A CAFE standard of 62 miles per gallon by 2025 might indeed come to pass. The Department of Transportation and the Environmental Protection Agency today released a "Notice of Intent to Improve Fuel Economy and Reduce Greenhouse Gas Emissions for 2017-2025" (PDF) that includes, as one possibility, decreasing greenhouse gas emissions by six percent a year for the years in question. A drop that steep would put us on track for 62 mpg, but the agencies are also looking at three, four and five percent decreases (where three percent equals a 47 mpg level by 2025).

Why does the administration think higher CAFE standards are important? Two reasons: the environment (of course) and the economy. The Notice of Intent says:
The automotive market is becoming increasingly global. The U.S. auto companies produce and sell automobiles around the world, and foreign auto companies produce and sell in the U.S. As a result, the industry has become increasingly competitive. Staying at the cutting edge of automotive technology, while maintaining profitability and consumer acceptance, has become increasingly important for the sustainability of auto companies. Trends in the world automotive market suggest that investments in improved fuel economy and advanced technology vehicles are a necessary component for maintaining competitiveness in coming years.
Nothing has been decided just yet, and we are not in a comment period. The 62 mpg level got a big pile of support from the governors of eight states – New York, Maine, Massachusetts, New Mexico, Maryland, Pennsylvania, Oregon and Washington – and other early voices are in favor of the go-big-or-go-home proposal. The governors write:
We urge you to set ambitious new standards for passenger vehicles. We have seen the automakers meet goals time and time again, and we are confident that technological improvements, including the plug-in hybrids and pure electric vehicles that they are rolling out, will increase efficiency and affordability further and will make 60 miles per gallon commonplace.
Some, though, are urging for a slow process. Dave McCurdy, president of the Auto Alliance, said in a statement that the automakers he represents want to work with the agencies on the new standard and that:
EPA and DOT should now engage a broad range of independent experts to undertake a thorough analysis and balance the technological opportunities to improve vehicle and fleet fuel economy with the economic challenges they present – for automakers and American consumers.
The government plans to issue its proposal next September and won't make a final rule until July 2012. You can read today's official government release here (PDF) and read related press releases after the jump. For more on the higher CAFE targets, read this.

[Sources: DOT, Detroit News, Auto Alliance]


PRESS RELEASES

EPA and DOT Announce Next Steps toward Tighter Tailpipe and Fuel Economy Standards for Passenger Cars and Trucks

Move should save consumers money, reduce dependence on oil

WASHINGTON - In keeping with President Obama's vision to reduce greenhouse gases and increase fuel efficiency, the U.S. Department of Transportation's (DOT) National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA), announced they will begin the process of developing tougher greenhouse gas and fuel economy standards for passenger cars and trucks built in model years 2017 through 2025. This will build on the success of the first phase of the national program covering cars from model years 2012-2016.

The program is a key part of the administration's energy and climate security goals, which call for the increased domestic production and use of existing, advanced, and emerging technologies to strengthen the auto industry and enhance job creation in the United States. Continuing the national program will help make it possible for manufacturers to build a single national fleet of cars and light trucks that satisfies all federal and California standards, while ensuring that consumers have a full range of vehicle choices.

"Continuing the successful clean cars program will accelerate the environmental benefits, health protections and clean technology advances over the long-term. In addition to protecting our air and cutting fuel consumption, a clear path forward will give American automakers the certainty they need to make the right investments and promote innovations," said EPA Administrator Lisa P. Jackson. "We will continue to work with automakers, environmentalists and other stakeholders to encourage standards that reduce our addiction to foreign oil, save money for American drivers, and clean up the air we breathe."
"We must, and we will, keep the momentum going to make sure that all motor vehicles sold in America are realizing the best fuel economy and greenhouse gas reductions possible," said U.S. Transportation Secretary Ray LaHood. "Continuing the national program would help create a more secure energy future by reducing the nation's dependence on oil, which has been a national objective since the first oil price shocks in the 1970s."

In a May 21, 2010 memorandum, President Obama directed EPA and DOT issue a Notice of Intent (NOI) that would lay out a coordinated plan, to propose regulations to extend the national program and to coordinate with the California Air Resources Board (CARB) in developing a technical assessment to inform the NOI and subsequent rulemaking process.

Consistent with the Presidential Memorandum, the NOI includes an initial assessment for a potential national program for the 2025 model year and outlines next steps for additional work the agencies will undertake. Next steps include issuing a supplemental NOI that would include an updated analysis of possible future standards by November 30, 2010. As part of that process, the agencies will conduct additional study and meet with stakeholders to better determine what level of standards might be appropriate. The agencies aim to propose actual standards within a year.

