By Timmons Roberts. Originally written for Brookings' Planet Policy blog and published on January 18, 2017.
EPA Head Scott Pruitt via Wikimedia
Last week, the Obama administration EPA rushed to legally secure rules on required 2025 average gas mileage standards for car and truck manufacturers, while at the same time auto industry lobbyists pushed the Trump transition team to roll back the “flexible” standards put in place under Obama.
The lobbyists appear to have a receptive ear in incoming Trump administration, but if these standards are weakened or gutted, the result will be a whole new generation of vehicle-buyers saddled with years of high and unstable fuel costs. And even more tragic, a pivotal opportunity to electrify our nation’s vehicle fleet—and make crucial progress in lowering the risks of climate change—will be lost. Here’s why this is so important, and why two contradictory trends reflect a tipping point for our nation, and why Trump and Pruitt’s actions are so important.
Stalled at 25 MPG while Electrics Soar: A Schizophrenic Industry?
The U.S. auto industry has two starkly contradictory trends going on at the same time. On the one hand, electric vehicles are finally going mainstream, with sales up 37 percent in 2016. The new Chevy Bolt was awarded Car of the Year from Motor Trend with its four-door hatchback getting 238 miles on a single charge.
On the other hand, with gas prices seemingly parked below $2.50 per gallon, the majority of American car buyers have again shifted back toward gas-guzzling models like SUVs and trucks, which at the end of 2016 made up nearly 60 percent of all vehicles sold. As a result, the average miles per gallon in the U.S. when weighted for sales completely stopped increasing in the last three years, stalling at 25.1 mpg.
The lobbyists appear to have a receptive ear in incoming Trump administration, but if these standards are weakened or gutted, the result will be a whole new generation of vehicle-buyers saddled with years of high and unstable fuel costs. And even more tragic, a pivotal opportunity to electrify our nation’s vehicle fleet—and make crucial progress in lowering the risks of climate change—will be lost. Here’s why this is so important, and why two contradictory trends reflect a tipping point for our nation, and why Trump and Pruitt’s actions are so important.
Stalled at 25 MPG while Electrics Soar: A Schizophrenic Industry?
The U.S. auto industry has two starkly contradictory trends going on at the same time. On the one hand, electric vehicles are finally going mainstream, with sales up 37 percent in 2016. The new Chevy Bolt was awarded Car of the Year from Motor Trend with its four-door hatchback getting 238 miles on a single charge.
On the other hand, with gas prices seemingly parked below $2.50 per gallon, the majority of American car buyers have again shifted back toward gas-guzzling models like SUVs and trucks, which at the end of 2016 made up nearly 60 percent of all vehicles sold. As a result, the average miles per gallon in the U.S. when weighted for sales completely stopped increasing in the last three years, stalling at 25.1 mpg.
As the U.S. Senate Environment and Public Works Committee sits down across from the president-elect’s nominee for the head of Environmental Protection Agency, Oklahoma Attorney General Scott Pruitt, it’s high noon at the O.K. Corral for the agency’s average fleet fuel economy standards. As the hearing tees off, American car buyers and a huge industry are getting mixed messages on which direction things are going—toward stagnation or greater efficiency
Figure 1: Average vehicle miles per gallon adjusted for sales in the United States, model years 2008 to 2016. Source: University of Michigan Transportation Research Institute.
A Price We're Paying Already
For drivers and for the Earth’s climate, this is a disaster in progress, and Pruitt should be asked about how he plans to move our nation quickly off fossil fuels.
Americans’ responding to the price signal of low gas prices may be logical in the short term, but in the long term we are sharply increasing our fiscal and environmental risk. On the fiscal side, any of a number of geopolitical, weather, or industrial factors could drive unpredictable spikes or unrelenting rises in the price of gasoline and diesel at the pumps. Americans buying SUVs in record numbers and people driving more means increasing demand for oil, which will almost certainly push prices higher. As one analyst puts it, for a large set of reasons, “oil prices must and will go up.”
Consumer Reports estimates that it could cost you more than $15,000 to fill up your Jeep Liberty over five years if you drive average amounts; charging an electric such as a Nissan Leaf could cost about $3,000. If gas prices rise and electricity is roughly stable, this gap expands. Buyers of inefficient vehicles now are being suckered into a dead end of volatile and unpredictable fuel prices that could sink their household budgets. When household budgets tighten, purchases in the rest of the economy drop, and economic slowdown occurs. This seems to be one of those “sugar high” moments, where short-term euphoria is followed by nasty times to come if we are re-addicted to oil for another generation.
And a Bigger Price We Will All Pay
The other long-term crises, of course, are human health and climate change. The Obama administration finally started moving the U.S. in the right direction in 2012 by increasing requirements that vehicles become more efficient through more miles per gallon of fuel. The standards they set, however, were flexible, allowing the fleet averages required by 2020 or 2025 to fall if people started buying more SUVs and trucks. For each extra gallon of petroleum burned, there is a plume of toxic chemicals that sends kids and adults to the hospital or to their graves from asthma or other respiratory diseases. A recent MIT study estimated that 53,000 Americans die prematurely each year due to vehicle emissions.
