New Fuel Plan Could Save Average Car Owner More than $3,000 in Fuel Costs during Life of Vehicle

Building on a vision laid out in May by President Obama, the U.S. Department of Transportation (DOT) and U.S. Environmental Protection Agency (EPA) announced details on September 15 of a proposed joint rule establishing a national program for greatly improved fuel economy and reduced greenhouse gases. Their proposal presents coordinated national fuel efficiency and emissions standards for passenger cars and light trucks, with the goal of saving 1.8 billion barrels of oil and reducing greenhouse gas emissions by nearly 950 million metric tons. For vehicles in model year 2016, the proposed rules would save the average car buyer more than $3,000 in fuel costs over the life of the vehicle.

The plan covers model years 2012 through 2016 for light-duty vehicles sold in the United States, requiring a 5% increase in fuel economy each year to reach a target of 35.5 miles per gallon (mpg) for the overall light-duty vehicle fleet by 2016. Those improved fuel efficiencies would fall under the Corporate Average Fuel Economy Standards (CAFE) program, which is run by DOT’s National Highway Traffic Safety Administration (NHTSA). The proposal also would mark the first-ever national emissions standards under EPA’s greenhouse gas program, with vehicles required to meet an estimated combined average emission level of 250 grams of carbon dioxide per mile. The proposed standards vary with the size of the vehicles to achieve the targeted average values for the U.S. fleet as a whole. The EPA is proposing to provide extra credits for flex-fuel and alternative fuel vehicles, advanced technology vehicles, and vehicles with improved air conditioning systems and other greenhouse gas reduction technologies. The EPA also proposes to place a cap on nitrous oxide and methane emissions from vehicles, to help limit their greenhouse gas emissions.

President Obama unveiled the new policy on May 19 as a result of a collaboration of the federal government with 10 major automakers, the United Auto Workers, leaders in the environmental community, and officials from California and other states. The NHTSA and EPA are providing a 60-day comment period that begins with publication of the proposal in the Federal Register, which had not yet happened as of Tuesday, September 22.