New fuel standard: pay now, save later

It doesn't matter if it's a reusable grocery bag or a car, it costs a bit more to be green initially, but it will save you money in the long run. With new federal fuel economy and emissions standards announced recently by the Obama administration, Americans will spend an estimated additional $1,100 on their new cars, but they'll save $3,000 in fuel costs over the car's 10-year lifetime.


The 1,200-plus-page proposal begins with the 2012 model year and calls for a 5 percent increase in fuel economy each year through 2016 model year, bringing the overall average of the nation's fleet of cars and light-duty trucks to 35.5 mpg. That's slightly higher than the fuel efficiency mandated by law in 2007, requiring an average fuel economy of 35 mpg. It's also four years ahead of the schedule passed by Congress.


The proposal is also historic because it would create the first-ever national emissions standard. In theory, having one standard, versus the current three separate standards by the Department of Transportation, the Environmental Protection Agency and the states' standards, will help reduce automakers' costs to build cars that meet the new requirements.


The proposal still allows automakers to build all types of vehicles from small cars to large SUVs and trucks and lets automakers primarily use existing technologies to meet the standard. As a result, the National Highway Traffic Safety Administration and the EPA, the two groups that created the proposal, expect automakers to use start-stop technology more widely. It shuts off the engine to avoid unnecessary idling and seamlessly restarts it when needed.


They also anticipate more improvement in engine efficiency, transmissions, tires and air conditioning systems to help boost fuel economy in conventional, gasoline-powered cars.


But if the standard is passed, it is likely that it will also result in automakers building more alternative fuel cars. The two agencies expect that it will encourage hybrid and clean-diesel technology, making them more widely available than they are today, as well as bring more electric cars and plug-in hybrids to market in the future.


If the program is put into effect, the reduction of greenhouse gas emissions and gasoline consumption will be substantial. Carbon dioxide emissions would be about 21 percent lower by 2030 than they would have been if we continued with the current standards. In addition, the new standard would result in 1.8 billion barrels of oil less than the current standard, which is about double the amount of oil the U.S. imported from Persian Gulf countries last year.


As is typical of government proposals, the new fuel economy and emissions proposal is open for public comment. Those who wish to state their opinion on the proposal can go do so at the EPA or NHTSA Web sites through Nov. 15. The final rule will by published by the Obama administration this spring.


Read more Driving for Dollars columns and Bankrate auto stories.


Tara Baukus Mello is a freelance writer who has written about automotive topics of interest to consumers since 1995. If you have a car question, e-mail it to us at Driving for Dollars.





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