As the Obama administration nears formalization of its proposed fuel economy standards out to the 2025 model year, officials must revise their thinking and make the standards technology neutral.
The tentative proposals, announced in July with apparent support from industry executives, regulators and environmental groups, would ramp up the corporate average fuel economy standard to 54.5 mpg by the 2025 model year.
That's a tough standard, which automakers and suppliers ought to be free to meet in any way that is technologically and commercially feasible. But thanks to a slew of incentives, credits and other inducements, automakers can get points for meeting CAFE standards without actually doing so. In the real world, the results in 2025 will be about 40 mpg, not 54.5.
One administration document admits that the program's incentives "encourage early introduction and adoption" of "game changing" advanced technologies, meaning electric vehicles, plug-in hybrids, fuel cell vehicles and large pickups with gasoline-electric hybrid powerplants -- the last one an obvious sop to the Detroit 3.
Missing are similar incentives for automakers to use existing technologies such as high-mileage gasoline engines and clean diesels.
By picking electrification -- the darling of many environmentalists -- as the winning technology, the administration risks forcing automakers and suppliers to invest in technology that may or may not turn out to be the best way to reduce fuel consumption. Electrification makes some sense in some circumstances, especially when the electricity comes from nonpolluting hydroelectric or nuclear power. But electrification makes much less sense in other applications.
It's wrong for the government to pick winners and losers.
Before the new fuel economy standards are cast in stone, the Obama administration must be intellectually honest and let the companies figure out which technologies are best to meet them.
The American public deserves as much.