The Senate Commerce Committee today reported out a fuel economy bill that fails to demand real improvements in fuel efficiency.
The vehicle for the markup was S. 357, the Feinstein “Ten in Ten” bill, although the language of the underlying bill was superceded by thirteen amendments, the primary one being a major substitute amendment by Sens. Inouye and Stevens.
Drawbacks of the package passed by the committee include the following:
- Fails to demand any significant improvement by any date certain. Currently, the truck fleet achieves an average fuel economy of 21.8 mpg, and the car fleet reaches 30 mpg. Today’s bill sets a target of merely 35 mpg thirteen years hence, which is 5 mpg less than the Senate was poised to require within ten years ago, in 1990. It is also much lower than what manufacturers could easily achieve with the wide variety of technologies available to them. Additionally, the bill gives the government excuses not to reach the “target” – if the target or a mandatory increase is not “cost-effective” – so that it’s not even a mandatory target at all.
- Concedes to the Bush administration’s demand for power to restructure CAFE. The bill also allows the government to set standards based on a vehicle’s "footprint," which means that larger vehicles can comply with lower fuel economy levels than smaller ones.
- Fails to close the dual fuel loophole. Although the primary substitute amendment originally would have eliminated the flex fuel credit, which gives automakers .8 mpg credit against their CAFE requirements, a second-degree amendment by Sen. Carper excised that language from the final package that passed the committee.
- Turns a public interest law into a cost-benefit law. The current law is a classic public interest statute which calls for NHTSA to set the maximum feasible standard, which means that it is supposed to consider the public interest (such as reducing our dependence on foreign oil and saving consumers at the gas pump) as paramount, while taking a look at anticipated costs just to make sure that it reaches the highest standard that doesn’t bankrupt the entire industry. In fact, the maximum feasibility language was a major achievement in the passage of the original fuel economy law.
This bill turns the existing law on its head. Now, the administration will be able to set standards based on industry-biased cost-benefit analysis, a notoriously flawed tool that pits wildly overestimated cost estimates against benefit numbers that are diminished by practices (such as discounting and monetization) that are built into the very rules of the cost-benefit game. White House regulatory czar Susan Dudley, like John Graham before her, will undoubtedly ensure that no significant fuel economy gain will ever be considered “cost effective.”
The bill was also sent to the committee with some positive aspects:
- Addresses incompatibility. The bill will be sent to the floor with a provision requiring that SUVs and light trucks be compatible with cars in a collision.
- Consumer information. It also will give consumers information to help them buy the most fuel-efficient vehicles.
- Funding NHTSA’s CAFE program. Finally, the bill gives $25 million (up from a paltry $1.7 million in 2007) to conduct thorough fact-finding investigations to ensure that the standards are set based on the best available evidence about manufacturer capacity and technological developments to achieve the maximum feasible fuel economy.