Will Scheme Deliver Real Oil Savings? One Million Barrels a Day Is the Benchmark

July 21, 2005 -- Fuel economy performance standards for pickups, SUVs and minivans are expected to undergo a sweeping overhaul by the Bush administration starting next month. While details remain vague, most observers say it will involve complex new vehicle classification schemes. It will be easy to get lost in the details. But the most important question is: Will the plan reduce our oil dependence, or not?

"Ignoring this challenge puts the country at grave risk on multiple fronts -- economic, security, and environmental. Automakers have cost-effective technology right now that could easily save at least one million barrels of oil a day if they were used more widely," said Roland Hwang, chief auto analyst at the Natural Resources Defense Council. "That is the minimum benchmark for any new performance standard."

The solution could start with the stroke of a pen: Simply by raising gas mileage standards for SUVs and other light trucks by 1 mpg per year for five years -- 27.2 mpg by 2012 -- America would save one million barrels of oil per day by 2020, according to NRDC.

America Needs More Miles Per Gallon

Passenger vehicles consume 40 percent of the oil we use -- a staggering eight million barrels per day. If no action is taken to improve performance, that consumption will balloon to nearly 12 million barrels a day by 2020. With oil prices at record levels, our thirst for oil has become a major economic and national security concern. Rising pump prices have also devastated Detroit's Big Three, which are suffering giant losses on plummeting gas guzzler sales. And there growing concern about global warming emissions.

In addition to hot-selling hybrid drive systems -- which can boost fuel economy 50 percent or more -- the list of fuel-saving technologies available to automakers today includes improved engine and transmission designs, and high-strength chassis materials.

Responsibility for oil savings rests with the National Highway Traffic Safety Administration, which sets Corporate Average Fuel Economy (CAFE) standards. In August the agency is scheduled to issue a proposed rule setting new standards for light trucks, including the pickups, SUVs and minivans which comprise more than half of all U.S. passenger vehicle sales. By law, they must require "maximum feasible" performance. The final rule is due next April. The current standard is 22.2 mpg by 2007.

The new rule is expected to offer a new series of weight- or size-based vehicle categories in place of today's single 'light truck' classification, making it harder to draw apples-to-apples comparison with current rules. Without safeguards, this could also give carmakers a perverse incentive to bulk up their vehicles to push them into a higher class with weaker performance standards. NRDC will be watching this closely, and providing a detailed assessment as soon as the rules are published.

Left & Right Agree: Oil Dependence is Dangerous

Experts across the political spectrum -- citing concerns ranging from falling oil production to national security -- agree on the need to curb our dangerous oil addiction. Last week, for example, the National Review published a powerful opinion piece by James Robbins: No Blood for Oil. The next day, the Washington Post featured another thought-provoking column by Paul Roberts: Our Post-Oil Future Needs a Push.

In addition, a recent Yale survey found that 92 percent of Americans believe the nation's dependence on oil is a serious problem; 93 percent (including 85 percent of Republicans) believe that making cars and trucks more efficient is the best way to reduce oil dependence.