Consumers could pay an extra $193 billion for fuel by 2035, study suggests.
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| © Reuters |
By Sven Gustafson, Autoblog
[post_ads]There's already plenty of debate over the Trump administration's plan to freeze fuel-economy and vehicle pollution standards as states like California vow to fight the relaxed rules,
and even automakers signal their intent to press on developing cleaner
cars. But one sector that is quietly cheering the proposal? U.S. oil
producers.
Bloomberg reports that oil-industry leaders have supported the move behind the scenes,
with companies including Marathon Petroleum, Koch Companies Public
Sector LLC and the refiner Andeavor disclosing lobbying activity on the
issue this year. They've argued that the Obama-era standards Trump
proposes to sweep aside are outdated, established when the U.S. was
over-reliant on foreign oil, and that they don't reflect huge increases
in U.S. exports of crude oil and petroleum products since then.
"We
come from a free-market perspective, where we believe consumers should
have a choice in their vehicles, and they can weigh all the appropriate
factors — be it size, horsepower, utility or fuel economy," Derrick Morgan,
senior vice president of the American Fuel and Petrochemical
Manufacturers trade group, which advocated for the changes in a meeting
at the White House in June, told Bloomberg. "We trust
individual consumers to make the right decisions; we don't think
Washington or Sacramento should be making all those determinations."
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The
Trump administration's proposal would freeze fuel-efficiency standards
at 2020 levels — about 37 miles per gallon by 2026, down from the Obama
administration's nearly 47 mpg — and weaken electric vehicle
mandates. It said the freeze would boost U.S. oil consumption by around
500,000 barrels of oil a day by the 2030s, decrease vehicle-related
fatalities by encourage consumers to buy new, safer cars — Autoblogscrutinizes that claim here — and lower projected regulatory costs for automakers by $319 billion through 2029.
Two auto trade groups representing GM, Ford, Toyota, Volkswagen
and others have said that despite the administration's proposal, they
continue to support efforts to improve fuel economy and "incentivize
advanced technologies."
In an analysis of the proposed freeze,
the researchers at the Rhodium Group noted that future oil prices would
play a major role in determining the overall effect of the relaxed
standards, since higher oil prices push consumers into smaller, more
fuel-efficient cars (though of course, modern crossovers
are quickly closing the fuel-economy gap on sedans). It notes that
light trucks last year made up 65 percent of total U.S. vehicle sales,
up from 50 percent in 2012, when oil prices peaked.
It said the
freeze would equate to between $193 billion and $236 billion in
additional cumulative fuel costs for consumers by 2035.
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Not lost
on many opponents of the freeze is the fact that nations around the
world are experiencing extreme weather — triple-digit heat waves in
Japan, wildfires in Sweden, Greece and California, and drought in South
Africa — that scientists are directly tying to climate change, brought about in significant part by burning fossil fuels.
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