Clients: Office of the California Attorney General and the California Air Resource Board
Authors: Liz Stanton, PhD, Gabriel Lewis, and Chirag Lala
October 2021
On behalf of the Office of the California Attorney General and the California Air Resource Board, this Applied Economics Clinic white paper examines the National Highway Traffic Safety Administration’s (NHTSA) Proposed Rulemaking for Model Years 2024-2026 Light-Duty Vehicle Corporate Average Fuel Economy Standards. The proposal would increase the stringency of Corporate Average Fuel Economy (CAFE) standards from their 2020 levels, setting the standards close to the path established in 2012. The NHTSA provides an estimate of the expected benefits in its 2021 Preliminary Regulatory Impact Analysis (PRIA), and it expects benefits in fuel savings, energy security, and drive value.Our analysis finds the estimated benefits to be a conservative estimate. Other benefits not included in the cost-benefit analysis would increase the net benefits and provide additional support for stricter fuel economy standards, if included in NHTSA’s comparison.