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Federal Actions Accelerate Transition to Plug-In Cars

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  • Felix Kramer
    Momentum for PHEVs has been growing steadily - but May looks like The month that changed the world. We re seeing Obama-style transformation all over. In
    Message 1 of 1 , May 26, 2009
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      Momentum for PHEVs has been growing steadily -
      but May looks like "The month that changed the
      world." We're seeing Obama-style transformation
      all over. In this chock-full posting we look at
      many of the new developments on the federal level
      -- not chronologically, but in order of
      importance -- plus a few links and our comments.
      At the end you can read the President's rousing
      remarks on fuel efficiency and the auto industry.

      (Shortly after it goes out on email, this posting
      will also be viewable at
      http://www.calcars.org/news-archive.html -- there
      you can add CalCars-News to your RSS feed.)

      Here's what we cover below:
      * New federal fuel standards after decades
      * House Cap and Trade bill: pros and cons, and impact on plug-ins
      * Energy Department defunds hydrogen for transportation
      * Cash for Clunkers bills advance, with some starting to question them
      * Multiple rounds of grant applications energize plug-in community
      * Military weighs in on vehicle electrification
      * Clean Economy Network launches
      * Must-read anthology on plug-ins from Brookings Institution
      * Plus the following off-topic ALERT:

      WE NEED YOUR LETTERS BY NOON WEDS: We haven't had
      a chance to post the announcement until now, but
      we encourage CalCars-News readers to write a
      comment to the California Air Resources Board,
      which this Thursday in Sacramento is holding its
      very important follow-up hearing on regulations
      for aftermarket conversions of hybrid cars. This
      has implications well beyond California, and
      potentially could affect the viability of
      companies (and their suppliers) that now convert
      Priuses and Ford Escapes, but may convert
      internal combustion gas guzzlers in the future.
      See one company's announcement with the details
      at the EAA-PHEV mailing list archive,
      http://autos.groups.yahoo.com/group/eaa-phev/message/3561
      and see January postings at
      http://www.calcars.org/news-archive.html for the background.

      OBAMA ADMINISTRATION'S NEW FUEL STANDARDS: 30%
      cut by 2016. The national fleet mileage
      (unchanged since 1985) will increase 5% annually,
      for cars reaching 39 MPG and light trucks
      (including SUVs) 30 MPG. This is the resolution
      of the long struggle since the passage of
      California's AB1493 (the Pavley Bill) that
      precipitated automakers' lawsuits to block higher
      standards in California (followed by more than a
      dozen states), and the Bush Administration's
      refusal to grant California a routine waiver to
      set its own standards (as it has done for decades
      because it had emissions regulations before the
      U.S. had national rules). See a good summary at
      http://www.greencarcongress.com/2009/05/obama-announces-new-national-fuel-policy-two-harmonized-standards-with-fleet-average-of-355-mpg-250-.html#more
      and a discussion of unresolved issues at
      http://earth2tech.com/2009/05/21/what-you-need-to-know-about-the-new-car-emissions-standards/
      .

      The new plan brokered by the Obama Administration
      has won the approval of automakers (10 were at
      the announcement), the autoworkers, the state and
      federal government agencies and elected
      officials, and many environmental groups. It
      represents the breakup of a decades-long impasse,
      with a single uniform national standard, so the
      automakers can no longer resist based on their
      opposition to a "patchwork of standards." It's
      not quite as strong as California's bill; it
      still leaves the U.S. way behind the rest of the
      world, and California is still free to enact
      stronger requirements after 2016. For a news
      context-setter and photo of the assembled group
      at the announcement see
      http://www.nytimes.com/2009/05/20/business/energy-environment/20emit.html

      Long-time CalCars supporters will recall that in
      Sept 2004, we testified at the ARB hearing on the
      implementation of the Pavley Bill, pointing
      out
      http://www.calcars.org/CalCarsARBTestimonySept04.pdf
      that "the elephant in the room" is PHEVs, which
      could start saving CO2 emissions faster than any
      other vehicle type and double the goal of 30%
      reduction in a decade. Several commissioners
      looked at each other and agreed it was necessary
      to rethink their dismissal of PHEVs. And now it's
      widely acknowledged that plug-in cars have to be
      a big part of automakers' future vehicle mix for
      them to meet the goals in a shorter time. That's
      where we see automakers' race on electric vehicles taking shape.

