Contents:

1. Summary
2. Fuel Economy
3. Global Warming Pollution and Automobiles
4. Cool Fuels
5. California Clean Car Discount (AKA "Feebates")
6. California Zero Emission Vehicles Program

Summary

Despite persistent industry and political pressure, UCS activists continue to push for strong fuel economy and low carbon fuel standards, as well as tougher vehicle pollution regulations. Last year’s fuel economy success recently came under threat when the Bush administration attempted to undermine the effectiveness of the new law. The administration also backed automaker allies as Environmental Protection Agency Administrator Stephen Johnson blocked state authority to regulate global warming pollution from cars.

Fuel Economy

Last year's landmark energy bill directed the National Highway Traffic Safety Administration (NHTSA) to set fuel economy standards requiring consistent progress toward a 35 miles-per-gallon (mpg) minimum fleet average for new cars and trucks by 2020. On April 22, NHTSA came out with its first stage—a proposed rule covering model years 2011 through 2015. This new proposal would significantly boost fuel economy for the first three years, but then require only meager improvements for the remaining two, setting a pace that could undermine efforts to reach the 35 mpg by 2020 goal.

Going over the proposed rule, UCS vehicle analysts have found several flawed assumptions that undermine potential gains in fuel economy. The proposal includes projected gas prices of $2.36 per gallon in 2020, a number that makes little sense compared with today's $3.51 per gallon. When predicting the future costs for heat-trapping emissions, the proposal cites a meager $7 per ton value on global warming pollution compared with the current $40 per ton on European markets. In addition, the Bush administration's plan doesn't put enough credence in the reality that automakers can already reach today's standard using existing technology, despite automaker claims to the contrary.

In contrast, a new UCS report Setting the Standard: How Cost Effective Technology Can Increase Vehicle Fuel Economy noted that NHTSA's regulations could lay the groundwork for a new vehicle fleetwide average of more than 50 mpg by 2030. According to the UCS report, NHTSA could set cost-effective standards nearing 40 mpg by 2020, a target achievable even without hybrid technology. If a modest 25 percent of the vehicle market includes hybrids in 2020, the United States could achieve a fleet average fuel economy of 42 mpg, while increased sales of fuel-efficient hybrids could lift the average even higher.

Much as UCS activists played a key role in the congressional debate over fuel economy, sending in nearly 100,000 letters during the course of the debate, they will now have a chance to weigh in on NHTSA's proposal. The April 22 proposal began a 60-day public comment period, and the proposal could be substantially rewritten before it is finalized. While the auto industry continues to pressure the administration to weaken the rule, UCS analysts and activists will counter with strong pressure to ensure that the vehicles of tomorrow are truly a part of our energy and environmental solution. We'll be looking to our activists for help in the weeks to come.

Global Warming Pollution and Automobiles

Unfortunately, the administration used the NHTSA fuel economy proposal to again try to trample states' rights to reduce global warming pollution from cars. This is despite decisions from the Supreme Court and two separate district courts that clearly indicate that the court considers fuel economy standards, meant to protect U.S. energy security, and global warming pollution standards, meant to protect the health and wellbeing of the U.S. public, to be distinct standards. The California clean car standards to limit global warming pollution from cars, already adopted by a dozen other states, are significantly stronger than the fuel economy standards being proposed by NHTSA. They would achieve a 30 percent greater reduction in global warming pollution for model year 2015, according to UCS analysis. NHTSA used deeply flawed legal arguments limiting states' rights to protect their citizens through the clean car standards. UCS maintains it is inappropriate for NHTSA to go beyond its authority, challenge the court decisions, and parrot the auto industry's discredited legal arguments.

Unfortunately, EPA Administrator Stephen Johnson is standing steadfastly by his decision to refuse the waiver that states need to implement these groundbreaking standards. But the states have not stood idly by. On January 2, Illinois joined California and 17 other states (Arizona, Connecticut, Delaware, Florida, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, and Washington) on a lawsuit to compel the EPA to grant the waiver. This includes four states that, like Illinois, have yet to commit to the clean car standards (Arizona, Delaware, Iowa, and Minnesota).

Illinois and Minnesota have gone a step further, and are making strides toward adopting the clean car standards in their legislatures. Having passed through relevant house committees in both states, both bills appear targeted for an initial vote in May, with movement to the state senates shortly thereafter. UCS activists have sent thousands of letters to house members in both states, and UCS analysts continue to work with state organizations to rebut the flawed, but persistent automaker arguments.

