Minimum Auto MPG Raised by Obama Administration

President Obama released new, tighter automobile fuel economy standards recently, marking the first increase in nearly 30 years. The new average fuel economy of passenger vehicles must now reach an average of 35.5 mpg by 2016, up from just over 25 mpg currently.

Here’s a breakdown of the mandated improvements:

• New passenger cars: Minimum 39 mpg by 2016, up from 27.5 mpg currently

• New light trucks: Minimum 30 mpg by 2016, up from about 23 mpg currently

The stricter standards will reduce passenger transportation emissions by about 30%. This huge reduction will save about 900 million metric tons of CO₂ emissions, said the administration. That’s like taking 194 coal plants offline! And since the transportation sector accounts for about 17% of our national carbon footprint, the new standards should result in a 5% reduction in our footprint overall. When you step back and look at the numbers, this may be the most significant policy every enacted to reduce the United States’ impact on climate change.

To provide a little background, this day was made possible by years of unrealized attempts to raise our minimum fuel economy. The new standards very closely mirror those California attempted to enact in 2005, which were blocked by the Bush-era EPA’s unwillingness to exempt the state from lower Clean Air Act standards. You also might remember an energy bill signed by Bush in December 2007 that called for corporate fleets to achieve a fuel economy of 35 mpg by 2020, a less stringent, less widespread, and less enforceable goal than Obama’s by all accounts.

Auto companies have reacted favorably to the new rules overall, because they provide the consistency of a federal standard as opposed to a hodgepodge of state standards. However, they will bear a cost on the order of $50 billion to upgrade their technology to meet the tougher requirements, as per a recent Department of Transportation study. This works out to about $1300 added, on average, to the cost of making each car and truck.

Despite this disincentive, the new standards elevate US fuel economy out of last place among industrialized countries, putting us near the level of China, Canada, and Australia by 2016, though still behind Europe and Japan.

Actual & Projected Fuel Economy for New Passenger Vehicles by Country, 2002-2018. Published before new US standards by the International Council on Clean Transportation, 2007.