Fuel Efficiency Standards Should be Modernized to Expand the Use of Advanced Fuels, Promote Driverless Technologies, and Strengthen U.S. Energy Security
In 2012, the U.S. National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA) together finalized a rulemaking establishing fuel efficiency standards for cars and light-duty trucks for model years 2017 through 2025. The 2012 rulemaking required that the agencies conduct a mid-term evaluation of the standards. The previous administration found the augural standards appropriate and issued the Final Determination in January 2017. After the new administration decided to reconsider the Final Determination, the agencies found that the previous standards were not appropriate. The proposed rule now begins the rulemaking process for new standards, which would maintain the standards from MY 2020 for MY 2021-2026.
SAFE has prepared a comprehensive response to the agencies, as part of their comment and feedback process. In these comments, SAFE states the opportunity to modernize the fuel efficiency standards while advancing the administration’s energy dominance agenda has never been greater. SAFE believes this goal can be achieved while meeting the needs of consumers, the automotive industry, and the nation. The SAFE response also adds:
Improved light-duty fuel efficiency has been critically important in lowering the oil intensity of the economy, which in turn strengthens U.S. economic and national security by insulating businesses and consumers from oil price volatility.
According to the agencies’ calculations, the cost to the U.S. of defending the global oil supply is zero. Failure to accurately assess the true military cost of protecting the global oil supply underestimates the value of the benefits. At minimum, approximately $81 billion per year is spent by the U.S. military protecting global oil supplies. The implicit subsidy for all petroleum consumers is approximately $11.25 per barrel of crude oil, or $0.28 per gallon.
Although the nation is undoubtedly more energy secure than it was before the revolution in U.S. shale oil 10 years ago, the United States’ dependence on oil continues to present significant economic and national security risks.
SAFE understands the agencies have expressed safety concerns regarding vehicle lightweighting, but existing research supports the finding that mass reduction can be safely integrated into the current vehicle fleet mix. The agencies’ own analysis confirms that mass changes will only bring about a small impact on the overall fatality rate.
SAFE disagrees that the standards have meaningfully contributed to higher vehicle prices and believes that existing data shows that fuel efficiency standards: do not contribute to higher vehicle prices; have not negatively impacted new vehicle sales; and are not keeping consumers in older, dirtier, and less safe vehicles.
The agencies propose a range of significant changes to the off-cycle technology program, including ending or sunsetting all off-cycle flexibilities. Any elimination, or phase-out, of the off-cycle technology adjustments would threaten to deter or delay investment in connected and automated vehicle technologies and runs counter to the goals of this rulemaking.
In addition, SAFE makes the following recommendations to the agencies:
SAFE believes the agencies should include the true military cost of protecting the global oil supply in their benefit-cost analysis.
We encourage the agencies to select an alternative that increases the stringency of the program by at least 2 percent per year.
Rather than focus on mass changes, SAFE urges the agencies to instead incentivize the introduction of advanced driver assistance technologies (ADAS) to reduce overall crash frequencies and fatalities.
The agencies should retain the off-cycle technology program, while considering a number of potential improvements tailored to accommodate truly innovative technologies.
SAFE believes that the agencies should seize this opportunity to enable greater long-term reductions in oil demand by continuing to incentivize advanced fuel vehicles such as those that operate on electricity, hydrogen, and natural gas.