House approves energy bill

The US House of Representatives yesterday approved a wide ranging energy bill designed to improve the fuel efficiency of cars, phase out traditional incandescent bulbs and other energy profligate appliance and boost production of biofuels.

The bill, which was passed by the Senate last week, was cleared in a 314-to-100 vote. It now looks set to become law after the White House last week said that it would not veto the bill if it was passed by the House.

The centrepiece of the new bill is the first increase in US fuel efficiency standards since 1975, which will boost the fuel efficiency of cars and trucks by 40 percent to an average 35 miles per gallon by 2020.

Under the new CAFE legislation, passenger cars would be required to reach 27.5mpg and minivans, SUVs and other light trucks 22.2mpg. The standards, which have been fiercely opposed by many within the automotive industry, will cut US oil demand by an estimated 1.1 million barrels a day.

Controversially, the bill also sets targets to raise annual output of renewable motor fuels such as ethanol five-fold to 36 billion gallons by 2022.

Electrical appliances such as dishwashers, washing machines and commercial freezers will also have to cut the amount of energy they use under the new legislation, while standards demanding a 30 per cent improvement in the energy efficiency of lighting will force the phase out of the traditional incandescent light bulb between 2012 and 2014.

House Democratic Majority Leader Steny Hoyer said the bill was "a historic turning point in America's energy policy," and will deliver real energy independence and "a stronger economy" for the US.

Environmental and green business groups also welcomed the new legislation, but expressed disappointment that proposals for new subsidies for renewable energy and increased taxes on oil firms were removed from the bill last week as part of a compromise deal to ease its path through the Senate.