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Bush’s Flex-Fuel Farce Will Not Improve Fuel Economy Standards

March 26, 2007

Bush’s Flex-Fuel Farce Will Not Improve Fuel Economy Standards

Alternative Fuel Not Widely Available to Consumers and Does Not Work Properly in Some Flex-Fuel Vehicles

WASHINGTON, D.C. – President Bush’s support of Flexible-Fuel Vehicles (FFV) as a way to curb the nation’s addiction to oil will have the net effect of lowering the overall fuel efficiency of the fleet, according to Public Citizen. Bush touted the vehicles today while meeting with the chief executives of Ford Motor Co., General Motors Corp. and Chrysler Group and inspected a number of FFVs on the White House lawn.

FFVs are supposed to operate on ethanol-based fuel in addition to gasoline. Under a loophole in the Corporate Average Fuel Economy (CAFE) program administered by the National Highway Traffic Safety Administration (NHTSA), manufacturers are allotted up to 0.9 mpg in CAFE credits for FFVs. This reduces the fuel economy their fleets must achieve under an assumption that these vehicles use gasoline 50 percent of the time and E-85 (a blend of 85 percent ethanol and 15 percent gasoline) the other 50 percent. Using this loophole, Ford saved itself as much as $135 million in fines it would have received for model years 2003 to 2005 for not meeting the actual fuel economy standards. In reality, Ford and other automakers are cheating the system because E-85 is not widely available, and some vehicles designated as FFVs do not operate properly with the fuel.

Fuel economy standards for passenger cars have remained stagnant since the early 1980s. The scarce availability of E-85 around the country makes it unlikely that FFVs will help change that. According to government data updated March 22, 2007, of the 5,494 alternative fueling stations in the United States, only 1,094 provide E-85. Eleven states have no E-85 fueling stations, and 22 states have only 10 or fewer.

“The automobile industry is aware of this discrepancy but markets and sells many flex-fuel vehicles in states where there are few or no E-85 fueling stations available to the public,” said Joan Claybrook, president of Public Citizen and the first administrator of NHTSA to issue CAFE standards. “Automakers fool consumers into thinking they are helping the environment and lessening our dependency on foreign oil, while they manipulate the CAFE credit loophole, avoid meeting federal fuel economy standards and laugh their way to the bank.”

In October 2006, Public Citizen and a Nebraska corn farmer filed a complaint with NHTSA asserting that two of Ford’s FFV models do not qualify for credits against the agency’s CAFE standards because the vehicles do not properly run on E-85. The complaint demanded the federal government take action against Ford’s misleading claims, which have allowed the automaker to avoid stiff penalties for not meeting federal fuel economy standards.

Between model years 2003 and 2005, Ford received CAFE credits it did not earn for approximately 228,000 Taurus and Mercury Sable FFVs, despite receiving numerous complaints from customers that these models were unable to operate properly on E-85. Ford was unable to fix the operational defect for the Taurus FFVs over the three model years.

Public Citizen has long warned NHTSA that the FFV loophole provides a disincentive for automakers to improve fuel economy and lowers the average fuel economy of the overall vehicle fleet. For example, Ford was credited in 2003 with achieving 43 miles per gallon (mpg) for more than 90,000 of its FFV vehicles, even though their performance is 26 mpg, less than the federal minimum standard of 27.5 mpg for passenger cars, according to a 2005 report by the Union of Concerned Scientists.

“If Bush were to try to drive one of those flex-fuel vehicles off the White House lawn, it’s unsure whether it would even make it outside the gate running on ethanol,” said Robert Shull, Public Citizen’s deputy director of auto safety and regulatory policy. “And once he was on the road, he would find no public gas stations in the District with E-85 to fuel up.”

The Bush administration has starved NHTSA for funds to develop and enforce effective fuel economy standards, allotting less than $2 million each year – one tenth of a percent of the amount of GM’s losses last year.

For the Department of Energy’s (DOE) list of the number and location of alternative fuel stations, click here.

For the DOE’s interactive locater map, click here.