Senate Republican Energy Bill will Lead to Greater Dependence on Imported Oil and Higher Prices at the Gas Pump

On March 25, the Senate Energy & Natural Resource Committee Republicans released their draft energy bill with a provision on fuel efficiency in cars and light trucks. Unfortunately, instead of increasing fuel efficiency their plan increases dependence on foreign oil and makes it harder to increase efficiency. The Republican provision could even potentially prevent or delay the meager 1.5 mpg increase the Bush Administration proposed last year for light trucks to meet by 2007. This sends the wrong signal given the current instability in the Middle East and rising gas prices at home.

Among other things, the Senate Republican energy plan would do the following:

1. Increase U.S. dependence on foreign oil by extending the ability of automakers to inflate their fuel economy ratings by selling vehicles that are capable of running on ethanol, but in fact run on gasoline 99 percent of the time, according to the Department of Transportation. This provision could completely nullify the oil savings this decade from the very small increase in the light truck fuel economy standard proposed by the Department of Transportation last year.



2. Place additional hurdles for the Department of Transportation to meet before it can set new fuel economy standards, such as considering the effects of fuel economy increases on vehicle and passenger safety as well as effects on U.S. employment. These requirements are proposed in spite of the fact that Congress had already directed the National Academy of Sciences to study the effects of fuel economy standards on vehicle safety and U.S. employment. The NAS report found no evidence that fuel economy regulations have suppressed U.S. employment. To the contrary, NAS found that improved fuel economy has reduced dependence on imported oil and improved the nation’s terms of trade. Also, while the NAS panel could not agree on whether fuel economy increases effect vehicle safety, it did agree that measures could easily be taken to minimize or reverse any potential adverse safety effects.



3. Require an entirely new, and largely redundant, National Environmental Policy Act (NEPA) review by multiple regulatory agencies before any new fuel economy increase could take effect. The Republican bill would formalize the requirement for an analysis of any new fuel economy rules under the National Environmental Policy Act (NEPA). Federal law already requires that the U.S. Department of Transportation take into account technological feasibility, economic practicability, the effect of other government regulations, and energy conservation, when setting fuel economy standards. A NEPA study would require a second analysis of many of these factors. NEPA is an important tool for protecting our nation’s natural resources. However, many Senate Republicans have opposed NEPA and sought to weaken it (in fact, Republicans formed a NEPA streamlining committee to eliminate redundant and inefficient use of NEPA). Their invocation of NEPA in this context, therefore, appears to be a cynical attempt to further complicate and delay the process of setting new fuel economy standards.

Related Documents:

Senate Republican Energy Bill will Lead to Greater Dependence on Imported Oil and Higher Prices at the Gas Pump (PDF with footnotes): http://environet.policy.net/relatives/4220.pdf