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CalSTEP Action Plan For California’s Transportation Energy Efficiency

The California Secure Transportation Energy Partnership (CalSTEP) has unveiled an action plan to achieve the state’s overall goals of reducing petroleum use by 15% and increasing alternative fuel use to 20% by 2020. CalSTEP is a diverse partnership of industry, government, academic and non-profit leaders, representing a diverse range of stakeholders, from automakers to conservation groups. (Earlier post.)

The multi-year Action Plan targets three key areas: increasing vehicular efficiency; diversifying the state’s fuel supply; and reducing the overall need to drive.

Without a change in policy, California fuel demand is currently projected to be 23 billion gasoline gallon equivalents (BGGE) for all on-road vehicles in 2020. In order to meet the 15% petroleum reduction goal established by the Air Resources Board and the California Energy Commission, the state needs to reduce that use by 7.6 BGGE to 15.4 BGGE, 15% below 2003 levels, by 2020. The CalSTEP actions can achieve these goals if all actions or their equivalent are taken by reducing 2.9 BGGE through greater fuel diversity; 1.8 BGGE through reducing the need to drive; and 2.9 BGGE from greater vehicle efficiency.

Two underlying tenets of CalSTEP’s Action Plan are:

  1. No single action is sufficient to address the state’s challenges in transportation energy; and

  2. The state can take meaningful action independent of the federal government to buffer itself from the ill effects of excess petroleum consumption.

CalSTEP’s recommended actions build on the economic strengths of the state. These actions are not the only approaches possible, but they define where action is needed and some of the best steps to take. We would also welcome other approaches that can engage with industry to achieve the results needed.

—Reginald R. Modlin, Director of Environmental Affairs at DaimlerChrysler

CalSTEP recommends actions in three primary and seven supporting areas. The three primary actions account for the bulk of the benefits in terms of reducing petroleum use and cutting global warming emissions. The supporting actions help achieve the goals, support state industry to create solutions and opportunities, and provide additional economic benefits. The primary actions include:

  • Alternative Fuel Portfolio Standard (AFPS)—a market-based approach for increasing alternative fuel use through fuel blending, dedicated use, and/or credit trading. Goals would be 10% alternative fuels by 2012 and 20% by 2020. (This is comparable to the Low Carbon Fuel Standard recently ordered by Governor Schwarzenegger. Earlier post.)

    To facilitate implementation, the AFPS would direct the California Energy Commission (CEC) to design and implement a credit trading program that allows obligated parties to comply with the AFPS standard through the purchase of tradable credits if they cannot or do not wish to blend or sell alternative fuels.

  • Smart Communities—a program to spark more transportation energy efficient community design and development that sets goals for reducing vehicle miles traveled (VMT) by 10% by 2020 in California’s urban regions and rewards communities who achieve who this goal.

  • Energy Security Tax Relief and Realignment (ESTRR) – a program to help protect Californians and investors against foreign oil price volatility and gaming that would use a revenue-neutral foreign oil security fee coupled with a rebate to all taxpayers to encourage the long-term production of and investment in efficient vehicle technologies.

The seven key supporting actions include:

  • California Alternative Fuels Infrastructure Partnership to expand alternative fueling stations and vehicles.

  • California Renewable Fuel Production Initiative to expand California’s ability to produce preferred fuels and to capitalize on their growing consumption.

  • State Fleet Leadership Challenge to fund and commit the state’s fleets to setting the standard for the use of efficient vehicles and alternative fuels.

  • New Transportation Future and Revolving Loan programs to spur the development and deployment of more efficient vehicles, technologies, and fuels.

  • Energy-Independent Vehicle Labeling Program to send simple, clear signals to consumers about which vehicles meet the highest efficiency targets.

  • Neighborhood Planning Revolving Loan and Transit Use Assistance programs to help communities plan for transportation energy efficiency.

  • Usage-Based “Pay As You Drive” Insurance to enable insurers to offer rewards to motorists who choose to drive less.




Too little. Too late.


Never to late to start (with the possible exception of urban planning which is already screwed up), but do these guys have any pull or money to actually get something done, or is this more hot air.

An Engineer

Too little. Too late.
There just is no pleasing some people, is there? A 15% reduction below 2003 levels is HUGE. The state is also undertaking a broad-ranging approach, making sure (or at least trying to) that advances in one area isn't offset somewhere else.

As I said before, CA is lightyears ahaead of the all-ethanol-all-the-time party in Washington, D.C.

Kit P

This not a plan, this is political posturing. Why wait till 2012 or 2020 when 2007 is do able? So one can explain to me why imported LNG or ethanol is better (rhetorical question unless you have a recent LCA). Not than I am against LNG or ethanol, I just think smaller mandates are all that are needed.


2007 is not doable. We currently produce very little alternative fuels in this state. We don't even produce much natural gas, for that matter. While we are an oil producer, we still get the bulk of our oil from imports just like the rest of the country.

Once cellulosic and algae technologies gain a foothold and producion is growing at a good clip, it'll work. Unfortunately it's looking like 2008 before that will even start.


Of course we couldn't take the obvious steps like a 55 mph speed limit, and steep fuel mileage based increases in the vehicle license tax.


Lots of ways to skin these cats and the obvious place to start is fuel conservation. But, how do you even get your feet moving out of the blocks when Detroit keeps trying to selling muscle power, low 0 to 60 times and "Road Tanks;" and, the tax code continues to favor writing off three ton SUVs? All this is in direct opposition to the idea of saving fuel.

These must be reversed before Mr. Average Joe will ever think about a lighter, less powerful vehicle.



Don't forget that Mr. Average Joe is also a voter, and politicians are loathe to do anything to hurt their chances of re-election.