      As attention shifts to how the carmakers will
      meet the regulations, journalists and analysts
      have a new favorite question: With low gas
      prices, will smaller, lighter and more-efficient
      cars attract buyers? And what if lower fuel
      demand leads to even lower gas prices? Virtually
      every article on that subject concludes "this
      wouldn't be a problem if we had a gas tax that
      set a floor on the price of gasoline -- but as we
      all know, no politician can survive voting for
      that, so it's of course unachievable." A
      refreshing new take is a Reuters story on the
      "Green Gold Rush" -- the economic opportunities
      the new standards open up:
      http://www.reuters.com/article/GCA-GreenBusiness/idUSTRE54I71D20090519.
      At Edmunds, Michelle Krebs reminds us of options
      like "feebates" -- taxing higher gas-guzzlers
      more than fuel-sippers:
      http://www.autoobserver.com/2009/05/new-fuel-rules-automakers-may-build-them-but-will-customers-buy-them.html
      and John O'Dell looks at a range of ways to
      incentivize sales of efficient vehicles:
      http://blogs.edmunds.com/greencaradvisor/2009/05/is-cafe-needed-consider-prodding-the-public-rather-than-pushing-automakers.html

      WAXMAN-MARKEY CAP AND TRADE LEGISLATION OK'D BY
      HOUSE ENERGY/COMMERCE COMMITTEE. "H.R. 2454, The
      American Clean Energy and Security Act," was
      significantly modified to gain the support of
      coal-state Democrats and others. While some
      environmental groups criticize its lower targets
      and providing emissions credit allocations to
      industry rather than auctioning them, advocates
      point out that most of the allocations to
      regulated industries will end up in with
      consumers. Their fundamental point is that this
      bill is the best we can do and still get 60
      Senate votes -- and that we must get started. For four perspectives, see
      * Joseph Romm's summary (and other pieces at
      Climate Progress
      http://climateprogress.org/2009/05/21/waxman-markey-approved-house-energy-and-commerce-committe/
      * Greenpeace critique, in partnership with
      Friends of the Earth and others
      http://www.greenpeace.org/usa/news/greenpeace-waxman-markey-clim
      * Report by Bryan Walsh of TIME (emerging as one
      of the most insightful journalists on the
      environment) http://www.time.com/time/health/article/0,8599,1900408,00.html
      * Debate at http://i3.democracynow.org/2009/5/22/climate_debate

      WAXMAN-MARKEY & PLUG-INS: The measure contains an
      additional $25 billion in loans to companies
      retooling to produce plug-in vehicles and buy
      batteries, doubling the amount committed in the
      TARP legislation last fall. It also includes
      funds funds for EV infrastructure, including
      charging stations and integration with smart grid
      systems. And to fund their reduction of CO2
      emissions in the vehicles they produce, they
      would get three percent of the federal
      government's revenue from carbon emissions
      permits from 2012 to 2017, then one percent to
      2025. See Subtitle C Sections 121-124 in the
      22-page bill summary and other documents at http://energycommerce.house.gov/ .

      ENERGY SECRETARY STEVEN CHU PROPOSES $0 FOR FUEL
      CELL CARS IN NEXT BUDGET: Chu proposed for the
      year beginning Oct 1, a $100M reduction in the
      hydrogen program, while maintaining $68 million
      research funds for stationery applications. He
      said, "We asked ourselves, is it likely in the
      next 10 or 15, or even 20 years that we will
      convert to a hydrogen-car economy? The answer, we
      felt, was no." Other than those directly involved
      in the industry, and some automakers continuing
      on momentum, most analysts see other technologies
      advancing far more rapidly and facing fewer
      barriers in technology, infrastructure and
      conversion losses. For insight into the reasons
      the Energy Department is favoring plug-in
      vehicles over fuel cells, see the links to the US
      DOE's Principal Deputy Assistant Secretary of
      Energy Steven Chalk's congressional testimony and
      Detroit News interview at
      http://blogs.edmunds.com/greencaradvisor/2009/03/federal-funding-shifting-away-from-fuel-cells-back-to-plug-in-hybrids.html

