Corporate Average Fuel Economy (CAFE): A Comparison of Selected Legislation in the 110th Congress

Corporate Average Fuel Economy (CAFE): A Comparison of Selected Legislation in the 110th Congress

Order Code RL33982
Corporate Average Fuel Economy (CAFE):
A Comparison of Selected Legislation in
the 110th Congress
Updated August 16, 2007
Brent D. Yacobucci
Specialist in Energy Policy
Resources, Science, and Industry Division
Robert Bamberger
Specialist in Energy Policy
Resources, Science, and Industry Division

Corporate Average Fuel Economy (CAFE):
A Comparison of Selected Legislation in
the 110th Congress
Summary
The rise in crude oil and gasoline prices since the winter of 2006 has renewed
the focus on U.S. fuel consumption in the transportation sector. Wider concerns over
greenhouse gas emissions and climate change have contributed to interest in reducing
fossil fuel consumption and improving the efficiency of the U.S. transportation
sector. Possible changes to the federal Corporate Average Fuel Economy (CAFE)
standards are one policy option to address the issue.
CAFE standards are fleetwide fuel economy averages that manufacturers must
meet each model year. Currently, separate CAFE standards are established for
passenger cars and light trucks, which include sport utility vehicles (SUVs), vans,
and pickup trucks. Several bills have been introduced in the 110th Congress to
modify the CAFE program. Senate energy legislation, H.R. 6, passed that body on
June 21, 2007; the bill includes language on CAFE. On August 3, 2007, the House
passed energy legislation — H.R. 3221 (241-170) and H.R. 2776 (221-189) — but
these bills did not include CAFE provisions. Two House bills addressing CAFE
(H.R. 1506, H.R. 2729) were circulated as possible amendments, but neither were
debated on the House floor.
This report provides a side-by-side comparison of these and other bills in the
110th Congress addressing passenger vehicle fuel economy in general and the CAFE
program specifically. The bills are compared on various policy options including, but
not limited to, the types of provisions identified above. The report also compares
provisions in bills that would establish greenhouse gas emissions standards for
passenger cars outside of the CAFE structure. Such emissions standards would likely
also have the effect of increasing fuel economy.
One issue in the CAFE debate over the years has been whether Congress should
set CAFE standards or delegate that authority exclusively to NHTSA. For passenger
cars, the original EPCA legislation established specific targets for model year (MY)
1978 and MY1985, and required that the Secretary of Transportation set standards
for the interim years. Some of the current proposals would also set specific targets
in the future; others would require annual improvements in CAFE by some specified
percentage. In some instances, both approaches are used. Those proposals would
establish a mandated CAFE by a certain date and require subsequent annual
percentage increases. Some bills would also require NHTSA to set the maximum
feasible interim standards.
Another key question is the form CAFE standards should take. One bill would
require that the CAFE standard be expressed in grams per mile of carbon dioxide
emissions (CO ), in addition to miles per gallon. States are pre-empted from
2
establishing their own CAFE standards but are permitted to set clean air
requirements. This has generated controversy, and some believe a requirement to
report fuel economy as a function of CO emissions is intended to have some bearing
2
on the differing treatment of the states between CAFE and emissions standards.

