The Obama Administration has taken the latest step in its ‘National Program’ of setting greenhouse gas (GHG) emissions and fuel consumption standards for all classes of vehicles and engines, proposing more stringent rules for model year (MY) 2017 and later light vehicles. The proposed rule, which would require vehicle manufacturers to cut light-vehicle carbon emissions to a level equivalent to a fuel economy standard of 54.5mpg by MY 2025, is the result of an agreement last summer between federal regulators, the automotive industry, and the state of California.
Under the proposal, vehicle manufacturers would be required to reduce passenger car GHG emissions by about 36% and light truck emissions by about 32% between MY 2016 and MY 2025. Actual reductions might differ, since the proposal includes incentives and credits for electric and plug-in hybrid-electric vehicles, “off-cycle” technologies (like adaptive cruise control), etc.
In terms of fuel efficiency, the corporate average fuel economy (CAFE) standard for passenger cars would rise from 37.8 mpg in MY 2016 to 56.0mpg in MY 2025, while the light-truck CAFE standard would rise from 28.8mpg to 40.3mpg. The actual improvement in fuel economy also might vary, as the proposal includes credits and programme “flexibilities”.
The proposed rule was formally published on 1 December, and public comments are being accepted through 30 January 2012.
The fuel economy rules would be implemented in two stages, with light trucks in particular facing more stringent requirements starting in MY 2022. The MY 2022-25 standards are considered “conditional”, however, and will be finalised only after a mid-term review and a second formal rulemaking.
The proposed rule was formally published on 1 December, and public comments are being accepted through 30 January 2012. There will also be a series of public hearings. The Administration hopes to publish a final rule in July 2012.
Reaction to the proposal has generally been positive, though some vehicle manufacturers questioned the Administration’s cost estimates and said the proposal should do more to encourage clean-diesel technology. Dealers continued their longstanding criticism of more stringent fuel economy rules, however, and some House Republicans vowed to fight any effort to promulgate tougher standards.
California embraced the federal proposals but at the same time announced a new “Advanced Clean Car” programme. This supplemental programme would require vehicle manufacturers to sell more zero emission vehicles and plug-in hybrid-electrics in California, while requiring cuts in emissions of “criteria” pollutants as well as greenhouse gases. The California Air Resources Board (CARB) will formally propose new rules soon.
Reaction to the proposal has generally been positive, though some vehicle manufacturers questioned the Administration’s cost estimates and said the proposal should do more to encourage clean-diesel technology.
State regulators, environmentalists, and even some industry groups want federal regulators to go further as well, and the Environmental Protection Agency (EPA) is considering new federal “Tier 3” rules to reduce tailpipe emissions of criteria pollutants and the sulphur concentration of gasoline. A group of state clean-air officials called on EPA to develop such standards on a similar schedule to the ongoing rulemaking for MY 2017-25 GHG emissions standards.
Recent efforts to write more stringent fuel efficiency and GHG emissions rules have been marked by strong government-industry co-operation, as this writer and other speakers noted during the AutomotiveWorld Commercial Vehicle Innovation Summit / USA 2011 in Washington DC in September. EPA and the National Highway Traffic Safety Administration (NHTSA) consulted the automotive industry closely during development of the recently proposed rules, and vehicle manufacturers are also being consulted about potential Tier 3 fuels and vehicle standards. Such a broad regulatory effort could potentially strain this cooperation, which runs counter to the often-contentious tone of policy-making in Washington today. It could also face political challenges that might grow stronger depending on the outcome of the November 2012 US elections.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
Ian C. Graig, chief executive of Global Policy Group, Inc., has written in the past in AutomotiveWorld.com on a wide variety of US policy trends and their implications for the automotive industry. Global Policy Group is a Washington-based research and government relations consultancy whose clients include leading US, European, and Japanese firms in the automotive, energy, utility, information technology, and financial services sectors. For more information, visit www.globalpolicy.com or contact Ian Graig directly at ian.graig@globalpolicy.com.
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