US Proposes 18% Fuel Economy Increase for New Vehicle Fleet from 2027 through 2032 Public Comment DEADLINE: October 16, 2023

July 31, 2023

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by Tom Krisher (Associated Press) The U.S. government wants to raise the fuel economy of new vehicles 18% by the 2032 model year so the fleet would average about 43.5 miles per gallon in real world driving.

The proposed numbers were released Friday by the National Highway Traffic Safety Administration, which eventually will adopt final mileage requirements.

Currently the fleet of new vehicles must average 36.75 mpg by 2026 under corporate average fuel economy standards adopted by the administration of President Joe Biden, who reversed a rollback made by former President Donald Trump.

The highway safety agency says it will try to line up its regulations so they match the Environmental Protection Agency’s reductions in greenhouse gas emissions. But if there are discrepancies, automakers likely will have to follow the most stringent regulation.

In the byzantine world of government regulation, both agencies essentially are responsible for setting fuel economy requirements since the fastest way to reduce greenhouse emissions is to burn less gasoline.

“I want to make clear that EPA and NHTSA will coordinate to optimize the effectiveness of both agency standards while minimizing compliance costs,” NHTSA Acting Administrator Ann Carlson said.

A large auto industry trade group which includes General Motors, Toyota, Ford, Stellantis and others said requirements from the agencies should be lined up. “If an automaker complies with EPA’s yet-to-be-finalized greenhouse gas emissions rules, they shouldn’t be at risk of violating CAFE rules (from NHTSA) and subject to civil penalties,” John Bozzella, CEO of the Alliance for Automotive Innovation, said in a statement.

However the alliance has said the EPA’s proposed cut in carbon emissions will require a huge increase in electric vehicle sales that’s not attainable by 2032. The EPA says the industry can reach the greenhouse gas emissions goals if 67% of new vehicles sold in 2032 are electric. Currently, EVs make up about 7% of new vehicle sales.

NHTSA said its proposal includes a 2% annual improvement in fuel mileage for passenger cars, and a 4% increase for light trucks. It’s proposing a 10% improvement per year for commercial pickup trucks and work vans. Automakers can meet the requirements with a mix of electric vehicles, gas-electric hybrids and efficiency improvements in gas and diesel vehicles.

The agency says the new regulations will save more than $50 billion on fuel over the vehicles’ lifetimes and save more than 88 billion gallons of gasoline through 2050 if NHTSA’s preferred alternative is adopted. The standards would cut new-vehicle fuel consumption nearly in half by the 2035 model year, and benefits will exceed costs by $18 billion, the agency said.

NHTSA will take comments from the public for 60 days before drafting a final regulation. READ MORE

Corporate Average Fuel Economy Standards for Passenger Cars and Light Trucks for Model Years 2027-2032 and Fuel Efficiency Standards for Heavy-Duty Pickup Trucks and Vans for Model Years 2030-2035 (Federal Register)

USDOT Proposes Updated Fuel Economy Standards to Strengthen Energy Security, Save Americans Hundreds of Dollars at the Gas Pump (National Highway Traffic Safety Administration)

Rural States, Groups Tell EPA of Emissions Proposal Concerns: State Departments of Transportation Say Rush to EVs Would Contribute to Shortfall in Highway Fund (Transport Topics)

Biden admin to hike fuel economy standards (E&E News)

Biden administration proposes 58 mpg fuel economy standard to help drive transition to EVs (Utility Dive)

NHTSA Aims for 43.5 mpg across New Vehicles by 2032 (Green Car Reports)

Biden-Harris Administration Announces New Clean Car Standards for Fuel Economy (Sierra Club)

Biden administration proposes to ratchet up fuel efficiency standards for passenger cars (The Hill)

Making the Most of Your Miles: Stronger Fuel Economy Standards (Environmental Law and Policy Center)

Excerpt from National Highway Traffid Safety Administration: Proposal kicks off public comment period and engagement with stakeholders on how to make cars and light trucks more fuel efficient, with the average light-duty vehicle estimated to reach 58 miles per gallon by 2032

The U.S. Department of Transportation’s National Highway Traffic Safety Administration today (July28, 2023) issued a proposal to update fuel economy standards for passenger cars and light trucks. A 60-day public comment period will begin after the proposal is published in the Federal Register.

NHTSA will engage with a broad set of stakeholders during this period, including consumers, unions, automakers, states, environmental groups and others. The proposal would also drive fuel efficiency improvements for heavy-duty pickup trucks and work vans.

If finalized as proposed, the updated standards would save Americans hundreds of dollars at the pump, all while making America more energy secure and less reliant on foreign oil. NHTSA estimates that the combined benefits of its proposal exceed costs by more than $18 billion.

“Better vehicle fuel efficiency means more money in Americans’ pockets and stronger energy security for the entire nation,” U.S. Transportation Secretary Pete Buttigieg said.

NHTSA’s proposed fuel economy standards complement and align with the Environmental Protection Agency’s recently proposed emissions standards for similar vehicle fleets. NHTSA will coordinate with the EPA to optimize the effectiveness of its standards while minimizing compliance costs, consistent with applicable statutory factors. With the release of today’s proposal, NHTSA invites comments from all stakeholders on how this goal can be achieved.