Contents
Background: Establishment of the CAFE Standards . . . . . . . . . . . . . . . . . . . . . . . 1
Recent CAFE Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Policy Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Policy Options Within CAFE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Combined Passenger Car/Light Truck Standards . . . . . . . . . . . . . . . . . 3
Definition of “Automobile” and “Light Truck” . . . . . . . . . . . . . . . . . . . 3
Mandated Numeric Increase in CAFE Standards . . . . . . . . . . . . . . . . . 3
Mandated Percentage Increase in CAFE Standards . . . . . . . . . . . . . . . . 3
Regulatory Flexibility/Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Expanded Considerations for Maximum Feasible Fuel Economy . . . . . 4
Attribute-Based Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Credit Trading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Carbon Dioxide Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Bush Administration Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Non-CAFE Policy Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Comparison of Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
List of Tables
Table 1. Comparison of Senate CAFE Bills in the 110th Congress . . . . . . . . . . . 7
Table 2. Comparison of House CAFE Bills in the 110th Congress . . . . . . . . . . . 13
Table 3. Comparison of Bills To Establish Automobile Greenhouse Gas
Standards in the 110th Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Corporate Average Fuel Economy (CAFE):
A Comparison of Selected Legislation
in the 110th Congress
The rise in crude oil and gasoline prices since the winter of 2006 has renewed
the focus on U.S. fuel consumption in the transportation sector. Wider concerns over
greenhouse gas emissions and climate change have contributed to interest in reducing
fossil fuel consumption and improving the efficiency of the U.S. transportation
sector. Among the various policy options to address the issue are changes to the
federal Corporate Average Fuel Economy (CAFE) standards.1 CAFE refers to the
average miles per gallon used by a manufacturer’s entire fleet of cars or light trucks
in a given model year.
Various bills in the 110th Congress would modify the CAFE program to increase
fuel economy standards for all vehicles, heighten the stringency of testing procedures,
and/or grant the National Highway Traffic Safety Administration (NHTSA) broader
authority to implement the program. In the Senate, S. 357 was reported, as amended,
from the Committee on Commerce, Science, and Transportation on May 8, 2007.
Some of its provisions were inserted, along with other energy initiatives reported
from committee, into S.Amdt. 1502 to H.R. 6. H.R. 6 passed the Senate June 21,
2007 and includes CAFE language.
On August 3, 2007, the House passed energy legislation — H.R. 3221 (241-170)
and H.R. 2776 (221-189) — but these bills did not include CAFE provisions. Two
House bills addressing CAFE (H.R. 1506, H.R. 2729) were circulated as possible
amendments, but neither were debated on the House floor. Some argued that it would
strengthen House negotiations with the Senate in conference if the House bill had
also included CAFE provisions. An effort to add CAFE language to House energy
legislation was defeated on June 28th in a House Committee on Energy and
Commerce markup (26-31). It is possible that provisions of H.R. 1506 and H.R. 2927
may figure in discussions should an energy bill reach conference.
Background: Establishment of the CAFE Standards
The Arab oil embargo of 1973-1974 and the subsequent tripling in the price of
crude oil brought into sharp focus the fuel inefficiency of U.S. automobiles. New car
fleet fuel economy had declined from 14.8 miles per gallon (mpg) in model year
(MY) 1967 to 12.9 mpg in 1974. In the search for ways to reduce dependence on
imported oil, automobiles were an obvious target. The Energy Policy and
1 For more information on CAFE, see CRS Report RL33413, Automobile and Light Truck
Fuel Economy: The CAFE Standards, by Brent D. Yacobucci and Robert Bamberger.

CRS-2
Conservation Act (EPCA, P.L. 94-163) established CAFE standards for passenger
cars for MY1978. The CAFE standards called for an eventual doubling in new car
fleet fuel economy. EPCA also granted NHTSA the authority to establish CAFE
standards for other classes of vehicles, including light-duty trucks.2 NHTSA
established fuel economy standards for light trucks, beginning in MY1979. For
passenger cars, the current standard is 27.5 miles per gallon (mpg) for MY2007. For
light trucks, the standard is 22.2 mpg for MY2007.
Under EPCA, the Secretary of Transportation has the discretion to adjust the
passenger car standard within a range from 26.0 to 27.5 mpg. Any increase above
27.5 mpg or below 26.0 mpg requires the Secretary to issue an amendment to the
standards. That amendment would be in force unless either chamber of Congress
disapproves. However, this one-House veto could be judged to be unconstitutional.3
The Secretary has much broader discretion with respect to setting light truck fuel
economy standards (referred to in the regulations as “non-passenger automobiles”).
This includes the authority to establish different standards for different classifications
of these vehicles.
Recent CAFE Regulations
In April 2006, NHTSA promulgated new CAFE rules for light trucks. After
MY2007, light truck manufacturers may voluntarily comply with a new “reformed”
standard based on the size of each specific manufacturer’s vehicles. Starting in
MY2011, all light truck makers will be subject to the reformed standards, which
NHTSA estimates will be equivalent to about 24.0 mpg under the old system. EPCA
gives NHTSA the authority to modify the light truck standards as it sees fit, including
setting standards based on vehicle attributes (in this case, size). EPCA does not grant
similar flexibility in application of the passenger car standard.
Policy Options
Policy Options Within CAFE
Several bills would amend the current CAFE program to increase CAFE
standards, change testing procedures, and/or grant NHTSA broader regulatory
discretion. CRS analyzed 12 CAFE-related bills with regard to several key policy
options:
! combined passenger car/light truck standards,
! definition of “automobile” and “light truck,”
! mandated numeric increase in CAFE standards,
! mandated percentage increase in CAFE standards,
2 Light-duty trucks include most sport utility vehicles (SUVs), vans, and pickups.
3 For more information see CRS Report RS22132, Legislative Vetoes After Chadha, by
Louis Fisher.

