EPA holds hearing for fuel economy

By Alisa Priddle

Detroit Free Press

Published: Tuesday, Jan. 17 2012 7:10 p.m. MST

DETROIT — The U.S. Environmental Protection Agency and National Highway Traffic Safety Administration held a public hearing in Detroit on Tuesday on new fuel economy and greenhouse gas emissions standards.

The new corporate average fuel economy, or CAFE, standards would require automakers to achieve a fleet average of 54.5 mpg or 163 grams/mile of carbon dioxide with vehicle models from 2017 to 2025.

On Tuesday, U.S. Rep. John Dingell, D-Mich., said he is "strongly in favor" of a single, viable fuel economy regulation after years of fighting similar measures he felt were not easily understood.

The proposed standards would be geared to the size of the vehicle to allow carmakers to continue to make all sizes and shapes. Each company's fleet-wide standard would reflect the mix of their vehicles.

The standards would apply to cars, light-duty trucks and medium-duty passenger vehicles and allow automakers to build a single fleet of vehicles that meet federal standards as well as those of California, said Margo Oge, director of the Office of Transportation and Air Quality.

Hybrids and electric vehicles enjoy a multiplier effect so that they count as more than one vehicle. Compressed natural gas vehicles will be weighted based on how much alternative fuel they actually use.

"These are the automotive jobs of the future," said Bob King, president of the United Auto Workers.

King said about 150,000 UAW members make vehicles and parts in the industry covered by the proposed rules.

The union chief applauded the 20,000 jobs automakers have pledged to protect and add in the next four years -- some of them in-sourced from other countries.

"This is a testament to good government," he said during the hearing.

The hearing is part of a comment period on the proposed standards that was to end Jan. 30 but has been extended to Feb. 13.

The new rules have received letters of support from the state of California, 13 automakers and the UAW. Daimler and Volkswagen do not support the standards, saying they do not provide sufficient credit for diesels, a technology they have invested heavily in.

The Center for Automotive Research in Ann Arbor, Mich., has called the targets unreasonable.

Mike Robinson, head of environment, energy and safety policy for GM, said he would rather not wait six years to see whether technology under development today is successful and cost effective. But GM will go through the 1,000-page proposal and pick out technical corrections.

Dealers are concerned about the timing and cost. Don Chalmers, a Ford dealer with the National Automobile Dealers Association, said he thinks the cost has been "considerably underestimated."

"If consumers don't buy enough of these products, we all lose," Chalmers said.

Mitch Bainwol, president of the Alliance of Automobile Manufacturers, said he is concerned that future consumer purchasing patterns are a big unknown. He called for a mid-term review to evaluate the situation.

King said the only other pushback he envisions is from big oil companies but he thinks public pressure will ensure their support.

The government claims continuing the 2025 standards will result in a savings of 4 billion barrels of oil and 2 billion metric tons of emissions over the lifetime of the vehicles sold in the 2017-2025 model years.

The technology would cost consumers an extra $2,000 per vehicle, on average, on a 2025 model, government agencies say, but could save $6,600 in fuel costs.

The Center for Automotive Research, in a report issued in June, disputes the figures and notes the cost must be considered in conjunction with the expense of also meeting safety standards. That combination could hike prices on vehicles by as much as 40 percent, causing a subsequent drop in sales.

The Environmental Defense Fund said the proposal would save an estimated $8,200 over the lifetime of a new vehicle for a national tally of $1.7 trillion in fuel savings by 2025.

Automakers continue to improve the fuel economy of their vehicles.

In December, light vehicles achieved 22.2 mpg compared with 21.7 a year earlier, according to TrueCar.com, an online auto data website.

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