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Thursday, April 01, 2010

DOT/EPA Set Fuel Economy & GHG Emission Standards

The U.S. Department of Transportation (DOT) and the U.S. Environmental Protection Agency (EPA) today jointly established historic new federal rules that set the first-ever national greenhouse gas emissions standards and will significantly increase the fuel economy of all new passenger cars and light trucks sold in the United States. The rules could potentially save the average buyer of a 2016 model year car $3,000 over the life of the vehicle and, nationally, will conserve about 1.8 billion barrels of oil and reduce nearly a billion tons of greenhouse gas emissions over the lives of the vehicles covered.

The collaboration of federal agencies allows for clearer rules for all automakers, instead of three standards (DOT, EPA, and a state standard). Today’s final rules, issued by DOT’s National Highway Traffic Safety Administration (NHTSA) and EPA, establish increasingly stringent fuel economy standards under NHTSA’s Corporate Average Fuel Economy program and greenhouse gas emission standards under the Clean Air Act for 2012 through 2016 model-year vehicles.

Starting with 2012 model year vehicles, the rules together require automakers to improve fleet-wide fuel economy and reduce fleet-wide greenhouse gas emissions by approximately five percent every year. NHTSA has established fuel economy standards that strengthen each year reaching an estimated 34.1 mpg for the combined industry-wide fleet for model year 2016. Because credits for air-conditioning improvements can be used to meet the EPA standards, but not the NHTSA standards, the EPA standards require that by the 2016 model-year, manufacturers must achieve a combined average vehicle emission level of 250 grams of carbon dioxide per mile. The EPA standard would be equivalent to 35.5 miles per gallon if all reductions came from fuel economy improvements.

Specifically, the new National Program:

· Reduces carbon dioxide emissions by about 960 million metric tons over the lifetime of the vehicles regulated, equivalent to taking 50 million cars and light trucks off the road in 2030.

· Conserves about 1.8 billion barrels of oil over the lifetime of the vehicles regulated.

· Enables the average car buyer of a 2016 model year vehicle to enjoy a net savings of $3,000 over the lifetime of the vehicle, as upfront technology costs are offset by lower fuel costs.
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