CRS-3
! regulatory flexibility/authority,
! expanded considerations for maximum feasible fuel economy,
! attribute-based standards,
! credit trading,
! carbon dioxide emissions, and
! other key provisions.
None of these policy options is mutually exclusive, and any or all options could be
adopted together. Each of these options is discussed below.
Combined Passenger Car/Light Truck Standards. One criticism of the
current CAFE program is its separate treatment of light trucks and passenger cars.
When EPCA was first enacted, most light trucks were used solely as work vehicles,
and they constituted a relatively small percentage of the light-duty vehicle fleet.
Since that time, light trucks, which include sport utility vehicles (SUVs) and vans,
are used more and more as passenger vehicles. Currently, light trucks make up
roughly half of the new light-duty vehicle market. As a consequence, some argue
that the distinction between the two fleets should be eliminated. Critics also allege
that specifications for some car-like vehicle models may have been designed
purposefully to qualify those vehicles for the lower mpg standard that applies to the
light truck fleet.
Definition of “Automobile” and “Light Truck”. Passenger car and light
truck standards could be combined by simply expanding the definition of “passenger
automobile” to include light trucks up to 8,500 pounds. Some proponents of tighter
standards argue that light trucks should be treated as passenger vehicles.
Further, some light trucks are too heavy to be included under the current CAFE
standard. Therefore, some proposals would expand the definition of “automobile”
or “light truck” to include all vehicles up to 10,000 pounds gross weight (current
standards cover vehicles up to 8,500 pounds gross weight). Other proposals would
expand CAFE standards to some heavier vehicles (e.g. SUVs and passenger vans) but
would exclude “work trucks” (e.g. pickups and cargo vans).
Mandated Numeric Increase in CAFE Standards. Some analysts argue
that price volatility in oil markets sends inconsistent signals to prospective new car
purchasers, and that the only way to avoid these mixed signals would be to mandate
higher CAFE standards. Some legislative proposals would require NHTSA to
establish new CAFE standards set at a fixed mpg target in a given year. Various
proposals would mandate increased standards for passenger cars, light trucks, or
both.
Mandated Percentage Increase in CAFE Standards. While some bills
would mandate an increase in the CAFE standards to specified levels, others would
require NHTSA to set rules to increase fuel economy by a set percentage every year.
In most cases, the bills mandate an annual CAFE increase of 4% from the previous
year. The bills vary on whether the increase would cover passenger cars, light trucks,
or both.

CRS-4
Regulatory Flexibility/Authority. As was mentioned above, NHTSA
currently has limited authority to modify the specific mpg target or the general design
of passenger car CAFE standards. Some legislative proposals would significantly
broaden NHTSA’s authority to amend the program, including allowing NHTSA to
set higher passenger car standards than EPCA currently allows. Currently, any
increase above 27.5 mpg or below 26.0 mpg requires the Secretary to issue an
amendment to the standards. That amendment is to be in force unless either chamber
of Congress disapproves.
Other proposals would allow NHTSA to extend the current single-year
compliance period to multiyear periods. Such a proposal, for example, might allow
NHTSA to require manufacturers to meet a set CAFE average for MY2011 through
MY2013, instead of requiring that the CAFE average be achieved in each model year.
Expanded Considerations for Maximum Feasible Fuel Economy.
Current law requires NHTSA to consider various factors in determining “maximum
feasible average fuel economy.” NHTSA must consider “technological feasibility,
economic practicability, the effect of other motor vehicle standards of the
government on fuel economy, and the need of the United States to conserve energy.”4
Some of the bills would add a further dimension, “cost-effectiveness,” and stipulate
weighing of several factors in assessing the cost-effectiveness of any proposed
changes in the standards. Among these factors are value to consumers, economic
security, national security, foreign policy, and the impact of oil use on various other
national policy concerns.
Attribute-Based Standards. As noted above, NHTSA has established size-
based CAFE standards for light trucks but does not have similar authority for
passenger cars. Some proposals would allow NHTSA to establish multiple levels of
passenger car CAFE standards for a given model year. The levels could be based on
a variety of vehicle attributes, including size and/or weight. The Senate-passed H.R.
6 would require attribute-based standards. H.R. 6 would also require that, after
enactment, the Secretary of Transportation would initiate a study toward developing
a fuel economy program to raise the vehicle fuel efficiency of medium- and heavy-
duty trucks.
Credit Trading. For each model year, automakers must meet separate CAFE
targets for three new vehicle fleets: domestically produced passenger cars, imported
passenger cars, and light trucks. In any year that a manufacturer exceeds the CAFE
standard for one of these given fleets, that manufacturer may “bank” credits for use
in meeting future year requirements. Conversely, in any year that the manufacturer
comes up short, it may “borrow” credits from an anticipated surplus in future years.
Under the current CAFE program, banked or borrowed credits may be used only for
the fleet in which they originated. For example, if an automaker generates credits for
its fleet of imported passenger cars, those credits may not be applied to its fleets of
domestic cars or light trucks. Similarly, automakers may not trade credits with other
automakers. However, some of the legislative proposals would allow a manufacturer
to move credits between fleets and/or trade credits with another manufacturer.
4 49 U.S.C. 32902(f)

