Driving to the CAFÉ: Congress Considers Fuel Efficiency Standards

What kind of car do you drive? How much does it cost to fill up the tank? How far do you have to drive to get to work? Do you consider miles per gallon when buying a car? Do you think car manufacturers should make more fuel efficient vehicles?

With gas prices soaring and scientists confirming that the atmosphere is indeed growing warmer, fuel efficiency has become a hot election topic.

The Bush administration has asked Congress to allow the Transportation Department to revise fuel economy standards. But that doesn’t necessarily mean all cars and trucks would be more efficient. It could mean a more flexible system in which corporate average fuel economy (CAFE) standards are traded among car companies.

What are CAFE standards?

In response to the 1973-74 oil crisis, Congress enacted the 1975 Energy Policy Conservation Act (EPCA), which established CAFE standards for passenger cars and light trucks.

CAFE requires any vehicle that is manufactured for sale in the United States and weighing 8,500 pounds or less to meet an average fuel economy rating of 27.5 miles per gallon. Average rating means that a manufacturer’s entire fleet of cars must come to an average 27.5 mpg.

If a manufacturer does not meet this standard, it is liable for a penalty of $5 for every 0.1 mpg that falls below it, multiplied by the total number of vehicles it produces. This penalty can amount to hundreds of millions of dollars.

Many SUVs and minivans have a lower fuel-economy standard because they are considered light trucks, even though they are mainly used as passenger vehicles. And larger trucks and SUVs like the Hummer H2, the Ford Excursion, and the Chevrolet Suburban used to have no fuel economy standards at all. Now, each automaker's fleet of light trucks--pickups, vans and SUVs--must average 21.6 m.p.g. That will rise to 22.2 m.p.g. in 2007 and 24 m.p.g. in 2011.

Since SUVs and large trucks have become enormously popular over the last decade, the fuel economy average for all vehicles has actually dropped about 6% since 1988.

The National Highway Traffic Safety Administration (NHTSA) is responsible for establishing and amending the CAFE standards, but Congress has the power to step in and demand changes.

Industry v. Environment

Automakers complain that higher CAFE standards would cost them too much. Instead of incorporating new and expensive fuel-efficiency technologies, manufacturers say that they would build lighter cars and trucks, which get better gas mileage but are less safe.

A 2002 report by the National Academy of Sciences explains that increased traffic fatalities are an unintended cost of raising CAFE standards. In addition, the strain of stricter requirements on the auto industry can lead to loss of jobs and slower economic growth. In European countries gasoline is much more expensive and trains and subways are much more modern and efficient. Europeans wonder why Americans spend their transportation money on highways that use up so much scarce fossil fuel. Of course, European countries are small and we are a continent wide - with many citizens living far away from mass transit.

While considering the environment, our representatives must evaluate tradeoffs like safety and the economy when debating CAFE standards.

Debating CAFE standards

Congress has varying philosophies of fuel efficiency standards. Some Republicans and most Democrats feel that the legislature should regulate fuel economy; they like the idea of setting CAFE at 33 miles per gallon or more.

Most Republicans and Michigan Democrats (who represent the auto industry) believe that Congress should not set a specific CAFE number; they fear a higher number would make U.S. manufacturers less competitive with foreign companies who tend to build smaller, more efficient cars. They say that this could lead to U.S. job losses and possible safety problems, since lighter cars tend to sustain more damage in traffic accidents.

The Bush administration prefers a proposal that would allow car companies to purchase fuel-efficiency credits from each other, which they say would create fair competition for manufacturers who build trucks and SUVs. Others say it is a bad idea to start allowing Japan to sell credits to Detroit. It doesn’t encourage innovation in fuel efficiency but creates a strange dependence on foreign auto manufacturers, they say.

Still others believe that concentrating on CAFE standards is misguided. They say that government should work on fuel alternatives instead. Even with higher efficiency standards, the U.S. remains dependent on foreign oil. More than 60 percent of oil used in the U.S. comes from overseas.

What do you think?

What is our individual responsibility for fuel efficiency versus our collective responsibility? Should government consider building better public transportation networks in places that don’t have them? What do you think the CAFE standards should be? Or should government primarily focus on alternative energy?

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Article Posted on: 5/13/2006