New CAFE-GHG Proposal

The Obama administration on Tuesday formally proposed joint CAFE-CAA fuel efficiency standards for cars and trucks that link fuel economy to reduced emissions from vehicles.  Manufacturers would need to increase fuel economy 5 percent per year from 2012 to 2016, with new cars and trucks averaging 35.5 miles per gallon by 2016.  Alternatively, manufacturers must meet a requirement that their vehicles on average emit no more than 250 grams of carbon dioxide per mile. With current technology, the measures are essentially equivalent.  Current CAFE standards require that cars average 27.5 miles per gallon and light trucks average 23.1 miles per gallon.  Download 2012-2016_CAFE_GHGN_PRM  EPA Administrator Lisa P. Jackson estimates the proposed regulations would save 1.8 billion gallons of oil between 2012 and 2016, and prevent greenhouse-gas equivalent to the output of 42 million cars.

According to the Washington Post, Washington Post story President Obama appeared at a General Motors plant in Lordstown, Ohio, claiming the proposal is a boon for both the environment and the automobile industry because "it will give our auto companies some long-overdue clarity, stability and predictability." The Alliance of Auto Manufacturers, the industry trade group, supported Obama's remarks, stating "This is really the road map for automakers to follow."  AAM estimated that the required changes would cost the auto industry $60 billion by 2016, but did not provide an estimate of price increase that consumers would experience..    

The proposal, if finalized in a timely manner -- i.e. before Copenhagen -- is a victory on one front of the battle to reduce U.S. greenhouse gas emissions.  The other front is the legislation to cap GHGs from stationary sources such as utility and industrial powerplants.  According to the Washington Post, Senate Majority Leader Harry M. Reid (D-Nev.) said yesterday that the Senate may not act on climate legislation until next year. The Obama administration, of course, could pressure Congress by proceeding to regulate GHGs under the existing Clean Air Act through calling for new State Implementation Plans, requiring New Source Review permits impose LAER and BACT for GHG, and imposing New Source Performance Standards for GHG.  However, the Administration is unlikely to play chicken with Congress absent proof that Congress is truly dragging its feet.

The Supreme Court in Massachusetts v. EPA almost 2 1/2 years ago determined that EPA has the power to regulate greenhouse gases from vehicles, prompting yesterday's action.

See the press release below:

CONTACT:

EPA: Cathy Milbourn

milbourn.cathy@epa.gov

202-564-7849

202-564-4355

 

DOT: Rae Tyson

202-366-9550

 

FOR IMMEDIATE RELEASE

September 15, 2009

 

DOT Secretary Ray LaHood and EPA Administrator Lisa P. Jackson Propose National Program to Improve Fuel Economy and Reduce Greenhouse Gases

 

New Interagency Program to Address Climate Change and Energy Security

 

WASHINGTON – U.S. Department of Transportation (DOT) Secretary Ray LaHood and U.S. Environmental Protection Agency (EPA) Administrator Lisa P. Jackson today jointly proposed a rule establishing an historic national program that would improve vehicle fuel economy and reduce greenhouse gases.  Their proposal builds upon core principles President Obama announced with automakers, the United Auto Workers, leaders in the environmental community, governors and state officials in May, and would provide coordinated national vehicle fuel efficiency and emissions standards.  The proposed program would also conserve billions of barrels of oil, save consumers money at the pump, increase fuel economy, and reduce millions of tons of greenhouse gas emissions.

 

“American drivers will keep more money in their pockets, put less pollution into the air, and help reduce a dependence on oil that sends billions of dollars out of our economy every year,” said EPA Administrator Lisa P. Jackson.  “By bringing together a broad coalition of stakeholders – including an unprecedented partnership with American automakers – we have crafted a path forward that is win-win for our health, our environment, and our economy. Through that partnership, we’ve taken the historic step of proposing the nation’s first ever greenhouse gas emissions standards for vehicles, and moved substantially closer to an efficient, clean energy future.”

 

“The increases in fuel economy and the reductions in greenhouse gases we are proposing today would bring about a new era in automotive history,” Transportation Secretary Ray LaHood said. “These proposed standards would help consumers save money at the gas pump, help the environment, and decrease our dependence on oil – all while ensuring that consumers still have a full range of vehicle choices.”