CRS-5
Carbon Dioxide Standards. One bill, H.R. 2927, would require that new
CAFE standards be expressed in grams per mile of carbon dioxide (CO ), in addition
2
to miles per gallon. Under EPCA, states are pre-empted from establishing their own
CAFE standards. But the Clean Air Act permits states to set their own clean air
requirements. This has generated controversy, and some believe a requirement to
report fuel economy as a function of CO emissions is intended to have some bearing
2
on the differing treatment of the states between CAFE and emissions standards.
Some of these matters are currently being litigated.
Bush Administration Proposal
In his 2007 State of the Union address, President Bush outlined a goal of
reducing gasoline5 consumption by 20% from projected levels in 2017. Of that 20%
reduction, the President proposed that 15% come from the increased use of renewable
and alternative fuels, and that 5% come from increased vehicle fuel efficiency. It has
been estimated that an annual 4% increase in CAFE standards would lead to a 5%
reduction in projected gasoline consumption in 2017. The Bush Administration has
not proposed legislation that would mandate an increase in CAFE standards.
On February 6, 2007, NHTSA submitted draft legislation to the House Energy
and Commerce Committee on the Bush Administration’s CAFE proposal.6 The
Administration’s proposal would not require an increase in fuel economy standards
but would grant NHTSA broader regulatory authority. The draft would allow
NHTSA to establish attribute-based standards for passenger cars and would allow for
CAFE credit trading.
Non-CAFE Policy Options
In addition to bills modifying the CAFE program, several other bills have been
introduced that would likely increase vehicle fuel economy through other measures.
For example, several bills requiring reductions in carbon dioxide and other
greenhouse gas emissions have been introduced. Of those bills, two would require
per-mile emissions reductions from passenger vehicles. While such emissions
standards would not technically constitute a change in fuel economy standards,
automakers and others contend that there is no way other than fuel economy increases
to reduce automobile greenhouse gas emissions.7
5 Gasoline is only one part of oil consumption (albeit the largest), and thus a 20% reduction
in gasoline consumption translates to a smaller reduction in overall petroleum consumption.
6 As of February 22, 2007, no Member has sponsored and introduced the Administration’s
proposal.
7 For more information on climate change bills, see CRS Report RL33846, Climate Change:
Greenhouse Gas Reduction Bills in the 110th Congress, by Larry Parker and Brent D.
Yacobucci.

CRS-6
Comparison of Legislation
Of the 14 CAFE bills compared, the eight Senate bills are compared in Table
1 and the four House bills are compared in Table 2. The two bills to control
greenhouse gas emissions from passenger cars are compared in Table 3.

CRS-7
Table 1. Comparison of Senate CAFE Bills in the 110th Congress
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
Bill Title
Improved Passenger
Ten-in-Ten Fuel
Fuel Economy Reform
Security and Fuel
Fuel Efficiency
Ten-in-Ten Fuel
Automobile Fuel
Economy Act
Act
Efficiency (SAFE)
Energy Act of 2007
Economy Act
Economy Act of 2007
Energy Act of 2007
Combined
No provision.
Passenger car and light
Passenger car and light
No provision.
No provision.
Passenger car and light
Passenger
truck standards
truck standards
truck standards
Car/Light Truck
combined starting in
combined starting in
combined starting in
Standards
MY2013. [Sec. 2]
MY2013. [Sec. 4]
MY2011. [Sec. 502]
Change in
No provision
Expands light truck
Expands definition of
Establishes that 4-
Establishes that 4-
Includes light trucks
Definition of
definition to include
“passenger
wheel drive is neither
wheel drive is neither
between 8,500 and
“Automobile” or
vehicles between
automobile” to include
necessary nor
necessary nor
10,000 pounds that are
“Light Truck”
8,500 and 10,000
all vehicles of up to
sufficient to qualify
sufficient to qualify
not “work trucks” —
pounds that are not
10,000 pounds
vehicle as a light-duty
vehicle as a light-duty
i.e. not heavier
“work trucks” — i.e.
designed to carry less
truck. [Sec. 2]
truck. [Sec. 2]
pickups and vans.
not heavier pickups
than 10 passengers.
[Sec. 504]
and vans [Sec. 5]
[Sec. 3]
Mandated
40 mpg for passenger
35 mpg for combined
27.5 mpg for
No provision.
No provision.
35 mpg for combined
Numeric Increase
cars only by MY2017.
fleets by MY2019.
combined fleets by
automobile and light
in CAFE
During interim, the
[Sec. 2]
MY2013. [Sec. 4]
truck fleets by
Standards
Secretary of
MY2020. [Sec. 502]
Transportation must
Interim MY2010
set standards for each
standards of 29.5 mpg
individual
for passenger cars and
manufacturer at
25.5 mpg for light
maximum feasible
trucks. [Sec. 2]
level. [Sec. 101]

