Pros and Cons of Proposed Fuel Economy Standards

 

That's not a very exciting headline, perhaps.  But the Trump administration's proposed changes to the so-called Corporate Average Fuel Economy (CAFE) rules have already drawn criticism from many quarters.  The Environmental Defense Fund, for example, claims in a headline that the changes will "cost Americans more for gas, weaken national security, and increase pollution."  If it's so bad, why is the administration doing it? 

 

At the news conference announcing the proposal, Trump was surrounded by representatives of several domestic automakers, who favor the move.  It is actually a further step in a series of actions that Trump has taken to step back from the Biden administration's CAFE standards.

 

Under the previous administration, each automaker had to ensure that the average "fleet" economy (all their current model-year production, basically) measured in miles per gallon, had to increase by 2% per year.  (Electric vehicles are assigned an equivalent value of fuel economy on the order of 140 MPG.)  Companies not meeting the standards pay fines or purchase credits from firms who exceed them. 

 

Already, the Trump administration has ceased levying the associated fines under the spending bill recently passed by Congress.  They are now proposing to lower the 2% figure to 0.5%, and roll back the "baseline" from which the percentages are calculated to 2022. 

 

Let's compare two cases:  the former policy with fines and the 2% rate versus the proposed policy.  And let's see how various constituencies are affected by the two cases.

 

In the former Biden-administration case, automakers faced the fact that in less than 10 years, the CAFE standards would require raising their average fuel economy by 20%.  Any time an engineering system has some of its performance mandated by law, engineers eventually run up against another law:  physical law.  While modern automobiles differ in thousands of ways from the typical 1955 car—computer-controlled engines, greater use of plastic for reduced weight, etc.—there is still only so much energy in a gallon of gasoline.  And beyond a certain point, the accessible design space shrinks as the required fuel economy rises.  What the old CAFE standards were doing in practice was to compel the auto industry to move toward smaller, lighter cars and more electric vehicles.

 

Yes, that would save people money in fuel costs, and make the U. S. more energy-independent, and reduce our carbon footprint.  But it also makes cars somewhat more expensive, at least at first, and gradually would eliminate certain larger sizes that consumers might want to buy.  So for automakers, the old rules meant compulsory redesigns against fundamental constraints that might eventually eliminate whole classes of vehicles.  For consumers, they meant more limited choices of somewhat more expensive cars, although ones that would be slightly cheaper to run.  And for the environment, it meant slower increases in carbon and other emissions, which are good things. 

 

The proposed reduction in CAFE increases to 0.5% means that the time to get to 20% higher than at present goes from 10 years to 36 years.  And in any case, there are no longer fines for violating the standards, so they are essentially an aspirational goal with no teeth in them.  Under the proposed rules, automakers will no longer be obliged to make cars steadily more fuel-efficient unless consumers ask for that.  Consumers will have a wider choice of cars that won't be more expensive simply because of the CAFE standards.  And while presumably we will have more carbon emissions than if the old standards were retained, unexpected advances in electric-vehicle technology may change this picture.

 

For example, in the December issue of Physics Today, the umbrella publication of the American Institute of Physics, researchers describe their work on solid-state lithium batteries that could vastly out-perform current lithium-ion batteries.  One radical improvement they hope to make is to replace the current graphite anodes, which can absorb only one lithium ion for every six carbon atoms, with solid-lithium ones, which raises the charge capacity of the anode by a factor of ten.  There are problems with solid-state battery technology, but if they are overcome, it might be possible to manufacture electric vehicles that are both cheaper to buy than gasoline-powered ones and travel farther on a charge. 

 

And if consumers are presented with such a choice, it's quite likely that the internal-combustion-engine-powered vehicles would be relegated to specialist uses in construction, etc., leaving most of the field to electric vehicles.  That would come about not because of any government mandate, but because competitive forces in the marketplace produced innovations that consumers genuinely want, and have the byproduct of increasing CAFE mileage and reducing pollution.

 

Obviously, there's no guarantee that solid-state batteries or any other innovation will ever make all-electric vehicles outperform gas-guzzlers in all significant ways:  first cost, performance (including range), and per-mile costs, including power and maintenance.  But it could happen, just as we saw a huge reduction in carbon emissions from power plants when coal was replaced by cheaper abundant natural gas, due not mainly to government mandates but to the privately-funded development of fracking technology. 

 

You can't count on these serendipitous things happening.  But it's equally short-sighted to think that the only good things that go on in a market are government-mandated changes. 

 

The CAFE changes proposed by the Trump administration are still open to comments before they are implemented.  I'm not holding my breath that the current regime will take negative comments into consideration, but it might happen.  Perhaps what is most harmful in this whole situation is the every-four-year policy shifts that manufacturers have been trying to deal with, as Obama was replaced by Trump, who was replaced by Biden, who was replaced by Trump again.  But a small-r republican form of government, as messy as it is, is better than being dictated to by a small group of powerful individuals with no term limits, which is how China is governed.  And for now, it looks like we may be reverting to more of a free-market model in the auto industry.  Consumers and manufacturers should enjoy it while they can, because it may not last. 

