Today, the FTC announced that it has issued final amendments to the Alternative Fules Rule, consolidating the labels required on alternative fuel vehicles (AFVs) with those required by the U.S. Environmental Protection Agency (EPA), eliminating the need for two different labels and reducing the burden on manufacturers and used car dealers of complying with the rule.
The Alternative Fuels Rule requires labels on new and used AFVs that run on liquid and non-liquid fuels, such as ethanol and other alcohols, including E85 ethanol-gasoline mixtures, natural gas, liquefied petroleum gas, hydrogen, coal-derived liquid fuels, fuels derived from biological materials (e.g., 100% biodiesel), and electricity. The labels for new AFVs disclose the vehicle's estimated driving range (i.e., the travel distance on a single charge or tank of fuel), general factors consumers should consider before buying an AFV, and toll-free telephone numbers and websites for additional information from the Department of Energy (DOE) and NHTSA. Labels for used AFVs contain only the general buying factors and DOE/NHTSA contact information.
In 2011, in an effort to obtain some consistency between FTC-required vehicle labels and EPA (and NHTSA) fuel economy labeling requirements, the FTC initiated a regulatory review, issued a Notice of Proposed Rulemaking and sought comments on a rule that would consolidate FTC and EPA vehicle labels for all new AFVs and eliminate FTC labels for used AFVs.
The new Rule will also impose a specific requirement related to driving range disclosures for flexible fuel vehicles (FFVs) (i.e., dual-fueled vehicles). Previously, the EPA requirements made disclosure of driving range discretionary. Now, to ensure the label provides vehicle buyers with comparative driving range performance for both alternative fuel and conventional gasoline, the Rule requires manufacturers to use the version of the EPA FFV label that discloses the vehicle's alternative fuel and gasoline driving range.
In deciding to eliminate the FTC alternative fuel labeling requirement for used AFVs, the FTC noted that these requirements do not provide vehicle-specific information, such as driving range, and may impose increased burdens on used car dealers as the AFV market expands. The Commission also considered, and rejected, a proposal to require fuel economy information on the FTC's Used Car Rule Buyer's Guide.
This move by the FTC should make compliance easier for used car dealers as more and more AFVs and FFVs come onto the used vehicle market due to the proliferation of state and federal agency requirements mandating higher fuel economy and the increasing popularity of cap and trade environmental regulations, leading to increased volume of production and sale of AFVs and FFVs.