Senate panel OKs 35 mpg fuel economy plan

A key Senate committee today adopted a fuel-efficiency plan that would require automakers' products to average 35 miles per gallon by 2020.

Democrats said the measure is on a fast track to be voted on next month by the full Senate, bolstering momentum for a rule change automakers have successfully blocked for nearly two decades.

By a voice vote, the Senate Commerce Committee today unanimously approved a compromise bill, but was still considering amendments this morning, said U.S. Sen., Daniel Inouye, D-Hawaii.

"This is not a perfect bill," Inouye said.

U.S. Sen. Bill Nelson, D-Florida, said he would offer an amendment that would increase the requirement to 40 mpg on the Senate floor.

The bill adopted also would give automakers $50 million a year in advanced battery research funding.

The full Senate will take up the bill in June.

That move may put pressure on the House Energy and Commerce Committee, chaired by U.S. Rep. John Dingell, D-Dearborn. That committee has sought to adopt an economy-wide measure to reduce greenhouse gases rather than pass a stand-alone corporate average fuel economy increase.

When Congress adopted the Corporate Average Fuel Economy program in 1975, it required automakers to more than double fuel mileage for passenger cars from 13 mpg to 27.5 mpg in a decade. That standard hasn't been increased since.

Rather than requiring 4 percent annual increases indefinitely beginning in 2020, the bill adopted by the committee would instead end the increases in 2030. The bill would also for the first time regulate the fuel economy of medium-duty trucks -- but would only require increases for 20 years.

The Senate Commerce Committee's proposal is the first corporate average fuel economy to be voted out of a Senate committee since the early 1990s. It also would give the National Highway Traffic Safety Administration the right to reform passenger car standards. And it would require the government to buy more fuel-efficient vehicles for the 60,000 automobiles the federal government purchases annually.

"This bill is not perfect but it is a constructive step to addressing our energy crisis," said U.S. Sen. Ted Stevens, R-Alaska. Stevens said he would seek to amend the bill on the Senate floor.

Last year, NHTSA required 2 percent annual increases in light truck fuel economy, which will reach 24 miles per gallon by the 2012 model year. Ten states led by California have filed suit to overturn the increase, calling it woefully inadequate.

The compromise fuel economy bill has narrowed slightly, moving toward what automakers have sought -- though they still complain it will cost tens of billions of dollars to comply with. A Bush administration analysis of the 4 percent annual increase requirement figured it would cost automakers $114 billion by 2017, including $85 billion for the Detroit's Big Three.

U.S. Sen. Trent Lott, R-Miss, who now represents a Toyota Motor Corp. manufacturing plant under construction near Tupelo, said "there are many problems with this legislation."

"The die is cast," Lott said. "I hope we can make it a fairer bill."

The committee also approved by voice vote a Democratic measure to ban "unconscionable price gouging" by oil companies that could result in civil and criminal penalties of up to $5 million and 5 years in prison.

"You know gouging when you see it," said U.S. Sen. Barbara Boxer, D-Calif., noting that 28 states have similar laws. Boxer noted that she saw a gas station in San Francisco Saturday selling gasoline at $4.28 a gallon.