CAFE Alternative May Be Pushed By Auto Companies
As we reported () on May 19, there is an alternative proposal to the potential new CAFE standards bill. That new CAFE standards bill is currently on its way to a vote in the Senate in the very near future.
The alternative proposal is being championed by Carl Levin, the senior senator from Michigan, and, as you might reasonably expect, an auto-industry advocate. Among the Levin proposal’s draft provisions are increases in average car fuel economy to 36 mpg by 2022 and increases in average truck fuel economy to 30 mpg by 2025. The Alliance of Automotive Manufacturers, an industry group that includes Toyota, the Big 3, and five other auto manufacturers, is considering getting behind the Levin proposal in an attempt to substitute the requirements of the Levin proposal for the stated terms of the new CAFE bill.
The new CAFE bill requires a fleet-wide average (both cars and trucks) of 35 mpg by 2020, and subsequent improvements of 4% a year thereafter until 2030. Just the mandate for calendar year 2020 means a whopping 40% increase in fuel efficiency from the current blended average will be required, since the average mpg for cars is currently 27.5 mpg and the average mpg for trucks is 22.2 mpg.
And that just satisfies the 2020 requirement. The annual 4% improvements required each year from the 2020 level until calendar year 2030 are the CAFE equivalent of compound interest being added to your credit card balance every month. It is impossible to achieve with current gasoline engine technology unless the federal government is also prepared to require a large percentage of consumers to purchase very small vehicles. If the federal government is not going to require citizens to buy a certain kind and size of car, then the standards in the new CAFE bill can only be met by technologies like plug-in hybrids, hydrogen-gas hybrid or all-hydrogen/all-electric vehicles.
There are “off-ramps” in the current bill that would allow the government to suspend the mpg requirements if the requirements are found to be too expensive or technologically unfeasible, but environmental advocates are working like mad behind the scenes to close those loopholes before the vote, since a suspension is viewed as a likely occurrence if the loophole exists. Another off-ramp is the one we commented on in the May 19 article, which allows a complete exemption from CAFE requirements from now until 2020 to any automaker that promises that all of their vehicles will be powered by alternative energy by 2020.
Auto industry executives view the increases in fuel mileage requirements mandated in the new CAFE bill as onerous, untenable and wildly unrealistic. Lawmakers, however, are in a take-no-prisoners mood regarding both fuel economy and greenhouse gas emissions from automobiles and are not likely to go along with any attempts by the auto industry or their ever-decreasing friends in the House and the Senate to just make the bill go away. Hence the consideration of the substitute measure from Sen. Levin.