CRS-8
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
Mandated
An annual, fixed
No provision.
For MY2010 through
For MY2013 through
Starting in MY2013,
Requires the Secretary
Percentage
percentage increase is
MY2012, requires a
MY2030, requires a
requires that CAFE
of Transportation to
Increase in CAFE
specifically prohibited.
4% annual increase in
mandatory annual fuel
standard for each class
establish procedures to
Standards
[Sec. 101]
passenger car fuel
economy increases of
of vehicles be
ensure the maximum
economy. [Sec.
4% for each class of
increased by 4% over
feasible increase in
106(a)(3)]
vehicles. [Sec. 102]
the previous model
fuel efficiency for
year’s standard. [Sec.
medium- and heavy-
Starting in MY2013,
3]
duty commercial
establishes a
vehicles. [Sec. 502]
mandatory annual fuel
economy increase of
4% for passenger cars
and light trucks
combined. [Sec.
106(a)(3)]
Improving Fuel
No comparable
No comparable
No comparable
The Secretary shall
Same as S. 875.
Would require the
Efficiency of
provision
provision.
provision.
establish average fuel
Secretary of
Medium and
economy standards for
Transportation, 18
Heavy-Duty
medium-duty trucks
months after
Trucks
that are consistent with
enactment, to initiate a
the projected benefits
study that could lead
of hybridization. In
to the establishment of
this section, the term
fuel economy
‘medium-duty truck’
standards, or other
means a truck (as
policies, to improve
defined in section
the fuel efficiency of
30127) with a gross
medium- and heavy-
vehicle weight
duty on-highway
between 10,000 and
trucks. Any program
26,000 pounds.
would provide a lead
time of 4 model years
and make no changes
in any targets at less
than three-year

CRS-9
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
intervals.
Regulatory
NHTSA is authorized
NHTSA is given
NHTSA may set lower
NHTSA may set lower
NHTSA may set lower
NHTSA is given
Flexibility/
to establish multiyear
broader authority to
standards for a model
standards for a model
standards for a model
broader authority to
Authority
compliance periods
increase passenger car
year if the targets are
year if the targets are
year if the targets are
increase passenger car
instead of the current
fuel economy without
not technologically
not technologically
not technologically
fuel economy without
single-year
congressional
achievable, would lead
achievable, would lead
achievable, would lead
congressional
compliance period.
approval. [Sec. 3]
to reductions in
to reductions in
to reductions in
approval. [Sec. 502]
[Sec. 101]
vehicle safety, or are
vehicle safety, or are
vehicle safety, or are
NHTSA may set
not cost-effective.
not cost-effective.
not cost-effective.
Secretary may set a
Standards may be set
different CAFE targets
[Sec. 4]
[Sec. 102]
[Sec. 3]
standard that is lower
individually for
for different
than the “maximum
different classes of a
manufacturers, but in
NHTSA may establish
feasible” level if there
manufacturer’s fleet of
any given year each
multiyear compliance
is “clear and
passenger
manufacturer must
periods (up to four
convincing evidence”
automobiles. [Sec.
achieve a minimum
years). [Sec. 5]
that this level can be
101]
average of 92% of the
demonstrated to not be
industry-wide CAFE
NHTSA may set
“cost-effective.” [Sec.
target. [Sec. 2]
different CAFE targets
503]
for different
manufacturers, but in
any given year each
manufacturer must
achieve a minimum
average of 92% of the
industry-wide target.
[Sec. 4]
Expanded
No provision.
No provision.
Cost-effectiveness is
Substantially similar to
Substantially similar to
Substantially similar
Considerations
added to the list of
S. 767/768.
S. 767/768.
to S. 767/768.
for Maximum
factors for NHTSA to
Feasible Fuel
consider in
Economy
determining maximum
feasible fuel economy.

CRS-10
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
Cost-effectiveness
would be measured
relative to several
criteria, including
value to consumers,
economic security,
national security,
foreign policy, and the
impact of oil use on
various other national
policy concerns. [Sec.
4]
Attribute-Based
NHTSA is given
No provision.
Starting in MY2013,
No provision.
No provision.
NHTSA is required to
Standards
authority to establish
NHTSA is given
establish attribute-
attribute-based
authority to establish
based standards. [Sec.
standards. [Sec. 101]
attribute-based
502]
standards. [Sec. 4]

