ACEEE NEWS RELEASE

---

NHTSA FIDDLES WHILE GASOLINE BURNS

Washington, D.C. -- Proposed changes to the nation's passenger truck fuel economy standards fall far short of a solution to current energy problems, claims the American Council for an Energy-Efficient Economy (ACEEE). Worse yet, they offer the auto industry greater wiggle room to avoid making honest efficiency improvements in their vehicles.

"The changes proposed by NHTSA will offer marginal, if any, actual fuel savings," stated Steven Nadel, Executive Director of ACEEE. "I feel embarrassed for the administration that with oil at more than $65 per barrel, this proposal is the best it has to offer." Under the most optimistic conditions, the proposed changes would save less than one-quarter of one million barrels per day-about one percent of current U.S. oil use-in the year 2020. Contributing to the paltry savings is the proposal's lack of any additional improvements beyond 2011.

Sweeping changes to fuel economy regulations for light duty trucks were proposed Tuesday by the National Highway Traffic Safety Administration (NHTSA). Chief among these changes are a slight increase to overall truck fuel economy between 2008 and 2011, and a radical restructuring of the rules to base MPG requirements on vehicle size. The latter change will allow automakers to sell large numbers of full-size pickups and SUVs without offsetting them with sales of more fuel-efficient trucks. Depending on a manufacturer's model offerings, the proposed regulations could yield an average fuel economy lower than the existing requirements.

Missteps and Missed Opportunities

While a detailed technological and economic feasibility analysis was employed by NHTSA to determine fuel economy targets for the size-based categories, questionable logic was also utilized, including basing the calculations on government gasoline price projections of $1.51-$1.58 per gallon. "Ironically, the administration has until April Fool's Day to consider revisions to its proposal," noted Nadel. "With assumptions like this, that date seems rather fitting." By law, NHTSA must publish a final rule by April 1, 2006 in order to affect model year 2008 vehicles. Adding to the irony, these standards were released on a day when the pump price of gasoline set a new record, and the day before oil surged to a new nominal record.

Notable missed opportunities in the proposal include MPG standards that decline over time in order to accommodate automakers' current product plans, and the continued omission of fuel economy requirements for vehicles over 8,500 pounds gross vehicle weight (which includes the Hummer H2, Ford Excursion, and all 250/2500 and higher series pickups).

"If we are to address the pain that drivers are now experiencing at the pump, we need to take bold action," concluded Nadel. Among the bold actions available to policy makers are broad increases in CAFE levels or fee-bates to encourage a shift to more efficient vehicles.

###

About ACEEE: The American Council for an Energy-Efficient Economy is an independent, nonprofit organization dedicated to advancing energy efficiency as a means of promoting economic prosperity, energy security,  and environmental protection. For information about ACEEE and its programs, publications, and conferences, contact ACEEE, 529 14th Street N.W., Suite 600, Washington, D.C. 20045 or visit www.aceee.org.