Germany and the European Commission on Saturday said a deal had been reached over an agreed phase-out of combustion engine vehicles.

To the irritation of some in Brussels, consensus on the issue was being held up by opposition from within Germany's ruling coalition government.

What was announced?

The deal ends a dispute over whether manufacturers would still be able to make cars using so-called e-fuels after 2035. It would allow for cars to be registered after that date, providing that any fuel they use is exclusively carbon neutral. 

"We have found an agreement with Germany on the future use of e-fuels in cars," EU Commission Vice President Frans Timmermans wrote on Twitter.

"We will work now on getting the CO2 standards for cars regulation [sic] adopted as soon as possible, and the Commission will follow up swiftly with the necessary legal steps," he wrote.

German Transport Minister Volker Wissing, who had pushed for the amendment, wrote that "vehicles with internal combustion engines can still be newly registered after 2035 if they fill up exclusively with CO2-neutral fuels."

What was behind the dispute?

Germany is home to a major car manufacturing sector, which would have to implement the EU legislation.

EU plans to only allow the manufacture of emissions-free cars after 2035 had to be put on ice after Germany raised last-minute objections, pushing to allow for e-fuel vehicle registration. 

Wissing and his neoliberal Free Democrats, a junior partner in Chancellor Olaf Scholz's ruling coalition, had led efforts to revise the deal, pushing back on Brussels' demands for a quick agreement.

As late as Friday, Germany's Transport Ministry and the EU Commission were said to be still exchanging letters and proposals to thrash out a compromise.

Scholz, speaking after an EU summit in Brussels on Friday, had said there would be an agreement "quite soon" to the dispute.

German Economy and Climate Minister Robert Habeck had said that any further delay would risk problems within the three-way coalition, which also includes the environmentalist Greens and Scholz's center-left Social Democrats (SPD). 

Greenpeace slams deal

Greenpeace, the environmental organization, sharply criticized the agreement. 

"This rotten compromise undermines climate protection in transport, and it harms Europe," said Greenpeace's mobility expert, Benjamin Stephan said.

He added that the "urgently needed orientation of the car industry towards efficient electromobility" would be watered down with the agreement. 

Critics of the e-fuels proposal had argued that manufacturing e-fuels is very expensive and energy-intensive. Using such fuels in a combustion engine car requires about five times more renewable electricity than running a battery electric vehicle.

lo,rc/wd (AP, Reuters, dpa)

While you're here: Every Tuesday, DW editors round up what is happening in German politics and society. You can sign up here for the weekly email newsletter Berlin Briefing.