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May 01, 2013
FTC consolidates vehicle labels

The Federal Trade Commission (FTC) has issued final amendments that consolidate its labeling requirements for new alternative fuel vehicles (AFVs) with the AFV labeling requirements of the EPA.  The amendments also eliminate FTC’s labeling requirements for used AFVs.  The FTC says the action is in line with its effort to review existing rules and eliminate inefficient, overly burdensome, and duplicative requirements. 

1995 Alternative Fuels Rule

In response to the Energy Policy Act of 1992, the FTC issued its Alternative Fuels Rule in 1995.  That action required labels on new and used AFVs that run on liquid and nonliquid fuels such as ethanol and other alcohols, including E-85 ethanol gasoline mixtures, natural gas, liquefied petroleum gas, hydrogen, coal-derived liquid fuels, fuels derived from biological materials (e.g., 100 percent biodiesel), and electricity. 

The FTC required labels for new AFVs that 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 the public can use to obtain additional information from the Department of Energy and the National Highway Transportation Safety Administration (NHTSA).  Labels for used AFVs provide only general buying information addressing factors such as fuel type, operating costs, fuel availability, performance, convenience, energy security, energy renewability, and emissions. 

Flexible fuel vehicles

In proposing the amendments in 2011, the FTC noted that EPA’s fuel economy labels disclose more information than the FTC-required vehicle labels and direct consumers to the U.S. government’s fuel economy website, which provides comprehensive comparative information for both conventional and AFVs.  However, in contrast to the FTC labels, the EPA requirements allow, but do not mandate, driving range disclosures for flexible fuel vehicles (FFVs) (i.e., dual-fuel vehicles).   Accordingly, in addition to consolidating the FTC and the EPA labels, FTC’s final amendment requires driving range disclosures on EPA labels for FFVs. 

Conflicting information 

FTC’s proposal was supported by industry groups that agreed that a single labeling requirement would allow apples-to-apples vehicle comparisons and eliminate potential confusion from two sometimes conflicting labels.  For example, the FTC noted that the cruising range values on FTC and EPA labels for electric vehicles are currently inconsistent. 

With regard to electric vehicles that are marketed as having zero emissions, some commenters on FTC’s proposal noted that the claim applies to tailpipe emissions only and does not account for emissions from fossil-fuel power plants.  The current EPA label “ignores” these upstream emissions, stated one commenter.  The FTC noted that the EPA and NHTSA do provide this information online, but it is not required in labels.  The FTC declined to address this issue in the amendments, but added that it may consider this and other advertising issues as part of its ongoing review of its Guide Concerning Fuel Economy Advertising for New Automobiles (see June 1, 2011, FR).

Click here for FTC’s final amendments.

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