 

Under the proposed program, which covers model years 2012 through 2016, automobile manufacturers would be able to build a single, light-duty national fleet that satisfies all federal requirements as well as the standards of California and other states. The proposed program includes miles per gallon requirements under NHTSA’s Corporate Average Fuel Economy Standards (CAFE) program and the first-ever national emissions standards under EPA’s greenhouse gas program. The collaboration of federal agencies for this proposal also allows for clearer rules for all automakers, instead of three standards (DOT, EPA, and a state standard).

 

Specifically, the program would:

 

·         Increase fuel economy by approximately five percent every year

·         Reduce greenhouse gas emissions by nearly 950 million metric tons

·         Save the average car buyer  more than $3,000 in fuel costs

·         Conserve 1.8 billion barrels of oil

 

Increase Fuel Economy and Reduce Carbon Dioxide Emissions:

The proposed national program would require model year 2016 vehicles to meet an estimated combined average emission level of 250 grams of carbon dioxide per mile. Under the proposed program, the overall light-duty vehicle fleet would reach 35.5 miles per gallon (mpg) in model year 2016, if all reductions were made through fuel economy improvements. If this occurs, Congress’ fuel economy goal of 35.0 mpg by 2020 will be met four years ahead of schedule. This would surpass the CAFE law passed by Congress in 2007, which required an average fuel economy of 35 mpg in 2020.

Reduce Greenhouse Gases:

Climate change poses a significant long-term threat to America’s environment. The vehicles subject to the proposed rules announced today are responsible for almost 60 percent of all U.S. transportation-related greenhouse gas emissions. These will be the nation’s first ever national greenhouse gas standards. The proposed standards would require model year 2016 vehicles to meet an estimated combined average emission level of 250 grams of carbon dioxide per mile under EPA’s greenhouse gas program. The combined EPA and NHTSA standards would reduce carbon dioxide emissions from the light-duty vehicle fleet by about 21 percent in 2030 over the level that would occur in the absence of any new greenhouse gas or fuel economy standards. The greenhouse gas emission reductions this program would bring about are equivalent to the emissions of 42 million cars.

 

Save Consumers Money:

NHTSA and EPA estimate that U.S. consumers who purchase their vehicle outright would save enough in lower fuel costs over the first three years to offset the increases in vehicle costs. Consumers would save more than $3,000 due to fuel savings over the lifetime of a model year 2016 vehicle. 

 

Conserve Oil and Increase Energy Security:

The light-duty vehicles subject to this proposed National Program account for about 40 percent of all U.S. oil consumption. The program will provide important energy security benefits by conserving 1.8 billion barrels of oil, which is twice the amount of oil (crude oil and products) imported in 2008 from the Persian Gulf countries, according to the Department of Energy’s Energy Information Administration Office. These standards also provide important energy security benefits as light-duty vehicles account for about 60 percent of transportation oil use.

 

Within the Auto Industry’s Reach:

EPA and NHTSA have worked closely to develop this coordinated joint proposal and have met with many stakeholders including automakers to insure the standards proposed today are both aggressive and achievable given the current financial state of the auto industry. 

 

NHTSA and EPA expect automobile manufacturers would meet these proposed standards by improving engine efficiency, transmissions and tires, as well as increasing the use of start-stop technology and improvements in air conditioning systems. EPA and NHTSA also anticipate that these standards would promote the more widespread use of advanced fuel-saving technologies like hybrid vehicles and clean diesel engines.

 

NHTSA and EPA are providing a 60-day comment period that begins with publication of the proposal in the Federal Register. The proposal and information about how to submit comments are at: http://www.epa.gov/otaq/climate/regulations.htm for EPA and http://www.nhtsa.dot.gov/portal/site/nhtsa/menuitem.43ac99aefa80569eea57529cdba046a0/

for NHTSA.

 

Draft Environmental Impact Statement:

NHTSA has prepared a Draft Environmental Impact Statement (EIS) for the proposed CAFE standards.  The Draft EIS compares the environmental impacts of the agency’s proposal and reasonable alternatives.  NHTSA is providing a 45-day comment period on the Draft EIS.  Information on the submission of comments is provided at the above NHTSA Web address.