CRS-11
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
Credit Trading
Greenhouse gas credits
Manufacturers may
Before MY2013,
No provision.
No provision.
Substantially similar to
registered with a
trade credits between
manufacturers are
S. 357. [Sec. 506]
national registry may
fleets and with other
allowed to trade
be purchased by
manufacturers. [Sec.
credits with other
manufacturers and
9]
manufacturers for the
applied to fleet fuel
same fleet (e.g.
economy results after
domestic passenger
MY2010. However,
cars). Starting in
credits purchased
MY2013,
through the registry
manufacturers may
cannot offset more
trade credits with other
than 10% of the fuel
manufacturers across
economy standard.
all fleets. However, in
[Sec. 102, 201]
the absence of such
credits, each fleet must
achieve at least 92% of
the overall CAFE
target. [Sec. 5]
Carbon Dioxide
No provision.
No provision.
No provision.
No provision.
No provision.
No provision.
Standards
Other Key CAFE-
The Secretary of
Starting in MY2014,
No provision.
Existing incentives
Broadens authority of
NHTSA must develop
Related
Transportation may
automakers must
within the CAFE
NHTSA to establish
a “motor vehicle
Provisions
not set standards that
install devices to
program for the
standards for a broader
safety standard” to
impose “marginal
provide real-time and
production of dual-
population of vehicles,
reduce death and
costs that exceed
cumulative fuel
fuel and flexible fuel
including vehicles
injury by improving
marginal benefits.”
economy data that will
vehicles are
with gross vehicle
compatibility of large
[Sec. 101]
enable drivers to
eliminated. [Sec.
weight of 10,000-
and small vehicles in
operate their vehicles
102(b)]
26,000 pounds. [Sec.
frontal- and side-
A “national registry
to use fuel more
2]
impacts. [Sec. 505]
system” for voluntary
efficiently. [Sec. 7]
Requires NHTSA to
greenhouse gas trading
set fuel economy
Beginning in
The National
would be established.
In order to reduce the
standards for medium-
MY2012, existing
Academy of Sciences
The Secretary of
likelihood of death or
duty vehicles (vehicles
incentives within the
(NAS) will conduct a

CRS-12
S. 183
S. 357 (Feinstein)
S. 767 / S. 768
S. 875
S. 1118
H.R. 6 - Senate
(Stevens)
[as introduced]
(Obama)
(Lugar)
(Dorgan)
Version (Reid)
Transportation,
injury from accidents,
with a gross weight
CAFE program for the
study of current and
working with the
NHTSA is required to
between 10,000 and
production of dual-
potential technologies
Department of
develop vehicle
26,000 pounds). [Sec.
fuel and flexible fuel
that might contribute
Commerce, will
ratings and standards
102(a)]
vehicles are
to meeting CAFE
determine the
to reduce damage by
eliminated. [Sec.3]
standards. [Sec. 509]
equivalency between
improving
fuel economy
compatibility of large
Requires establishment
improvements and
and small vehicles in
of a tire fuel efficiency
greenhouse gas
frontal- and side-
consumer information
reductions. [Sec. 201]
impacts. [Sec. 6]
program.[Sec. 513]
Other Key Non-
No provision.
Requires the
S. 768 also modifies
This is a broad bill that
From MY2012-2022,
Among a number of
CAFE Provisions
Environmental
existing tax credits for
also: modifies the
manufacturers must
additional provisions,
Protection Agency to
hybrid vehicles and
existing hybrid vehicle
produce not less than
would require
establish a program to
establishes a
purchase tax credit and
10% more dual-fueled
establishment of an
label new vehicles’
manufacturer tax
establishes a tax credit
vehicles than in the
Advanced Battery
expected lifetime
credit for advanced
for fuel-efficient
preceding model year.
Initiative to award
greenhouse gas
technology vehicles.
vehicles; establishes a
[Sec. 3]
grants and identify
emissions. [Sec. 11]
manufacturer’s tax
technological needs;
credit for advanced
promulgation of
technology vehicles;
standards for biodiesel
modifies the existing
fuel; and establishment
mandate for renewable
of a credit-trading
fuels; promotes
program; and sets
renewable fuel
requirements for
infrastructure;
manufacture of
mandates the
flexible-fuel vehicles
production of
and raising consumer
alternative fuel
awareness about
vehicles; limits oil
availability of these
exploration in certain
vehicles.
areas.

