Dramatic US fuel efficiency rule changes

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LESS GAS?: New regulations in the US aim to dramatically increase fuel efficiency.

New fuel economy rules in the US will require the fleet-wide average of new cars and trucks sold in the US to double over the next 13 years.

The average fuel economy must reach 54.5 miles per gallon (4.31 litres per 100 kilometres) by 2025, up from 28.6 mpg (8.22 litres/100km) at the end of last year.

The regulations will bring dramatic changes to the cars and trucks in US showrooms, with the goal of cutting greenhouse gas emissions and fuel consumption.

To meet the standard, automakers will need to introduce new technology to improve gasoline-powered engines. And they'll need to sell more alternative fuel vehicles. Critics say the rules will add thousands to the price of new cars and make them unaffordable for many.

The administration says the latest changes will save families more than US$1.7 trillion (NZ$2.11 trillion) in fuel costs and bring an average savings of US$8000 (NZ$9945) over the lifetime of a new vehicle sold in 2025. The standards also are the biggest step the US government has ever taken toward cutting greenhouse gas emissions, Environmental Protection Agency Administrator Lisa Jackson said. Tailpipe emissions from cars and light trucks will be halved by 2025, the government said.

US President Barack Obama said the new fuel standards "represent the single most important step" his administration has taken to reduce US dependence on foreign oil.

But Republican presidential candidate Mitt Romney has opposed the standards, and his campaign has called them extreme and said they would drive up the price of new cars. Any savings at the pump would be wiped out by rising costs of cars, the campaign said.

The gas mileage requirements will be phased in gradually and get tougher starting in 2017. They build on a 2009 deal between the Obama administration and automakers that committed cars and trucks to average 35.5 mpg by model year 2016.

In the arcane world of government regulations, the rules don't mean that cars and trucks will average 54.5 mpg in 13 years. It's actually closer to 40 mpg in real-world driving.

Under the complex regulations, dubbed "Corporate Average Fuel Economy, or CAFE," automakers can have lower mileage by using credits for selling natural gas and electric vehicles, changing air conditioning fluid to one that pollutes less, and even for placing louvres on car grilles to improve aerodynamics. They won't have to improve pickup truck mileage much for the first few years, but big improvements will come later, after 2020.

Still, automakers have been adding technology to boost gas mileage, mainly because people want to spend less on fuel, which averaged about US$3.75 per gallon this week. The research firm JD Power and Associates says that fuel economy is the top factor people consider when buying a car in the US.

By 2025, some bigger models may disappear, and dealers could offer more efficient gas-electric hybrids, natural gas vehicles and electric cars. There also will be smaller motors, lighter bodies and more devices to save fuel, such as circuits that temporarily shut off engines at traffic lights.

The changes will raise new car prices, but the government says that will be more than offset by the savings at the pump.

The new rules were adopted after an agreement between the administration and 13 automakers last year. That's a change from the past, when automakers fought stricter fuel economy changes, saying it cost them too much to build vehicles to meet the stricter standards.

Industry leaders repeatedly told the Obama administration that they wanted one nationwide fuel standard, fearing separate mileage standards from California and other states.

"They wanted certainty so that as they invest in the future they will know what rules they are playing by," Jackson said.

Fuel economy standards were first imposed on US automakers in the 1970s. The aim was to make cars more efficient and reduce the nation's dependence on foreign oil at time when the Arab oil embargo was creating fuel shortages. The administration says this is the first update in decades.

The National Highway Traffic Safety Administration will enforce the standards, calculating the average mileage of cars sold by each automaker. Automakers can be fined if they don't comply.

The requirements, which can be imposed without congressional approval, will be reviewed in 2018 and could be reduced if the technology isn't available to meet the standards.

The rules are tough, but General Motors, the largest US car company, will roll out features to comply, spokesman Greg Martin said.

"Consumers want higher fuel efficiency in their cars and trucks, and GM is going to give it to them," he said.

The administration likes to tout co-operation between automakers and the government in forming the latest rules.