      CASH FOR CLUNKERS BILL ADVANCES: Waxman-Markey
      also includes $3.5-$4.5 billion incentivize
      vehicle swaps for a million vehicles. It has also
      been introduced as a stand-alone bill in the
      House and Senate. The bill has been slightly
      improved, giving higher amounts for swaps with a
      10MPG increase. Senators Dianne Feinstein and
      Susan Collins, recognizing the measure's
      limitations, have introduced a bi-partisan
      stronger version, requiring much higher
      efficiency vehicles in the swap:
      http://blogs.edmunds.com/greencaradvisor/2009/05/senate-members-offer-clunkers-measure-they-say-is-greener-than-house-version.html
      . But none of them have begun to think about the
      points CalCars has been making involving the
      "embedded energy" involved in building a car.
      That means, in simplified terms, unless you
      replace a car with one getting twice the MPG,
      you're a net loser in terms of energy and CO2
      savings. Weighing in on this issue are Bill
      Chameides, dean of Duke University's Nicholas
      School of the Environment, and Richard Larrick,
      an associate professor at Duke's Fuqua School of
      Business, saying, "Just because you go out and
      buy a new car and it has a higher fuel economy,
      it doesn't mean you're actually saving C02." They
      also support switching how we view fuel
      efficiency, to talk about "gallons per hundred
      miles" to enable us to appreciate the impact of
      energy savings from the least efficiency
      vehicles.
      http://www.nytimes.com/gwire/2009/05/08/08greenwire-clunkers-deal-for-autos-stirs-questions-about-12208.html


      PLUG-IN COMMUNITY REACHES FINISH LINE
      AFTER INTENSE ROUNDS OF APPLICATIONS: Remember
      those stimulus grant programs we alerted you to?
      Organizations ranging from large automakers and
      component makers to regional consortia,
      universities, small startups and many nonprofits
      have been buried in paperwork, spreadsheets and
      PDFs for months. Deadlines to apply for over $2
      billion in grants from the Department of Energy
      (DOE) under the American Recovery and
      Reinvestment Act for batteries and components and
      for a range of products and services under the
      category of "transportation electrification" have
      passed; the US Clean Cities program applications
      close May 29. Still to come is "ARPA-E" for
      transformational technology. (See links to all at
      http://www.energy.gov/recovery/funding.htm .)
      (CalCars advised many, wrote endorsement letters,
      and partnered as education/outreach subawardees
      in three applications.) Results will be announced
      this summer, with funds available this fall.

      WONDER WHO APPLIED FOR WHAT? We won't be
      surprised if the number of applicants exceeds
      500. We've heard of many imaginative and
      inspiring ideas. We think telling the world about
      these proposals will spur further innovation and
      partnerships that will speed the arrival of the
      green jobs, new company formation, community
      revitalization, and fossil fuel and greenhouse
      gas reduction goals of the program. Given the new
      administration's pledges of "transparency and
      accountability," we have urged the Department of
      Energy to approach the entire process in the
      spirit of "coopetition." We have proposed that
      for the first time, DOE release the
      non-confidential summaries that were requested
      from all applicants. A perfect home has been
      created for such information: the DOE Recovery
      Act Clearinghouse
      https://recoveryclearinghouse.energy.gov/index.htm
      . We're taking our request through channels and
      hope for a positive response, but we may seek
      allies and endorsements if we don't make rapid progress.

      MILITARY THINKTANK URGES
      HYBRIDIZATION/ELECTRIFICATION: 12 retired
      generals and admirals from four branches of the
      US military on the Center for Naval Analysis
      Military Advisory Board have issued a report,
      "Powering America’s Defense: Energy and the Risks
      to National Security"
      http://www.cna.org/nationalsecurity/energy/
      citing "the electrification of combat" and
      urging "energy efficiency, smart grid
      technologies, and electrification of its vehicle
      fleet." Topics include The National Security
      Risks of Business as Usual and "Achieving Energy
      Security in a Carbon-Constrained World"
      (including migration that could result from
      rising ocean levels and other disruptions). The
      report confirms analyses that the cost of
      delivering fuel to the battlefield can reach
      hundreds of dollars per gallon, and suggests
      analyzing the "fully burdened price of fuel" to
      include military expenditures to operate some
      military bases, defend sea lanes and maintain
      forward presence. In a confirmation of the impact
      of PHEV experts and advocates, the
      acknowledgments and citations include
      ClimateProgress. Google.org and its 2030 plan,
      the California Energy Commission and many National Laboratories.

