35 mpg by 2020 might mean just 33.2 mpg for Detroit

Looks like the tighter car fuel standards -- 35 mpg fleetwide average by 2020 -- in the energy bill aren't as tight as I'd imagined. (right: Toyota Sequoia at the L.A. Auto Show)

This energy bill looks like it will punish the car companies that have already taken steps toward producing more gas-efficient cars, while rewarding companies that have been focusing on SUVs. As the L.A. Times reports:

Under the new regulation, the fuel-economy average for all makers selling cars in the U.S. would be 35 mpg, rather than the company-by-company approach currently applied. According to the Transportation Department, the 2007 combined rating for all automakers is 26.4 mpg.

As a result, some manufacturers, particularly those selling smaller cars, will probably be asked to meet a higher standard, while the bar may be lower for those with fleets heavy on trucks and large passenger cars.

That means the Detroit Three automakers -- which have been dragging their feet and producing monster trucks -- may need to reach only 33.2 mpg -- while Honda might have to get an average of 39.2 mpg by 2020, according to a recent study by the University of Michigan's Transportation Research Institute:

Moreover, the study concluded, the higher standards will actually be more profitable for companies like General Motors Corp., Ford Motor Co. and Chrysler, as well as Toyota Motor Corp., because they can improve mileage on their lowest-mileage vehicles relatively cheaply.

Now that just seems plain unfair.... But beyond that, there's still the ethanol issue. The L.A. Times. reports that because the bill allows credits for ethanol use, "companies are planning to increase their production of inefficient trucks that consume the corn-based fuel, even though ethanol isn't sold in many states, including California."

Even before the energy bill passed, Grist reported that "the federal government's "dual-fuel loophole" provides automakers a 1.5 mile-per-gallon credit toward meeting fuel-economy standards -- without requiring that flex-fuel vehicles actually run on alternative fuel.... The government estimates that flex-fuel vehicles run on ethanol blends less than 1% of the time."

Ethanol, by the way, produces less energy per gallon than gas -- making the efficiency of vehicles running on the stuff much lower. However, because of the credit system in the bill, the vehicles will still get "an effective mileage rating 50% higher than their actual rating." Many environmentalists -- even those interested in biofuels -- have come out against corn ethanol for a variety of reasons, one of them being that "each gallon of ethanol takes the energetic equivalent of roughly three-quarters of a gallon of ethanol to produce."

Congress approved the energy bill Tuesday. Bush signed it this morning.

Photo by Siel