On January 28^th, 2012, the California Air Resources Board unanimously voted to adopt the Advanced Clean Cars Program, which represents the most comprehensive effort in the world to set society on path to end our dependence on oil.  It’s a tremendous victory for California residents and consumers, with national and global benefits and implications. By 2025 in California:

• One in seven new cars sold will be zero-emission (battery electric or hydrogen fuel cell electric) or plug-in hybrid vehicles, and approximately 1.4 million of these vehicles will be on the road;

• Greenhouse gases will be reduced by 52 million tons, the equivalent of taking 10 million cars of the road;

• Tailpipe emissions of soot and smog forming emissions will be cut by 75%;

• California drivers will save $5 billion in operating costs, with average consumers seeing nearly $6,000 in fuel cost savings over the life the advanced car (compared to added upfront costs of approximately $2,000); and

• 21,000 jobs will be added in California, rising to 37,000 in 2030.

The program rightly focuses industry efforts on both incremental and transformative change.  On the incremental side, the Low Emission Vehicle (LEV) regulations set targets for automakers to improve the efficiency and emissions systems associated with internal combustion engines, which are likely to be at least part of our transportation portfolio well into the future.  The Zero Emissions Vehicle (ZEV) and Clean Fuels Outlet (CFO) regulations aim to spur the commercialization of ZEVs, which do not rely on petroleum and offer a clear path to clean, sustainable transportation.

Interestingly, automakers all expressed general support of these rules. This marks a tremendous sea change from the past, when automakers nearly unanimously opposed past ZEV and LEV rulings. Why the change of heart?

The times have changed.  Nearly all of the regulated companies have made substantial investments in the advanced technologies the regulations will require.  Nissan and GM have released the Leaf and Volt, respectively, with the aim of making money.  Upstarts such as Tesla, CODA, and Fisker are challenging the traditional players with their clean technologies. And the summer 2011 fuel economy agreement between the federal government, ARB, and automakers set the table for collaboration and cooperation.

Now the oil industry is the laggard.  The Clean Fuels Outlet will require major oil refiner/importers to install hydrogen fuel stations (and potentially battery electric charging stations) to fuel ZEVs that the auto companies project they will produce.  In the very worst-case scenario, the CFO would cost oil companies less than a day’s worth of profits.  At best, any investment the oil companies make would be recovered with profits increasing over the years. Regardless, the oil companies are threatening legal action; much like the auto companies did at the advent of ZEV.

While the CFO saga will continue to play out as the rules become finalized, Energy Independence Now will be working behind the scenes to ensure that the rules set the floor for advanced technology deployment, not the ceiling. We have our work cut out for us, but the recent ARB action represents significant milepost on the way to sustainable transportation.

This entry was posted on Tuesday, February 7th, 2012 at 1:08 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.