Vehicle Emission Rules to Tighten
Tuesday, May 19, 2009
The Obama administration today plans to propose tough standards for tailpipe emissions from new automobiles, establishing the first nationwide regulation for greenhouse gases.
It will also raise fuel efficiency targets to 35.5 miles per gallon for new passenger vehicles and light trucks by 2016, four years earlier than required under the 2007 energy bill, sources close to the administration said.
The measures are significant steps forward for the administration's energy agenda by cutting greenhouse-gas emissions that contribute to climate change and by easing U.S. dependence on oil, most of which is imported.
The administration is embracing standards stringent enough to satisfy the state of California, which has been fighting for a waiver from federal law so that it could set its own guidelines, sources said. Govs. Arnold Schwarzenegger (R-Calif.) and Jennifer M. Granholm (D-Mich.) will be among a variety of state and industry officials who plan to attend an announcement today, according to sources close to the administration.
The deal has been under negotiation since the first days of the administration. It represents a compromise among the White House; the state of California; and the auto industry, which has long sought national mileage standards and has waged an expensive legal battle against the California waiver. The industry will get its national standard, but at the price of one that approximates California's targets. Industry officials said they would drop all related lawsuits.
David McCurdy, president of the Alliance of Automobile Manufacturers, said that the agreement reached late Sunday night would provide the industry with "clarity and predictability."
That predictability won't come cheap. A senior administration official said the new standards would raise the cost of an average car by $1,300, $600 of which could be attributed to the rules being announced today. The remaining increase would stem from previous energy policy.
"Consumers can retain choice but for more fuel-efficient cars. Every single category of car will be more efficient," the official said, noting that fuel savings would offset much of the higher cost.
The announcement planned for today marks a major change in tone from the Bush administration, which had rejected California's waiver in March 2008, barring states from setting their own limits on greenhouse-gas emissions from automobiles. At the time, 13 other states and the District of Columbia were also seeking permission to impose standards similar to California's.
Obama had ordered the Environmental Protection Agency to reconsider the ruling.
Under the compromise, the federal government would establish two sets of standards, one for mileage and one for tailpipe emissions of carbon dioxide.
The Transportation Department's National Highway Traffic Safety Administration would set the new fuel-economy standards, which would raise the average fuel efficiency of a new car by 30 percent. Cars, for instance, would need to average 39 miles per gallon by 2016, while light trucks would need to reach 30 mpg.
The EPA, using its power to regulate carbon dioxide emissions under a 2007 Supreme Court ruling, plans a tailpipe emissions standard of 250 grams per mile for vehicles sold in 2016, roughly the equivalent of what would be emitted by vehicles meeting the mileage standard. Vehicles sold in 2009 are expected to emit about 380 grams per mile, industry sources said. The EPA needs to go through a rulemaking process to allow responses before the standards would go into effect.
One person involved in the negotiation said the Supreme Court's ruling on regulating emissions helped push companies to bargain because they feared the prospect of having to comply with separate EPA standards in addition to those from NHTSA and California.
"That's what brought the companies to the table," the person said.
In addition, many of the automakers that originally fought California's standards are now struggling for survival and in a weaker position to fight. Their opposition also waned after last year's high gasoline prices and consumers' newfound frugality shifted the mix of vehicles being sold toward more fuel-efficient models. General Motors said yesterday that in 2008, its cars got an average of 29.7 miles a gallon, higher than the 27.5 requirement; its new trucks got 23.2 mpg, higher than the 22.6-mpg requirement for last year.
"We are pleased that President Obama is taking decisive and positive action as we work together toward one national standard for vehicle fuel economy and greenhouse gas emissions that will be good for the environment and the economy," Ford said in a statement.
The EPA is also expected to impose restrictions on greenhouse-gas emissions resulting from leaks of air-conditioning coolant in vehicles. The automakers would be able to use some credits for complying with those regulations to offset a small part of fuel-efficiency requirements, sources familiar with the talks said.
California made modest concessions in the negotiations. From 2012 to 2015, the new mileage standards will be slightly less stringent than required under California's rules, which will be amended. In addition, EPA and NHTSA will use the federal approach of pegging standards to the "attributes" of vehicles, such as size and engine type, said sources familiar with the negotiations. California, by contrast, used just two broad categories of vehicles.
Sources close to the administration said the EPA would still grant a waiver to California at the end of June, but that the state would not exercise it in light of the new national standards.
Proponents of tougher fuel-efficiency standards hailed reports of today's announcement.
"If media reports are true, after years of oil price inflation, policy stagnation and automotive industry litigation, President Obama has solved the energy and economic policy equivalent of a Rubik's Cube," said Rep. Edward J. Markey (D-Mass.), who was a principal author of the 35-mpg standard that Congress adopted in 2007.
"In addition to dramatically reducing the global warming emissions from our vehicles, this move will slash our dependence on oil and make us more energy independent," Sierra Club executive director Carl Pope said in a statement. "Congress put us on the road toward more fuel efficient vehicles two years ago when it passed the first increase in fuel economy standards in more than 30 years. Now President Obama is dramatically accelerating our progress."