For years this space has advocated for expanding use of natural gas as the best strategy for Connecticut’s economy and the environment. We’re happy to see that Gov. Dannel P. Malloy’s new energy plan includes expansion of natural gas for homes and also includes efforts to develop natural gas for automobiles and trucks. Indeed we supported the United Illuminating and Northeast Utilities mergers into the natural-gas market with the hope they would help propel this change.
With this support, however, we urge the Malloy administration and the utilities to put the focus on market forces and not subsidies. It is also urgent that the governor not fall prey to the idea that the government mandate the percent of renewable energy that consumers must buy. None of us can truly know the best combination of costs and environmental benefit in this time of transition in our energy markets.
Helping companies and consumers transition to clean and lower-cost natural gas, through more responsive utility rules, and expanding infrastructure responsibly is not a disruption to market forces.
But to the degree that the utilities benefit from changing regulations of their heating market through this program they should be expected to be commit to help develop the natural gas transportation infrastructure which would truly making Connecticut a leader in blue energy.
For D.C.-imposed ineffectiveness and unintended consequences, it’s tough to beat the Corporate Average Fuel Economy (CAFE) program.
Enacted amid the energy-policy nitwittery of the 1970s, CAFE is still around, and thanks to the Bush and Obama administrations, it promises to misallocate resources and increase fatalities for decades to come.
In 1978, the first federal mileage mandate forced manufacturers to build cars that achieved an average of 18 miles per gallon. A second, less-stringent dictate for “light trucks” — i.e., minivans, SUVs and pickups — went into effect the following year.
For a brief period, it appeared that CAFE worked. In 1978, the U.S. thirst for gasoline was 7.4 million barrels per day (bpd). Demand dropped for several years afterward. But even as CAFE standards intensified, the downward consumption trend didn’t last:
1985: 6.8 million bpd
1995: 7.8 million bpd
2005: 9.2 million bpd
How was that possible? Didn’t farsighted fedpols, working with brilliant bureaucrats, command conservation?
Two factors contributed to CAFE’s dismal performance: the light-truck “loophole” and a gasoline-price collapse.
As the Washington Post’s Warren Brown observed, “CAFE did not … require consumers to buy what the car companies want to sell,” and thus, the market shifted toward roomy SUVs and minivans. The federal government’s mileage micromanagers, Brown lamented, “all but killed family station wagons.”
Millions of tire-kickers began to consider bigger vehicles, and as ‘70s stagflation gave way to the booming Reagan and Clinton years, many households could afford to supersize. In addition, the penalty at the pump vanished. Adjusted to today’s purchasing power, a gallon of gasoline dropped from $3.53 in 1981 to $1.59 in 1999. Whether a driver owned a Chevy Tahoe or a Toyota Corolla, motoring was much cheaper, and chances are, he did a lot more of it.
Thoughtful analysts began to realize that Americans’ overall gasoline demand — something Washington has no business wagging its finger about, but that’s for another column — will decline only due to dramatically higher prices and/or economic strife comparable to the Nixon-Ford-Carter epoch.
Conservation scolds, meet $4-a-gallon gasoline and the Great Recession. Here are the figures:
2007: 9.3 million bpd
2008: 9.0 million bpd
2009: 9.0 million bpd
2010: 9.0 million bpd
2011: 8.8 million bpd
At the start of 2012, Tom Kloza of the Oil Price Information Service speculated that gasoline use was headed toward its lowest level “since Elian Gonzalez was at the top of the news, Time Warner was heralding the synergies of its AOL purchase, and American Beauty was the Golden Globe winner.” By the end of June, consumption was on track to fall for the fifth year in a row.
Great news? Not for the president and the environmental paranoiacs who oversee his energy policies. In 2009, using authority granted to it in an atrocious energy bill signed by George W. Bush, the administration boosted the fleetwide fuel-economy decree to 35.5 miles per gallon in 2016. Undesirable and unnecessary, but the ratcheting-up was puny, compared to what was to arrive this year. On August 28, as the GOP nominated its presidential candidate, Hurricane Isaac headed for land, and most citizens focused on the imminent Labor Day break, Obama compounded the CAFE catastrophe. He “finalized groundbreaking standards that will increase fuel economy to the equivalent of 54.5 mpg” in 2025.
Wildly ambitious, but we’re told that scary-smart engineers with gee-whiz doohickeys can deliver. Writing in Politico, the “deputy assistant to the president for energy and climate change” gushed that the stricter mandate will “drive innovation in the manufacturing sector and help create new jobs throughout the supply chain, from companies that make everything from advanced engines and transmission systems to cutting-edge batteries and more efficient tires.”
Here in reality, federal technocrats’ past predictions — about everything from spacecraft to “green” power, magnetic-levitation trains to embryonic stem-cell research — offer scant assurance that the invention of a few just-around-the-corner thingamajigs will make passenger vehicles sip gasoline by 2025. The Big Three and their “foreign” competitors will likely respond by doing what they’ve done in the past: reducing weight. And lighter cars mean more carnage. Entities as varied as Harvard, the Brookings Institution, the National Academy of Sciences, and USA Today (using data from the Insurance Institute for Highway Safety and National Highway Traffic Safety Administration) have concluded that CAFE’s body-count numbers are in the thousands.
The automobiles of the future will be costlier and more dangerous than they should be, to fix an imaginary problem. It’s something to remember the next time you hear a pundit extol the blessings of bipartisanship.