The national program is intended to save consumers money by cutting down on fuel costs, improve our nation's energy security by reducing dependence on petroleum, and protect the environment by reducing greenhouse gas pollution that leads to climate change. Climate change is the single greatest long-term global environmental challenge. Cars, SUVs, minivans, and pickup trucks are responsible for 57 percent of U.S. transportation petroleum use and almost 60 percent of all transportation-related greenhouse gas emissions.

The results of the interim technical assessment are summarized in the NOI and presented in a separate document, which NHTSA, EPA and CARB are also jointly releasing today. To achieve further annual greenhouse gas reductions, the automotive industry could choose from a variety of advanced technologies.

The assessment also considers the costs and effectiveness of applicable technologies, compliance flexibilities available to manufacturers, potential impacts on auto industry jobs, and the infrastructure needed to support advanced technology vehicles. This assessment was developed through extensive dialogue with automobile manufacturers and suppliers, non-governmental organizations, state and local governments, and labor unions.

More information on the NOI, the technical assessment, and submitting
comments: http://www.nhtsa.gov/fuel-economy and http://www.epa.gov/otaq/climate/regulations.htm


Statement of Dave McCurdy on the Notice of Intent to Improve Fuel Economy and Reduce Greenhouse Gas Emissions for 2017-2025

The Alliance remains convinced that a single national program to improve fuel economy and reduce greenhouse gas emissions is the best approach for the environment, our customers, and our economy.

As the agencies acknowledge, the assumptions in the Notice of Intent – and the potential ranges of improvements that they imply – are based on very preliminary and incomplete data at this point, and inevitably will change as more information is brought to the process.

In the coming weeks, we will carefully review the technical assessment's assumptions regarding factors that will impact vehicle fuel economy increases over this time period. These include vehicle technologies and technology costs, the cost of gasoline, development of low-carbon fuels, and development of infrastructure to charge plug-in hybrids and battery electrics.

EPA and DOT should now engage a broad range of independent experts to undertake a thorough analysis and balance the technological opportunities to improve vehicle and fleet fuel economy with the economic challenges they present – for automakers and American consumers.

The Alliance is committed to working collaboratively with EPA, NHTSA and California to achieve these goals in a way that allows consumers to choose and afford vehicles that fit their needs.
###

The Alliance is a trade association of twelve car and light truck manufacturers including BMW Group, Chrysler LLC, Ford Motor Company, General Motors, Jaguar Land Rover, Mazda, Mercedes-Benz, Mitsubishi Motors, Porsche, Toyota, Volkswagen and Volvo.



CAR TECHNOLOGY EXPERT PRAISES FLEXIBILITY OF FUEL ECONOMY STANDARDS
Rules allow full range of cars, SUVs, and pickups

John German, an engineer who worked in the auto industry under Chrysler and Honda for 21 years and is now senior fellow and Program Director at the International Council for Clean Transportation, released the following statement to help clarify the scaled nature of the government's proposed fuel economy standards, which grade vehicles "on the curve":

"Pushing the fleet to a 60 mpg standard will not push consumers into small cars. The technology exists to dramatically increase the fuel economy of all cars, from the smallest to the largest, without any change in the size and performance of the vehicles bought by consumers. And the law is designed to encourage improvement across the fleet - selling additional small cars does not help a manufacturer comply with the standards
."


NATIONAL CONSUMER EXPERT RESPONDS TO FUEL ECONOMY ANNOUNCEMENT
Calls for 60 mpg

Washington, DC - The Obama Administration announced this morning its intent to set new fuel economy and greenhouse gas emissions standards for cars and light trucks in model years 2017 to 2025. Mark Cooper is Director of Research for the Consumer Federation of America, an association of nearly 300 nonprofit consumer organizations. He issued the following statement in response to today's Notice of Intent on the next round of fuel economy standards:

"A fuel economy standard of 60 mpg by 2025 would be a big win for American consumers. It will give them what they want - clean, fuel efficient cars that take them farther on a dollar and curb our appetite for expensive oil that often comes from countries that don't like us.

"For too long, weak fuel economy standards have cost consumers billions of dollars in savings. By setting a 60 mpg standard, the Obama Administration can help put those billions back in the pockets of consumers."

"Sixty miles per gallon falls at the high end of the range of future standards contemplated by the Notice of Intent. We look forward to convincing the agencies that 60 mpg is technically feasible and economically practicable, as well as good for consumers and the nation
."