EPA to Revisit CAFE Requirements; Will Greener Cars Continue?
The U.S. Environmental Protection Agency (EPA) is set to consider lowering the Corporate Average Fuel Economy (CAFE) target of 54.5 mpg for new-vehicle fleets by the 2025 model year. However, it is unlikely that fuel-economy standards will be rolled back in the near term.
Under the new Trump administration, the EPA will reopen a review of auto emissions standards that were put in place to reduce greenhouse gas emissions and improve fuel economy initiated in 2012 by the EPA, the Department of Transportation, and California’s Air Resources Board (CARB).
However, the process to change requirements won’t be fast. News reports say that federal and state governments will need to reach a balance in setting up rules for regulating tailpipe emissions. A review and actual actions to change current standards set by the National Highway Traffic Safety Administration (NHTSA) will take time, especially with possible legal battles with environmental groups and states, principally California.
California already has its own emissions requirements in place to impose stricter air-quality standards for the health of residents. Currently, federal law does not allow states, except for California, to set its own vehicle emissions requirements. California, however, can seek waivers under the federal Clean Air Act (passed in 1970) to sell zero-emission vehicles. In addition, 15 other states have adopted California’s stricter standards. Removing California’s waiver that is part of the Clean Air Act could be difficult.
However, U.S. automakers argue that the cost of meeting the 54.5 mpg CAFE guidelines will surpass the EPA’s 2012 projection of $200 billion. In addition, with current lower gasoline prices and increased consumer demand for SUVs and pickup trucks (which account for over 63% of new-vehicle sales, according to the Power Information Network® (PIN) from J.D. Power), automakers are in a difficult position.
EPA officials have said that any changes in standards will need to be evaluated and will also need to be held up in the courts, according to WIRED. Meanwhile, automakers in Europe and China continue to tighten their emissions standards. There’s also concern about what happens to hybrids and electric vehicles if CAFE standards are relaxed significantly.