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Senate Passes Energy Bill; Compromise on CAFE

22 June 2007

Sa17921
The CAFE component of the Senate energy bill raises average fuel economy for new vehicles by 10 mpg in 10 years. Click to enlarge.

The Senate late last night passed the energy bill by a Yea-Nea vote of 65-27, including a compromise version (SA 1792) of CAFE legislation that increases new light-duty vehicle fleetwide fuel economy to an average 35 mpg by 2020, but that eliminates the mandatory 4% per year increase thereafter that had been part of the original proposal.

The bi-partisan compromise, which is more exacting than the Levin-Bond amendment supported by the auto industry (earlier post), was offered by Senators Ted Stevens (R-AK) and Thomas Carper (D-DE), and was endorsed by Senators Dianne Feinstein (D-CA), Olympia Snowe (R-ME), Daniel Inouye (D-HI), Byron Dorgan (D-ND), John Kerry (D-MA), Maria Cantwell (D-WA), Bill Nelson (D-FL), Barbara Boxer (D-CA), Amy Klobuchar (D-MN), and Larry Craig (R-ID).

Sa17922
Comparison of nominal  fuel consumption and greenhouse gas standards. Solid lines represent mandatory standards, dotted lines represent proposed standards. (Europe does not yet have mandatory limits.) Rendered as L/100 km. Different test cycles will produce different results on the same vehicle. This chart represents the averaged nominal standards for each country, but does not attempt to normalize them to a single standard. Click to enlarge.

Major provisions of the new “Ten-in-Ten” Act (10 mpg increase in fuel economy in 10 years) include:

  • Increases fleetwide average fuel economy for all cars, SUVs, and trucks up to 10,000 lbs in weight by 10 miles per gallon from model years 2011 to 2020—from 25 to 35 miles per gallon by model year 2020.

  • The rules will use attribute-based classes (such as size or weight) determined by the Department of Transportation’s National Highway and Transportation Safety Administration (NHTSA). Each class of vehicles—as determined by NHTSA—will be required to meet the new fuel economy standard for that particular class to achieve the fleetwide average of 35 miles per gallon by 2020. Each automaker will no longer be required to average the fuel economy for the entire fleet of cars they produce.

  • From 2011 to 2019, NHTSA must set fuel economy standards that are the maximum feasible, and ratchet these standards up to meet the 2020 target of 35 miles per gallon. In 2020, the total average must meet 35 miles per gallon, unless NHTSA determines that the achievement of the 35 miles per gallon standard would not be cost-effective for the nation. The bill defines “cost-effective” to mean that the value to the United States of reduced fuel use from a proposed fuel economy standard is greater than or equal to the cost to the United States of such standard. From 2021 to 2030, NHTSA must set fuel economy standards that are the maximum feasible, and ratchet these standards up at a reasonable rate.

  • Establishes a credit system and trading program for automakers run by NHTSA. Should an automaker exceed the standards it can sell its credits to another automaker, or bank the credits for up to 5 years. If an automaker cannot meet the standards in a given year, it can purchase credits, use banked credits, or borrow from projected surpluses from future years.

  • Establishes an “off-ramp”, or mechanism for alternative standards, for automakers (upon their application), if NHTSA determines that the prescribed standard is more stringent than the maximum feasible average fuel economy level that manufacturer can achieve.

  • Directs NHTSA to develop a structure to evaluate and establish fuel efficiency standards for commercial trucks that increase at the maximum feasible rate. Requires improvement in the fuel economy of medium and heavy duty trucks over a 20 year period. It also removes work truck weighing up to 10,000 pounds from the fuel efficiency standards for cars and light trucks.

  • Automakers that sell less than 0.4% of the cars sold in the United States would have their fuel economy standard set by NHTSA at the maximum feasible level outside of the regular car standard.  (Currently 0.4% of the cars sold in the US each year is approximately 60,000 cars).

  • Creates a consumer labelling program that also includes greenhouse gas emissions.

