The Department of Transportation on Friday increased fuel efficiency standards for new vehicles that will begin next year as part of the Biden administration’s clean energy agenda, a move that reversed a decision by former President Trump to roll back regulations aimed at reducing greenhouse gas emissions.
Under the new Corporate Average Fuel Economy standards, automakers will need to improve fuel efficiency by 8% for model years 2024, which will be released next year, and 2025. A 10% increase will be required for model year 2026.
That means automakers will need to produce passenger cars and light trucks with a fleet-wide average of 40 miles per gallon for 2026 model years, up from the current 28 miles per gallon standard set under Mr. Trump.
The National Highway Traffic Safety Administration, an umbrella division of DOT, conceded that the new environmental standards would cost automakers more than $200 billion through 2029 and raise the cost of new vehicles by an average of $1,087. It said drivers would have a long-term net gain, however, because of a lifetime fuel savings estimate of $1,377.
“Today’s rule means that American families will be able to drive further before they have to fill up, saving hundreds of dollars per year,” Transportation Secretary Pete Buttigieg said. “These improvements will also make our country less vulnerable to global shifts in the price of oil and protect communities by reducing carbon emissions by 2.5 billion metric tons.”
Mr. Trump’s yearly efficiency standards were at 1.5% while former President Obama’s were at 5%.