An economic analysis performed by the International Council on Clean Transportation (ICCT) found that, given recent improvements in auto technology, the EPA’s rigorous study to determine 2025 fuel efficiency standards may have been too conservative, in some cases overstating the per-car cost of implementing carbon-reducing technologies by 40 percent.
The analysis comes at a time when the Trump Administration has moved to undo the fuel efficiency standards imposed by the EPA in January under the Obama Administration. Trump’s EPA has claimed that asking the auto industry to meet fuel efficiency standards of more than 50 mpg by 2025 would cost American jobs. (The ICCT notes that this mpg number can be reduced by about 23 percent during “real-world” driving "due to factors like greater real-world acceleration and operating in hot and cold temperatures" and accounts for that in its study.)
According to the ICCT, the impact of complying with those original fuel efficiency standards wouldn’t be as dramatic as the current administration suggests. “Technology costs continue to decrease, proving that previous estimates, including those made by the federal regulatory agencies, have been too conservative,” the ICCT wrote in its white paper. While the EPA's analysis only tried to predict automaker costs out to 2025, the ICCT looked at cost estimates from 2025 to 2030 and found that by 2030, even more ambitious fuel standards would be possible.
(By the way, if you feel like you’ve heard the acronym ICCT before, you may be right—it’s the same nonprofit organisation that commissioned University of West Virginia researchers to test emissions on Volkswagens, essentially leading researchers to crack the biggest automaker scandal in recent history.)
Can 2025 efficiency standards be met with combustion engines?
In this new paper the council writes that so far, the auto industry has generally met fuel efficiency standards through the adoption of “more efficient engines, transmissions, accessories, light weighting, aerodynamics, and tires.” That’s not likely to change over the next 8 years, the ICCT says, adding that automakers can still rely on improving combustion engine vehicles to meet the projected 2025 goals, rather than being forced to attempt to sell lots of electric vehicles to uncertain customers. “Continually improving technologies such as cylinder deactivation, high compression Atkinson cycle engines, light weighting, and mild hybridization will allow internal combustion to dominate automakers’ strategies to comply with adopted 2025 standards.”
The ICCT’s analysis looked at several potential carbon-saving technologies and analysed them according to how much each would cost to add to a vehicle, as well as how much pollution each technology could reduce. To accurately predict the costs and pollution savings of each technology, the ICCT collaborated with automotive suppliers such as Eaton, Ricardo, Johnson Controls, Honeywell, ITB, BorgWarner, Dana, FEV, Aluminum Association, Detroit Materials, and SABIC. The group also relied on a series of working papers to make its projections.
“The cost differences indicate that some of the advanced combustion technology costs will be reduced by about $100 [per vehicle] for direct injection and cooled exhaust gas recirculation,” the ICCT wrote.
The group also looked at the cost of building electric and plug-in hybrid electric vehicles. “The largest cost difference is in the case of electric vehicles, where our costs are approximately $1,600–$2,700 less than those of the US EPA.“
The ICCT determined that federal fuel economy regulations could get even stricter out to 2030 without costing automakers too much. Increasing fuel economy requirements after 2025 would “result in modest, gradual vehicle price increases through 2030,” the ICCT claimed, while adding that consumer fuel savings would be two to three time greater than the cost increases. “Such 2030 standards could be achieved mostly with advanced combustion technology, while also initiating the wider launch of plug-in electric vehicles to 13 percent to 23 percent of the new vehicle fleet,” the ICCT wrote.
Nic Lutsey, the ICCT’s program director, said in a statement, “If the US wants to be a global leader and remain a stable market for vehicle technology investments here, they will stick with the standards. Our research certainly shows what is possible if we stick with a steady progression toward more advanced fuel-efficiency technologies.”
The Auto Alliance, an auto industry lobby that has fought against the fuel efficiency rules, has said that forcing automakers to meet aggressive fuel efficiency guidelines showed that the EPA was divorced from the realities of the market because low gas prices had wiped out consumer demand for high-efficiency vehicles. Ars contacted the Auto Alliance for comment and we will update if we receive a response.
