Negotiators for the U.S. House and Senate have reached an agreement on new fuel-economy rules that would expand rather than decrease the country’s oil consumption. Under the agreement, automakers would continue to receive credits through the model year 2008 for manufacturing vehicles that can run on both ethanol and gasoline. These credits are used to offset the production of SUVs and other low-gas-mileage vehicles. Environmentalists criticize the credits as a giveaway, because those who drive the flexible-fuel vehicles seldom make use of the ethanol option. A recent government report found that extending the credit program through 2008 would increase petroleum consumption by at least 9 billion gallons. The House-Senate agreement also calls for the National Highway Traffic Safety Administration to rewrite fuel-economy standards to reduce the fuel consumption of light trucks by at least 5 billion gallons of gasoline by the 2012 model year. Sen. John Kerry (D-Mass.), who co-sponsored an earlier, failed proposal to substantially tighten fuel-efficiency standards, said, “It’s shocking to me we couldn’t do better when we’re on the brink of war with Iraq and we know how much oil comes from the most volatile parts of the world.”