  • Requires the federal government to purchase the most fuel efficient cars practicable.

  • Uses money raised by fuel economy penalties to fund research into fuel-saving technologies and to expand the availability of alternative fuels. Calls for an advanced battery initiative and standards for biodiesel.

  • Requires NHTSA to issue a final rule by 2018 to create safety standards that address the differences between the largest and smallest vehicles.

The final version also removes the earlier provision that mandated that 50% of cars be flex-fuel in 2012, increasing to 80% in 2015. The new language calls for ensuring that 50% of vehicles sold in the US are alternative fuel vehicles by 2015—including but not limited to flex-fuel vehicles, hybrids, electric vehicles, fuel cells and others.

The action on fuel economy now moves to the House.

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June 22, 2007 in Fuel Efficiency, Policy | Permalink | Comments (27) | TrackBack (0)

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Comments

This has enough loopholes to drive a truck or an SUV through -- which is what will happen.

Wait till gas hits $5.00 per gallon US. It will make this
current legislation a great first step. Then the PHEV and
BEV's will bring in the new legislation.

I'm not surprised that they took out the 4% increase yearly, but I just wish they would have replaced it with at least a 1-2% increase.

That's a pathetic definition of "cost-effective", based on fuel costs alone, without any regard for emissions. As the Kyoto targets get more stringent, the emission cost per ton of CO2 will rise dramatically, and NHTSA can't take that into account according to this bill.

Furthermore, William, there's no guarantee at all that fuel costs will rise to $5/gallon: recall that they fell dramatically in the 1980s and 90s due to political forces, and there's no indication that reserves will fall enough to create a scarcity problem. Indeed, if you add oil sands, Canada can unleash enormous reserves, even at today's prices. Only a carbon tax is certain raise the effective fuel price.

brad, By 2020 it could well be irrelevant anyways. It seems that a lot will happen in the next 13 years.

tripp: Bingo. Anyone who reads GCC (or my site, to add a shameless plug) knows that there's a revolution coming in transportation well before 2020. BEV's and plug-in series hybrids will make 35 MPG look like a pathetic joke by the time 2020 rolls around.

The car companies played a stalling game for decades regarding the regulation of plain old gasoline engine (POGE) vehicles, and they "won". But look at the price they paid in terms of an industry that's struggling financially and is woefully behind the curve on some key technologies.

The rules of the game are changing, and the US car companies are in much worse shape than they should be right now to absorb, and even exploit, that change.

The credit systems looks like a perfect way to weasel out: just borrow credit from projections so they can make 25mpg cars and say that by 2020 they will have a 135mpg car and us that projection to clear any penalties.

Peak Oil is very likely to hit way before 2020 so oil shortage and extremely high prices will cause a market demand in fuel efficiency (and of course BEV and Biofuels) that will make this legislation look like cold s***.

Lou

Don't think US is any worse than others. PHEVs will be standard product by 2015 and as pointed out, 35mpg is nothing. Toyota has backed off their first Li HEVs creating an opening for competitors. GMs VOLT, if launched successfully could outsell all other GM cars in its history. Most manufacturers are going to minimally mild HV designs. Tesla, Lightning, ZAP, etc. are building first gen EVs and by 2020 they will be dominant higher end vehicles.

The bill provides support for a dynamic array of new energy technologies including geothermal, tidal, wind, solar, biomass and new batteries. Power plant design is next on the agenda and there are good prospects there. Even the much shouted about CAFE standard has finally risen? Miracle??

This Energy bill is nearly 180 degrees opposite the last one of only two years ago. Today's bill clearly shows the US a leader in the renewable energy revolution and that the biggest players are in the game. That's a pretty remarkable turnaround in a very short time. Texas will build world's largest wind farm apparently - who would have thought that...up?

Of course the doomers predict end-of-the-world in 2012, so all this could be moot.

I beg to differ. The current techology at hand could give us vehicles capable of giving us 40 MPG, but instead, we get 35 MPG by 2020?!