      CLEAN ECONOMY NETWORK LAUNCHES: A new
      organization http://www.cleaneconomy.net
      announces itself: "Welcome. We are business
      voices -- investors, professionals, workers and
      entrepreneurs engaged in catalyzing clean
      development and creating green jobs. This is our
      best hope for economic growth, climate stability,
      energy security, and competitiveness." Formed by
      people from across the political spectrum (though
      many first came together in CT4O (Clean Tech for
      Obama), the group says "the rules of the clean
      economy are being written now," and aims to
      engage in that process, focusing especially on
      supporting an effective carbon price, working at
      the state level to leverage public dollars, pass
      a comprehensive federal clean energy package, and
      finance clean investments. You can join as a free
      General Member and participate in advocacy
      activities, provide input, and attend events, or
      become an Executive Member at $1,500 and gain
      access to insider events and briefings. The group
      is somewhat complementary to Environmental
      Entrepreneurs http://www.e2.org , which is
      affiliated with the Natural Resources Defense Council.

      INDISPENSABLE NEW BOOK ON PLUG-INS: "Plug-in
      Electric Vehicles: What Role for Washington?"
      arrives just in time. Here's THE BOOK TO READ to
      get the current thinking about the benefits and
      opportunities for plug-ins -- and the policies to
      get there. Its editor is David Sandalow, who was
      based at Brookings Institution until he was
      confirmed as the Energy Department's new
      Assistant Secretary for International Affairs and
      Domestic Policy.) Here's our annotated Table of
      Contents -- get information and order for $30 or
      less at http://www.calcars.org/books.html .
      * Foreword -- Strobe Talbott -- eminent foreign
      policy analyst and president of the Brookings
      Institution: concise and compelling four pages worth the price of the book!
      * Commentary-- Dan Reicher -- explains
      Google.org's interest and recaps the
      Google/Brookings Institution Plug-In Conference in June 2008.
      * Introduction -- David Sandalow -- topics
      reviewed and updated since the author's 2007
      "Freedom From Oil: How the Next President Can End
      the United States' Oil Addiction," which
      helped provide roadmaps for several Presidential candidates.
      * PART 1 BENEFITS
      * Geopolitical Implications of Plug-in Vehicles
      -- R. James Woolsey, Chelsea Sexton -- overview of benefits.
      * Electrification of Transport and Oil
      Displacement: How Plug-Ins Could Lead to a 50
      Percent Reduction in U.S. Demand for Oil --
      Saurin D. Shah -- co-author of the influential
      2006 Alliance Bernstein report, "The Emergence of
      Hybrid Vehicles" (still available at
      http://www.calcars.org/downloads ) explores
      market penetration issues and sees a 2-6 year
      societal payback for a rapid transition.
      * Pluggable Cars: A Key Component of a Low-Carbon
      Transportation Future -- Deron Lovaas, Luke
      Tonachel -- summarizes the environmental issues and the EPRI-NRDC study.
      * The Cash Back Car -- Jon Wellinghoff -- broad
      and very accessible summary of opportunities from vehicle-to-grid integration.
      * PART 2 BARRIERS
      * The Impact of Plug-In Hybrids on U.S. Oil Use
      and Greenhouse Gas Emissions -- Alan L. Madian,
      Lisa A. Walsh, Kim D. Simpkins -- focuses on
      market penetration issues. (This chapter and
      Shah's confirm how difficult it is too get
      plug-ins fast enough; we hope the next generation
      of discussions will factor in the opportunities
      to convert millions of internal combustion engine vehicles on the road.)
      * Look Before You Leap: Exploring the
      Implications of Advanced Vehicles for Import
      Dependence and Passenger Safety -- Irving Mintzer
      -- raises issues of materials required for rapid scale-up.
      * PART 3 POLICIES
      * Current Federal Authorized Programs on Plug-In
      Hybrids, Battery Electric Vehicles, and Related
      Efforts -- Dean Taylor -- captures the
      legislative and administrative history of government programs.
      * Tax Credits for Electric Cars: Stimulating
      Demand through the Tax Code -- Benjamin H. Harris
      -- explores and explains those subtle
      distinctions between deductions, credits,
      refundable credits, and the impact of the Alternative Minimum Tax.
      * Cost-Effectiveness of Greenhouse Gas Emission
      Reductions from Plug-in Hybrid Electric Vehicles
      -- Daniel M. Kammen, Samuel M. Arons, Derek M.
      Lemoine, Holmes Hummel -- costs and benefits of
      PHEVs in context of trends in battery prices and federal incentives.
      * Federal Policy Options to Support Early
      Electric Vehicle Deployment by Reducing Financial
      and Technological Risks -- Bracken Hendricks,
      Benjamin Goldstein -- proposes fleet purchases,
      Federal Battery Guarantee Program to reduce risks
      to consumers and a secondary market for used
      batery packs; tells the story of World War II indusstrial retooling
      * Electric Vehicles: How Do We Get Millions on
      the Road? -- Tom Z. Collina, Ron Zucker --
      explores the Better Place and similara business
      models and the evolution of the national power grid.
      * Electric Utility Issues in Replacing Oil with
      Electricity in Transportation -- Steve Marshall
      -- explains regulatory policies and electric
      utilities; explains why they haven't been behind
      plug-ins in ways comparble to oil companies and
      internal combustion engine vehicles.
      * Promoting Use of Plug-In Electric Vehicles
      through Utility Industry Acquisition and Leasing
      of Batteries -- Peter Fox-Penner, Peter Dean
      Murphy, Mariko Geronimo, Matthew McCaffree --
      presents benefits of a new business opportunity.

