California May Agree To Withdraw Its Emissions Waiver Exemption Request
By Chris Haak
We’ve called the wisdom of granting an EPA waiver to California and the states that follow California emission rules into question a few times in the past. At the risk of repeating ourselves again, California proposed greenhouse-gas (CO2) reductions that – because CO2 emissions are related more or less proportionately to fuel consumption, would have been a de-facto fuel economy standard different from the 35 mpg CAFE standard that Congress approved a few years ago. The effect of granting the waiver to California, which President Obama has said he supported doing, and in fact instructed the EPA to review the decision made by the EPA under the Bush Administration to deny this waiver. In an article about six weeks ago, I lamented this shortsighted policy choice and advocated for at least a national CO2 (i.e., fuel economy) standard rather than having different rules for different states. In an extremely rare bit of good news for the auto industry, it now appears that my wish may have come true.
Mary Nichols, chair of the California Air Resource Board (also known as CARB), said in Washington during a hearing last week on whether the EPA should grant California’s exemption that California would agree to withdraw its emissions waiver request with the EPA if an agreement could be reached on a national CO2 standard. The Detroit automakers and their allies have argued incessantly against the EPA granting this waiver to California and the 13 other states that adhere to California emission standards. California is allowed to regulate auto emissions because it began regulating them since the 1960s, before the Feds did, but the Federal government is the only entity allowed to regulate fuel economy. California and its allies have been arguing – thanks to a Supreme Court decision that ruled that CO2 was a pollutant – that limiting CO2 is just a natural extension of limiting pollution. But it’s more complicated than that.
The argument against granting the waiver is twofold. Aside from the states’ rights issues that the waiver raises – basically, the 10th Amendment to the Constitution says, “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” Proponents of the waiver – and the 10th Amendment – believe that the Federal government is infringing upon California’s right to regulate these gases; the opposite side believes, of course, that it does have that right.
Another argument against granting the waiver is that it would be extremely cost-prohibitive to any manufacturers who wish to sell vehicles in California and sympathizing states to have two different vehicle fleets – those available in California and the other 13 states, and those available in the remaining 36 states. California-sold new vehicles would have to be more fuel-efficient than those sold in the other states in order to meet California’s CO2 limits. If the 14 California-style states didn’t make up about half of the new-vehicle market, automobile manufacturers could just tell to put their limits where the sun doesn’t shine and not sell new cars there. In 1980, one of the darkest years in Corvette history, the California-spec cars had 180-horsepower, 305-cubic inch V8s, while the rest of the country had more powerful, 350-cubic inch V8s. Back then, it was a lot cheaper to certify a new powertrain than it is today, with the far more strict standards and quality/longevity expectations that we now have. That means that as much as I’d love to see consumers in those states “penalized” with less-powerful vehicles in order to meet the California CO2 rules, doing so would be too expensive for automakers (not to mention harming me personally, since I live in one of the 13 states that follows California’s rules).
Keeping prices the same in the non-California-compliant 36 states and charging consumers in the 14 California-compliant states for the cost difference wouldn’t work either, because that would make new vehicles in those states prohibitively expensive. The result would be an even further collapse in the new-vehicle market, which this industry can ill-afford to see right now. Also, again speaking selfishly, I’m not particularly interested as a resident of one of those states in paying more money for a slower car.
With all of this in mind, it’s good news to hear that California’s Mary Nichols is making noise about a compromise whereby her state would stop trying to get a waiver from the EPA that allowed them to regulate CO2, and instead would get more strict Federal limits on the gas. Even this solution will mean smaller, more fuel efficient cars for consumers (and likely more expensive ones), but it also means that only a single vehicle fleet would be necessary for the entire nation.
Now, if this happens as Ms. Nichols is indicating it might, I’d next love to see boutique gasoline blends eliminated to smooth out gasoline supplies around the US. A guy can dream, can’t he?
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