Shell Game

There’s a new federal proposal on the table to give makers of pure electric cars bonus points to help them meet new tougher fuel economy standards. Joseph White of the Wall Street Journal calls it the auto industry version of a “buy one, get one free” deal.

The debate over CAFE and electric cars is already underway—more than a year from the introduction of the first mainstream electric cars.

The immediate reaction from environmentalists, and fans of hybrid and electric cars, might be to shout “Yes” and throw a fist in the sky. That is, until you hear that the Alliance of Automobile Manufacturers, the lobbying organization representing 11 of the biggest automakers in the US market, is championing the idea. “The ability to earn, trade and bank credits” by producing electric and hybrid vehicles “is essential to meeting the goals of the national program,” which calls for automakers to boost the average fuel efficiency of their fleets to 35.5 miles per gallon by 2016, said Charles Territo, an Alliance spokesman.

A Failed Precedent

How would the system work? Makers of electric cars would not only get a stellar rating for producing zero tailpipe emissions and using a super-efficient electric drivetrain, the carmaker would use a multiplier of 1.2 or 2.0 when counting toward its fleet-wide average. A similar strategy is already in place for cars that can—but seldom do—use an 85 percent of ethanol.

Since 1988, automakers have been allowed to assign flexible-fuel vehicles higher fuel economy ratings under the government’s CAFE fuel economy regulations. This means that a full-size SUV that averages 13 mpg is rated at roughly 23 mpg for CAFE purposes, even if its owner never fueled it with E85. EVs will only use electricity as fuel, but the same game of banking, shifting, and selling credits would apply. Proponents say this would help automakers keep costs down, and sell electric and hybrid cars for cheaper—although there’s no guarantee that the savings wouldn’t be applied to producing more SUVs or giving bonuses to executives.

Potential Confusion

We wholeheartedly support consumer adoption of advanced fuel-efficient vehicles such as electric cars. But at face value, EV extra credits—rather than 1:1 numbers—would lower the bar on overall fleet averages.

Some analysts believe using electric cars—which don’t use petroleum-based fuel—as a tool to meet or shift fuel efficiency standards is inherently misleading. “There’s a lot of confusion out there on the issue because CAFE is defined based on petroleum use, so non-petroleum fuel options like EVs get credit disproportionate to their actual emissions reduction impact,” John DeCicco, senior lecturer at the University of Michigan’s School of Natural Resources and Environment, told “This is similar to the issue leading to the eye-popping MPG numbers for the Chevy Volt.”

DeCicco believes that this scheme is not only confusing, but counter-productive. “Funny math can’t substitute for engineering breakthroughs. EVs of any sort can only make a real difference if they succeed on their merits for both customer value and emissions reduction. Bonus credits may fool a few starry-eyed policymakers, they won’t fool either the marketplace or the Earth’s atmosphere.”

He would like to see a level playing field, in which all extra credits are dropped, and compliance is measured “strictly on the basis of actual measured energy use per mile, regardless of the fuel or energy source.”