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Government Regulatory Initiatives Encouraging the Development and Sale of Gas/Electric Hybrid Vehicles: Transforming Hybrids from a Curiosity to an Industry Standard

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Government Regulatory Initiatives Encouraging the Development and Sale of Gas/Electric Hybrid Vehicles: Transforming Hybrids from a Curiosity to an Industry Standard William & Mary Environmental Law and Policy Review Volume 30 (2005-2006) Issue 1 Article 7 October 2005 Government Regulatory Initiatives Encouraging the Development and Sale of Gas/Electric Hybrid Vehicles: Transforming Hybrids from a Curiosity to an Industry Standard Daniel Ramish Follow this and additional works at: https://scholarship.law.wm.edu/wmelpr Part of the Environmental Law Commons Repository Citation Daniel Ramish, Government Regulatory Initiatives Encouraging the Development and Sale of Gas/Electric Hybrid Vehicles: Transforming Hybrids from a Curiosity to an Industry Standard, 30 Wm. & Mary Envtl. L. & Pol'y Rev. 231 (2005), https://scholarship.law.wm.edu/wmelpr/vol30/ iss1/7 Copyright c 2005 by the authors. This article is brought to you by the William & Mary Law School Scholarship Repository. https://scholarship.law.wm.edu/wmelpr GOVERNMENT REGULATORY INITIATIVES ENCOURAGING THE DEVELOPMENT AND SALE OF GAS/ELECTRIC HYBRID VEHICLES: TRANSFORMING HYBRIDS FROM A CURIOSITY TO AN INDUSTRY STANDARD DANIEL RAMISH* INTRODUCTION In 2001, White House Press Secretary Ari Fleischer was asked whether Americans should change their lifestyles to conserve energy.' He responded, "[t]hat's a big 'no.' The President believes that it's the goal of policymakers to protect the American way of life. The American way of life is a blessed one and we have a bounty of resources in this country. 2 Late in 2005, in the wake of two hurricanes and record gas prices,3 the cost and supply of energy has fully emerged as a central national issue.4 Suddenly the same Bush Administration is encouraging Americans to carpool * Daniel Ramish is a 2006 J.D. candidate at William and Mary School of Law. He previously received a B.S. in Commerce from the University of Virginia. The author would like to thank the editorial staff for their diligence, and Laura Wehrmeyer for her patience and timely assistance. 'Polly Ghazi, Stars and Gripes:Rejection of the Kyoto Climate Treaty Triggered Alarm Bells, But How True Are Claims That President Bush Is Bad for the Health of the Planet?, GUARDIAN (LONDON), May 16, 2001, at 8. 214. 3 See, e.g., Michael E. Kanell, Layoffs a Cloud on City's Horizon; Georgia State Forecast: Energy Only Minor Drag, ATLANTA J.-CONST., Nov. 17, 2005, at 1F. Some environmentalists suggest that the hurricanes were brought on by global warming, which is mostly the result of burning fossil fuel. Editorial, Is Global Warming the Culprit?,CHICAGO TRIB., Sept. 27, 2005, at C18. 'Problems and Priorities, http://www.pollingreport.com/prioriti (last visited Nov. 18, 2005) (displaying poll results about important national priorities, many of which include energy or oil or gas). According to a NBC News/Wall Street Journal Poll conducted in early November, 2005, 8% of Americans think that the cost and supply of energy should be the federal government's top priority. Id. 231 232 WM. & MARY ENVTL. L. & POL'Y REV. [Vol. 30:231 and avoid nonessential travel,5 and conservatives in Congress have begun criticizing the oil industry.6 Conservation has become a bipartisan goal.7 Polls indicate that after Hurricanes Rita and Katrina, 64% of Americans experienced "financial hardship" because of gas prices.' According to the American Association of Retired persons ("AARP"), 13% of Americans over fifty said they ate less to cope with gas prices, and 6% had even reduced medical treatment or cut their prescriptions.9 With fuel prices threatening all-time highs adjusted for inflation,1" vehicle purchase habits nevertheless resisted change; only 22% of Americans considered purchasing more fuel efficient vehicles.11 Hybrid gas/electric vehicles were more popular in August and September of 2005 because of the 13 storms,12 but when the price of gas fell to more moderate levels the total number of hybrids sold dropped to the lowest monthly total since June. 14 As of November 14, 2005, even after hurricane effects had dissipated, a gallon of gas cost $2.258, representing an increase of 18% from the same week in 2004, $1.918, 54% from the 5 Anna Bernasek, Real Energy Savers Don't Wear Cardigans.Or Do They?, N.Y. TIMES, Nov. 13, 2005, at C5. 6 Justin Blum, Oil Executives Face Scrutiny Today; Explanations Sought for Higher Profit, WASH. POST, Nov. 9, 2005, at DO. 'See Bernasek, supranote 5; see also Amanda Griscom Little, FriedmanFighter, GRIST, Apr. 5, 2005, availableat http://www.grist.org/news/maindish/2005/04/05/ friedman. 8 Jenny Deem, What's the Breaking Point? As Gas Prices Keep Rising, Drivers Aren't Defecting From Their Cars-Yet, DENV. POST, Oct. 13, 2005, at F-01. 