EPA poised to scrap fuel economy targets that are key to curbing global warming — setting up clash with California

March 29, 2018 2:57 PM PT

Reporting from Washington — The Trump administration is poised to abandon America’s pioneering fuel economy targets for cars and SUVs, a move that would undermine one of the world’s most aggressive programs to confront climate change and invite another major confrontation with California.

The Environmental Protection Agency is expected to announce in the coming days that it will scrap mileage targets the Obama administration drafted in tandem with California that aim to boost average fuel economy for passenger cars and SUVs to 55 miles per gallon by 2025, according to people familiar with the plans.

The agency plans to replace those targets with a weaker standard that will be unveiled soon, according to the people, who did not want to be identified discussing the plan before it was announced.

EPA spokeswoman Liz Bowman said a draft determination was undergoing interagency review and a final decision would be made by Sunday.

EPA chief Scott Pruitt has previously suggested that he thinks the targets are too onerous for manufacturers and inhibit them from selling the vehicles most popular with Americans. A climate skeptic, Pruitt has questioned mainstream science on the warming caused by greenhouse gases such as auto emissions.

Whether Pruitt can weaken the rules for the entire country is an open question. California, with its history of smog problems and heightened vulnerability to climate change, has unique authority under the Clean Air Act to impose its own standard. The act also permits other states to adopt the California rules, and a dozen have.

Over the last decade, the federal government has worked with California to keep mileage targets uniform nationwide, folding the state’s aggressive smog and anti-pollution goals into the national program. A single standard is crucial to automakers who don’t want to contend with multiple production lines to comply with conflicting rules in states, particularly one as important to car sales as California.

After President Trump was elected, automakers immediately began lobbying him to rewrite the rules — and to pressure California to dial back its efforts. Pruitt’s action would give the companies limited or no relief if it is not enforced nationwide since California’s rules apply to more than a third of cars sold across the country, and automakers are loath to create multiple production lines to comply with conflicting rules.

The state is showing no sign of yielding. And the EPA chief is striking an increasingly hostile tone toward it, suggesting that he may seek to revoke the federal waiver that allows California to impose tougher rules than those of the federal government.

State leaders are daring him to try. They are confident it is a legal fight California would win.

“We are not going to go backward,” said California Atty. Gen. Xavier Becerra. “We are not interested in a race to the bottom…. We are prepared to take whatever action, legal or otherwise, we have to to protect our health and our economy.”

“We didn’t make these moves lightly,” Becerra said of the fuel economy targets. “They came after years of study, scientific evidence, fact-gathering, comment periods, a lot of back and forth among experts and stakeholders. To unwind this and go backward would cost our industries and cost our people billions of dollars. There has to be a good reason to make any kind of move. We have seen nothing change that would make California change its position.”

The 55 miles per gallon target is based on outdated testing methods, so it is widely accepted that the current figure that would appear on the window sticker in showrooms is closer to 44 miles per gallon.

The ambitious Obama-era program is geared toward moving drivers into vehicles that by 2025 release, on average, half the greenhouse gases of vehicles built in 2010. The EPA called it the “the most significant federal action ever taken to reduce [greenhouse gas] emissions.”

Some experts say the vehicle program is more significant in the fight against global warming even than Obama’s signature Clean Power Plan, which sought to curb emissions from electricity plants. While market trends are pushing utilities to drive down their emissions even after Trump moved to unravel the Clean Power Plan, the auto industry is at risk of stalling on climate action if it is not pushed by government.

“Given the work that needs to be done to bring the transportation sector along and the importance of driving those emissions down, having government policy like this is essential,” said Ann Carlson, a professor of environmental law at UCLA.

The existing fuel economy rules are also at the foundation of California’s own climate goals, which could prove impossible to meet if the EPA were to successfully strip its authority to enforce them.

The auto industry is still holding out hope that a deal between California and the EPA could be brokered. A compromise might involve the state consenting to easing up on the rules for vehicles sold from 2022-25 — the years targeted by the administration — in exchange for extending federal rules out to 2030 with aggressive targets in those later years.

“We keep urging people not to rush to judgment,” said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers. “We haven’t seen the EPA’s data. We need to see what the government comes up with…. We see it as in California’s best interest to engage with the federal government and other stakeholders. If the state wants to maximize greenhouse gas reductions, it should work with us on a national level. California will get more done that way than going it alone.”

Ford Chief Executive Bill Ford, who has led the push for weakening the standard, wrote in a Medium post Tuesday that the company was “not asking for a rollback” but “flexibility to help us provide more affordable options for our customers.”

The Trump administration’s tone is more threatening than diplomatic. Pruitt told Bloomberg that he sees little sense in extending the mileage targets past 2025, and he also said publicly that California should not have the power to set the fuel economy agenda for the rest of the nation. It all suggests he is positioning to try to revoke the state’s waiver.

The environmental waiver is just one of many the federal government has granted the state over the decades, as California confronts its distinct problems with pollution and also serves as a model for environmental action nationwide. None of those waivers has ever been revoked, according to Stanley Young, a spokesman at the California Air Resources Board.

“There is a serious legal question as to whether one can, in fact, be revoked — and California would vigorously oppose such an effort,” he wrote in an email.

Carlson expects the administration will try.

It would have to take aim at the “compelling and extraordinary” circumstances that entitle California to obtain the waiver under federal law. In this case, those circumstances include the threat climate change poses to California’s coastline, its industries and its air quality, among other things.

The administration could argue other states face similar challenges and that the mileage rules can be made more flexible without imperiling them. And it would also argue that the rules are so onerous as to make them technologically and economically infeasible.

California’s confidence that it would prevail is rooted in the reams of evidence it has amassed to rebut such claims, and the decades in which its authority to impose air rules tougher than the EPA’s has been virtually undisputed by Washington.

“This is going to be a big legal battle,” Carlson said.