From: Tom Doggett, Reuters
Published March 12, 2010 06:35 AM

US EPA to regulate Green House gas emissions from cars

The White House is finalizing rules on the first U.S. greenhouse gas emission standard for automobiles, which would raise average fuel economy 42 percent by 2016 in a bid to slash oil imports and fight climate change.

The Environmental Protection Agency and the Transportation Department sent the final rules this week to the White House's Office of Management and Budget, according to a notice posted on the OMB website.

The higher mileage requirements will reduce U.S. greenhouse gas emissions by 900 million metric tons and save 1.8 billion barrels of oil over the life of vehicles built during the 2012-2016 model years, according to the EPA.

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The vehicle emissions standards will be phased in starting with the 2012 model year, raising fuel economy to an average 35.5 miles per gallon by the time the 2016 models are ready -- up 42 percent from the current 25 miles per gallon.

Lower U.S. gasoline consumption could make more crude supplies available in the world market, which in turn could put downward pressure on oil prices.

Phil Flynn, an analyst with PFGBest Research in Chicago, said the new standards will definitely lower U.S. oil demand, but that could be offset with higher fuel use in other countries.

"We can save it here, but are these cars going to be marketable in China, where all the demand growth is going to come from?" he asked.

The rules follow an EPA finding that greenhouse gas emissions from new vehicles contribute to air pollution, a danger to public health.

Article continues: http://www.reuters.com/article/idUSTRE62A5S320100311

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