Big news on the emissions regulation front today. For years, California has been in the driver's seat (or at least the co-pilot's chair) when it comes to American emissions regulations thanks to the grandfathered ability of the state to define its own rules. These rules were almost always stricter (i.e., cleaner) than the federal government's. Since about a dozen states then adopt California's regulations as their own, something the auto industry just hates, there are basically two sets of regulations in play in the U.S. In December 2007, the Bush Administration stopped California's ability to enforce its own laws by denying the state a waiver that would have allowed it to regulate greenhouse gas emissions. The Bushies really didn't like what California was doing.
Four years ago, California enacted a law that required automakers to reduce their average fleet greenhouse gas emissions by 30 percent in a decade. While the dozen states have been waiting to implement the California law, everyone needed to wait until EPA issued that waiver in order to start. With the Obama Administration now in charge, it looks like the waiver may finally come.
Our inboxes were flooded this morning with press releases and reader tips about reports that Obama would reevaluate the waiver denial, something he promised during his campaign. The LA Times writes that at least 17 other states, with about 40 percent of the U.S. population, are looking at adopting (or have already adopted) the California rules, so this decision could affect vehicle sales for almost half of all Americans.
Meanwhile, on NPR this morning, the Auto Alliance repeated its opposition to the state-by-state (or even two-tier) regulation system. The Alliance's Charles Territo told NPR that, "At this difficult time for the industry, and for the economy as a whole, what we need is certainty and consistency, not confusion and chaos." In the same NPR piece, California Attorney General Jerry Brown said that the automakers came begging for a government bailout after people stopped buying their big vehicles, but they continue to fight rules that call for smaller, cleaner vehicles.
The National Auto Dealers Association released a study last week that found that, "state-by-state regulations would have 'little or no environmental benefit' but would erratically harm the economy." Their email is pasted after the jump. We'll be in D.C. for that city's auto show next week and will be paying close attention to the regulatory atmosphere when we get there. Without a doubt, there will be more to come. Thanks to everyone who sent this in.
UPDATE: more here.
[Source: LA Times]
NADA (the Nat'l Auto Dealers Assn) did a study that concluded that a patchwork of state fuel standards based on the CARB (California Air Resources Board) rule would be needlessly destructive compared to a single national fuel efficiency standard.
That is, state-by-state regulations would have "little or no environmental benefit" but would erratically harm the economy. Not exactly a good political bargain for environmentalists.
Among the conclusions of the study:
* Almost no analysis or scrutiny has been given on how CARB's rule will actually work in practice or why such regulation is still necessary since Congress hiked the national fuel economy standard by 40 percent in 2007. [The proposed CAFE standard that the Obama admin will finalize by April is actually 0.3 mpg higher than California's.]
* An automaker could comply in California and offer the exact same choice of vehicles in another CARB state, and yet still not be in compliance, solely due to differing consumer demand for different types of vehicles.
* The patchwork would create the "cross border sales loophole," as CARB's regulation does not regulate cars imported from non-CARB states that are registered in CARB states.
* The patchwork reopens the SUV loophole; and
* Several automakers and potentially new entrants from China and India would be exempt from CARB's regulation until 2016, provided they limit their sales in California.
Those are all quotes from the press release, which is here.
And the 34-page study is here.