The writing is on the wall. California laws requiring the rough equivalent of 45 to 50 mpg are in the works.
President Barack Obama will fulfill a campaign pledge today by telling the Environmental Protection Agency to reconsider its rejection of California’s rules to regulate greenhouse-gas emissions. The action follows a request for new public review of the Bush-era decision from both California governor Arnold Schwarzenegger and the head of the California Air Resources Board, Mary Nichols.
In practical terms, if the waiver is now granted, automakers will have to comply with new, more stringent rules that cut fuel consumption across the vehicles they sell in California and other states. National laws require an average of 35 miles per gallon by 2020, but California’s regulations require the rough equivalent of 45 to 50 mpg. Automakers, dealers, and their allies have reacted with alarm, raising the familiar refrain of a “patchwork” of laws that differ in each state.
It started in 2002, when California adopted a state law that required it to regulate greenhouse gas emissions. Under the Clean Air Act, the state had legally set its own exhaust emissions limits more than 50 times since the early 1970s, with waivers routinely granted by the EPA. Its rules were completed by December 2005, so it requested a new waiver—and got no response.
After two years, the agency denied the waiver but proposed new CAFE rules that raised fleet mileage to 35 mpg by 2020, which automakers reluctantly accepted as the lesser of two evils. California promptly sued the EPA. In the waning days of the last presidency, the Department of Transportation postponed issuing the new CAFE rules; the Obama Administration is planning to deliver those rules by April 1.
While the Supreme Court said greenhouse gases like CO2 can legitimately be regulated as exhaust emissions, automakers argue that California’s limits are de facto regulation of fuel economy—which can only be set by national CAFE laws. Indeed, traditional pollutants like carbon monoxide, oxides of nitrogen, and hydrocarbons are reduced by exhaust treatment, but CO2 is almost directly proportional to petroleum burned—although the use of biofuels can break that relationship.
“Patchwork” Excuse—Used Twice
By now, 17 other states, covering more than half the US population, have agreed to adopt the California standards. The automakers’ fear is a “patchwork” of emissions laws, and indeed that has become the buzzword to summarize their objections. Last week the National Automobile Dealers Association released a study called “Patchwork Proven: Why A Single National Fuel Economy Standard Is Better for America Than A Patchwork of Regulations,” using the word twice. It warns of “irreparable harm” and extreme “unintended consequences” to domestic carmakers already struggling to avoid bankruptcy.
President Obama suggested that approval of the California waiver could resolve the “patchwork” issue. This opens the possibility for establishing California-level standards on a 50-state level.
The challenge comes in the definition of compliance, which depends on the mix of vehicles sold in each state. Dealers say that they might be forced to switch off sales of trucks by August to meet the limits. Automakers couldn’t simply ship them whatever sells, but would have to vary the model mix state by state. Buyers could still buy vehicles in other states—a loophole—and new automakers from China and India would be exempt for a few years.
The devil is always in the details, and these fears may have some relevance. But they’re also sadly reminiscent of automakers’ absolute intransigence toward any regulation of their products or industry in any form over the last 50 years. The counter-proposal is no more than, “Stick with what’s there, don’t do anything new.” And these days, Detroit has less public credibility or support than it once did.
In the end, the important question is not what Obama will do, but whether the automakers have been planning for this day by preparing to deliver more efficient vehicles of all sizes, including hybrid gas-electric cars.