From what I've been reading on GCC, congress, as usual, is coming late to the party. New technology is exploding with or without them, so the best thing they can do is get the h*** out of the way.

It would be interesting if new legislation gave the current
car manufacturers a guarantee on federal fleet purchases. The
first company to ramp up to the 2020 CAFE standards would get
the majority of state and fedral contracts untill the next
manufacturer met the benchmark. Then those that would follow,
would get a proportional share of this market going forward.
I wonder how long it would take to get light duty vehicle
efficiency to a fleet average to 35mpg. Market incentives to
corner market share, while guaranteeing a future production
quota, for a set benchmark, are enticing indeed. Place a large
enough order for cars that aren't rolling off assembly lines,
and it will be interesting to see how fast those lines retool
and crank out the product that will save Uncle Sam on his
gas card every month. They call it a Win-Win scenario.

The end of the world will come, but why worry because some
Mayan got writers cramp, while pulling an all nighter, cranking
out calender dates.

Now they can say they've done something, even if it will turn out to be irrelevant. I'm hoping that this will help companies like Phoenix that require that extra help.

I believe that the world will end in 2079 because that's when the two word date field in my banking application runs out ;)

Some of you are truly oblivious. The new CAFE numbers mean absolutely nothing. The real CAFE figures will be set by CARB. Except as base, for the CARBite gentlemen to set even more impossibilist mileage requirements, under the guise of CO2 emissions.

Not that the CARBites have ever been rational. Lie the mandates fro electrics auto fleets by 1990. Lie the mandates ZEV vehicles by Fuel Cells by 2000. Why not another ridiculous pie-in-the-sky-fantasy ?

Sen Levin's attempt to specifically set aside the CARB CO2 requirements that are in abeyance for no more than another year got dropped from the Democrat kludge.

The REAL mileage requirement set by CARB is over 47 MPG for the entire fleet from shanks mare to 18 wheel Peterbuilts. It may actually be worse as Rail locomotives nor ocean going ships in territorial California water seem exempt, so they also come into the calculation? It appears they do.

That what the asinine CARBites have set, and eleven other dodo states have dutifully subscribed to do as well. That is what 34% across the board lower CO2 emission by 2012 requires, over and above any CAFE rating than active.

It will be really ironic when the Science that has been emerging in the last 5 years, will have relegated CO2 to no more than a tiny 10% or less of the warming experienced during the last 150 years until the peak recorded in 1998.

By 21012 the cyclically declining Solar output should have the temperature dropping outright as global temperatures did from 1940 to 1976 despite rising CO2 levels that may prove not to be anthropogenic generated anyhow, but merely the oceans slowing their massive CO2 absorption.

The oh so trendy types, will be warning again about the "Big Chill" arguing we must fight the global climate change. How?

Maybe by putting MORE CO2, a harmless and biologically necessary trace gas into the atmosphere, of course.

PS ...have you noted the subtle shift in the argument by the enviro-wackos. Now it is no longer "Global Warming" but "Climate Change" (Up and tomorrow Down) that must be fought. With them in charge or getting rentier profits naturally.

Then yay for CARB. They might actually save the US auto industry from itself. It's nice to know that someone is actually pushing the status quo. Much of the EV tech we have now came from the push in the 90s. Just think where we would be if they'd kept pushing.

neilpackrat,

All the EV progress came in spite of all the cgovernment pushing, forcing and distorting the R&D expenditures. It came from good old ingenuity and skull sweat on the part of Toyota engineers, and the inspired thinking of the good doctor at UCD.

Not a bit of it came from all the federal and California jackass mandates, that forced the auto makers to waste billions, to attempt to and fail to produce miracles on a impossible schedule.

How far advanced wiould we be if that R & D money had been more rationally and approriately been spent?

Who says the government has to force the pace of technology, ohter than setting a direction? They merely have to set a policy direction and then let the technology flow.

