California Granted Power to Self-Regulate Auto Emission Standards

The Environmental Protection Agency celebrated a triumphant victory on Wednesday, March 9, when California recovered the authority to establish emission standards, enabling the state to tighten regulations on greenhouse gas emissions beyond federal requirements. This decision to reestablish California as a leader in the fight toward greener motor vehicle efficiency was delivered by the Biden administration, which reversed a Trump administration attempt to block the state from using its vast economic influence in the auto industry. To many, this decision to grant power back to the state not only indicates tremendous acknowledgment of California’s abilities to self-regulate but sets a precedent for enabling states to achieve increased autonomy over environmental matters.

TRUMP-ERA LIMITATIONS TO CLEAN AIR ACT

The origins of California’s sovereignty to specify auto emission standards can be delineated back to the 1960s when the Golden State pursued and acquired a waiver under the federal Clean Air Act, known colloquially as the California Waiver. This waiver enabled California to set its emission standards for new motor vehicles; this power would later be dismantled in 2019 by the Trump administration. Revoking California’s CAA waiver was the first step in Trump’s two-phase plan: the Safer Affordable Fuel-Efficient Vehicles Rule. The second stage, effected in 2020, limited the Obama-era fuel-economy standards set by the Department of Transportation. Through its unique interpretation of the Clean Air Act, Trump’s administration was capable of passing the SAFE Vehicles rule, which contained a set of fuel and carbon dioxide emissions

standards that increased in strictness by a factor of 1.5% annually as opposed to Obama’s objective to increase the stringency of emissions by 5% annually. The shift in fuel standards reached through the SAFE Vehicles rule was intended to drastically reduce vehicle and technology costs by an estimated $200 billion. The administration’s justification for this push was that stricter fuel economy regulations would bring about smaller vehicles that would, inevitably, be much more threatening in the case of collision. Naturally, car manufacturers resorted to selecting a side dependent upon their preference to uphold environmental efficiency or profits. GM, Toyota, and Nissan took the side of Trump whereas Ford, Honda, BMW, Volvo, and Volkswagen found interest in California. Nevertheless, through this single, calculated maneuver, the Trump administration was able to strip California of its EPA-granted waiver, as well as any autonomy in dictating self-governed emission standards.

CALIFORNIA’S COMMAND OVER AUTO MARKET

Prior to Trump’s SAFE Vehicle rule, California held enormous authority in influencing the automotive market, due in part by the state’s immense population, as well as the prominence of environmental threats, such as wildfires, occurring close to home. To initially obtain the EPA waiver, the state would need to demonstrate “compelling and extraordinary conditions”; this requirement would be achieved simply by demonstrating that Southern California’s air pollution in the 1960s was unacceptable. Even today, in California, transportation claims responsibility for over 50% of air pollution, as well as 80% of smog formation and 95% of toxic diesel emissions. Thus, the necessity to dictate emission rules, independent of other states, seems obvious. Granting regulatory power back to California will generate immense benefits, not from a capitalist perspective, but from the angle of achieving reduced pollution. Already, since the EPA chose to restore California’s authority to set pollution rules, 16 other states and Washington D.C. have followed the California plan. This collective of states eager to see a change in the

automotive industry account for over 40% of the United States’ market for vehicles. However, with California’s vehicle market alone nearly the size of that of Italy, as well as ten times the size of Norway, a leader in electric mobility, the implications of the EPA’s decision will surely be evident. Governor of California, Gavin Newsom, weighed in on the decision by stating, “The restoration of our state’s Clean Air Act waiver is a major victory for the environment, our economy and the health of families across the country that comes at a pivotal moment underscoring the need to end our reliance on fossil fuel.”

DIVISION BETWEEN PARTIES OVER OUTCOME

Despite widespread triumph, from groups not only in California but throughout the country, not everyone is pleased about the EPA’s decision. To many, granting self-regulation power back to California will provide an opportunity for the state to control the automotive markets beyond what is believed to be constitutionally permitted. In fact, during the summer of 2021, 16 Republican state attorneys general begged the EPA not to reinstate California’s authority. For these opposers of state-run regulation, the common denominator is often the denial of emission impacts altogether. CEO of Public Policy Institute of California, Mark Baldassare, asserts, “There is generally a very substantial majority of Californians who feel their way of life is threatened by what’s occurring.” This threat, more times than not, is the concern that loss in profits will not exceed the benefit of reducing pollution – a pollution they believe to be of minimal concern. This opposition makes sense when considering how conservatives and liberals, alike, tend to deny problems exist when they don’t support the solutions being proposed.

A study conducted by Duke University found this to be true. The study included a survey in which participants were informed that global temperatures would rise by 3.2 degrees in the coming years. For the group of republicans that were told that pollution regulation and carbon tax would be the solution to these rising temperatures, only 22% believed that global temperatures would rise by that much. Alternatively, when informed that free market solutions would be the answer, an astonishing 55% conceded that they agreed that temperatures were on the rise and should be addressed. As for the general public, observations of increased wildfires and smog levels across the state of California have influenced over 60% of state residents to support the assertions by climate scientists regarding global warming. Nevertheless, individuals who stand in opposition to California’s EPA waiver will do what they can to impede the state from making any major changes. Washington representative and Republic leader of the House Energy and Commerce Committee commented on the issue, “President Biden’s strict auto emissions regulations are yet another example of this administration putting a radical rush-to-green regulatory regime ahead of restoring America’s energy dominance and leadership.”

WHAT TO EXPECT IN COMING MONTHS

The actions that will stem from reestablishing California’s commitment to auto emissions have not yet been determined, however the Biden administration Department of Transportation has proposed to strengthen fuel economy requirements for automakers from a 1.5% annual improvement to 8%, more stringent than during Obama’s presidency. California is also free to pursue its plan to require all new cars sold in 2035 to be solely electric-powered. With the guidance of the California Air Resources Board, this plan will be achieved through a series of smaller milestones, the result of which will attempt to solve the pollution issues that have plagued California for decades. And while California’s new-found freedom to influence the automotive industry will not remediate the ever-growing gas prices, we can anticipate automakers improving gasoline-powered vehicle performance, as well as advancing the technology to bring to pass an era of exclusively electric vehicles.