Frankly, I think Tesla's approach is the best one. Show that alternative energy can be exciting and sporty. Show that it means an increase in your quality of life instead of a hair-shirt sacrifice.



I like what Tesla is doing and enjoy the idea of a fast launch sports car. I read recently where they are investing in the development of a sedan..all good stuff!..something for the sports driver as well as the family. Trouble is these vehicle won't make it to production fast enough in sufficient numbers to solve the oil supply problem. A whole lot of research and prototyping is being accomplished but not much is making it to production. The problem will persist and the only way we have to make a difference now is by conservation until these new efficient autos make it into production.


The major challenges of the next 50 years will be Global Warming and ‘Peak Oil’, and personal transportation will be profoundly affected by both. The long development time and usage period of cars mean that the total lifecycle(from start of design concept to the end of the cars life) is 25-30 years. This timeframe helps stress the urgency of change in transportation policy now, and the need for national leadership!

America’s addiction to oil consumes 20-21 Million Barrels of Oil Per Day (mbpd), we produce around 8mbpd, and import the rest. Oil radically worsens our balance of trade and increases our geopolitical risk. The US currently uses 25-30% of global consumption and produces 30% of global CO2, but has less than 5% of the world’s population.

A new Transportation Energy Policy must be evolutionary, reasonable, broadly supportable, realistic and compatible with free society, otherwise it wont be implemented. The policy should focus on; improving the efficiency of the internal combustion engine; adopting energy recovery systems (hybrid, regenerative braking etc); adopting more efficient energy sources (pluggable hybrids); getting the population involved at an operational level in fuel economy and switching to Bio-fuels, particularly Bio-diesel (because of its 60-70% higher energy density than ethanol).

Specific Steps should include:
1. Significantly revamp Corporate Average Fuel Economy (CAFE) standards to drive improvements in fuel efficiency, raising standards by 10-12% every second year for at least the next 15 years. This will bring the US in line with global average fuel economy, and radically reduce CO2 production from the transport sector.
2. Legislate to require average fuel consumption (MPG) in all advertising, like the health warning in tobacco advertising.
3. Legislate to require fuel consumption instrumentation in the dashboard allowing drivers to understand, in real time, how their driving style affects fuel economy.
4. Define an allowance and taxation system based on fuel consumption at vehicle purchase and during annual registration/licensing. Taxes and allowances should help offset the incremental costs of designing and building better fuel economy.
5. Revenues from taxation should fund research, development and adoption of fuel economy improvements in the chemical, biological and industrial engineering fields.
6. Support the Bio-diesel industry, facilitating fast infrastructure permitting and making Bio-diesel and Bio-diesel blends available nation-wide.
7. Align Global (US, Japanese and European) emissions standards to allow a global auto market, this will allow more fuel efficient autos, and more efficiency focused manufacturers into the US market.

The initial efficiency steps are achievable, because the required technologies are already being used by the global auto companies in other parts of the world (try and find a diesel Dodge Calibur that does 37mpg in the US).

Probably the most challenging hurdle to change is “leadership”. These changes require the highest level of buy-in and endorsement by government and industry. From the adoption of Hybrid cars we can see that the public willingness for change is there. It is the President and Congress’ role to encourage the nation to accept our new reality, and to energize the nation to meet the challenges that we must face. The future wealth and health of our nation is dependent on this leadership, let us hope that those that we elect to govern our country have the wisdom to take action rather than abdicate their responsibilities.


Interesting, that Mr. Kehughes plan looks way more realistic and effective than California one. Compare, for example, “…Energy Policy must be evolutionary, reasonable, broadly supportable, realistic and compatible with free society…” and “…use a revenue-neutral foreign oil security fee…”, for California alone.

Couple of technical comments, thought.

US population is 5% of global, and US produces over 25% of CO2 emissions, but US also accounts for more than 20% of global economy. Anyone in US want to reduce personal consumption to average world level?

In 2006 US used 25% of corn harvest to replace about 1.6% of oil by ethanol. Domestic biodiesel has even less potential, because US climate does not allow growing of oil crops with anyhow comparable yield of tropical palm oil, for example. Even with anticipated development of third generation biofuels, their share in oil consumption realistically could be no more than 10% - in 20 years.

Aside for smaller fuel tank, more energy dense then ethanol biodiesel has no energy advantages.

10-12% increase in CAFÉ effectively means only one thing: smaller cars with weaker engines, as it is the case in most of the world. Further 10-12% reduction in fuel consumption every two years is not technically possible.

If US would align in the past their emission standards to the rest of the world, there would be no emission standards at all. US “invented” emission standards, and the rest of the world develops and aligns their with 5-10 years delay. Currently US and Japanese emission standards are effectively same (which means no diesel cars in Japan, before new generation of clean diesel will kick in), and Europe reluctantly is moving to same standards in proposed Euro5, which hopefully will be operational in 7-8 years.

As for diesel Dodge Caliber, I doubt we will see it in US any time, same with diesel passenger vehicles. Current generation of lean burn direct injection gasoline engines with lean NOx adsorbers have almost same fuel efficiency as diesel engine, but is cheaper and cleaner. Conventional hybrids are already way more efficient then diesel cars. No need to repeat grave European mistake with diesel cars proliferation. Note: I am talking about passenger cars. Light and heavy duty vehicles will benefit a lot from clean diesel engines.


kehughes wrote: It is the President and Congress’ role to encourage the nation to accept our new reality

Well then we are in trouble, aren't we? The president makes his own reality. Congress goes along to get along.


Nothing on expanding public transit, especially railways? That's where the long term gains are...the individual automobile is already dead in the water and throwing different fuels at it won't work.

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