EPA to Revisit Decision Prohibiting California Greenhouse Gas Regulations, NHTSA to Issue New CAFE Standards

President Obama directed the U.S. Environmental Protection Agency (EPA) to reconsider a Bush Administration decision which denied California and other states from regulating greenhouse gases emitted from motor vehicles. The president also directed the National Highway Traffic Safety Administration (NHTSA) to finalize a rule to increase the Corporate Average Fuel Economy (CAFE) standards for passenger cars and light trucks for model years 2011–2015. Both actions had been anticipated.

In late 2007, President Bush signed into law energy legislation to raise the CAFE standards for passenger cars and light trucks by 40%, to an industry average of 35 miles per gallon by 2020. SEMA worked with the automakers and other industry associations as part of the CAFE Coalition to help negotiate a compromise approach that would allow carmakers to reach a fair and attainable standard.

The EPA cited the new law as justification for denying California’s waiver request to regulate carbon dioxide (CO2) emissions from automobiles starting in 2009. The CO2 rules were issued by the California Air Resources Board and adopted by 13 other states. The EPA ruled that the new CAFE law will achieve greater CO2 savings than the California program and that a federal approach provides a national solution, as opposed to a potential patchwork of state rules. 

If the EPA grants California’s waiver request, more than a dozen states that have adopted the California rules will be able to mandate a 30% cut in greenhouse gases from passenger cars and light trucks by 2016. SEMA has joined with the automakers in support of a national approach to greenhouse gases. 

Since CO2 is a direct by-product when a fossil fuel is burned and there is no other practical method for capturing tailpipe emissions of CO2, SEMA and the automakers contend that the California rules are a de facto fuel-economy regulation. Only the federal government can establish fuel standards. 

The NHTSA has been directed to complete its new fuel-economy standards for passenger cars and light trucks by the end of March. The agency issued a proposed rule last year to implement the 2007 energy law beginning with model year 2011. The draft rule would speed up the time table to reaching the goal of 35 mpg by 2020 a bit faster than anticipated. The auto companies have requested more time to achieve the goal. 

For more information, contact Stuart Gosswein at