As Trump Considers U-Turn on Emissions Standards, California Floors Hybrid

March 8, 2017

This week the Trump administration could announce a formal revisit to the EPA’s vehicle emissions standards, likely reversing rules enacted during the Obama era. These data-driven standards are promulgated jointly by the EPA and the Department of Transportation under the Clean Air Act to control air toxics and greenhouse gas pollution, while considering the cost and feasibility of targets.
Beginning in 2009, following a long impasse with the auto industry, the Obama administration negotiated an agreement to ratchet mile-per-gallon requirements for cars and light trucks up to 35.5 mpg from their average of roughly 25 mpg at the time. The current standards, negotiated in 2011, would further increase the average fuel economy of the U.S. car and light truck fleet to 54.5 mpg by 2025. For reference, car manufacturers estimate that fewer than 4% of new vehicles today would meet the 2025 requirements. At the time of the agreement, the Obama administration forecast an upfront cost of about $200 billion over 13 years to the auto industry, yielding an immense $1.7 trillion in savings to motorists through decreased fuel consumption over the life of those vehicles. Indeed, the administration expected that by 2025, improved fuel economy would be responsible for greater carbon reductions than the Clean Power Plan, which addresses national power generation.
However, agreement on these emissions standards came with the caveat of a mid-term review to “determine whether the standards for the final years of the program were feasible.” Though the regulations were set in place for vehicles manufactured through model year 2021, the EPA was given until April 2018 to complete its review as to whether the 2022-2025 standards were still practicable. The EPA reached its decision earlier than expected, and the week before Obama left office, it announced a final rule meant to lock in the standards through 2025.
Auto companies were swift to react to the announcement—and its timing—with eighteen industry executives penning a letter to Trump in February to seek renewed examination of the fuel economy rules. CEO and President of the Alliance of Automaker Manufacturers, Mitch Bainwol alleged in a statement that the “final determination is the product of egregious procedural and substantive defects” which failed to allow for “meaningful notice and comment” in a rush to beat the new administration.
A number of environmental groups, including the Sierra Club, NRDC, Union of Concerned Scientists and League of Conservation Voters, rejected those assertions outright. The groups counter that the rule was a product of “a thorough and open process of review and consultation over the course of years,” which included input from the automobile industry. Moreover, the challenged standards are precisely those that many auto companies agreed to during the Obama era, shortly after a dramatic federal rescue from bankruptcy, and hemmed in by higher gas prices ($2.31 a gallon today compared to a high of $3.60 in 2012).
On the other hand, it’s not clear that the EPA’s decision was as final as intended. Because the EPA did not jointly release its 2017 plan with the Transportation Department, and did not publish notice of the decision in the federal register, there is speculation that this leaves a “legal loophole” for the Trump administration. Instead of formally withdrawing the rule, as a full notice-and-comment rulemaking with attendant delays and legal challenges, sources familiar with the issue note the administration could simply reopen the review and put forth its own efficiency standards within the next year. Of course, if the EPA’s unilateral January announcement does constitute a final rule, this shortcut would be unavailable to the new administration.
Yet, even if the Trump EPA returns to the review, it’s not evident that the agency would come to markedly different conclusion this time around: the last determination involved a rigorous study culminating in a “more than 1,200-page Technical Assessment Report that examined costs, technology effectiveness, and other aspects of the standards.”
There’s also still the issue of California’s special status under the Clean Air Act. Owing to Los Angeles’ notorious history of smog, tailpipe emissions standards in California predate the first federal equivalent, beginning in the sixties. In recognition, the state is uniquely authorized under the Clean Air Act to obtain waivers to set its own emissions standards, provided they are at least as stringent as federal requirements. California has do so over 100 times, setting off “an array of pollution-reduction gains.” Following a round of amendments to the Act in 1977, Congress extended the option to adopt California’s standards to all other states.
Currently, California and the twelve states that have adopted its standards account for nearly one third of all new car purchases. Even if the Pruitt EPA succeeded in rolling back previous emissions standards, auto companies would either have to build two classes of cars, or continue all models under the stricter standards. The only other option would be to retroactively invalidate the California waiver. While California has been denied a waiver before, for instance, when it sought to first introduce carbon-based restrictions during George W. Bush’s first term,
There is no precedent for revoking a waiver, and there doesn’t appear to be a pathway in the Clean Air Act for doing that,” points out Safe Climate Campaign founder Dan Becker.
Others have been more direct about the impending possibility of a showdown between the feds and the coterie states that remain tough on emissions. Massachusetts Senator Ed Markey pointed out that “attacking the California waiver is a recipe for chaos for the car companies because those states will not go easily, and they know it.” S. William Becker, executive director of the National Association of Clean Air Agencies has similarly warned that

“if this administration goes after the California waiver, there will be an all-out brawl between Trump and California and the other states that will defend its program.”

Trump’s EPA is advised to check itself before it wrecks itself.