9 Id. 10 See David Montgomery, Fuel Hardy; While Gasoline Remains a Relative Bargain,Some DriversAre Ready to Pay Any Price, WASH. POST, Aug. 24, 2005, at CI (indicating that a gallon of gas cost $3.11 of today's dollars in 1981). Fuel prices exceeded $3 after the hurricanes. Kanell, supra note 3. " Poll: Gas Prices Affecting Habits, CBSNEWS.COM, Sept. 1, 2005, http://www. cbsnews.com/stories/2005/09/01/opinions/polls/main812533.shtml. 12 Total US Hybrid Sales Drop in October; Prius Sales Climb 21%, GREEN CAR CONGRESS, Nov. 4, 2005, http://www.greencarcongress.com/2005/11/total-us_ hybrid.html#more. '3 Kanell, supra note 3. '4 Total US Hybrid Sales Drop in October, supra note 12. 2005] GOVERNMENT REGULATORY INITIATIVES AND HYBRIDS 233 same week in 2003, $1.464, and more than double the price of early 2002, e.g., March 4, $1.118.15 With gas prices promising to continue to increase every year, hybrids nevertheless have yet to amount to more than 1.48% of new cars purchased.' 6 Market forces are just not enough to induce Americans to invest in fuel-efficient vehicles. Alan Greenspan, chairman of the Federal Reserve, declares that the era of cheap oil is over, 7 a sentiment echoed by Ford,'8 Chevron,19 and BP.2 ° Oil shortages will create worldwide economic instability,2 ' increase American dependence on oil from the Middle 22 East, aggravate this nation's vulnerability to terrorist attacks,223 and intensify pressure on Congress to allow drilling in areas that have been hitherto safeguarded as environmental refuges.24 15 ECONOMAGIC.COM, U.S. Regular Conventional Retail Gasoline Prices (Cents per Gallon), http://www.economagic.com/em-cgi/data.exe/doewkly/day-mg-rco-us (last visited Nov. 18, 2005). 16 See Total US Hybrid Sales Drop in October, supra note 12. 17 Diane Carmen, Oil Prices Fuel Push for Alternatives, DENV. POST, Nov. 13, 2005, at C-01. Greenspan said that "the recent surge in energy prices will undoubtedly be a drag from now on." Id. 18 Editorial, Gas Taxes: Lesser Evil, Greater Good, N.Y. TIMES, Oct. 24, 2005, at A20. William Clay Ford, Jr., chairman and chief executive officer of Ford, said, "[w]e know that the days of unlimited, inexpensive gasoline are over." Id. 19 Marc Fisher, To See It Coming Is Not Enough, WASH. POST, Sept. 1, 2005, at BOL. According to Chevron chairman David O'Reilly, "[t]he era of easy access to oil is over ....we are experiencing the convergence of geological difficulty with geopolitical instability." Id. 2 Brad Stone, How to Beat the Big Energy Chill, NEWSWEEK, Nov. 21, 2005, at 46. BP stands for "Beyond Petroleum," or so says the company's new advertising campaign. Id. 21 Robert J. Samuelson, Is the Global Economy Unstable?,WASH. POST, Mar. 16, 2005, at A23. 22 David Ignatius, Why Gas PricesAre Too Low, WASH. POST, Jun. 1, 2004, at A23. 23 Justin Blum, Terrorists Have Oil Industry in Cross Hairs: Economic Disruption is a Key Goal, WASH. POST, Sept. 27, 2004, at A12. 24 See, e.g., Justin Blum, 51-49 Senate Vote Backs Arctic Oil Drilling:Longtime Bush Goal for Alaskan Wildlife Refuge Closer to Reality, WASH. POST, Mar. 17, 2005, at Al (implying that record high oil prices as the impetus behind a vote to allow drilling in Alaska's Arctic National Wildlife Refuge ("ANWR")). ANWR is the second-largest wildlife refuge in America and concern for environmental damage to plant and animal life had previously shielded it from drilling. See 234 WM. & MARY ENVTL. L. & POL'Y REV. [Vol. 30:231 Roughly 50% of United States oil use may be attributed to motor vehicles. 25 Automobile fuel economy in America has plateaued in the past eight years,26 while vehicle miles steadily increased,27 and automobiles continue to contribute heavily to air 2 pollution. ' This note suggests that to avert the looming oil crisis and combat air pollution and global warming the federal govern- ment should promote hybrid gas/electric vehicles through three regulatory initiatives: 1. Reduce government fuel subsidies; 2. Allow hybrids to use all high occupancy vehicle ("HOV") lanes; and 3. Subsidize hybrid research and provide incentives for automobile manufacturers to produce hybrids. A. Fuel Crisis Concerns Energy experts have an ongoing debate about the future of oil.29 A vocal minority of experts support a theory known as 'peak oil.'30 In the 1950s a geophysicist named M. King Hubbert predicted Kate M. Joyce, U.S. Energy Policy Since September 2001, 51 FORDHAM ENVTL. L. REV. 31, 36 (2004). 2 5 INTERNATIONAL CENTER FOR TECHNOLOGYASSESSMENT, GASOLINE COSTS AND EXTERNALITIES 1 (2005), availableat http://www.icta.org/doc/RPG%20security% 20update.pdf. 26 Pamela Yip, MYTH, Gasoline Is Taking a Larger Bite Out of My Pocketbook. FACT, We've Paid Much More., DALLAS MORNING NEWS, May 30, 2004, at 22A. While fuel economy has improved for individual vehicles, the growth in popularity of less fuel-efficient light trucks has held back the aggregate efficiency of American vehicles.
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