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BRUSSELS, Nov 8 (Reuters) - The European Commission will propose on Wednesday tougher carbon dioxide reduction targets for new cars and vans of 30 percent by 2030 and a crediting system to promote electric vehicles, EU sources said.
The EU executives' proposal aims to curb greenhouse gases from transport as part of the bloc's push to cut emissions by at least 40 percent below 1990 levels by 2030.
It has already met with opposition from nations with big automotive sectors, such as Germany, and will face a tough battle before being approved by the EU's 28 member states and European Parliament to become law.
Amid fierce lobbying, the target was up for discussion until being approved in a meeting of EU commissioners on Wednesday morning ahead of its planned announcement.
Under the draft proposal, if carmakers are found in breach of rules, they face penalties of 95 euros for every gram of CO2 above the limit and for each new vehicle registered in a given year.
In a policy innovation, the proposal would allow carmakers to offset their overall target if the share of zero and low-emission vehicles in their fleet surpasses a benchmark set by regulators.
European carmakers have lobbied for the emissions reduction target to be set at 20 percent and have called for compliance to be conditional on consumer uptake of electric cars.
In a nod to manufacturers' concerns, the Commission is set to earmark 800 million euros ($928 million) to support the roll out of charging points for electric vehicles and 200 million euros for battery development.
Despite the push back from industry, outrage over Volkswagen cheating on emission tests in the United States has put pressure on EU regulators to seek tougher controls.
The Commission is also keen for legislation to stimulate European development of low-emission vehicles, afraid it is falling behind China, Japan and the United States.
"Europe's car industry must regain the trust of its consumers," EU climate Commissioner Miguel Arias Canete said ahead of the proposal. "We want the European automotive industry get back in the race for global leadership on clean vehicles." (Reporting by Alissa de Carbonnel; editing by Philip Blenkinsop and Jason Neely)