MPG Standards Blast Upward

Vehicle mile-per-gallon requirements shot upward last week with an Obama Administration proposal to tie greenhouse gas emissions standards to vehicle efficiency requirements for new cars and trucks beginning in 2012. With the announcement, President Barack Obama set the U.S. on a path to meet a target of 39 mpg for cars and 30 mpg for light trucks by 2016. The goal puts future U.S. vehicle standards in the range of current gasoline-electric hybrids as compared with today's efficiency average of 25 mpg. The proposal is the result of a deal negotiated with several states that want the benefits of these high-mileage vehicles and auto industry leaders who want national mpg standards. The result is a plan that will speed up by four years vehicle efficiency goals laid out by Congress in the 2007 energy law. The White House estimates the new standards will increase average vehicle costs by $1,300, but they put the U.S. on a trajectory to greatly change the power systems in its vehicles. In the long run, battery researchers and manufacturers are likely beneficiaries, considering Obama's additional goal of putting 1 million plug-in hybrid vehicles on the road by 2015, as well as the Administration's offer of $1.5 billion in grants to U.S. battery manufacturers to encourage new production. Applications for these grants were due last week.