In addition, UCS has been keeping the pressure on Administrator Johnson to ensure that federal agencies do not further attempt to undermine state authority. In February, UCS activists went directly to the Environmental Protection Agency's (EPA) "Flow of the River" blog and voiced their feelings over Administrator Johnson's rejection of the waiver states need to implement the clean car standards. The results were extraordinary. More than 700 people took the time to make heartfelt and eloquent comments about the need for sound science to guide EPA policy making, and the contribution our vehicles must make to solve global warming. (As a comparison, the blog averages about a dozen comments per post.) The message came in so clear that the effort was covered by US News & World Report, and Marcus Peacock, deputy administrator of the EPA and author of "Flow of the River," actually posted a response on the UCS HybridBlog. This endeavor was not just seen by the media, but truly heard by decision makers. Our efforts continued the drumbeat of public dissatisfaction, augmenting the ongoing stories about the depth of dissatisfaction EPA staff have for Administrator Johnson's ill-advised decision. UCS also worked with Free Range Graphics and our coalition partners at SaveOurEnvironment.org to create a new online video and community action alert to bolster state efforts toward protecting and expanding the clean car standards nationwide.

UCS will continue to use its combination of science-based analysis and effective citizen action to continue the momentum toward cleaner cars in the Midwest and around the country.

Cool Fuels

The UCS "Smart Bioenergy" initiative continued in anticipation of the EPA's rulemaking on the Renewable Fuel Standard (RFS), passed in last year's energy bill. The 2007 RFS breaks new ground because it counts the carbon content in fuels, and, if interpreted correctly, would make carbon count throughout the lifecycle of the fuel. To qualify as renewable fuels under the 2007 RFS, fuels from new facilities must reduce global warming pollution by at least 20 percent as measured on a lifecycle basis. This means counting all the direct and indirect global warming pollution associated with growing, producing, distributing, and using the fuels. 

If all the fuels covered by the RFS meet these requirements, the global warming pollution avoided will be about 100 million metric tons of CO2 a year by 2022. According to UCS projections, this would reduce global warming pollution from light vehicle fuels by about 6 percent in 2022, if global warming pollution from those fuels not covered by the RFS stays constant. Unfortunately, ethanol plants that were under construction when the bill was signed in to law are exempt from meeting the global warming pollution reductions, which could be as much as 12 billion gallons of corn ethanol.

If forests are cleared and converted to farmland to grow biofuels, however, the emissions from clearing the forest can greatly outweigh the annual emissions reductions from the biofuels. To make the RFS work as it must, it's essential to take into account both the direct land changes and the "indirect" land use, stemming from increased biofuels crops leading to increased land use elsewhere for food crops.

The way to guarantee reductions in the global warming pollution from our transportation fuels is a standard that applies to all fuels, not just a small subset like the RFS. UCS will continue to track the EPA's progress on the RFS, but also intensify our efforts on the more comprehensive Low Carbon Fuel Standard that is currently attached as part of Senators Joe Lieberman's (I-VT) and John Warner's (R-VA) America's Climate Security Act.

California Clean Car Discount (AKA "Feebates")

In January, the California State Legislature chose not to take action on the California Clean Car Discount bill to reduce global warming pollution from cars and trucks. The bill was written by UCS experts and supported by a coalition of more than 90 health, religious, environmental, business, and civic organizations. The bill would have established a system of fees and rebates (known as ‘feebates') on the sales of new cars and trucks based on the vehicles' emissions of global warming pollution. UCS experts estimate that such a program could save consumers thousands of dollars while wiping out over 75 million tons of global warming pollution per year by 2030. This would be equivalent to taking almost 20 million vehicles off the road. Although legislative action on the Clean Car Discount bill has slowed for the moment, UCS is working to ensure that a feebates program becomes part of the official list of preferred global warming policies to meet the state's new requirement to reduce its global warming pollution nearly 30 percent by 2020. Our efforts have been bolstered by a recent independent poll showing over 65 percent support for a feebates program in California. The state will release a list of preferred policies in June.

California Zero Emission Vehicles Program

Despite pressure from UCS and our activists, as well as others across the state, California state regulators recently weakened the state's Zero Emissions Vehicle (ZEV) program. Regulators reduced the minimum number of "pure" zero emission vehicles that auto makers must produce from 2012 to 2014 from 25,000 to 7,500. The new rules require auto manufacturers to make up for the reduction in pure ZEVs by producing over 58,000 "Enhanced Partial Zero Emission Vehicles"—typically plug-in hybrid vehicles—but it may not be enough to help California meet its global warming goals. A UCS analysis concluded that even with widespread acceptance of plug-in hybrids, the state would need 379,000 pure zero-emission vehicles on the road by 2020 to be on a path to meet its long-term global warming pollution reduction target.
 
However, due to pressure from UCS and others, the state agreed to overhaul the entire ZEV program by the end of 2009, and to review an analysis by UCS, the Natural Resources Defense Council, and five other groups that identifies potential loopholes that might weaken the program. UCS will continue working to ensure policies that encourage the development of clean advanced technology for vehicles.