I fully expect that the LDV fleet wil be electrified and have no problem meeting the CAFE mandates and exceeding them. I'm not sure a 18 wheel Peterbuilt towing a triple rig, is ever going to average 47 MPG and I have no idea what the mileage rating of a 7500 HP deisel-electric locmotive gets, towing a one mile train. Nor do I have any idea what a two hundred thousand ton supertsnker or cargo container vessel gets for mileage.

I recall that on tour with the Queen Mary in Long beach they mentioned that she got on average of 2-4 inches per gallon of fuel. Lots of improvemnent to be made in a few years to get to 47 MPG...

sweet, we'll have the same fuel economy averages in 2020 as the rest of the world has today!

main thing that worries me here is this:
«If an automaker cannot meet the standards in a given year, it can purchase credits, use banked credits, or borrow from projected surpluses from future years»
who determines these "projected surpluses" and how?

Stan: For the millionth time quit exaggerating. They didn't waste billions. They didn't even spend billions except on lawyers. They did build the EV1 which contains technology and experience that will go into the Volt.

This method of reducing our dependence on foreign oil has failed. The actual fleet average has been decreasing from 1986 under this approach. This is same old, same old silly vaporware.

So long as the public allows the political class to continue to shovel sand against the tide, this sort of tommy-rot up with we must put.

Stan - "It will be really ironic when the Science that has been emerging in the last 5 years, will have relegated CO2 to no more than a tiny 10% or less of the warming experienced during the last 150 years until the peak recorded in 1998.

By 21012 the cyclically declining Solar output should have the temperature dropping outright as global temperatures did from 1940 to 1976 despite rising CO2 levels that may prove not to be anthropogenic generated anyhow, but merely the oceans slowing their massive CO2 absorption. "

No even close unless you are thinking of the incorrect 'science' contained in the Global Warming Swindle. For the correct science read AR4. You have not even got the cycling solar output right. The sun has increased slightly from early this century however has not increased enough to account for recent warming. Any downturn is likely to be swamped by the very strong AGW forcing.

My 1990 Geo Metro got 50 mpg.
The 2008 Toyota Prius gets 45 mpg.
The 2009 Honda Accord diesel will get about 45mpg.

What's the big woo about 35mpg? BFD!

Will automakers receive the same flex-fuel credit that they currently receive?

If I am not mistaken, automakers receive a credit that they can count against their CAFE # for every car released with a flex-fuel engine. SUV's with 13 mpg containing flex-fuel engines, etc., exploit the loophole.

It only costs $200-300 extra to make an engine "flex-fuel", so I wouldn't be surprised if every automaker offers flex-fuel engines in ALL models in 5-10 years in order to shirk the 35 mpg standard... Flex-fuel engines are basically standard in all new Brazilian cars, so it wouldn't be that hard to replicate that in the U.S.

Ender,

Sorry but you can certainly chose to believe the counter arguments, as you wish.

However, the IPCC itself, DOES NOT.

The IPCC in TAR IV just out, allocates up to up to 15% of global warming to Solar Radiation increases as pure radiative corrections.

They ALSO say the convective effects of increased Solar radiation is not known well enough to account for... yet. So they didn't, and assigned the balance to the CO2, for all the rest. Of course, save that 15%, that they awarded to increased solar output by the direct radiation mechanism, for the time being, acknowledging increased solar variability, and increased output must have an effect.

So CO2 is reduced from 100% of the "problem" now to 85% of a smaller "problem" at most, while acknowledging a lot more will be reduced NEXT time. The IPCC in TAR III said the sun's increase could account for as much as 85% of the warming observed in theory; but they did not know how to allocate it ...then.

The IPCC, hardly a "denier", did promise that when the Science is clearer, they NEXT IPCC (TAR V) due long before 2012, will include the reassignment of warming contributions to the appropriate mechanism. It will include the contribution due to solar warming because of convective effects; and the contribution from the also reduction of the cloud cover through the mechanism of reduced cloud nucleation by Cosmic Ray particles.

This effect is mediated by deflection from the enlarged Solar wind due to the increased Solar output.

