Motor Vehicle Fuel Consumption Standards Act proclaimed



    OTTAWA, Nov. 7 /CNW Telbec/ - The Honourable Lawrence Cannon, Minister of
Transport, Infrastructure and Communities, and the Honourable Gary Lunn,
Minister of Natural Resources Canada welcomed the proclamation into law of the
Motor Vehicle Fuel Consumption Standards Act (MVFCSA).
    "Regulating the fuel efficiency of new motor vehicles is an important
element of the Government's legal framework for reducing greenhouse gas
emissions. Proclaiming the Act is an important step towards achieving one
mandatory national standard," said Minister Cannon.
    "The proclamation of this act is good news for Canada," said Minister
Lunn. "Setting mandatory fuel consumption standards will lead to sustained
improvements in fuel efficiency and help to reduce greenhouse gas emissions
from vehicles purchased in Canada."
    In 2005, the Government of Canada and the Canadian automotive industry
signed a Memorandum of Understanding (MOU) stipulating that the Canadian
automotive industry would take actions to voluntarily reduce greenhouse gas
(GHG) emissions of new vehicles in Canada. The agreement called on the
automobile industry to cut GHG emissions from light-duty vehicles (cars,
minivans, sport utility vehicles and pickup trucks) so that by 2010, annual
emissions reductions will reach 5.3 megatonnes (Mt).
    Under the MVFCSA, fuel consumption standards will be established for
light-duty road motor vehicles. These standards will come into force following
the expiration of the MOU between the auto industry and the Government of
Canada in 2010 and will be implemented for model year 2011.
    MVFCSA standards will be developed with input from stakeholders. They
will be designed for Canada to maximize our environmental and economic
benefits, will be achievable within the integrated North American market and
will be benchmarked against a stringent, dominant North American standard. The
new standards will be published by the end of 2008.
    For more information on the Government of Canada's ecoTRANSPORT
initiatives, please visit www.ecoaction.gc.ca

    
                 MOTOR VEHICLE FUEL CONSUMPTION STANDARDS ACT
                 --------------------------------------------

    THE ACT

    In 1982, Parliament passed the Motor Vehicle Fuel Consumption Standards
Act (MVFCSA), providing for mandatory fuel consumption standards. The Act
establishes the legal authority to regulate fuel consumption for prescribed
classes of motor vehicles. However, the Government did not proclaim the act
due to a voluntary commitment by manufacturers to continue to provide vehicles
that meet U.S. standards. The voluntary commitment was broadly consistent with
the framework and authorities established by the Act.

    The Motor Vehicle Fuel Consumption Standards Act provides that:
    - all motor vehicle fuel consumption values must be registered with
      Transport Canada;
    - each motor vehicle must bear a fuel consumption label and a national
      fuel consumption mark;
    - Company Average Fuel Consumption (CAFC) standards will be set for
      specific classes of motor vehicles;
    - each vehicle maker or importer must submit the data required to
      calculate their CAFC values for comparison against the standards;
    - fines will be set for each vehicle maker or importer whose CAFC value
      for a particular class of motor vehicle is higher than the standard for
      that class; and
    - CAFC credits will be recorded for each vehicle maker or importer whose
      CAFC value for a particular class of motor vehicle is lower than the
      standard. If a penalty year occurs, credits may be taken from any or
      all of the three years before or from the year following the penalty
      year, to reduce the fine.

    Potential entry into force and use of the act has been a regulatory
backstop for the last 25 years, while previous governments have pursued
voluntary approaches with the auto industry. This government has decided to
use regulation over voluntary agreements as it provides a greater degree of
certainty, predictability and accountability.

    HISTORY

    Fuel consumption regulation in North America came into effect as a
response to the "Energy Crisis" of the mid 1970's. In the U.S., the Energy
Policy and Conservation Act of 1975 introduced Corporate Average Fuel Economy
(CAFE) standards, which were required to be met by each manufacturer or
importer, averaged across vehicle sales in each year. The standards for
passenger vehicles were set by the U.S Congress and, in 1979, separate
standards for light trucks were introduced by the U.S. Department of
Transportation.
    The Canadian and the American motor vehicle manufacturing industries have
grown increasingly integrated since the 1965 Auto Pact, which reduced barriers
to the flow of automotive trade and investment between the two countries. In
1976, the Government of Canada established voluntary Company Average Fuel
Consumption (CAFC) targets. These targets, by agreement with the motor vehicle
industry, were set to represent an equivalent level of vehicle fuel-efficiency
as provided by the CAFE standards in the U.S.
    In 2005, the Government of Canada and the Canadian automotive industry
signed a Memorandum of Understanding (MOU) stipulating that the Canadian
automotive industry would take actions to voluntarily reduce greenhouse gas
(GHG) emissions of new vehicles in Canada.
    The agreement called on the automobile industry to cut GHG emissions from
light-duty vehicles (cars, minivans, sport utility vehicles and pickup trucks)
so that by 2010, annual emissions reductions will reach 5.3 megatonnes (Mt).
    In October 2006, the Government of Canada announced, under a Notice of
Intent to Regulate, that it intends to regulate the fuel consumption of road
motor vehicles under the Motor Vehicle Fuel Consumption Standards Act after
the expiry of the MOU between the auto industry and the Government of Canada.
Regulations would take effect for model year 2011. This was confirmed in
April 2007, under the Regulatory Framework for Air Emissions. It was stated
that as part of a broader transportation policy package, a mandatory
fuel-efficiency standard, beginning with the model year 2011, will be
developed through a process that will involve input from all the stakeholders,
and it will be published by the end of 2008. It will be designed for Canada to
maximize our environmental and economic benefits, will be achievable within
the integrated North American market, and will be benchmarked against a
stringent, dominant North American standard. Furthermore, it confirmed that
the government will build on the 2005 agreement in establishing its ambitious
regulated fuel-efficiency standard. These new regulations will be developed
and implemented under the Motor Vehicle Fuel Consumption Standards Act.

                                                              November 2007
    




For further information:

For further information: Karine White, Press Secretary, Office of the
Minister of Transport, Infrastructure and Communities, Ottawa, (613) 991-0700;
Media Relations, Transport Canada, Ottawa, (613) 993-0055; Louise Girouard,
Director of Communications, Office of the Minister, Natural Resources Canada,
Ottawa, (613) 996-2007; Transport Canada is online at www.tc.gc.ca. This news
release may be made available in alternative formats for persons with visual
disabilities.


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