The US President signed a new law that would give a new direction to country’s auto fuel efficiency standards. It would help in increasing the production of ethanol and underpin the energy mix.
According to the news published by Smartmoney, George W. Bush, the US President, signed an important energy bill into a law on December 19, 2007 to uplift the standards of auto fuel financial system for the very first time within last three decades. It also needs quadrupling the production of biofuel.
The purpose of Energy Independence and Security Act is to change the way the US utilizes its energy mix. It also includes increasing the production of renewable energy to around 36 Billion Gallons by 2022 and setting better standards for fuel financial system for light trucks and passenger cars.
The main purpose for bringing in the law is to enhance the production of ethanol from corn as well as other resources, including woodchips and switchgrass to increase ethanol production nearly five-fold by 2022. Apart from this, the country wants to reduce its dependency on imported oil and raise its energy security by domestic production.
According to the report “New Opportunities in US Biofuel Market (2006)” by RNCOS, the demand for ethanol has increased in the US after seeing its positive impact on environment as well as its economy and national security. Beside, laws and regulations that made it compulsory for mixing biofuel with petroleum products in specified proportion have increased the ethanol demand.
Moreover, renewable fuel standards have also contributed in the growth of the industry by encouraging investors who want to invest in emerging technologies, production bases, distribution system and storage infrastructure.
The new energy bill has called to consumers to use appliances, including lighting, home heating and cool systems, of high efficiency. It has a provision for research and development funds, which will be used for increasing the efficiency of lighting systems, smart grid technologies, and advanced transportation and batteries.
In next couple of years, there will be fuel efficiency mandates for cars and trucks manufacturers as well. Those standards will be measured fleetwide, resulting in the availability of wide range of fuel efficiency in cars and trucks with low gas mileage.
On the other side, environmentalists are not happy with the new energy bill because they think that the reduction in global warming with this bill would be wiped out by the appropriations bill. Appropriation bill includes production of liquid coal in which the production of CO2 is twice as compared to the production of gasoline.
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