The Fuse

Who Benefits from NHTSA’s New Autonomous Vehicle Policy?

by Leslie Hayward | September 22, 2016

This week, the National Highway Traffic Safety Administration (NHTSA) released long-awaited policy guidance on autonomous vehicles, designed to pave the way for further innovation in the sector in coming years. Industry and government sometimes find themselves in a counterproductive relationship in which companies seek to avoid regulations, but that’s not the case with NHTSA’s guidance. Given the newness and many uncertainties around driverless car technology, the need for policy at the federal level has become clear.

The guidance has been well received by both industry and commentators. Wired magazine explains that the federal government has usually been flat-footed when it comes to emerging regulatory issues:

Regulation of technology is a tricky thing—again and again, the U.S. government has found itself desperately trying to catch up to tech developments. Recent examples of this include bitcoin, high-bandwidth internet access, apartment sharing (a la Airbnb) and ride hailing (a la Uber).

According to Wired, here’s what works about NHTSA’s guidance:

This DoT document, however, suggests the federal government is not going to get caught unawares by the autonomous ambitious of car and tech companies. As government documents go, it’s a pretty piece of penmanship, covering the most critical consequences of the move from cars that are driven by humans to cars that drive themselves. It does so clearly, managing to simultaneously guide and encourage. And it makes clear that one thing matters more than anything else to the federal government: That autonomous vehicles are safe.

One reason the rules have seen widespread acceptance is the agency’s deft regulatory touch.

One reason the rules have seen widespread acceptance is the agency’s deft regulatory touch. NHTSA’s policy draws a line between the federal government’s responsibilities and those of the states, does not require specific licenses or operators to be present in fully autonomous vehicles once the technology is ready, facilitates information sharing among manufacturers based on best practices currently used by the aviation industry, and offers non-binding safety recommendations for manufacturers. It gives auto and tech companies a long leash on which to innovate and encourages them to continue to do so.

A White House fact sheet describes the contents of the guidance as falling into four main categories:

  • Vehicle performance guidance for manufacturers, developers, and other organizations outlining a 15 point “Safety Assessment” for the safe design, development, testing, and deployment of highly automated vehicles, including a request that automakers sign and submit this safety assessment to certify that their vehicles are ready for public roads.
  • Model for state policy that presents a clear distinction between Federal and State responsibilities and recommends policy areas for states to consider with a goal of generating a consistent national framework for the testing and operation of automated vehicles while leaving room for learning and valuable state discretion.
  • Current regulatory tools that National Highway Traffic Safety Administration (NHTSA) can use to aid the safe development of automated vehicles, such as interpreting current rules to allow for appropriate flexibility in design, providing limited exemptions to allow for testing of nontraditional vehicle designs and ensuring that unsafe automated vehicles are removed from the road.
  • New tools and authorities that NHTSA could consider seeking in the future to aid the safe and efficient deployment of new lifesaving technologies and ensure that technologies deployed on the road are safe. For example, NHTSA is seeking public feedback on whether to consider pre-approving novel automated vehicle technologies before they are allowed on public roads and whether to create a new Federal safety standard for revolutionary vehicle designs, such as ones that do not require a steering wheel or gas pedal.

Who benefits from the guidance?

NHTSA’s action has drawn a wide swath of support. Disabilities advocates are emboldened by the fact that the guidance does not require a licensed driver to be present in a fully autonomous vehicle—a provision that would limit the number of people who can travel independently in an autonomous vehicle to those who can already drive. The guidance also pleased safety advocates. In addition to Mothers Against Drunk Driving, who said at the NHTSA release event that driverless cars will prevent the 30 percent of automobile accidents that occur thanks to drunk driving, the National Safety Council said, “This policy gives carmakers and states the green light to innovate while keeping safety at the forefront.”

There’s also important energy implications to driverless cars, which were articulated by General James Conway, 35th Commandant of the Marine Corps and Co-Chairman of the Energy Security Leadership Council. He said:

“It’s not too strong to also say that events taking place here today have a positive impact on our national security. For way too long, our nation has been reliant on the import of petroleum products to grease the wheels of our economy. Indeed, over 90 percent of our massive transportation system is powered by this single commodity. Today, as we stand here, our nation imports roughly 25 percent of our annual requirement. American oil companies do much to prosper our economy—and hopefully one day can meet all our petroleum needs. But, during my four decades in the U.S. Marine Corps, I have seen too much national treasure, and too many lives, spent to ensure this steady flow of oil. The preponderance of autonomous vehicles on the drawing board today do not use gasoline and—perhaps more than any other single development—will help reduce our over-reliance on imported oil. From my perspective, that is reason enough—in and of itself—to be encouraged by the events of today.”

The U.S. transportation system currently relies on petroleum fuels for 92 percent of its needs. Autonomous vehicles are anticipated to enable a rapid shift towards electric vehicles, diversifying the transportation sector away from a single, highly-volatile global commodity. Although shared, autonomous vehicles will likely induce greater demand for travel, modeling shows that the vast majority of such vehicles will be advanced fuel vehicles and therefore petroleum use will decline substantially.

us car parc

One reasons that autonomous vehicles are expected to be largely electric is the impact of fleet purchasing on the marketplace. Modeling by Securing America’s Future Energy (SAFE) has shown that consumers would significantly utilize shared, autonomous vehicles. Each shared, autonomous vehicle replaces about 10 personally-owned vehicles and over 7 million would be in use by 2040. With the availability of shared, autonomous vehicles, the total number of light-duty vehicles in the United States would decline by 75 million, from a 2040 baseline of just under 250 million.

new vehicles by fuel

Fleets, with their emphasis on total cost of ownership over initial purchase price, will choose to deploy electric vehicles because of the dramatically lower per-mile fuel cost and lower maintenance costs. SAFE’s modeling shows that all shared, autonomous vehicles would be electric by 2040. About half of non-shared autonomous vehicles would be electric as well. Thanks to these shifts, the model shows 70 percent of miles driven in 2040 will be by fully or semi-electric vehicles (such as plug-in hybrids).

autonomous vehicle guidance

SAFE’s model shows that pro-autonomy policies combined with pro-alternative fuel vehicle policy would lead to massive petroleum displacement. Transportation oil use will decline from current levels of over 11 million barrels a day to under 4 million barrels a day by 2040, even as vehicle miles traveled increases by 30 percent. But it’s critical to note that such an outcome only comes as a combination of pro-autonomous policies (similar to those put forward by NHTSA) and pro-alternative fuel policies. Therefore, the leadership that NHTSA demonstrated this week with its new policy guidance must not be restricted to autonomous vehicles; it must apply to a broader swath of the transportation system, to encourage use of non-petroleum fuels.