 

Sources:  I referred to an NPR report on the Trump administration proposed CAFE-standard changes at https://www.npr.org/2025/12/03/nx-s1-5630389/trump-administration-rolls-back-fuel-economy-standards.  I also referred to a webpage of the Environmental Defense Fund at https://www.edf.org/media/trump-administration-announces-plan-weaken-fuel-economy-standards-cars-and-trucks.  The Physics Today article "Solid-State Batteries:  Hype, Hope, and Hurdles" by S. Muy, K. Hatzell, S. Meng, and Y. Shao-Horn appeared on pp. 40-46 of the December 2025 issue.

Electrifying New York — Again

 

Thomas Edison famously electrified New York City in 1882 when the first commercial central power plant in the world went online at 255-257 Pearl Street.  It took most of the next three decades to spread the blessings of electric power through the rest of the city, but it got done without much help from any government.  Electric lights were cheaper, safer, and just better than gaslight or kerosene lamps, and little government intervention was required to persuade millions of New Yorkers that going electric was the thing to do.

 

New York City now faces a new kind of electrification:  the electric car.  As an article in the New York Times recently described, the futuristic vision of having only all-electric vehicles inside the confines of the five boroughs that make up New York is being realized slowly, if at all. 

 

One significant drawback is the lack of public charging stations.  Even after setting a modest goal of installing 120 new charging stations, the city ended up as #93 in a recent survey that rated 100 cities in terms of how electric-car-friendly they were.

 

New York City's commissioner of transportation Hank Gutman is determined to change the situation.  His commission issued a report calling for 1,000 curbside chargers by 2025 and 10,000 by 2030.  Every municipal parking lot will have one-fifth of its slots equipped with chargers, if the plans in the report are carried out.

 

One might ask if those slots will be reserved for electric cars only, of which there are presently only 20,000 registered in all of New York City.  If only electric cars can park in those slots, all this means for the old-fashioned gas-guzzler driver is that the municipal parking lots will effectively shrink by 20%.

 

The electric car is perhaps one of the few major mass-market items whose main selling point is ideological.  From a purely pragmatic individual point of view—whether you are looking at personal safety, saving money, or convenience—there is really nothing an all-electric car can offer that a gasoline model can't also offer.

 

The ideological reason to buy an all-electric car is that it is one small step for a car buyer, but multiply that by a billion or so and it will be a giant leap toward a fossil-fuel-less future in which global warming is defeated.  And this reason cannot be discounted, because I think it is one of the main reasons people currently buy electric vehicles.

 

Whether it makes sense for someone to spend an extra ten to thirty thousand dollars on a car that requires careful logistical planning to make it between charging stations and may not in fact reduce carbon emissions at all if the local electric utility burns coal, is a decision that individuals are free to make.  But so far, despite the growing sales figures of upstarts such as Tesla, the prospect of gasoline vehicles going the way of kerosene lamps by 1910 actually looks pretty reasonable, if you give it another three or four decades.

 

In 1910, there were still lots of people who used kerosene lamps, and it would be another twenty or thirty years before such things were found only in extremely rural areas.  And it would take government intervention, in the form of the Rural Electrification Administration, to bring electricity to the remaining rural areas without electric power.  Still, nobody was forced to put away their kerosene lamps and get connected.  People in rural areas had to wait longer because it cost more to install the lines than in urban areas, but they still wanted electricity as much as their city cousins did.

 

Until all-electric vehicles are cheaper and easier to buy and operate than gasoline-powered ones, it will be like pushing on a string to get most people to buy one.  Some of the string moves when you push on it, but most of it doesn't.  There are those who feel that the chronic global-warming emergency is so urgent that fossil fuels should be effectively banned—taxed out of existence or otherwise made inaccessible to the average person.  This would represent a draconian market intervention by governments in an area where government has not exactly covered itself with glory, judging by similar historical interventions such as the price controls during the gasoline crisis of the 1970s.

 

The technological optimists among us (and on some days I count myself in that number) look to a day when some new and currently unthought-of technology improves battery storage capacity by another factor of 10 and lowers the price by the same factor.  If that happened, electric cars would simply out-perform and undercut the price of gasoline vehicles, which hold the record as being the most complicated mass-produced human-sized object in history. 

 

By contrast, the entire drive train of an electric car is a battery, some electronics, and electric motors hooked to the wheels.  The rest is software, and we all know how cheap software is.  I don't think we'll get to the point that companies will give away electric cars for free as long as you put up with the ads, but it might come close.

 

At that point, we won't need government subsidies or carbon taxes or prohibitions to make the transition from gas to electric vehicles.  People will want to do it of their own free will, and the market will be more than happy to oblige.  But it might not happen for a while yet.

 

One of the most scarce commodities these days is patience.  Even with the vastly superior performance of electric lighting, which was not cheaper than gas to begin with, it took the better part of four decades before most people were able to make the transition.  Heavy-breathing global-warming alarmists may say, "We don't have four decades! We've got to do something now!!"  We are just emerging from the results of two years of governments "doing something now" to fight COVID-19, and offhand I can think of only one of those things that had an unequivocally positive effect on the outcome:  the rapid development of vaccines.  Most other actions arguably did more harm than good, or at least mixed in a lot of harm with the good. 

 

Let's not make that mistake again.

 

Sources:  Ginia Bellafante's article "New York's Electric Car Future Faces Several Challenges" appeared in the Mar. 13, 2022 edition of the New York Times.