Last December, President Bush signed a new energy bill into law that requires automakers to achieve a Corporate Average Fuel Economy standard of 35 mpg by 2020. This historic stiffening of CAFE standards set a lofty goal, but left plenty of time to get there and new standards of any kind won't begin until the 2011 model year. Today, which happens to be Earth Day, U.S. Transportation Secretary Mary E. Peters laid out the first set of new CAFE rules that will be implemented for passenger vehicles and light trucks from 2011 through 2015.

The first step on the path to 35 mpg by 2020 will be increases of 4.5% in CAFE standards for passenger vehicles and light trucks over the five-year period spanning 2011 and 2015. This means that standards for passenger vehicles will rise from the current 27.5 mpg to 35.7 mpg by 2015, while light trucks will go from 23.5 mpg to 28.6 mpg. The NHTSA claims the new interim standards will save 55 billion gallons of gasoline and reduce carbon dioxide emissions by 521 million metric tons. They also claim that drivers will save $100 billion in fuel costs over the lifetime of vehicles that fall under the rule.

We decided to reach out to the Big 3 automakers in the U.S. to ask for a comment, and both Ford and Chrysler are keeping mum until they've had a chance to read over the new rules. General Motors, meanwhile, already released a statement reiterating what it said last December, which is that it will meet the new standards despite how tough they are.

Automakers are also able to earn credits when they happen to exceed the CAFE standards, and can either bank those for a time when they won't meet them or even sell the credits to other automakers at a cost below what the fine would be for not meeting the standards. We've heard rumors, for instance, that Honda's sitting on a healthy pile of credits.

Now that we have an actual CAFE target for the auto industry to hit in the near term, expect to see a flurry of activity from automakers. Lithium-ion plug-in hybrids, series hybrids, diesels and all-electric cars will likely be the new technologies that help the industry meet these new interim CAFE standards by 2015, and the first change set for 2011 is not far away at all.

[Source: NHTSA]


PRESS RELEASE

Secretary Peters Proposes 25 Percent Increase in Fuel Efficiency Standards Over 5 Years for Passenger Vehicles, Light Trucks

Fuel efficiency standards for both passenger vehicles and light trucks would increase by 4.5 percent per year over the five-year period ending in 2015 – a 25 percent total improvement that exceeds the 3.3 percent baseline proposed by Congress last year – under an ambitious new proposal announced today by U.S. Transportation Secretary Mary E. Peters.

"This proposal is historically ambitious, yet achievable," Secretary Peters said. "It will help us all breathe a little easier by reducing tailpipe emissions, cutting fuel consumption and making driving a little more affordable."

For passenger cars, the proposal would increase fuel economy from the current 27.5 miles per gallon to 35.7 miles per gallon by 2015. For light trucks, the proposal calls for increases from 23.5 miles per gallon in 2010 to 28.6 miles per gallon in 2015.

All told, the proposal will save nearly 55 billion gallons of fuel and a reduction in carbon dioxide emissions estimated at 521 million metric tons. The plan will save America's drivers over $100 billion in fuel costs over the lifetime of the vehicles covered by the rule, Secretary Peters said.

As required by Congress, the proposed rule allows for automakers to earn credits for exceeding Corporate Average Fuel Economy, or CAFE, standards. This will serve as an incentive for companies to exceed these goals while giving manufacturers flexibility to meet the standards without compromising their economic vitality. The goal is to save fuel, not endanger jobs, Secretary Peters said.

"Looking at the fuel-efficient technologies already available, it's easy to see a not-too-distant future when cars fueled by something other than gasoline will be readily available and affordable," Secretary Peters said. "Until that time, however, we will continue to do what we can, safely and efficiently, to improve gas mileage and help consumers spend less time and less money at the pump."

Over the last six years, the Administration has twice made changes to the nation's CAFE standards, including the first since 1975 to increase mileage requirements for light trucks. Last year, President Bush called for an energy plan that goes even further by requiring attribute-based fuel efficiency standards for passenger vehicles. A copy of the CAFE proposal can be found at www.nhtsa.gov.