A national policy on fuel economy standards and greenhouse gas emissions provides regulatory certainty and flexibility that reduces the cost of compliance for auto manufacturers while addressing oil consumption and harmful air pollution. Consumers will continue to have access to a diverse fleet and can purchase the vehicle that best suits their needs.

EPA and National Highway Transportation Safety Association (NHTSA) are developing a joint proposed rulemaking, which will include full details on the proposed program and supporting analyses, including the costs and benefits of the proposal and its effects on the economy, auto manufacturers, and consumers.  After the proposed rules are published in the Federal Register, there will be an opportunity for public comment and public hearings.  The agencies plan to issue a Notice of Proposed Rulemaking by the end of September 2011. California plans on adopting its proposed rule in the same time frame as the federal proposal.

Given the long time frame at issue in setting standards for MY2022-2025 light-duty vehicles, EPA and NHTSA intend to propose a comprehensive mid-term evaluation. Consistent with the agencies’ commitment to maintaining a single national framework for vehicle GHG and fuel economy regulation, the agencies will conduct the mid-term evaluation in close coordination with California.

In achieving the level of standards described above for the 2017-2025 program, the agencies expect automakers’ use of advanced technologies to be an important element of transforming the vehicle fleet.  The agencies are considering a number of incentive programs to encourage early adoption and introduction into the marketplace of advanced technologies that represent “game changing” performance improvements, including the following:

Incentives for electric vehicles, plug-in hybrid electric vehicles, and fuel cells vehicles;
Incentives for advanced technology packages for large pickups, such as hybridization and other performance-based strategies; credits for technologies with potential to achieve real-world CO₂ reductions and fuel economy improvements that are not captured by the standards test procedures.

In addition, EPA plans to propose provisions for the following: Credits for improvements in air conditioning (A/C) systems, both for efficiency improvements and for use of alternative, lower global warming potential refrigerant; Treatment of compressed natural gas (CNG); continued credit banking and trading, including a one-time carry-forward of unused MY 2010-2016 credits through MY 2021.