      May 19, 2009 – 1:05 p.m.
      CQ Transcript: President Obama Announces New Auto
      Mileage and Emissions Standards
      http://www.cqpolitics.com/wmspage.cfm?parm1=1&docID=news-000003120709


      SPEAKER: PRESIDENT BARACK OBAMA

      Thank you. Thank you. Thank you, everybody. Thank
      you. Thank you very much. Thank you.

      Please, everybody have a seat. Have a seat. What
      an extraordinary day. The sun is out because good things are happening.

      Before I get started, just some preliminary
      introductions. I'll probably repeat them in my
      formal remarks, but I want to make sure that I
      acknowledge some people who've been critical to
      this effort and critical to so many efforts at the state and federal levels.

      First of all, Speaker Nancy Pelosi , who has just
      been cracking the whip and, you know, making
      Congress so productive over these last several days. We are grateful for her.

      My wonderful secretary of transportation, Ray LaHood, is in the house.

      Lisa Jackson, the outstanding administrator of the EPA.

      Some of the finest governors in the country are
      here. Let me take them in order of good looks.

      Sorry, Arnold.

      (LAUGHTER)

      Jennifer Granholm of Michigan, Governor Deval
      Patrick of Massachusetts, and Governor Arnold Schwarzenegger of California.

      (APPLAUSE)

      Barbara Boxer just had to leave, but the -- the
      head of the Environment Committee in the Senate
      who's done just outstanding work. And Senators
      Feinstein, Levin, and Stabenow couldn't be here,
      because they are busy voting on credit card
      legislation that we're going to get done before Memorial Day.

      And we've got two outstanding members of the
      House of Representatives, John Dingell -- where's
      John? Right here. The dean of the House, who's
      done so much extraordinary work around these
      issues, and Sandy Levin. Please give them a round of applause.

      (APPLAUSE)

      I also want to mention Ron Gettelfinger of the
      UAW, our president who's just been a great leader
      during some very trying times in the auto industry.

      And Carol Browner, who helped to make this all
      happen today, please give Carol Browner a big round of applause.

      (APPLAUSE)

      Since -- since I'm acknowledging everybody -- I'm
      in a voluble mood today -- let me go ahead and
      acknowledge my other members of the cabinet who
      are here who are part of our energy green team
      and do just outstanding work on an ongoing basis.

      First of all, my secretary of labor, Hilda Solis.

      (APPLAUSE)

      OBAMA: The guy who's just cleaning up the
      Department of Interior and doing an extraordinary job, Ken Salazar .

      (APPLAUSE)

      Our head of HUD, Shaun Donovan .

      (APPLAUSE)

      And our commerce secretary, Gary Locke .

      (APPLAUSE)

      Now, thank you all for coming to the White House
      today and for coming together around what I
      consider to be an historic agreement to help
      America break its dependence on oil, reduce
      harmful pollution, and begin the transition to a clean-energy economy.

      This is an extraordinary gathering. Here we have
      today standing behind me, along with Ron
      Gettelfinger and leadership of the UAW, we have
      10 of the world's largest auto manufacturers, we
      have environmental advocates, as well as elected
      officials from all across the country.