The CERN Experiments will be producing results by early next year to calibrate the reduced cloud formation effect, and allow Science to better understand that mechanism, when taken into the laboratory.

Confirming reduced cloud cover will in turn increase the radiative contribution by a small amount, as well, since the present assignment assumed no cloud cover change due to this hypothesized effect.

Despite the alarmist counter-arguments, the Science will be clear and established by then. CO2 increase will be relegated to a largely non-causative but corollary effect of the Warming created by the Sun's periodic variability, except for a tiny effect.

Experiments to measure the Ocean isotopic solubility preference, for certain isotopic CO2 will be better understood.

The Sun's "meteorological" operation will also be much better understood. The Science is building from essentially nothing, in 2003 and increasing rapidly. From essentially nothing at the turn of the century, the new solar orbiting satellites, are changing Solar meteorology by leaps and bounds. From what we newly know, by then, the Solar out put should be dropping if the recent Science proves correct predictive. The astrophysicists have detected "underground rivers" of flowing plasma that occasionally erupt to the Solar surface and create Sun spots and magnetic storms.

I certainly agree that some residual small effect will remain from anthropogenic CO2 increase, but hardly a major problem except on the scale of continued use at increasing intensity, for several Millenia. Despite alarmism, the world was warming at the rate of just less than a degree per century, and would not really be a problem for a couple hundred years. Now we will understand CO2 is not the driving mechanism and responsible for only 10-15% of the "problem". So a couple centuries of CO2 warming becomes a couple Millenia of a one tenth as large "problem", if all else were equal. Of course it's s not. The Solar output dwarfs the tiny anthropomorphic CO2 contribution.

When mankind had nothing to do with 85% of a self-created and barely measurable "problem", it won't matter as much when the problem is only 15% as large a concern as then imagined.

Other Science will also contribute to relieving the "problem". Clarification of the increase in plant fertility and its effects will be more apparent. A side effect is that the North American forests have grown at and unprecedented rate, recently due to increased atmospheric CO2 fertility. There is almost 1/3 more volume of wood in NA, than there was as short as thirty years ago. that is a lot of sequestered Carbon.

Elsewhere, the other continents have not been measured. It may turn out that Man's contribution to the CO2 atmospheric inventory, has already been substantially sequestered. So the rise in atmospheric CO2 may be much more a natural phenomenon due to the ocean's solubility.

Dr. Janikowski's research on selective solubility of CO2 in ice-cores is calling into question the entire creditability of the assertion of historically stable atmospheric CO2.

Other non ice-core atmospheric analogues indicate that the atmospheric CO2 has varied much more over the last two thousand years then was thought. Rather than being stable at 280 PPM through the Medieval Warm Period and the little Ice Age, the atmospheric CO2 may have varied from 270 to at least 335 PPM, naturally.

In effect, Dr Janikowski says that ice dissolves CO2 at a very low rate but not zero. Therefore the air entrapped in ice-cores of over a few hundred years old arrives at a solubility limit of about 280 PPM. It makes sense when you think about it. Ice IS water, and water dissolves some CO2.

Half of the increased CO2 may turn out to be not mankind's contribution or fault at all.

Mankind just won't be burning fossil for Millenia to come at the present or growing intensity. We don't want to continue to use expensive, primitive technology; and we couldn't if we wanted to do so. There is just not enough fossil or manufactured fossil analogues available even if Man wanted to do so.

Man will choose the cheaper, more inexpensive methods to move himself and his goods. Thee Electrification of Ground Transport will collapse petroleum demand, in due course.

Having ridden the "global warming" manufactured threat to gain political power, version 2.0 addresses the coming doom of "climate change." Thus when the CO2 starts falling due to reduced solar output, the party of the left will be ready for "Ice Age Two."

Air polution is a real problem, but help is on the way, hybrid drives, and non-fossil fuel sources of power.

sweet, we'll have the same fuel economy averages in 2020 as the rest of the world has today!
Just got back from Europe and $6/gal gas. Damn, they got a lot of nifty cars there!!

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