The proposed rule sets targets that are consistent with Congress’ direction to conserve fuel and promote American energy independence and American auto manufacturing, while providing flexibility to industry on how to achieve those targets. Though NHTSA does not take electric and other alternative fuels into account in setting the standards, manufacturers may use all available technologies – including advanced internal combustion engines, hybrid technologies and electric vehicles – for compliance.

The new proposal also supports the Biden-Harris Administration’s commitment to cutting costs for Americans and reducing harmful greenhouse gas emissions and air pollution in communities near freeways and other heavily trafficked roads, which are disproportionately low-income communities of color. Since the lowest-income households spend nearly 20% of income on transportation fuels, which is three times the average U.S. household, this proposal is consistent with the Administration’s commitment to advancing environmental justice.

“CAFE standards have driven the auto industry to innovate in improving fuel economy in ways that benefit our nation and all Americans,” NHTSA Acting Administrator Ann Carlson said. “The new standards we’re proposing today would advance our energy security, reduce harmful emissions, and save families and business owners money at the pump. That’s good news for everyone.”

As one of the range of options on which the agency is taking public comment, the preferred alternative in NHTSA’s proposal includes a 2% per year improvement in fuel efficiency for passenger cars, and a 4% per year improvement for light trucks, beginning in model year 2027 and ramping up through model year 2032, potentially reaching an average fleet fuel economy of 58 miles per gallon by 2032.

It also includes a 10% improvement per year for commercial pickup trucks and work vans (with gross vehicle weight ratings of more than 8,500 pounds and less than 14,001 pounds) beginning in model year 2030 and ramping up through model year 2035.

If finalized as proposed, this alternative would:

Save consumers more than $50 billion on fuel over the vehicles’ lifetimes.
Reduce our dependence on oil by saving more than 88 billion gallons of gasoline through 2050.
Prevent more than 900 million tons of CO2 emissions – the equivalent of taking more than 233 million vehicles off the road from 2022 through 2050.

The proposal also models a range of additional alternatives. NHTSA requests comment on the full range of standards from the no-action alternative to the most stringent alternative modeled, including comment on combinations of standards that may not be explicitly identified in the proposal.

You can read the proposal here. For more information, please see NHTSA’s Corporate Average Fuel Economy page. READ MORE

Excerpt from Transport Topics: State transportation planners, rural farmers and electric utilities are joining a chorus of stakeholders expressing concern about the potential consumer and business costs associated with a federal proposal aimed at expanding use of electric vehicles and curtailing the prevalence of internal combustion engines.

The departments of transportation for Idaho, Montana, North Dakota, South Dakota and Wyoming in a letter to Environmental Protection Agency Administrator Michael Regan said the agency’s proposed Emissions Standards for Model Years 2027 and Later Light-Duty and Medium-Duty Vehicles rule, which aims to propel a shift from diesel- and gasoline-powered vehicles to EVs, would drastically affect revenue flowing into the Highway Trust Fund — which is derived from federal taxes on gas and diesel. They note that EVs contribute nothing to the fund, yet still exacerbate wear and tear on roads. The loss of this revenue for road maintenance, they argue, would negatively affect access to essential services, such as schools, employment, food, health services and more.

The states further noted that EV usage is much less common in their states compared with others. “EVs are not well-suited for all of our nation’s climates, especially in states that are rural, are at high altitude, or both,” their letter said. “In such areas, long-distance travel in often extreme temperature ranges significantly impact EV range.” READ MORE

Excerpt from Federal Register: NHTSA, on behalf of the Department of Transportation (DOT), is proposing new fuel economy standards for passenger cars and light trucks and fuel efficiency standards for model years (MYs) 2027–31 that increase at a rate of 2 percent per year for passenger cars and 4 percent per year for light trucks, and new fuel efficiency standards for heavy-duty pickup trucks and vans (HDPUVs) for MYs 2030–2035 that increase at a rate of 10 percent per year. NHTSA is also setting forth proposed augural standards for MY 2032 passenger cars and light trucks, that would increase at 2 percent and 4 percent year over year, respectively, as compared to the prior year's standards. NHTSA currently projects that the proposed standards would require an industry fleet-wide average for passenger cars and light trucks of roughly 58 miles per gallon (mpg) in MY 2032 and an industry fleet-wide average for HDPUVs of roughly 2.6 gallons per 100 miles in MY 2038. NHTSA further projects that the proposed standards would reduce average fuel outlays over the lifetimes of passenger cars and light trucks by $1,043 and of HDPUVs by $439. These proposed standards are directly responsive to the agency's statutory mandate to improve energy conservation and reduce the nation's energy dependence on foreign sources.

DATES:

Comments: Comments are requested on or before October 16, 2023. See the SUPPLEMENTARY INFORMATION section on “Public Participation,” below, for more information about written comments.

Public Hearings: NHTSA will hold one virtual public hearing during the public comment period. The agency will announce the specific date and web address for the hearing in a supplemental Federal Register notice. The agency will accept oral and written comments on the rulemaking documents and will also accept comments on the Draft Environmental Impact Statement (DEIS) at this hearing. The hearing will start at 9 a.m. Eastern time and continue until everyone has had a chance to speak. See the SUPPLEMENTARY INFORMATION section on “Public Participation,” below, for more information about the public hearing. READ MORE