings underscore the necessity of the upcoming utility factor (UF) correction scheduled for November 2026/27, which aims to align official accounting with actual climate impact. T&E argues that freezing the UF at the 2025/26 correction levels would underestimate real-world emissions by 56%. Crucially, the report states that freezing the UF is the single change to the car CO2 framework that would have the largest impact on battery electric vehicle (BEV) sales, potentially lowering them by 13 percentage points in 2030 and 18 percentage points in 2035. The correction is designed to incentivize manufacturers to improve PHEV technology. Evidence from the 2025 UF correction shows that some carmakers increased electric ranges by 85% and battery sizes by 68% to offset the impact, while only raising vehicle prices by 2%.
US Market Implications
While the regulatory framework discussed is specific to the European Union, the findings are relevant to US readers because global automakers such as GM, Ford, and Toyota operate in both markets. The data suggests that PHEV designs which pass EU WLTP tests but fail to deliver real-world efficiency could face similar scrutiny or regulatory adjustments in the US, where EPA testing standards also aim to reflect actual driving conditions. Manufacturers may need to adjust their global engineering strategies to ensure that PHEVs meet stricter real-world emissions expectations across all major markets, potentially impacting the availability and performance of hybrid models sold in the US.
The Bottom Line
T&E recommends that European co-legislators keep the planned UF correction to ensure official emissions match real-world performance. The organization suggests that taxation should complement this by using stricter CO₂ and electric-range criteria to prevent high-emitting models from receiving the same favorable treatment as best-performing PHEVs. By 2030, the report estimates that electric ranges of 140–220 km will be necessary to keep PHEVs at or below 50 gCO2/km.
