Fuel-efficiency rules: The second-best route on oil dependence
THE BEST WAY by far to address Americans’ oil dependence is the one that almost no one in Washington likes: raising the federal gasoline tax. It would encourage consumers to drive less and burn less fuel when they do, spurring technological innovation, cleaning the air and sending fewer dollars to hostile foreign regimes. Yet Congress has refused to raise the gas tax since 1993, and it doesn’t appear likely to do so anytime soon.
Given this aversion to rational policy, President Obama has searched for other ways to accomplish similar goals.
One is subsidizing the purchase of very fuel-efficient cars or electric vehicles. But that’s extremely expensive for an already overextended Treasury. Another is setting high fuel-efficiency standards for new cars and trucks. That, according to modeling from Harvard’s Kennedy School of Government, could reduce carbon emissions from the transportation sector more than paying people to buy alternative vehicles would and cost the government much less. The modeling, of course, finds that a higher gas tax is much more effective, but the president doesn’t need congressional approval to mandate vehicle efficiency.
So in 2009, Mr. Obama raised the average fuel standard for cars and light trucks to 34.1 miles per gallon by 2016, in a grand agreement between the federal government, automakers and the state of California, which has special dispensation under the law to set its own rules.
Now, Mr. Obama is deciding how much that standard should rise by 2025. Environmentalists hoped that he would push average fuel economy up to 60 mpg or above. Automakers wanted any new standard to fall somewhere around 40 mpg. But the Detroit press has reported that the Obama administration has floated 56.2 mpg.
Obama’s reported standard might be an opening bid for further negotiations with the auto industry. But the president would be right to aim high.
Enacting strong vehicle efficiency standards will not make America energy-independent. But as long as raising the gas tax is off the table, pressing automakers to make their vehicles ever more efficient is one of the few things Obama can do to cut greenhouse gas emissions and oil use — by about a half-billion tons of carbon dioxide and about 1.1 billion barrels of oil over the life of vehicles produced in 2025, assuming a 56.2 mpg standard, according to the Environmental Protection Agency.
These improvements aren’t free. Cars will probably get lighter and have more advanced powertrains. Automakers might have to sell more hybrid vehicles. Vehicle sticker prices could rise by about $2,300. But, the EPA estimates, owners will see a return on their extra investment in reduced fuel costs after a few years.
Perhaps by then, Congress will have raised the gas tax, too, allowing consumer demand rather than government mandate to drive efficiency and invention.