April 13, 2018

On April 2, 2018, Environmental Protection Agency (EPA) Administrator Scott Pruitt announced that the agency would revise fuel economy standards for cars and trucks for model years 2022 through 2025, citing recent data that suggest the current standards are not appropriate.

The current standards, requiring automakers to engineer their fleets so gas mileage would average 54.5 miles per gallon by 2025, were established by President Barack Obama’s administration in 2012 under the Clean Air Act. As part of that rulemaking, the EPA made a regulatory commitment to conduct a Mid-term Evaluation (MTE) of the standards no later than April 1, 2018. Before leaving office, the Obama Administration made a Final Determination on January 12, 2017 that the standards remain appropriate and should not be amended. However, under the Trump Administration, the EPA and Department of Transportation reopened the regulatory docket in August 2017 asking for additional information and data relevant to assessing the appropriateness of these standards.

On April 13, 2018, the EPA published a notice in the Federal Register stating that Administrator Pruitt found that the current standards are based on outdated information, and that more recent information collected from the docket suggests that the current standards may be too stringent. In particular, Administrator Pruitt argues that the standards present challenges for auto manufacturers due to feasibility and practicability, raise potential concerns related to automobile safety, and result in significant additional costs for consumers, especially low-income consumers. The notice also announces the withdrawal of the previous Final Determination. The EPA, in partnership with the National Highway Traffic Safety Administration, initiated notice of rulemaking and comment in the Federal Register (Docket ID: EPA-HQ-OAR-2015-0827 at regulations.gov).

As the EPA’s annual report indicates that the transportation sector accounts for the largest contribution of carbon dioxide emissions in the nation, supporters of the Obama-era standards argue that strict emissions standards would spur innovation and protect the environment through reduction of carbon dioxide emissions. Conversely, automakers have heavily criticized the standards, pointing to increased costs that would be required for industry to comply. The change in rulemaking is further complicated by the fact that California, through a waiver granted by the EPA under provisions of the Clean Air Act, can impose stricter standards for vehicle emissions of certain pollutants than federal requirements. Under the leadership of Administrator Pruitt, the EPA is reexamining the California waiver and the potential for inconsistent and conflicting standards.

Sources: Auto Alliance, Department of Transportation, Environmental Protection Agency, Federal Register