A Primer on Fuel Economy Standards

Summary
A responsible energy policy must reduce our dependence on oil. American cars, SUVs and other light trucks now consume 8 million barrels of oil every day (mbd). Raising fuel economy standards for new cars, SUVs and other light trucks to an average of 40 miles per gallon (mpg) over the next 10 years will save nearly 2 mbd in 2012 and nearly 4 mbd by 2020 -- more oil per day than we import from the Persian Gulf and could extract from the Arctic National Wildlife Refuge, combined. This responsible step will save consumers billions of dollars at the gas pump and slash heat-trapping CO2 emissions that cause global warming.

History
In 1975 Congress passed and President Ford signed the law establishing Corporate Average Fuel Economy (CAFE) standards. CAFE standards set the minimum average fuel economy that a manufacturer’s fleet of cars must meet. Congress required cars to ramp up from 13.8 mpg to 27.5 mpg by the late 1980s. However, despite dramatic advances in technology, 25 years later that standard is still in place. Congress asked the Department of Transportation to set light truck fuel economy. Light truck standards inched up to 20.7 mpg, but have virtually stagnated for 20 years.

The Benefits of CAFE Standards

• Raising CAFE Standards will Improve our Energy Security:
  We import 53 percent of our oil. Our cars, SUVs, and other light trucks guzzle 40% of the oil used in the US every day. Raising CAFE standards for new cars, SUVs and other light trucks to 40 mpg is the biggest single step we can take to curb our oil dependence.
  
  The NAS fuel economy report concludes: “If fuel economy had not improved, gasoline consumption (and crude oil imports) would be about 2.8 million barrels per day higher than it is, or about 14 percent of today’s consumption.” U.S. oil imports rose 28 percent in the last decade. Unless Congress acts to increase fuel economy standards, oil imports will continue to grow. The Energy Information Administration (EIA) estimates that on the current trajectory, U.S. oil imports will rise to 64 percent by 2020.



• Raising CAFE Standards will Save Consumers Money
  CAFE standards already save consumers money at the gas pump. Because fuel economy for cars doubled between 1975 and the late 1980s, a new car purchaser saves thousands of dollars at the gas pump over the lifetime of the car. Now it is time for Detroit to pass on savings to SUV owners. Making the Ford Explorer go from 19 mpg to 34 mpg would cost $935 in technology, but would save the owner $790 each year on gas. Raising CAFE standards for new cars, SUVs and other light trucks to 40 mpg over the next 10 years will save consumers $16 billion annually by 2012.



• Raising CAFE Standards will Reduce Global Warming pollution
  Raising CAFE standards would reduce our global warming pollution. Carbon dioxide emissions from our cars and trucks add to the CO2 blanket around the earth, which prevents heat from leaving the atmosphere, causing global warming. America’s cars and and trucks alone emit more CO2 than all but four countries in the world -- the U.S. as a whole, China, Russia, and Japan. Each gallon of gasoline burned pumps 28 pounds of CO2 into the atmosphere, thus the more efficient the vehicle, the lower the CO2 emissions.

Related Documents:

A Primer on Fuel Economy Standards (PDF with footnotes): http://environet.policy.net/relatives/4221.pdf