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Administration finalizes rule to raise fuel standards for new cars, light trucks by 2026

A view of Interstate 405 in Los Angeles. (Reed Saxon/AP)
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The Department of Transportation released tailpipe pollution standards Friday that would require average fuel efficiency of new cars and light trucks to reach 49 miles per gallon in less than four years. Biden administration officials said the new standards, which largely reverse a Trump-era rollback, would help cut greenhouse gas emissions and save consumers money at the pump.

The regulation finalizes the Biden administration’s rejection of the approach taken under the Trump administration, which in 2020 weakened standards set during the Obama presidency. The new rule requires the nation’s automakers to increase fuel efficiency fleetwide by 8 percent starting late next year, another 8 percent the year after and 10 percent for model year 2026.

The eventual standard of 49 miles per gallon, issued by the National Highway Traffic Safety Administration, is based on lab testing. NHTSA estimates real-world fuel economy will be roughly 25 percent below the formal standard, which would be about 37 miles per gallon.

The Environmental Protection Agency, which shares responsibility for overseeing the standards and issued its own companion rule in December, estimates its tightened emissions rules would achieve roughly 40 miles per gallon in real-world conditions, up from about 32 miles per gallon under the Trump administration.

With gas prices soaring, oil markets beset by events in Ukraine and Biden’s climate agenda stalled in Congress, administration officials have emphasized the savings Americans will see at the pump in the coming years because of Friday’s rule. Americans buying new vehicles purchased through 2030 will spend about $192 billion less on gas because of the rule, according to the administration.

Mileage standards are an important tool for cutting greenhouse gases, with the transportation sector the biggest source of such emissions in the United States. On Friday, Transportation Secretary Pete Buttigieg called the rule “a big step, and just one part” of a broader strategy to address climate change by shifting toward cleaner energy and electric vehicles.

Whether the United States can dramatically reduce its on-road emissions will depend, in large part, on how widely electric vehicles are adopted.

Buttigieg on Friday called on Congress to pass a stalled measure that would provide tax credits to buyers of electric vehicles. That would drop the price of an electric pickup “from about 40,000 bucks down into the 20s. We could do that through policy that is available right now,” he said.

Some environmental advocates said the administration needed to go further to meet its climate goals, but oil-producing states, led by Texas, are seeking to overturn the EPA’s December rule.

New Biden rule reducing climate emissions from cars and SUVs reverses major Trump rollback

The NHTSA rule was accompanied by voluminous backup documentation, including cost-benefit and environmental-impact analyses that show the complexities of reducing emissions from gas-powered vehicles even as the auto industry pledges to sharply increase its sales of electric vehicles.

The 49-mile-per-gallon average required under NHTSA’s rule is slightly higher than what the agency proposed in August. It is largely in line with the EPA’s December rule, although they are not identical.

EPA estimates for real-world results from emissions standards take into account colder temperatures, faster driving and the use of air conditioning, which decrease mileage efficiency compared with what NHTSA officials calculate based on lab results.

Dan Becker, director of the Safe Climate Transport Campaign at the Center for Biological Diversity, said NHTSA’s rule fell short of what is needed in the way mileage standards are governed in the United States.

“The stringency level isn’t up to what the climate challenge presents, and there are too many loopholes that allow auto companies to make too many gas-guzzlers,” Becker said. He said mileage standards for SUVs, pickups and vans are weaker than those for cars, which has contributed to automakers’ shift away from producing smaller passenger cars.

According to NHTSA calculations, the required average for passenger cars would reach about 59 miles per gallon in 2026. The agency says passenger cars generally include two-wheel drive crossovers and SUVs, station wagons and sedans. For light trucks — which include bigger and heavier SUVs, pickup trucks, vans, minivans and four-wheel drives — the required average fuel economy that year is just over 42 miles per gallon. As with the fleetwide average, those would be lower in real-world conditions.

The mileage standards largely echo those established in an agreement between California and Ford and several foreign carmakers in 2019 as the Trump administration sought to roll back Obama-era standards and revoke California’s long-standing ability to set stricter pollution limits.

Ford on Friday noted its history of standing with California on mileage standards during the Trump years. In a statement, Chief Policy Officer and General Counsel Steven Croley said the company “applauds NHTSA’s efforts to strengthen fuel economy standards and create consistent benchmarks to accelerate our national transition toward a zero-emissions transportation future.”

Ford is charting an aggressive path on electric vehicles, with its F-150 Lightning pickup truck and E-Transit van heading to customers this year. Other automakers are also seeking to gain ground on electric vehicle leader Tesla.

Gina McCarthy, the White House’s national climate adviser, said in an appearance Friday with Buttigieg and Deputy NHTSA Administrator Steven Cliff that the administration sees an opportunity in the challenge of reaching Biden’s goal of at least halving emissions compared with 2005 levels by 2030. Cleaner, more efficient transportation is key to getting there, she said.

“It is not about pain and suffering. It’s about grabbing the future for our industry, for our unions and for America. That’s what we’re doing today,” McCarthy said.

Cliff said that with the standards announced Friday, the nation will cut pollution by roughly the same amount as if 5 million of today’s cars were taken off the road. “And we’ll do this with American ingenuity,” Cliff said. “We, as a nation, have never shied away from a challenge.”

Those challenges are significant. According to the EPA’s Automotive Trends Report, consumers’ preference for bigger vehicles has been eating up efficiency gains by manufacturers. Sedans and wagons have fallen to fewer than a third of new cars, compared with about 50 percent in model year 2013 and 80 percent in 1975, the report said. Larger SUVs categorized as trucks hit a market share of 39 percent in model year 2020, according to the EPA, which “offset some of the fleetwide benefits” of making individual vehicle types run cleaner.