Obama To Announce First Nationwide Carbon Emissions Standards For Autos

May 19, 2009 9:33 a.m. EST

Washington, D.C. (AHN) - President Barack Obama on Tuesday will propose tougher rules for auto emissions, including the first ever greenhouse pollution standards nationwide. The regulations adopt the stricter emissions controls proposed by California during the Bush administration.

Obama will make the announcement aroun noon from the Rose Garden of the White House. His speech will mark a "groundbreaking step," according to Press Secretary Robert Gibbs, since it brings together "groups that are normally aligned against each other ... [and for] two decades couldn't agree on updating emissions and fuel efficiency standards."

The President had signed a memorandum in February directing the Environmental Protection Agency (EPA) to reconsider California's application for a waiver to set stricter emissions controls than what is implemented by the federal government. The order reversed a controversial Bush administration decision not to allow states to regulate auto emissions.

Under the new rules, automakers must comply with a 35.5 miles-per-gallon standard by 2016, four years earlier than required by the Corporate Average Fuel Economy (CAFE) regulations. The change from the current average of 25.1 miles per gallon represents a five percent average increase in fuel efficiency beginning 2012, when the national emissions program is implemented.

Oil savings over the four-year life of the program are estimated to be 1.8 billion barrels of oil, a White House official said during a briefing.

"The program is also projected to achieve reductions of 900 million metric tons of greenhouse gas emissions under the life of the program. That is equivalent to taking 177 million cars off the road or shutting down 194 coal plants," the official added.

The Alliance of Auto Manufacturers, a trade association of 11 car and light truck manufacturers including BMW Group, Chrysler, Ford Motor Company, General Motors, will join the President at the White House during the announcement.

It released a statement saying, "A National Program is a priority to automakers because a national fuel economy program allows manufacturers to average sales nationwide, so customers in all 50 states can continue to buy the types of vehicles they need for family, business and leisure. A National Program also avoids conflicting standards from different regulatory agencies, and it gives automakers much needed certainty for long-term product planning."

Automakers will have to pay $600 in 2016 to meet the new standard, in addition to the $700 they already shell out under the CAFE.

The new rules will be unveiled as Chrysler and GM continue receiving federal assistance.

Chrysler, the third largest U.S. automaker, filed for Chapter 11 protection last month after talks between Treasury officials and its lenders until broke down despite a reported $2 billion cash offer from the government to forgive $6.9 billion worth of debts. The White House Auto Industry Task Force had rejected Chrysler's restructuring plan early this year and gave the company until the end of April to prove its viability and negotiate with Fiat about a merger.

GM is working to revise and strengthen its restructuring plan ahead of a June 1 deadline from the White House. The nation's largest automaker, GM is seeking $16.6 billion in government bailout money in addition to the $13.4 billion it has already received.