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Loopholes Could Sap Potency of Obama Fuel Deal, Policy Experts Say

Concerns center around the formula used to reach the 54.5 mpg standard, the leniency granted to big trucks and how emissions for EVs will be counted

Aug 3, 2011
President Barack Obama

WASHINGTON—Half-starved conservationists have been thrown so few crumbs by the Obama administration that it's tempting for some to praise the bread bits tossed their way as the most scrumptious they have ever feasted upon.

Take fuel economy standards, for instance.

When the president announced a Friday pact with 13 automakers that would force cars and light trucks to achieve 54.5 miles per gallon by 2025, hallelujahs were emitted nationwide. It is being praised as a historic, job-creating, dollar-saving, air-cleansing, carbon-curbing savior.

The new round of standards, which covers model years 2017 through 2025, is heralded as a pathway for raising fuel economy 75 percent above 2010 levels. It has the potential to save more oil — 1.5 million barrels per day — than this nation now imports from Saudi Arabia and Iraq combined.

All of that red, white and blue pageantry, however, dwarfed the caution flags raised by transportation policy experts. Among those adding a hue of yellow to the conversation is think tank specialist Therese Langer, who saw plenty of space for loopholes when she lifted up the hood to examine the agreement.

"Don't get me wrong, I also think this is a big deal," Langer told SolveClimate News. "Getting to that level of 54.5 miles per gallon is an impressive achievement."

But Langer, transportation program director at the American Council for an Energy-Efficient Economy, also sees some shortcomings in the way the proposal is being ironed out.

One, she fears the auto industry will try to water down regulations during the built-in "mid-course review." And, two, she is afraid the deal doesn't maximize the potential of advanced vehicle technology and includes provisions that could undermine economic and environmental benefits. Her specific concerns center around the formula used to reach the much-ballyhooed 54.5 mpg standard, the leniency granted to big trucks, and how emissions from electric vehicles will be counted.

"The essence of it is that manufacturers have an ingrained aversion to regulation, even when it is going to help them out" in the long run, Langer said. "If they can introduce some level of uncertainty, they will do it. Then it becomes a question regulators have to ask themselves: Are we jeopardizing an industry that is just getting back on its feet in difficult economic times?"

Miles Per Gallon: Is 54.5 a Mere 36?

The 2017-2025 agreement expands on the 2012 to 2016 pact reached under the mandate of the Clean Air Act and the Energy Independence and Security Act of 2007. The miles-per-gallon standard is slated to reach 34.1 by 2016. It stands at 28.3 this year.

But these fuel efficiency formulas are incredibly complex and the final numbers are confusing to the public because they aren't what they appear to be on the surface. That has been the frustrating case for decades.

For instance, auto manufacturers are allowed to take credit for upgrading their vehicles' air conditioning systems so they don't leak or use harmful refrigerants. Do that math, Langer said, and 54.5 mpg tapers off to 50 mpg.

There's also what's known as the "real world correction factor," which knocks that 50 mpg down another 20 to 30 percent. The difference varies by vehicle and occurs because standards are based on laboratory testing, while the sticker attached to the vehicle window factors in adjustments for actual road performance.

So, clunk, that 50 mpg figure then drops to somewhere between a less exhilarating 36 mpg and 40 mpg.

Kateri Callahan, president of the nonprofit Alliance to Save Energy, says the testing procedures used for measuring fuel economy standards are outdated leftovers from an era of the 1970s when the national speed limit was 55 mph and cars weren't technologically advanced.   

"The full economic, national security and social benefits of the standards cannot be realized until the government updates the woefully out-of-date testing procedures," Callahan said.

Some green organizations lobbied the Obama administration for a fuel standard as high as 62 mpg, which Langer said could be achieved through modest vehicle weight reductions and the increased use of non-hybrid plugins.

"There's still a lot to be gotten out of the internal combustion engine and a lot more to wring out of conventional technologies," Langer said. "If the role of the rule is to maximize reductions in greenhouse gas emissions and fuel consumption, then this was an opportunity to do it."

Possible Off-Ramp for Industry

The fine print in the new agreement is especially important, Langer and others emphasized, because the mid-course review lets players such as EPA, NHTSA, the California Air Resources Board and industry representatives revisit the rule to determine if revisions are necessary beginning in 2022.

"This basically allows for reconsideration of the target," Langer said. "It makes us nervous that industry will look at this as an off-ramp, saying that the standards are too tough to meet through 2025. They could claim it's already a hazardous situation for them and they're being asked to do more."

The Alliance of Automobile Manufacturers, a trade association representing many of the carmakers involved in the agreement, referred SolveClimate News to individual manufacturers for comment on the pact.

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