January 10, 2022

Ann Mesnikoff

New Cleaner Car Standards: On the Road to Urgently-Needed Climate Action

The EPA's stronger emissions standards get the U.S. back on track to reduce our pollution

I watched Don’t Look Up over the holidays. No spoilers here (I hope), but if you accept the premise that the climate crisis is like a meteor hurtling towards earth, would you want every possible action taken to stop an impending disaster? If the conceit of the movie doesn’t work for you, how about this story from Rolling Stone about the melting ice caps. The real-life situation is urgent, but there is a lot we can do as a nation to make a difference.

Among President Biden’s first actions was returning the U.S. to the Paris agreement, the international agreement to reduce greenhouse gas emissions to avert the worst impacts of climate change. He has also set out necessary climate goals for the country. In some cases, like the clean energy tax credits and other policies tied up in the Build Back Better Act, Congress must act. In other cases, the Biden administration is in the driver’s seat (or holds the keys) – this is a blog about the U.S. Environmental Protection Agency’s recently announced final clean car standards after all.

Cars are Driving U.S. Emissions

The transportation sector is now the leading source of U.S. greenhouse gas pollution (29%) and our cars, SUVs, and pickups make up nearly 60% of those emissions. With this as context, Biden’s Executive Order 13990 “Protecting Public Health and the Environment and Restoring Science To Tackle the Climate Crisis,” directed EPA (and U.S. DOT) to reevaluate the so-called SAFE rules the Trump administration completed to undermine emissions reductions (and fuel economy standards) that had been set under the Obama administration in 2012 for new cars and light trucks through Model Year 2025.

In July 2021, EPA issued its proposal to not only reset standards for some of the years the Trump administration weakened but also set the auto industry up for the even stronger standards needed to put us on a path to a zero-climate pollution vehicle future. EPA’s proposal covered Model Year (MY) 2023-2026 new cars and light trucks – thereby resetting the standards for MY 2023-2025 that the Trump administration set and setting a new standard for MY2026. EPA offered a base proposal and two alternatives – with Alternative 2 being the strongest option. EPA took comment on these options including an additional reduction in greenhouse gas pollution in 2026 (a 10 g/mile reduction). EPA’s proposal also included a slew of “flexibilities” to help automakers meet these new standards.

Our Midwest Coalition Spoke out for Strong EPA Standards

ELPC joined EPA’s public hearing on its proposal back in August and joined 24 Great Lakes partners in written comments (and also joined national coalition partners on a detailed set of legal and technical comments). EPA issued its final rule on December 20^th and this is our chance to assess how this rule measures up to our comments. Read our comments here:

Full Coalition Letter

Testimony to EPA

We urged EPA to adopt strong, technology-forcing standards for cars and light trucks to slash U.S. climate pollution. Specifically, we urged EPA to adopt its more stringent Alternative 2 with the addition of the 10 g/mi greater stringency for MY 2026. We argued that stronger standards would support clean car innovation and manufacturing in the Midwest (and beyond).

We also called on EPA to drop the many “flexibilities” such as “multipliers” and other loopholes that undermined the ultimate goals. The way these standards work is that they are applied to the manufacturer’s whole fleet for each model year, and the automakers can earn credits if their fleet pollutes less than the standard in a given year. They can sell or use these credits to offset another year in which they might pollute more.

We raised concerns about overly generous credits automakers can earn. In some cases EPA’s proposal could grant “phantom” credits for emissions reductions that did not actually happen, weakening the overall stringency of the standards. We specifically raised concerns with how EPA proposed to award automakers credits for producing electric vehicles.

The final rule is a bit of a mixed bag

Here is what EPA decided on the points we raised:

• Proposed alternatives: “In recognition of lead time considerations, for MYs 2023 and 2024, EPA is finalizing the proposed standards for those model years. For MYs 2025 and 2026, EPA has determined that it is appropriate to finalize standards more stringent than those proposed, … we are finalizing standards that are the most stringent of the alternatives considered in the proposed rule for those model years.”
• Flexibilities: When it came to the “flexibilities” we urged EPA to curtail or drop, EPA notes in the final rule that “[t]here was also broad opposition among … commenters to the proposed flexibilities and incentives, based on concerns that the flexibilities were unnecessary and would compromise the stringency of the program.”
• Electric Vehicles (and natural gas vehicles): Rather than increasing the multiplier for electric vehicles and extending it through 2025, EPA opted for keeping it at 1.5 for EVs and including it for MY 2023-2024 only and removing the multiplier for natural gas vehicles for MYs 2023-26. EPA acknowledged that too much “flexibility” can weaken the program.

The New Standards are a Good Step Forward

As we noted in our initial response here, we appreciate that EPA is tightening up standards and driving down greenhouse gas pollution (and fuel consumption) from new vehicles and is preparing to issue even stronger standards to kick in after 2026. Stronger standards are absolutely needed to help protect the climate.

It is clear from the EPA’s analysis to support this final rule that the automakers have the technology to slash tailpipe greenhouse gas pollution while delivering important climate, clean air, and consumer benefits (like savings at the pump).

According to EPA, the final emission standards targets for 2023-2026 increase in stringency by between 5-10 % in each model year (as compared 1.5 % per year increase under the Trump standards these replace). EPA’s fact sheet for the rule is here but some key highlights include that these new standards will:

• Result in 3.1 billion tons of avoided CO₂ emissions through 2050.
• Reduce gasoline consumption in the U.S. by more than 360 billion gallons—reaching a 15 % reduction in annual U.S. gasoline consumption in 2050.
• Achieve total fuel savings between $210 billion and $420 billion through 2050.
• Maintain momentum towards expanding market share of zero emissions vehicles, with the standards resulting in battery electric and plug-in hybrid vehicle market share of 17 % by MY 2026.

EPA’s standards for MY 2023-2026 are a reset. We had urged stronger action, but this final rule is an essential step in correcting the Trump administration’s attack on clean cars and climate action. Now EPA must quickly propose standards for MY2027 and beyond that will rapidly slash tailpipe climate pollution and put us on a path to a safer zero emissions future.