      And this gathering is all the more extraordinary
      for what these diverse groups, despite disparate
      interests and previous disagreements, have worked together to achieve.

      For the first time in history, we have set in
      motion a national policy aimed at both increasing
      gas mileage and decreasing greenhouse gas
      pollution for all new trucks and cars sold in the
      United States of America. And I want to...

      (APPLAUSE)

      I want to applaud the leadership of the folks at
      the Environmental Protection Agency, the
      Department of Transportation, and the White House
      Office of Energy and Climate Change who've worked
      around the clock on this proposal, which has now been embraced by so many.

      You know, in the past, an agreement such of this
      -- such as this would have been considered
      impossible. It's no secret that these are folks
      who've occasionally been at odds for years, even
      decades. In fact, some of the groups here have
      been embroiled in lawsuits against one another,
      so that gives you a sense of how impressive and
      significant it is that these leaders from across
      the country are willing to set aside the past for the sake of the future.

      For what everyone here believes, even as views
      differ on many important issues, is that the
      status quo is no longer acceptable.

      While the United States makes up less than 5
      percent of the world's population, we create
      roughly a quarter of the world's demand for oil.
      And this appetite comes at a tremendous price, a
      price measured by our vulnerability to volatile
      oil markets, which send gas prices soaring and families scrambling.

      It's measured by a trade deficit where as much as
      20 percent of what we spend on imports is spent
      on oil. It's measured in billions of dollars sent
      to oil-exporting nations, many that we do not
      choose to support if we had a choice. It's
      measured in a changing climate, as sea levels
      rise and droughts spread, forests burn and storms rage.

      And what is all the more tragic is that we've
      known about these costs in one way or another
      since the gas shortages of the 1970s, and yet all
      too little has been done. Calls for action rise
      and fall with the price of a barrel of oil. Worn
      arguments are traded across entrenched divides.
      Urgency fades. Complacency grows. And time passes.

      As a result, we have done little to increase the
      fuel efficiency of America's cars and trucks for
      decades. Think about this. Consider how much has
      changed all around us. Think of how much faster
      our computers have become. Think about how much
      more productive our workers are. Think about how
      everything has been transformed by our capacity
      to see the world as it is, but also to imagine a world as it could be.

      That's what's been missing in this debate for too
      long. And that's why this announcement is so
      important, for it represents not only a change in
      policy in Washington, but the harbinger of a
      change in the ways business is done in Washington.

      No longer will we accept the notion that our
      politics are too small, our nation too divided,
      our people too weary of broken promises and lost
      opportunities to take up an historic calling. No
      longer will we accept anything less than a common
      effort made in good faith to solve our toughest
      problems. And that is what this agreement seeks to achieve.

      Right now, the rules governing fuel economy in
      this country are inadequate, uncertain, and in
      flux. First, there is the standard for fuel
      economy administered by the Department of Transportation.

      On top of that, the Environmental Protection
      Agency, in response to a decision by the Supreme
      Court, may have to set limits on greenhouse gas
      emissions from vehicles, establishing another standard.

      California has sought permission under the Clean
      Air Act to require that vehicles sold in
      California meet yet another even stricter
      emission rule. And 13 states and the District of
      Columbia have agreed to adopt California
      greenhouse gas reductions if the permission, called a waiver, is granted.

      Now, car companies might then face three
      different sets of overlapping requirements, one
      administered by the Department of Transportation,
      one administered by the EPA, and still a third
      administered by California and 13 other states.

      This proposed national policy, under the
      leadership of two agencies and bringing together
      14 states, 10 companies, as well as autoworkers
      and environmental groups, changes all that.

      The goal is to set one national standard that
      will rapidly increase fuel efficiency without
      compromising safety by an average of 5 percent
      each year between 2012 and 2016, building on the
      2011 standard my administration set shortly after taking office.

      A series of major lawsuits will be dropped in
      support of this new national standard. The state
      of California has also agreed to support this standard.

      And I want to applaud California and Governor
      Schwarzenegger and the entire California
      delegation for their extraordinary leadership.
      They have led the way on this, as they have in so
      many other efforts to protect the environment.

      In addition, because the Department of
      Transportation and EPA will adopt the same rule,
      we will avoid an inefficient and ineffective
      system of regulations that separately govern the
      fuel economy of autos and the carbon emissions they produce.

