Trump Administration Seeks to Revoke California's Ability to Set its Own Fuel Economy Standards

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【Summary】The Trump administration is looking to revoke California’s ability to set its own fuel efficiency standards and reverse planned hikes in fuel efficiency standards adopted by the former Obama administration.

Eric Walz    Jul 23, 2018 4:47 PM PT
Trump Administration Seeks to Revoke California's Ability to Set its Own Fuel Economy Standards

California has the highest sales of electric vehicles in the country, with 50 percent of all U.S. electric vehicles being sold in the state. In addition, the Los Angeles metro area also has some of country's worst air pollution.

To combat California's well-known smog problems, over the years, the golden state enacted some of the strictest emission standards for motor vehicles in the state, even going as far as requesting a waiver from the EPA to set its own fuel economy standards, which are tougher than what the federal government mandates.

Now, President Trump is looking to revoke California's ability to set its own fuel efficiency standards and reverse planned hikes in fuel efficiency standards adopted by the Obama administration.

The move is expected as early as Thursday and will propose revoking California's power to set state vehicle emissions rules and mandate the purchase of electric vehicles, a government official briefed on the matter said and was reported by Reuters.

The Obama era plan was to mandate that all cars sold average 54.5 miles per gallon by 2025, up from 38.3 mpg in 2018— a lofty goal. A freeze would reduce the average fleet fuel economy standard from a current projected level of 46.8 miles per gallon in 2026 to just 37 miles per gallon, according to an earlier draft obtained by Democratic Senator Tom Carper.

According to Reuters, the U.S. Transportation Department and Environmental Protection Agency (EPA) are expected to unveil a proposed regulation that recommends freezing national emissions requirements at 2020 levels unitl 2026, the official said on condition of anonymity because it has not yet been made public.

In addition, the Trump administration plans to propose a rule that would revoke a waiver California was granted by the EPA under the Clean Air Act, which allowed California to set its own emissions rules and requirements for zero emission vehicles.

The EPA and the Transportation Department is set to hold public hearings and listen to feedback before finalizing a decision.

Regulators predict that freezing national emissions standards after from 2020 to 2026 would increase U.S. fuel consumption by about 500,000 barrels of oil per day, the source said.


Smog caused by motor vehicles, a common sight in Los Angeles, California

Government regulators also estimate the regulation, which is called the ‘Safer and Affordable Fuel Efficient' (SAFE) Vehicles rule, will reduce traffic deaths, supposedly from cars being made lighter to meet the fuel economy requirements, as well reduce the cost of new vehicles.

The proposal will likely meet strong resistance in California, a state that has embraced electric vehicles, as well as a dozen other states that have adopted California's tough emission rules. Currently, California is requiring average vehicle fuel efficiency to reach nearly 50 miles per gallon by 2025.

In addition, eliminating California's electric vehicle mandate might hurt automakers like Tesla Inc and General Motors, both companies are investing billions in battery-powered vehicles.

The administration contends the new rules could lead to a total of 1 million additional new vehicle sales through 2029 versus if the Obama rules remained in place, the official said.

Major automakers have repeatedly said they do not back freezing the requirements but have called for changes to take into account fuel prices and shifting consumer demand from cars to small SUVs.

In May, California and a group of 16 other states challenged the Trump administration's decision to reopen strict U.S. vehicle emissions rules for review. Reuters reported previously that the Transportation Department plans to assert in the proposal that California is also barred from setting emissions rules under a 1975 EPA law.

The administration's draft says the proposal would save up to 1,000 highway deaths annually by reducing the cost of new vehicles and pushing people to buy new safer cars sooner, the source said. However, California and environmentalists have previously criticized that analysis.

California is considered an environmentally conscious, ‘green' state, and the announcement is already being targeted by politicians.

California Attorney General Xavier Becerra said in a statement Monday that he is "ready to use every legal tool at our disposal to protect the current vehicle emission standards."

Representative Jimmy Gomez, a California Democrat, posted on Twitter that the state's "vehicle emissions standards are a big part of our environmental identity.... We actually care about our future. Stay out of CA's way!"

The draft proposal forecasts the average cost of a new vehicle would fall by $1,850 by 2030 and would only have a "negligible impact" on the global climate of "3/1000th of one degree Celsius by 2100." The science behind the forecast is unclear.

The Trump administration projects the new rule would reduce "societal costs" by about $500 billion over the life of the vehicles, but the administration's overall forecast net benefits are unclear, once higher fuel consumption is taken into account.

In January, California Governor Jerry Brown set a new target of 5 million zero-emission vehicles in California by 2030, up from a prior goal of 1.5 million by 2025.

Critics of the Obama era plan to increase average fuel economy to 54.5 mpg have called it a thinly disguised effort to force people to adopt more expensive electric vehicles and plug-in hybrids, as the average is difficult for automakers to achieve with a model line-up of fossil fuel-powered vehicles.

Regardless of the decision, automakers, including electric carmaker Tesla and General Motors, have announced plans to spend billions of dollars on new EV models over the next five years.

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