CRS-13
Table 2. Comparison of House CAFE Bills in the 110th Congress
H.R. 656 (Reichert)
H.R. 1133 (Berkley)
H.R. 1500 (DeFazio)
H.R. 1506 (Markey)
H.R. 2927
(Hill)
Bill Title or
To require higher standards
Freedom through
Gasoline Price Stabilization
Fuel Economy Reform Act
To increase the corporate
Purpose
of automobile fuel
Renewable Energy
Act of 2007
average fuel economy
efficiency with the goal of
Expansion (FREE) Act
standards for auto-mobiles,
reducing the amount of oil
to promote the domestic
used for fuel by
development and
automobiles in the United
production of advanced
States by 10 percent
technology vehicles, and
beginning in 2017, and for
for other purposes.
other purposes.
Combined
No provision.
No provision.
No provision.
Passenger car and light
No provision.
Passenger
truck standards combined
Car/Light Truck
starting in MY2011. [Sec.
Standards
4]
Change in
No provision.
No provision.
No provision.
Expands definition of
No provision.
Definition of
“automobile” to include all
“Automobile” or
vehicles of up to 10,000
“Light Truck”
pounds. [Sec. 3]
Mandated
33 mpg by MY2017;
33 mpg by MY2016;
37 mpg by MY2018 and 40
Mandates “a projected level
Projected fuel economy for
Numeric Increase
interim standards would be
interim standards would be
mpg by MY2023; interim
of average fuel economy”
passenger and non-
in CAFE
set by Secretary of
set by Secretary of
standards would be set by
of at least 27.5 mpg for
passenger automobiles
Standards
Transportation beginning in
Transportation beginning in
Secretary of Transportation
vehicles up to 10,000
would be not less than 32
MY2010 to reach the
MY2010 to reach the
beginning in MY2010 to
pounds beginning in
mpg or greater than 35 mpg
mandated target. [Sec. 1]
mandated target. [Sec. 8]
reach the mandated target.
MY2012, and 35 mpg in
in MY2022. [Sec. 1]
[Sec. 9]
MY2018.

CRS-14
H.R. 656 (Reichert)
H.R. 1133 (Berkley)
H.R. 1500 (DeFazio)
H.R. 1506 (Markey)
H.R. 2927
(Hill)
Mandated
No provision.
No provision.
No provision.
Requires that current 27.5
No provision.
Percentage
mpg standard for passenger
Increase in CAFE
automobiles be increased
Standards
4% annually beginning in
MY2009. [Sec. 4]
Regulatory
No provision.
No provision.
No provision.
National Highway Traffic
No comparable provision.
Flexibility/
Safety Administration
Authority
(NHTSA) may set lower
standards for a
manufacturer for a model
year if the targets are not
technologically achievable,
or are not cost-effective;
and if a lower standard
during MY2012-MY2017
would not result in a failure
to attain 35 mpg in
MY2018. [Sec. 4]
Expanded
No provision.
No provision.
No provision.
Cost-effectiveness is added
No provision.
Considerations for
to the list of factors for
Maximum Feasible
NHTSA to consider in
Fuel Economy
determining maximum
feasible fuel economy.
Cost-effectiveness would
be measured relative to
several criteria, including
value to consumers,
economic security, national
security, foreign policy, and
the impact of oil use on
various other national
policy concerns. [Sec.
4(a)(3)]

CRS-15
H.R. 656 (Reichert)
H.R. 1133 (Berkley)
H.R. 1500 (DeFazio)
H.R. 1506 (Markey)
H.R. 2927
(Hill)
Attribute-Based
Authorizes Secretary to
No provision.
Authorizes Secretary to
Extends flexibility to
Extends flexibility to
Standards
establish size-based
establish size-based
Secretary to establish
Secretary to establish
standards for different
standards for different
attribute-based standards
attribute-based standards
classes of vehicles. [Sec. 1]
classes of vehicles. [Sec. 9]
(including size) for
(including size) for
different classes of
different classes of
vehicles, or in the form of a
vehicles, or in the form of a
mathematical function.
mathematical function.
[Sec. 4]
[Sec. 1]
Changes in Test
No provision.
No provision.
No provision.
Requires joint report from
No provision; however,
Procedures
the Departments of
would require that annual
Transportation and Energy,
standards also be expressed
and the Environmental
in the equivalent of
Protection Agency that, in
average grams per mile of
part, assesses the accuracy
carbon dioxide emissions.
of CAFE test procedures
used to measure fuel
economy, and to “identify
any additional factors or
methods that” would
contribute to the tests’ more
accurately reflecting in-use
fuel economy. [Sec. 4]
Credit Trading
Authorizes Secretary to
No provision.
No provision.
No provision.
Authorizes Secretary to
establish a credit trading
establish a credit trading
program. [Sec. 2]
program. [Sec. 1]

