Obama: Truck Fuel Efficiency Ready for Round Two

Directs EPA, DOT to work on new standards; proposes infrastructure tax credit

Improvong the Fuel Efficiency of American Trucks

WASHINGTON -- On Tuesday, President Obama announced a plan to further boost the fuel efficiency of medium and heavy-duty trucks, and called for greater investment in infrastructure for alternative fuels.

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During a visit to a Maryland distribution center owned by grocer Safeway Inc., President Obama said he was directing the Environmental Protection Agency (EPA) and the Department of Transportation's National Highway Traffic Safety Administration (NHTSA) to develop the next phase of medium- and heavy-duty vehicle fuel efficiency and greenhouse-gas (GHG) standards by March 2016.

The first round of standards, which were finalized in Sept. 2011, covered medium- and heavy-duty vehicles model years 2014 through 2018. They require combination tractors--big rigs or semis--to achieve up to about a 20% reduction in fuel consumption and GHG emissions by model year 2018. Heavy-duty pickups and vans would need to hit a 15% reduction in fuel consumption and GHG emissions, and vocational vehicles--delivery trucks, buses and garbage trucks--would have to cut fuel consumption and GHG emissions by about 10% by model-year 2018.

The Obama administration projects that these moves will save 530 million barrels of oil and reduce GHG emissions by approximately 270 million metric tons, saving $50 billion in fuel costs over the vehicles' lifetimes.

The plan calls for the EPA and the NHTSA to issue a Notice of Proposed Rulemaking (NPRM) by March 2015 for the second round of standards, which would extend beyond model year 2018. According to government figures, heavy-duty vehicles represented 4% of registered vehicles on the road in 2010, but contributed 23% of the transportation sector's on-road fuel use and GHG emissions. These vehicles are the second-largest source of GHG emissions within the transportation sector, with passenger cars and light trucks being the largest source.

The President also renewed his call for the end of $4 billion in subsidies for oil and gas companies, and for Congress to establish an Energy Security Trust, fed by $2 billion in revenues generated from federal oil and gas development. The fund would support research into alternative-fuel vehicles that run on biofuels, electricity, hydrogen and natural gas.

He also proposed $200 million in a new tax credit to goose investment in infrastructure to support more alternative fuel vehicles. The proposal would be fuel-neutral, meaning the private sector would determine if biofuels, electrification, natural gas, hydrogen or other alternative fuels would be the best fit in their communities. The President also called for extending the cellulosic biofuel producer credit that expired at the end of 2013.

Click here to view the complete plan, Improving the Fuel Efficiency of American Trucks: Bolstering Energy Security, Cutting Carbon Pollution, Saving Money & Supporting Manufacturing Innovation.