EPA

U.S. House Subcommittee holds Hearing on Fuel Economy and Clean Car Standards

This week the U.S. House of Representatives Subcommittee on Consumer Protection & Commerce and the Subcommittee on Environment & Climate Change held a joint hearing entitled “Driving in Reverse: The Administration’s Rollback of Fuel Economy and Clean Car Standards.” In an effort to combat climate change, remain competitive globally in the automotive industry, improve air quality standards, and keep jobs for American’s, the subcommittees explored the Administration’s proposed roll back of fuel economy and greenhouse gas standards for Model Year (MY) 2021-2026 light-duty cars and trucks.

The Energy Policy and Conservation Act of 1975 directs the National Highway Traffic Safety Administration (NHTSA) to establish Corporate Average Fuel Economy (CAFE) standards for cars and light trucks to reduce fuel consumption and encourage Americans to invest in clean, more efficient vehicles. The U.S. Environmental Protection Agency (EPA) sets greenhouse gas (GHG) standards for vehicles under the Clean Air Act Amendments (CAA). Additionally, under the same law, the EPA may grant waivers of preemption that would allow a state to implement its own standards, as it has done with California many times. Due to overlap, the EPA and NHTSA announced they would be working together to standardize CAFE and GHG standards, as well as California standards, rather than automakers adhering to a patchwork of regulations.

Under the Administration, the EPA and NHTSA announced they would reconsider the final decision from 2017 for CAFE and GHG standards. In 2018 the agencies submitted a notice of proposed rulemaking, the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule for MY 2021-2026 Passenger Cars and Light Trucks, that would maintain current standards through MY 2020 but would freeze the standard after that and withdraw California’s waiver. Subcommittee members on both sides of the aisle expressed concerns regarding the rollback arguing that the rule would eliminate approximately 60,000 jobs from the automotive industry, CO2 emissions, gasoline and oil consumption would increase, ultimately decreasing the quality of air for Americans, increasing the number of auto-related deaths per year, and costing consumers more money. Representatives from NHTSA and the EPA did not agree.

Witnesses:

  • The Honorable William L. Wehrum, Assistant Administrator, Office of Air and Radiation, U.S. Environmental Protection Agency

 

  • Heidi King, National Highway Traffic Safety Administration, U.S. Department of Transportation

 

  • The Honorable Mary D. Nichols, Chair, California Air Resources Board

 

  • David Friedman, Vice President, Advocacy, Consumer Reports

 

  • Ramzi Y. Hermiz, President and Chief Executive Officer, Shiloh Industries, Inc.

 

  • Josh Nassar, Legislative Director, United Auto Worker

 

  • The Honorable Jeff Landry, Attorney General, State of Louisiana

 

  • David Schwietert, Interim Chief Executive Officer, Alliance of Automobile Manufacturers

 

  • Nick Loris, Deputy Director of the Thomas A. Roe institute for Economic Policy; Herbert and Joyce Morgan Fellow in Energy and Environmental Policy, Heritage Foundation

To view the hearing in its entirety, click here.

Democrats Introduce Legislation for Zero-Emission Vehicles by 2040

Today, Senator Jeff Merkley (D-OR), and U.S. Congressman Mike Levin (D-CA) introduced the Zero-Emission Vehicles Act of 2019, that would make all new car sales zero-emissions vehicles by 2040. Senator Merkley and Congressman Levin are the lead sponsors on the bill. The legislation has already garnered support in both the House and Senate.

To view Senator Merkley’s remarks, click here.

To view Congressman Levin’s remarks, click here.

Electric Vehicle Tax Credit Causes Quarrel in Congress

The Internal Revenue Code Section 30D establishes an electric vehicle (EV) tax credit as an incentive for consumers to buy and own qualified electric vehicles. The claimed credit can be up to $7,500 and is based on the EV’s car battery size. However, these EV tax credits will eventually run out. The federal government is looking at phasing out these tax credits and while there is no set expiration date, that process has already started. Once a manufacturer sells 200,000 qualified EV’s in the United States, the amount a consumer is eligible for receiving decreases. Tesla was the first automaker to hit the 200,000 threshold in July 2018. Due to hitting the mark, consumers that buy Tesla EV’s after December 31, 2019 will not be eligible for a federal EV tax credit.

The debate surrounding this EV tax credit has found itself on both sides of the aisle and in both chambers of Congress. In the U.S. Senate, Senators Lamar Alexander (R-TN), Debbie Stabenow (D-MI), Gary Peter (D-MI), Susan Collins (R-ME), and U.S. Congressman Dan Kildee (D-MI), introduced S. 1094, the Driving America Forward Act. This bipartisan legislation seeks to raise the 200,000 vehicles’ cap to 400,000 vehicles per manufacturer. The legislation also extends the hydrogen fuel cell credit for ten years. Sponsors of the bill argue that this will be a step forward in cleaner transportation, combatting climate change, and support American job growth. In the U.S. House of Representatives, democrats are urging for increasing the 200,000-vehicle cap as well. Congressman Mike Doyle (D-PA), introduced H.R. 2096, with the purpose of amending “the Internal Revenue Code of 1986 to provide tax credits for energy storage technologies, and for other purposes.” While this bill addresses numerous clean energy pushes, the bill also encourages revision and continuation of the EV federal tax credit.

Opposition to the bill in both chambers can be seen from Senator John Barrasso (R-WY) and, in the House, Congressman Jason Smith (R-MO). These two Members have introduced similar versions of the same bill that seeks to eliminate the EV federal tax credit and impose a federal highway user fee on alternative fuel vehicles. Senator Barrasso believes that with the termination of this tax credit, there will be billions in taxpayers funds saved and will “strengthen the Highway Trust Fund by ensuring that alternative fuel vehicle drivers pay into it.” Similarly, Congressman Jason Smith (R-MO) believes that “the EV federal tax credit has benefited the wealthy… [and that it’s] time to end this wasteful subsidy.”

As of now, numerous organizations and automakers support the Driving America Forward Act and believe that this legislation and the continuation of the federal EV tax credit will not only benefit the environment in an effort to reduce the total output of CO2 emissions, but also remain an incentive for consumers to purchase EV’s in the future.

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