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Final rule on fuel economy rollback opens door for lawsuits

Administration says new rule will lower the price of cars

EPA Administrator Andrew Wheeler unveiled the final rule two years after it was initially proposed.
EPA Administrator Andrew Wheeler unveiled the final rule two years after it was initially proposed. (Bill Clark/CQ Roll Call)

The Trump administration Tuesday formally rolled back fuel-efficiency standards for passenger vehicles established under the previous administration — a move that hobbled a key U.S. policy to lower greenhouse gas emissions, infuriated environmentalists and is likely to trigger legal challenges.

By diluting the Obama-era vehicle standards, among the most ambitious fuel economy regulations in the world, Trump administration officials argued they could lower the prices of vehicles, encouraging consumers to buy new, safer cars.

Two years after his agency made its initial proposal to weaken the vehicle standards, EPA Administrator Andrew Wheeler unveiled the rule, finalized and publicly released Tuesday, with Transportation Secretary Elaine L. Chao, who said the new standards would save lives, prevent injuries, lower the price of new vehicles and clean the environment.

“By making newer, safer, cleaner vehicles more affordable for American families, we will save lives, create jobs and improve the quality of life and pave the way for a brighter future for our citizens,” Chao said.

Trump had originally proposed to freeze standards at 2020 levels but received pushback even from some automakers, who worried such a step was too drastic a reversal from the Obama-era standards. EPA’s own Science Advisory Board found “significant weaknesses in the scientific analysis” behind that plan to lock in standards at 2020 levels.

The new rule will increase fuel-efficiency standards by 1.5 percent each year through model year 2026, and it would apply to new vehicles starting in 2021. The standards issued in 2012 would have mandated about 5 percent annual increases, requiring automakers to sell vehicles that average, across a fleet, 54 miles per gallon by 2025.

Under the Trump administration, the rule would require a fleet-wide average of about 40 miles per gallon by 2026. 

“Consumers have different preferences, so while we are ensuring average fuel economy will continue to rise, we are also recognizing that consumers, that American families, often face many different competing considerations and we can’t get families better safety, better environmental standards if they can’t afford the sticker price in the first place,” James C. Owens, acting administrator of the National Highway Traffic Safety Administration, told reporters. “We believe we’ve struck the right balance for the American people.”

President Donald Trump and officials in his cabinet have long chafed at climate rules and regulations, including other regulations for heavy-duty trucks, household appliances, fossil energy companies and farmers, often describing such rules in existential terms.

“The assault on the American auto industry is over,” Trump said in March 2017 at an auto plant in Ypsilanti, Mich.

In documents supporting the rule, the administration said it would reduce the price of new vehicles by $1,000,  result in 2.7 million additional vehicles sold because of the lower price and result in 3,300 fewer crash fatalities and 397,000 fewer injuries over the lifetime of vehicles built according to the new standards.

Wheeler argued that the tighter emission goals set by Obama were unreachable by most auto manufacturers and often forced them to increase the cost of trucks and SUVs in order to offset the cost of the electric vehicles they were forced to produce to meet the goals.

Legal challenges

Environmental and consumer advocacy groups upbraided the final rule, which is nearly guaranteed to draw lawsuits from Democratic attorneys general and environmentalists.

Carol M. Browner, an EPA administrator under President Bill Clinton, called the new standards an “atrocious attack on our families’ health and future.”

“In the midst of an out of control global pandemic, it is appalling for the Trump administration to prioritize this environmental rollback that will put our families’ health at further risk,” said Browner, chair of the League of Conservation Voters.

Michelle Romero, national director of Green For All, said the rule “couldn’t have come at a worse time,” noting the coronavirus disease, COVID-19, that has transformed daily life worldwide. “If nothing else, the coronavirus pandemic has demonstrated how fragile public health is and how interdependent we are on each other,” she said. Still at issue is how the rule will affect California, which has for 50 years set its own tailpipe emissions standards under a provision in the Clean Air Act of 1970. 

The White House has argued California, which has an air-regulation agency that predates EPA and the Clean Air Act, should follow the same rules as the rest of the country and that it does not have the right to set its own standards. Setting its own standards, the administration contends, creates confusion for the automotive industry.

Still, the administration’s rollback has highlighted a schism in the American auto industry.

Thirteen states and the District of Columbia have followed California’s lead in setting stricter standards, meaning the California rules by some estimates cover more than 40 percent of America’s population. 

And Trump’s original move to pull back dramatically from Obama-era regulations spurred four automakers — Ford, Honda, BMW and Volkswagen — to enter an agreement with California in July to set a fuel-efficiency standard of 51 miles per gallon on average for the manufacturers’ range of cars and light-duty trucks by 2026. 

That move infuriated Trump, who responded by threatening to launch an antitrust investigation against the four automakers and threatening California with legal action if it did not back away from the agreement.

“The auto industry has consistently called for year-over-year fuel economy and greenhouse gas improvements that also recognize that the standards originally developed almost a decade ago are no longer appropriate in light of shifting market conditions and consumer preferences,” John Bozzella, president and CEO of the Alliance for Automotive Innovation, a car-company trade group, said in a statement.

“It is important to note that this final rule establishes near-term compliance obligations, understanding that the auto industry and our nation face economic challenges due to the COVID-19 public health emergency,” Bozzella said.

“The greatest opportunity for environmental benefits will happen as we look to longer-term policies beyond 2026,” he said, adding that his industry produced a variety of electric and low-emissions vehicles. “Looking to the future, we need policies that support a customer-friendly shift toward these electrified and other highly efficient technologies.” 

More toxins

Dan Becker, director of the Safe Climate Campaign of the Center for Auto Safety, a consumer advocacy group, noted that because the new rule would likely increase fuel consumption, more people would be exposed to toxins during the refining process.

“It’s going to increase the amount of fuel that is refined,” Becker said in an interview. “This stuff is carcinogenic. It will kill you,” he said. “Of the many bad things Trump has done to the environment, this is the worst.”

David Doniger, a longtime environmental attorney with the Natural Resources Defense Council, said the industry wanted a relaxation of the Obama rules. But car companies did not want as deep a rollback as they’re getting, he said.

“We’re pretty confident that it remains true that the industry remains divided,” Doniger said by phone. “They wanted much smaller changes and they’re getting much more than they wanted.”

The United Auto Workers is also opposed to diluting fuel efficiency standards for automobiles, Josh Nassar, legislative director for UAW, which represents more than 1 million auto-industry workers and retirees, told House lawmakers in June 2019.

“We’re really concerned that it’s going to actually stifle companies from innovating and also from competing in a global economy,” Nassar said. “Many of the new technologies you see in cars, in more efficient cars, are built in the United States, and we want to keep it that way.”

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