      And in a time of historic crisis in our auto
      industry, when domestic auto manufacturers are
      making painful choices and restructuring their
      businesses to be viable in the future, this rule
      provides the clear certainty that will allow
      these companies to plan for a future in which
      they are building the cars of the 21st century.

      Yes, it costs money to develop these vehicles.
      But even as the price to build these cars and
      trucks goes up, the cost of driving these
      vehicles will go down as drivers save money at the pump.

      And this is a point I want to emphasize. If you
      buy a car, your investment in a more
      fuel-efficient vehicle, as a result of this
      standard, will pay off in just three years. In
      three years' time, you will have paid off the additional investment required.

      So this is a winning proposition for folks
      looking to buy a car. In fact, over the life of a
      vehicle, the typical driver would save about
      $2,800 by getting better gas mileage.

      And the fact is, everyone wins. Consumers pay
      less for fuel, which means less money going
      overseas and more money to save or spend here at
      home. The economy as a whole runs more
      efficiently by using less oil and producing less
      pollution. And companies like those here today
      have new incentives to create the technologies
      and the jobs that will provide smarter ways to power our vehicles.

      And that's why, in the next five years, we're
      seeking to raise fuel economy standards to an
      industry average of 35.5 miles per gallon in
      2016, an increase of more than 8 miles per gallon
      per vehicle. That's an unprecedented change,
      exceeding the demands of Congress and meeting the
      most stringent requirements sought by many of the
      environmental advocates represented here today.

      As a result, we will save 1.8 billion barrels of
      oil over the lifetime of the vehicles sold in the
      next five years. Just to give you a sense of
      magnitude, that's more oil than we imported last
      year from Saudi Arabia, Venezuela, Libya, and Nigeria combined.

      (APPLAUSE)

      Here's another way of looking at it: This is the
      projected equivalent of taking 58 million cars off the road for an entire year.

      I also want to note that the agreement we have
      announced today is part of a far larger effort.
      In fact, on the other end of Pennsylvania Avenue,
      Henry Waxman is chairing a meeting of the Energy
      and Commerce Committee, which is working on an
      equally historic energy bill that will not only
      help our dependence on foreign oil, prevent the
      worst consequences of climate change, and build a
      clean-energy economy, but will provide more than
      $15 billion to help build the cars and trucks of
      the future right here in America.

      (APPLAUSE)

      And the recovery plan we put in place, as well as
      the budget that builds on it, makes historic
      investments in a clean-energy economy, doubling
      our capacity to generate renewable energy like
      wind and solar, investing in new battery
      technologies for plug-in hybrids, and building a
      smarter, stronger grid on which the homes,
      businesses and vehicles of the future will run.

      (APPLAUSE)

      Now, too often lost in the back-and-forth of
      Washington politics, absent in arguments where
      the facts opponents use depend on the conclusions
      they've already reached, absent all that is this:
      Ending our dependence on oil, indeed, ending our
      dependence on fossil fuels, represents perhaps
      the most difficult challenge that we have ever
      faced, not as a party, not as a set of separate interests, but as a people.

      We have, over the course of decades, slowly built
      an economy that runs on oil. It has given us much
      of what we have, for good, but also for ill. It
      has transformed the way we live and work, but
      it's also wreaked havoc on our climate. It has
      helped create gains in prosperity unprecedented
      in history, but it also places our future in jeopardy.

      Ending this dependence will take time. It will
      take an incredible effort; it will take an
      historic investment in innovation. But more than
      anything, it will take a willingness to look past
      our differences, to act in good faith, to refuse
      to continue the failures of the past, and to take
      on this challenge together, for the benefit not
      just of this generation, but generations to come.

      All the people who've gathered here today, all
      the auto executives, all our outstanding elected
      officials and appointees, Ron Gettelfinger,
      members of Congress, governors, all these folks
      here today have demonstrated that this kind of
      common effort is possible. They've created the
      template for more progress in the months and
      years to come. Everything's possible when we're
      working together, and we're off to a great start.

      So thank you, everybody. Appreciate it.

      (APPLAUSE)


      -- -- -- -- -- -- -- -- -- -- -- --
      Felix Kramer fkramer@...
      Founder California Cars Initiative
      http://www.calcars.org
      http://www.calcars.org/news-archive.html
      -- -- -- -- -- -- -- -- -- -- -- --
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