In its Clean Power for Transport report, the European Parliament said the plans were aimed at reducing the region’s dependence on imported oil. It added that 94% of energy consumed by transport was oil-based during 2010, of which 84% was imported contributing to a 2.5% GDP deficit in the EU trade balance.

Plans to improve the uptake of electric, hydrogen fuel cell, LNG and CNG-powered vehicles could save the region €4.2bn (£3.51bn) per year by 2020, rising by €1bn (£840m) each year as it negates the impact of oil price hikes, while creating 700,000 additional jobs by 2025 and contributing to a 60% CO2 emission reduction target by 2050.

But the Parliament said there was no single fuel solution for it. By 2020, the EU wants Member States to have plans in place to install eight million electric vehicle chargers across the region, 10% of which will be publically accessible. This is aiming for a benchmark of around four million electric vehicles on the road by the end of the decade – half the number anticipated by Member States.

The UK will be home to the third largest network in the region, at 1,221,000 units by 2020, behind Germany and Italy at 1,503,000 and 1,225,000 respectively. A lack of charging infrastructure is said to be a component problem but not the single solution, with publicity, incentives (financial and non-financial) and a standardised connection also vital.

Further ahead, by 2025 the European Union wants a region-wide refuelling network for hydrogen fuel cell vehicles, a date which matches the predicted price parity with diesel and petrol models. This will create a network of 143 stations with a standardised refuelling process spread no further than 186 miles apart along major routes.

Carlo Fidanza (EPP, IT), the rapporteur and lead negotiator for Parliament, said: ‘This is a crucial step forward for the development of alternative fuels. It represents a balanced agreement which holds together both the ambition and the realistic approach that makes this directive the appropriate tool to create market prospects and give operators and manufacturers certainty as to the law.’

The agreement has to be approved by the Transport Committee, Parliament as a whole and the European Council, set to happen during April, before being put into action.