President Obama has made it official. The United States fuel economy standards are being increased starting in 2012, which edges up the current standards by 5% a year to a fleet average of 35.5 MPG in 2016. This makes the CAFE law passed by Congress in 2007 – which required new vehicles an average fuel economy of 35 mpg in 2020 – relatively useless. These New American Fuel Economy Standards should also bring with it a reduction of 900 million metric tons in greenhouse gas emissions.

From the White House press release:

“In the past, an agreement such as this would have been considered impossible,” said President Obama. “That is why this announcement is so important, for it represents not only a change in policy in Washington, but the harbinger of a change in the way business is done in Washington. As a result of this agreement, we will save 1.8 billion barrels of oil over the lifetime of the vehicles sold in the next five years. And at a time of historic crisis in our auto industry, this rule provides the clear certainty that will allow these companies to plan for a future in which they are building the cars of the 21st century.”