CRS-16
H.R. 656 (Reichert)
H.R. 1133 (Berkley)
H.R. 1500 (DeFazio)
H.R. 1506 (Markey)
H.R. 2927
(Hill)
Carbon Dioxide
No provision.
No provision.
No provision.
No provision.
Requires Secretary to
Standards
establish fuel economy
standards both in terms of
miles per gallon and grams
per mile of carbon dioxide.
[Sec. 1]
Other Key CAFE-
Preamble states that the
Advises Secretary that
Advises Secretary that
Act is not intended to
Establishes fund for
Related Provisions
bill’s intention is to de facto
interim standards not only
interim standards not only
“limit, constrain, supersede,
domestic
reduce the amount of oil
reach mandated 33 mpg by
reach mandated goals, but
or expand” authorities for
commercialization and
used in automobiles by
MY2016, but maximize
maximize retention of jobs
prescribing motor vehicle
production of advanced
10% beginning in 2017.
retention of jobs in the
in the sector, and not
safety standards. [Sec. 5]
technology vehicles and
sector, and not degrade
degrade safety of
components. Fund will be
Advises Secretary that
safety of automobiles. [Sec.
automobiles. [Sec. 9]
financed by civil penalties
interim standards not only
8]
collected for non-
reach mandated 33 mpg by
Requires Executive Branch
compliance with fuel
MY2016, but also must
agencies to improve the
economy standards. [Sec.
maximize retention of jobs
average fuel economy of
1]
in the sector, and not
new vehicles in each
degrade safety of
vehicle class by 3 mph by
Requires establishment of a
automobiles. [Sec. 1]
MY2011, and 6 mpg by
tire fuel efficiency
MY2014 over a baseline
consumer information
calculated for all vehicles in
program.
the MY2008 fleet for each
[Sec. 2]
vehicle class. [Sec. 10]
Requires establishment of a
fuel conservation education
program.
[Sec.3]
Extends credit for
production of alternative-
fueled automobiles. [Sec. 4]
Other Key Non-
No provision.
This is a broad bill that also
This is a broad bill that also
No provision.
No provision.

CRS-17
H.R. 656 (Reichert)
H.R. 1133 (Berkley)
H.R. 1500 (DeFazio)
H.R. 1506 (Markey)
H.R. 2927
(Hill)
CAFE Provisions
includes provisions relating
includes provisions on
to nuclear energy, offshore
several matters such as
leases, repeal of certain tax
petroleum industry
subsidies and extension of
concentration, the Strategic
certain tax credits,
Petroleum Reserve,
renewable portfolio
minimum inventory levels.
standard, and other matters.
Table 3. Comparison of Bills To Establish Automobile Greenhouse Gas Standards in the 110th Congress
S. 309 (Sanders)
S. 485 (Kerry)
Bill Title
Global Warming Pollution Reduction Act
Global Warming Reduction Act of 2007
Greenhouse Gas
The Environmental Protection Agency (EPA) Administrator is required
The EPA Administrator is required to establish regulations for reducing
(GHG) Emission
to establish regulations starting in MY2016 requiring the average fleet
greenhouse gas emissions from passenger vehicles at least as stringent as
Standard
greenhouse gas emissions be less than 205 grams per mile for passenger
those adopted by the California Air Resources board on September 23-
cars and 332 grams per mile for light trucks. [Sec. 707] (This greenhouse
24, 2004. Those regulations cap greenhouse gas emissions at 205 grams
gas standard is roughly equivalent to an MY2016 CAFE standard of 42
per mile for passenger cars and 332 grams per mile for light trucks by
mpg for passenger cars and 26 mpg for light trucks.)
2016. [Sec. 704] (This is roughly equivalent to an MY2016 CAFE
standard of 42 mpg for passenger cars and 26 mpg for light trucks.)
Other Key CAFE-
Requires greenhouse gas emissions standards for medium- and heavy-
No provision.
Related Provisions
duty trucks.
Other Key Non-
Caps greenhouse gas emissions on an economy-wide basis beginning in
Caps greenhouse gas emissions on an economy-wide basis beginning in
CAFE Provisions
2010. Emissions are capped at 20% of their 1990 levels in the year
2010. Emissions are capped at 38% of their 1990 levels in 2050. The
2050. The EPA has the discretion to employ a market-based allowance
allowance trading system includes an allocation scheme that requires an
trading program or any combination of cost-effective emission reduction
unspecified percentage of allowances to be auctioned. The bill also
strategies. The bill also includes mandatory greenhouse gas emission
includes a new energy efficiency performance standard. The bill would
standards for new powerplants, along with a new energy efficiency
establish a renewable portfolio standard (RPS), increase biofuel
performance standard. The bill would establish a renewable portfolio
mandates under the Renewable Fuels Standard, and mandate new

CRS-18
S. 309 (Sanders)
S. 485 (Kerry)
standard (RPS) and a new low-carbon generation requirement and
infrastructure for biofuels. Finally, the bill expands and extends existing
trading program.
tax incentives for alternative fuels and advanced technology vehicles,
and establishes a manufacturer tax credit for advanced technology
vehicle investment.