In an e-mail to Ars, Lutsey contended that consumers were not uninterested in fuel-efficient cars. “Automakers that lead in the deploying these technologies-for example, Mazda on SkyActiv, Ford on its EcoBoost-appear to be doing very well selling these technologies to happy customers."
The analysis comes at a time when the Trump Administration has moved to undo the fuel efficiency standards imposed by the EPA in January under the Obama Administration. Trump’s EPA has claimed that asking the auto industry to meet fuel efficiency standards of more than 50 mpg by 2025 would cost American jobs. (The ICCT notes that this mpg number can be reduced by about 23 percent during “real-world” driving "due to factors like greater real-world acceleration and operating in hot and cold temperatures" and accounts for that in its study.)
According to the ICCT, the impact of complying with those original fuel efficiency standards wouldn’t be as dramatic as the current administration suggests. “Technology costs continue to decrease, proving that previous estimates, including those made by the federal regulatory agencies, have been too conservative,” the ICCT wrote in its white paper. While the EPA's analysis only tried to predict automaker costs out to 2025, the ICCT looked at cost estimates from 2025 to 2030 and found that by 2030, even more ambitious fuel standards would be possible.
(By the way, if you feel like you’ve heard the acronym ICCT before, you may be right—it’s the same nonprofit organisation that commissioned University of West Virginia researchers to test emissions on Volkswagens, essentially leading researchers to crack the biggest automaker scandal in recent history.)
Can 2025 efficiency standards be met with combustion engines?
In this new paper the council writes that so far, the auto industry has generally met fuel efficiency standards through the adoption of “more efficient engines, transmissions, accessories, light weighting, aerodynamics, and tires.” That’s not likely to change over the next 8 years, the ICCT says, adding that automakers can still rely on improving combustion engine vehicles to meet the projected 2025 goals, rather than being forced to attempt to sell lots of electric vehicles to uncertain customers. “Continually improving technologies such as cylinder deactivation, high compression Atkinson cycle engines, light weighting, and mild hybridization will allow internal combustion to dominate automakers’ strategies to comply with adopted 2025 standards.”
The ICCT’s analysis looked at several potential carbon-saving technologies and analysed them according to how much each would cost to add to a vehicle, as well as how much pollution each technology could reduce. To accurately predict the costs and pollution savings of each technology, the ICCT collaborated with automotive suppliers such as Eaton, Ricardo, Johnson Controls, Honeywell, ITB, BorgWarner, Dana, FEV, Aluminum Association, Detroit Materials, and SABIC. The group also relied on a series of working papers to make its projections.
“The cost differences indicate that some of the advanced combustion technology costs will be reduced by about $100 [per vehicle] for direct injection and cooled exhaust gas recirculation,” the ICCT wrote.
The group also looked at the cost of building electric and plug-in hybrid electric vehicles. “The largest cost difference is in the case of electric vehicles, where our costs are approximately $1,600–$2,700 less than those of the US EPA.“
The ICCT determined that federal fuel economy regulations could get even stricter out to 2030 without costing automakers too much. Increasing fuel economy requirements after 2025 would “result in modest, gradual vehicle price increases through 2030,” the ICCT claimed, while adding that consumer fuel savings would be two to three time greater than the cost increases. “Such 2030 standards could be achieved mostly with advanced combustion technology, while also initiating the wider launch of plug-in electric vehicles to 13 percent to 23 percent of the new vehicle fleet,” the ICCT wrote.
Nic Lutsey, the ICCT’s program director, said in a statement, “If the US wants to be a global leader and remain a stable market for vehicle technology investments here, they will stick with the standards. Our research certainly shows what is possible if we stick with a steady progression toward more advanced fuel-efficiency technologies.”
The Auto Alliance, an auto industry lobby that has fought against the fuel efficiency rules, has said that forcing automakers to meet aggressive fuel efficiency guidelines showed that the EPA was divorced from the realities of the market because low gas prices had wiped out consumer demand for high-efficiency vehicles. Ars contacted the Auto Alliance for comment and we will update if we receive a response.
In an e-mail to Ars, Lutsey contended that consumers were not uninterested in fuel-efficient cars. “Automakers that lead in the deploying these technologies-for example, Mazda on SkyActiv, Ford on its EcoBoost-appear to be doing very well selling these technologies to happy customers."