New standards for light vehicle fuel economy announced

The Environmental Protection Agency (EPA) and the Dept. of Transportation (DOT) have formally rolled out the second stage of their joint rulemaking to set higher fuel economy and greenhouse gas (GHG) pollution standards for passenger cars and light trucks. EPA and DOT announced yesterday that their newest joint rule—for model year 2017-25 vehicles-- will save Americans over $1.7 trillion at the pump or nearly $8,000 per vehicle by 2025

The Environmental Protection Agency (EPA) and the Dept. of Transportation (DOT) have formally rolled out the second stage of their joint rulemaking to set higher fuel economy and greenhouse gas (GHG) pollution standards for passenger cars and light trucks. EPA and DOT announced yesterday that their newest joint rule—for model year 2017-25 vehicles-- will save Americans over $1.7 trillion at the pump or nearly $8,000 per vehicle by 2025.

The new second-stage standards will also reduce America’s dependence on oil by an estimated 12 billion barrels and, by 2025, reduce oil consumption by 2.2 million barrels per day – enough to offset almost a quarter of the current level of foreign oil imports. Taken together, these actions will also cut 6 billion metric tons of greenhouse gas emissions over the life of the programs, said the agencies.

According to the two agencies, the proposed rule for model year 2017-2025 passenger cars and light trucks is “expected to require increases in fuel efficiency equivalent to 54.5 mpg if all reductions were made through fuel economy improvements. These improvements would save consumers an average of up to $6,600 in fuel costs over the lifetime of a model year 2025 vehicle for a net lifetime savings of $4,400 after factoring in related increases in vehicle cost. Overall, the net benefit to society from this rule would total more than $420 billion over the lifetime of the vehicles sold in model year 2017-2025.”

This latest regulatory proposal builds on the first phase (2012-2016) of the Obama Administration’s MPG/GHG program, which it said will raise fuel efficiency equivalent to 35.5 mpg by 2016 and result in an average light-vehicle tailpipe CO2 level of 250 grams per mile.

Combined with 2011 fuel economy standards and the standards in effect for 2012-2016, the latest proposal represents the most significant federal action ever taken to reduce greenhouse gas emissions and improve fuel economy. Taken together, these actions would reduce greenhouse gas emissions by half and result in model year 2025 light-duty vehicles with nearly double the fuel economy of model year 2010 light-duty vehicles.

“These unprecedented standards are a remarkable leap forward in improving fuel efficiency, strengthening national security by reducing our dependence on oil, and protecting our climate for generations to come,” said Transportation Secretary Ray LaHood in a call with reporters.

“We expect this program will not only save consumers money, it will ensure automakers have the regulatory certainty they need to make key decisions that create jobs and invest in the future,” LaHood continued. “We are pleased we’ve been able to work with the auto industry, the states, and leaders in the environmental and labor communities to move toward even tougher standards for the second phase of the president’s national program to improve fuel economy and reduce pollution.”

"By setting a course for steady improvements in fuel economy over the long term, the Obama Administration is ensuring that American car buyers have their choice of the most efficient vehicles ever produced in our country,” said EPA Administrator Lisa P. Jackson.

“That will save them money, reduce our nation's oil consumption and cut harmful emissions in the air we breathe,” added Jackson. “This is an important addition to the landmark clean cars program that President Obama initiated to establish fuel economy standards more than two years ago. The progress we made with the help of the auto industry, the environmental community, consumer groups and others will be expanded upon in the years to come - benefiting the health, the environment and the economy for the American people.”

By continuing the national program developed for model year 2012-2016 vehicles, EPA and DOT stated they have “designed a proposal that allows manufacturers to keep producing a single, national fleet of passenger cars and light trucks that satisfies all federal and California standards. It also ensures that consumers will continue to enjoy a full range of vehicle choices with performance, utility and safety features that meet their individual needs.”

The model year 2017-2025 proposal includes a number of incentive programs to encourage early adoption and introduction of what the agencies termed “game-changing” advanced technologies, such as hybridization for pickup trucks.

The public will be able to comment on the proposal rulemaking for 60 days-- once it is published in the Federal Register. In addition, DOT and EPA said they plan to hold several public hearings around the country to enable further public input.

California plans to issue its proposal for model year 2017-2025 vehicle greenhouse gas standards on Dec. 7 and will finalize its standards in January. EPA Asst. Administrator Gina McCarthy noted during the media call that the agency is “confident that their [California’s] rules will align with ours and in the end we will have national standards [for MPG and GHG performance].”

In August, the two agencies announced tighter MPG/GHG rules for commercial vehicles that will begin to kick in with model year 2014.

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