As a species, time is running out for us to balance our carbon budget, which will be used up in somewhere between five to 20 years at current rates of emissions. The only way to make life sustainable on Earth is to drastically slash our emissions to “net zero” by then. The U.S. pledge to United Nation’s Paris Agreement, though too weak to keep us within that budget, was built substantially upon doublingfleet fuel efficiency averages. Yet even that level of reductions is far from what we need. To get to zero in time, we must get fossil fuels out of our economy, fast, through rapid electrification of vehicles and home heating.
Two Gears to Get Mileage Back into "Drive"
There are many ways for carmakers to meet the gas mileage needed to avoid the most tragic climate impacts. These technologies include using advanced fuel injection, putting hybrid technology in cars and trucks, and going fully electric. “We have the technology,” admitted Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers. “But if sales aren’t there, we can’t meet the standards…That’s a regulatory-marketplace collision.” This simply shows the lack of clear leadership from governments.
Scott Pruitt should be asked a series of firm questions on whether he will take efforts to improve our national fuel efficiency in drive, park, or reverse. If he understands that climate change is happening, that it is human caused, and that it is urgent and requires our ambitious action, his choices are two in the face of this collision. He can regulate inefficient vehicles directly, by not allowing their sale or taxing them heavily upon their sale and resale. Or he can put a price on carbon, and eliminate the huge subsidies fossil fuel producers enjoy as they dump vast health and climate destabilization costs on society.
For the sake of our future, Scott Pruitt should be asked these tough questions this week. If he’s serious about his role as the head of the EPA, his answers should leave no ambiguity.
For drivers and for the Earth’s climate, this is a disaster in progress, and Pruitt should be asked about how he plans to move our nation quickly off fossil fuels.
Americans’ responding to the price signal of low gas prices may be logical in the short term, but in the long term we are sharply increasing our fiscal and environmental risk. On the fiscal side, any of a number of geopolitical, weather, or industrial factors could drive unpredictable spikes or unrelenting rises in the price of gasoline and diesel at the pumps. Americans buying SUVs in record numbers and people driving more means increasing demand for oil, which will almost certainly push prices higher. As one analyst puts it, for a large set of reasons, “oil prices must and will go up.”
Consumer Reports estimates that it could cost you more than $15,000 to fill up your Jeep Liberty over five years if you drive average amounts; charging an electric such as a Nissan Leaf could cost about $3,000. If gas prices rise and electricity is roughly stable, this gap expands. Buyers of inefficient vehicles now are being suckered into a dead end of volatile and unpredictable fuel prices that could sink their household budgets. When household budgets tighten, purchases in the rest of the economy drop, and economic slowdown occurs. This seems to be one of those “sugar high” moments, where short-term euphoria is followed by nasty times to come if we are re-addicted to oil for another generation.
And a Bigger Price We Will All Pay
The other long-term crises, of course, are human health and climate change. The Obama administration finally started moving the U.S. in the right direction in 2012 by increasing requirements that vehicles become more efficient through more miles per gallon of fuel. The standards they set, however, were flexible, allowing the fleet averages required by 2020 or 2025 to fall if people started buying more SUVs and trucks. For each extra gallon of petroleum burned, there is a plume of toxic chemicals that sends kids and adults to the hospital or to their graves from asthma or other respiratory diseases. A recent MIT study estimated that 53,000 Americans die prematurely each year due to vehicle emissions.
As a species, time is running out for us to balance our carbon budget, which will be used up in somewhere between five to 20 years at current rates of emissions. The only way to make life sustainable on Earth is to drastically slash our emissions to “net zero” by then. The U.S. pledge to United Nation’s Paris Agreement, though too weak to keep us within that budget, was built substantially upon doublingfleet fuel efficiency averages. Yet even that level of reductions is far from what we need. To get to zero in time, we must get fossil fuels out of our economy, fast, through rapid electrification of vehicles and home heating.
Two Gears to Get Mileage Back into "Drive"
There are many ways for carmakers to meet the gas mileage needed to avoid the most tragic climate impacts. These technologies include using advanced fuel injection, putting hybrid technology in cars and trucks, and going fully electric. “We have the technology,” admitted Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers. “But if sales aren’t there, we can’t meet the standards…That’s a regulatory-marketplace collision.” This simply shows the lack of clear leadership from governments.
Scott Pruitt should be asked a series of firm questions on whether he will take efforts to improve our national fuel efficiency in drive, park, or reverse. If he understands that climate change is happening, that it is human caused, and that it is urgent and requires our ambitious action, his choices are two in the face of this collision. He can regulate inefficient vehicles directly, by not allowing their sale or taxing them heavily upon their sale and resale. Or he can put a price on carbon, and eliminate the huge subsidies fossil fuel producers enjoy as they dump vast health and climate destabilization costs on society.
For the sake of our future, Scott Pruitt should be asked these tough questions this week. If he’s serious about his role as the head of the EPA, his answers should leave no ambiguity.
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