ENVIRONMENT | Protecting our natural resources
08 February 2007
Vehicle Fuel Economy Plan Could Benefit Environment
Consumers, automakers will not be harmed economically, experts say
Washington -- President Bush’s plan to reduce gasoline use in the United States by increasing the fuel economy of passenger vehicles could make the country less dependent on oil imports and mitigate greenhouse gas emissions without causing economic harm to consumers or automakers, experts say.
In his January 29 State of the Union address, Bush proposed reducing gasoline use by 20 percent over 10 years from what the Department of Energy has projected would be consumed if no further action were taken. The proposal calls for reforming fuel economy standards for passenger vehicles and increasing use of renewable and alternative fuels. If the plan is enacted, the administration projects it would cut annual projected emissions from cars and light trucks -- pickups, minivans and sport utility vehicles (SUVs) -- by as much as 10 percent, according to the administration. (See related article.)
The details of the vehicle fuel economy reform were outlined in a legislative proposal sent February 6 to Congress.
“I think it is a good goal,” said David Greene of the engineering science and technology division at Oak Ridge National Laboratory. “It’s aggressive but achievable without [causing] any harm to [the] automobile market or auto manufacturers.”
Greene told USINFO that his views do not necessarily represent those of his lab or the Energy Department, which counts Oak Ridge among its prime research and development facilities.
He said that the Bush administration's goal can be attained with existing technologies if U.S. automakers change their strategy and use those technologies to improve fuel economy rather than increase engine power or vehicle mass, as they have done for the last 25 years.
John German of American Honda Motor Company told the Senate Energy Committee January 30 that with proper use of existing technology, fuel economy could have been improved by almost 1.5 percent per year from 1987 to 2006.
Instead, as U.S. automakers and consumers increasingly have opted for larger vehicles, the average fuel economy of new autos in the United States has actually declined since the early 1990s.
MIXED REACTIONS TO PRESIDENT’S PROPOSAL
Some mainstream environmental groups have cautiously welcomed Bush’s plan as a step in the right direction.
Struggling U.S. automakers, however, indicated their dissatisfaction with it. They say that mandatory standards will be costly to meet and will force them to sell products consumers do not want.
However, Walter McManus of the University of Michigan told the Senate Energy Committee that U.S. consumers have “placed a much higher value on fuel economy than Detroit automakers have given them.”
He said that a study published in fall 2006 by the automotive division he heads also showed that proactive fuel economy increases would strengthen U.S. automakers’ financial position.
The president’s proposal assumes fuel economy increasing 4 percent annually beginning in 2010.
Under the proposal, the administration would be given authority to set standards for passenger cars, an authority that now lies with Congress.
The current corporate average fuel economy (CAFE) program requires 27.5 miles per gallon (11.6 kilometers per liter) fleet average; a standard below those of other major developed countries and China.
Yet the CAFE program has been criticized by U.S. automakers and some legislators. They have argued that it is easier for Asian producers, such as Toyota and Honda, to comply with the standards because they predominantly produce cars that are light and fuel-efficient. U.S. manufacturers have tended to build heavier gas-guzzlers. CAFE critics also argue that lighter vehicles are less safe than larger and heavier cars, a claim questioned by some environmental groups.
ADMINISTRATION SEEKING FLEXIBLE SCHEME FOR SETTING STANDARDS
The administration prefers a scheme similar to the one it introduced in 2006 for light trucks, which would allow it to set the standards for each vehicle in each category based on its “footprint,” or width and distance between the wheels. Such a system, officials said, reduces average safety risk, preserves consumer choice and spreads the burden of compliance across all manufacturers and product lines.
Because the administration’s approach is relatively novel it requires caution, Greene said. He said the U.S. vehicle safety regulator should do a study of potential unintended and undesirable consequences of this system.
The proposal sent to the House of Representatives Energy and Commerce Committee also calls for credits that could be given to automakers for exceeding the standards and then traded among automakers, financial institutions and other investors beginning in 2010.
Greene said such a system would give manufacturers more flexibility in meeting new standards.
He said, however, that one study he saw indicated that potential gains in economic efficiency or any potential losses in mileage from credit trading are likely to be modest.
The previous Congress, dominated by Republicans, rejected an earlier administration proposal that called for similar CAFE reforms.
Lawmakers from both parties have introduced several fuel economy measures of their own. One would aim for a 4 percent annual increase in the existing CAFE standards; another would increase those standards to 40 miles per gallon (16.8 kilometers per liter) over 10 years.
