"Obama drives forward with more oil savings"
Last year, Obama raised new car fuel efficiency standard to 35.5 mpg by 2016, the biggest step the U.S. government has ever taken to cut CO2. Now he’s taking the next step, as CAP’s Daniel J. Weiss explains.
Congressional efforts to reduce oil use and global warming pollution are stalled due to near blanket opposition from Senate Republicans along with a handful of Democrats. Meanwhile, President Obama continues to use his authority to accomplish both of those goals.
On Friday, October 1st, EPA Administrator Lisa Jackson and Transportation Secretary Ray LaHood announced a “Notice of Upcoming Joint Rulemaking to Establish 2017 and Later Model Year Light Duty Vehicle GHG Emissions and CAFE Standards.”
Jackson noted that:
Continuing the successful clean cars program will accelerate the environmental benefits, health protections and clean technology advances over the long-term. In addition to protecting our air and cutting fuel consumption, a clear path forward will give American automakers the certainty they need to make the right investments and promote innovations.
These new standards could reduce oil use by up to 1.3 billion barrels over the lifetime of the cars built from 2017-2025. This is equal to the combined 2009 oil imports from Libya, Nigeria, Saudi Arabia, and Venezuela. The new standards could also cut greenhouse gas pollution by up to nearly 600 million metric tons during that same period.
Today’s announcement provided a range of options that the government will seek public comments. The options include fuel economy improvements of 3% to 6% annually, which would translate to 47 miles per gallon to 62 miles per gallon. There are also scenarios that assume different mixes of gasoline and diesel vehicles, and hybrid, plug-in, and all electric vehicles.
|Scenario||Gram of CO2/mile in MY 2025||MPG Equivalent||Lifetime of vehicles CO2e reduction (million metric tons)||Lifetime of vehicles Fuel Reduction (million barrels)||Average preliminary vehicle cost estimates||Average net lifetime owner savings|
Each of these scenarios would add a different average cost to the price of vehicles, and provide a different net life time savings from lower gasoline purchases. EPA analysis predicts that
All MY 2025 scenarios, regardless of technology pathway, have a positive net lifetime fuel savings between approximately $4,900 and $7,400, and for MY 2025 all of the scenarios and technology pathways pay back in 4.2 years or less.
This is a very conservative estimate because the “gasoline price used for this estimate is $3.49/gallon in 2025.” The last time gasoline prices were as high as $3.48 a gallon was the week of October 6, 2008. Oil prices were $93 per barrel the week of October 3, 2008. So the cost savings in the EPA-DOT proposal assume that oil prices remain below $100 per barrel even as the world’s economies recover and oil demand rises. If gasoline prices are higher than $3.49 or $100/barrel, then the savings would be greater and the payback period shorter.
Some in the auto industry may claim that a 60 MPG fuel economy standard 15 years from now will be too difficult to achieve. However, the Union of Concerned Scientists and other environmental organizations believe that this goal is realistic.
Conventional internal combustion engine vehicles can be made much more efficient by applying, for example, downsized turbocharged engines, six- and seven-speed transmissions, high-strength lightweight materials, enhanced aerodynamic designs, and more climate-friendly air conditioning systems. Some vehicles already on the road use a limited number of these technologies. However, all new vehicles could apply the full range of technology to maximize fuel efficiency.
In addition, such standards would increase investments in plug-in hybrid and electric vehicle technologies.
Adoption of the 6 percent annual increase would save the most oil, reduce the most pollution, and provide the biggest boost to the U.S. auto industry by driving it to develop, build and export the cleanest cars of the 21st Century. Hopefully, this will be the standard ultimately adopted by the administration.
Today’s announcement is the beginning of a nearly two year process to propose and adopt final standards. The proposal is due a year from now, and will go final by July 31, 2012.
Comments on this first proposal should be sent by October 31, 2010. There will be another opportunity comment after the issuance of the proposed rules due by September 30, 2011. Instructions for comments:
Submit your comments, identified by Docket ID No. EPA-HQ-OAR-0799 and/or NHTSA-2010-0131, by one of the following methods:
www.regulations.gov: Follow the on-line instructions for submitting comments. Email: a-and-r-Docket@epa.gov. Fax: EPA: (202) 566-1741; NHTSA: (202) 493-2251. Mail: EPA: Environmental Protection Agency, Mail code: 2822T, 1200 Pennsylvania Ave., NW., Washington, DC 20460, Attention Docket ID No. EPA-HQ-OAR2010-0799 or NHTSA: Docket Management Facility, M-30, U.S. Department of Transportation, West Building, Ground Floor, Rm. W12-140, 1200 New Jersey Avenue, SE, Washington, DC 20590.
— Daniel J. Weiss is Senior Fellow and Director of Climate Strategy, Center for American Progress.