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Environmental Policies And States’ Rights Back In The Spotlight

Have you heard? The White House has finally come out with its long-anticipated move to roll back fuel-efficiency standards put in place by the Obama administration. Officially, they are aiming to challenge state’s rights to set their own stricter tailpipe emission standards. But some say they face a difficult task in actually getting his to pass.

The details of the new push came in the form of a proposed rulemaking notice issued by the Environmental Protection Agency (EPA) and National Highway Traffic Safety Administration (NHTSA) on August 2. The specific language in the proposal seeks to:

  • “Amend certain existing Corporate Average Fuel Economy (CAFE) and greenhouse gas emissions standards for passenger cars and light trucks and establish new standards, covering model years 2021 through 2026.”

The official name for the new rule is the Safer Affordable Fuel-Efficient Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light Trucks (SAFE Vehicles Rule). The government agencies responsible stated that this rule is merely an extension of the Corporate Average Fuel Economy and Light-Duty Vehicle Greenhouse Gas Emission Standards, a congressionally mandated rule set in place last year. They went on to call this a formal step in setting the 2021-2026 model year standards for automakers.

EPA Acting Administrator Andrew Wheeler stated that the EPA was addressing the current standards in a way that would strike the right regulatory balance based on the most recent data, while also creating a comprehensive 50-state solution that would allow Americans to afford newer, safer vehicles that pollute far less.

He even went on to state that the new rulemaking would “save lives” while also continuing to improve the environment and decrease pollution. The agency has come out stating that the current standard represents “costly” increases that would create unsafe roads. The unsafe roads argument was predicated on the fact that it is believed automakers would develop lighter vehicles to increase MPG ratings, rather than develop new technologies.

The agency states that the current standards have been responsible for driving up the cost of new vehicles to today’s average of $35,000. And they pointed to a study completed in 208 that shows new model year vehicles are safer, so they want to address regulatory standards that drive down the costs for newer vehicles.

But Will it Happen?

The proposed changes to the light-duty tailpipe emissions standards are likely to be challenged by many different advocacy groups during the rulemaking process. For many, the fact that the administration wants to strip California from being able to set its own stricter fuel economy standards for passenger cars and light-duty trucks is a non-starter. Trucking industry groups also believe this could have an impact on heavy-duty commercial motor vehicle emissions rules.

Interestingly enough, the proposed rule has brought together quite a different range of industry advocates and players. You now have environmental advocacy groups, consumer protection, and auto industry groups on the same side of the issue. It may come as a surprise to some, but major automakers have also come out against the proposed rule. Many state attorneys general have also come out strongly against the proposal.

The ATA released a statement saying that the EPA will face a “long, litigious road” if the states and federal government cannot resolve their differences regarding the proposal. It is notable, however, that the Phase 2 truck GHG/MOG rules are not part of the proposed roll back.

The trucking industry will likely be following developments on this matter very closely, as whatever happens with the passenger vehicle market parallels very closely with what happens in the heavy-duty commercial motor vehicle field.

Three specific areas where this measure could have an impact include California’s:

  • Waiver authority;
  • Greenhouse gas emissions, and;
  • The ‘endangerment’ finding.

While automakers did ask President Trump to loosen Obama administration MPG/GHG rules, they are not fretting that the current administration’s efforts go to far. Many are also well aware that California and states following its lead will have no problem suing the federal government to retain California’s waiver authority.

California lawmakers have come out strongly against the proposed rulemaking, stating that if the federal government were to withdraw California’s waiver, it would represent an unprecedented and potentially unlawful action. They also went on to state that it would aggravate pollution, potentially harm consumers and public health and weaken overall environmental standards. California Governor Jerry Brown called the proposal “stupidity.”

Of course, both agencies are seeking public comment on these regulatory moves. The EPA has stated it will open a docket for public comments for 60 days within the Federal Register. Comments regarding the rulemaking may be submitted through this link and by referencing the following docket number: Docket EPA-HQ-OAR-2018-0283.

Glider Kit Rules to be Enforced After All

We recently reported that the EPA had decided not to enforce the GHG Phase 2 rule aimed to limit glider kits to their original purpose of allowing truck owners to repair vehicles that need specific parts. The rule was designed to address truck owners and motor carriers who were using them to install older engine technologies on newer rigs with better aerodynamic properties. With many considering this to be a glaring loophole in federal emissions standards GHG Phase 2 was meant to address it.

The history behind this new move can be traced back to the EPA regulatory proposal they issued in November of 2017. That proposal was designed to reconsider glider kits restrictions. At the time the EPA used a study commissioned by the largest glider kit company in the U.S., and was later withdrawn by the university that issued it. Even truck OEM Volvo was caught in the mix as the EPA also used a study that Fitzgerald Glider Kits found questionable.

On the other side of the argument, the Environmental Defense Fund commissioned a study that found if the EPA put a two-year non-enforcement policy on limiting the number of glider kits allowed, it would result in over 1,700 premature deaths over the lifetime of the additional vehicles allowed. At this time, it appears Fitzgerald Glider Kits is the only manufacturer still fighting the rule. Freightliner, who used to be a large glider kit installer, has decided to continue drawing down their operation, no matter what rule’s final outcome is.

Now, with the court challenge having officially stopped the EPA from its non-enforcement endeavor, environmental advocacy groups are coming out strong in support of the ruling. The EDF camt out saying that the EPA’s effort was both “irresponsible” and “dangerous.” Still, the fight is not over. The EPA has proposed a rule to permanently repeal the glider kit portion of the GHG regulations, which will also likely end up in court. The outcome of that is anybody’s guess.

The European Union Sets a Standard

Meanwhile, the European Union has come out strongly to reduce CO2 emissions across their member states. Their new goal is aimed at both passenger vehicles and commercial motor vehicles. Specifically, their proposal would reduce emissions by 30% within 12 years. This move represents the EU’s first continent-wide move on reducing emissions.

Of course, the proposal would have to be approved by EU member states and the EU parliament. Previously, the E.U. had no overall regulations governing fuel economy, but once the Paris Climate Agreement was signed, the goal of reducing emissions by 40% by 2030 changed the paradigm. The Paris Climate Agreement put transportation at the center of its goal to reduce emissions, especially on the heavy-duty commercial motor vehicle sector.

Still, even in the environmentally-conscious E.U., some see the proposal has being a bit too harsh and possibly butting undue strain on the continent’s transportation industry. Specifically, the European Automobile Manufacturer’s Association (ACEA), which represents several major heavy-duty commercial motor vehicle manufacturers, has applauded efforts to reduce emissions, but also believes that the current goals are far too ambitious and may not give OEMs enough time to develop the vehicles that meet the new standards.

Specifically, the advocacy group stated that the commission basically took the CO2 reduction levels they put into place for passenger cars and trucks and applied them to heavy-duty commercial motor vehicles without taking into full account that there are big differences between the two segments. Another advocacy group, the International Road Transport Union, also came out in support of emissions reductions, but also worried that adding these standards might drive up the cost of new vehicles and put in undue burden on transportation companies and truck drivers.

With so much happening on both sides of the Atlantic where environmental regulations are concerned, many wonder how his will all shake out. Will states’ rights win out in the United States and will industry come to the rescue and prevent new regulations from driving up costs in the European Union? As these debates take shape as we move into 2019, you can rest assured we will be right here reporting on it for you at the QuickTSI Blog.

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