New Fuel-Efficiency Standards On Horizon

The Obama administration is poised to issue new fuel efficiency standards as part of a broader goal of limiting pollution and greenhouse gases. The new rules are expected to be announced Tuesday.

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MICHELE NORRIS, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Michele Norris.

Tomorrow, President Obama is expected to announce tougher fuel economy standards for cars and trucks. It's part of an ambitious effort to cut greenhouse gas emissions.

NPR environmental correspondent Elizabeth Shogren joins us now to talk about the new rules.

Elizabeth, what are you hearing? How high are the standards the administration will be setting?

ELIZABETH SHOGREN: The White House officials aren't speaking for the record right now, but they did speak to representatives from environmental groups, from industry; and those people have passed down some of the general goals to me. The new standard would cut greenhouse gas emissions 30 percent by 2016. This is an ambitious goal. The best way to cut greenhouse gas emissions from cars and trucks is to make them go farther on a gallon of gas. And the new standard would make cars and trucks on average get 35.5 gallons - miles, excuse me, miles on a gallon by 2016. That's four years sooner than what current law would require.

NORRIS: The administration has a lot on its plate right now: the economy, the wars in Iraq and Afghanistan, the pledge to take on health care and to do that this year. So why are they taking this on right now as well?

SHOGREN: Well, two years ago, the Supreme Court said that the Environmental Protection Agency had the power to regulate greenhouse gas emissions. At the same time, California and more than a dozen other states were pressing to have their own tougher greenhouse gas emissions. So this has been pressing the Obama administration to address this issue, despite all else that's been going on now. And now, they've been working on it since they came into office and they've finally come up with an agreement.

NORRIS: Now, some other states have already been setting their own higher fuel economy standards. You mentioned California, for instance. How did the federal rules compare?

SHOGREN: Well, one indication of how these rules compare to California is that I spoke with Governor Schwarzenegger from California, his press secretary. And the governor is expected to be in Washington tomorrow for the event. So we're not sure exactly all the details of these announcements, but we do know that basically, they are California standards applied nationwide. Already, more than a dozen states copied California, and now, it looks like President Obama wants to follow suit as well.

NORRIS: Now, the U.S. auto manufacturers are already suffering. We hear about that every day. Do these new standards present another big challenge for an industry that's already ailing?

SHOGREN: Yes, these will be very difficult standards for the auto industry to meet. Now, the auto industry has, as you mentioned, they're hemorrhaging money already, and one of the things that's hard for U.S. carmakers is to sell these small fuel-efficient vehicles, which will be required to get to this new standard. They often actually lose money when they sell those cars. How the auto industry in the United States makes money is by selling those big SUVs with lots of expensive options on them. So this is going to be a big challenge.

You also have the challenge that - of fuel prices. Gasoline prices are very low now. So when people go to the auto dealership, they're looking - they're not thinking about fuel efficiency as the main thing on their mind.

The one thing that the automakers do get with this new standard is that they get one predictable standard for the whole country, and that's what they've been wanting. They don't want to have to meet the standard for California and a dozen other states, and then meet the other standard as well.

NORRIS: That's NPR's environment correspondent Elizabeth Shogren. Elizabeth, thank you very much.

SHOGREN: Thank you.

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