On Wednesday, the Environmental Protection Agency plans to announce strict new exhaust emission standards designed to effectively force the auto industry to phase out sales of gas-powered cars. It is an ambitious – and risky – move by the Biden administration to bolster its climate goals by boosting sales of electric vehicles while ushering in the end of the internal combustion engine (ICE) era.
But it won’t be as simple as banning the sale of gas-powered cars or requiring companies to only sell vehicles with electric powertrains. Rather, the new EPA rules would set an emissions cap on the total number of new cars each automaker sells in a year. That limit would essentially ensure that two-thirds of the vehicles they sold in the US by 2032 would be electric vehicles, according to a report by The New York Times. Full details are expected to be released on Wednesday.
The effort to make this happen will be absolutely enormous. Automakers are already moving toward more EV sales, but plug-in vehicles still only represent a fraction of the total US auto market. Getting them from where they are now, with about 7 percent of new car sales, to where the Biden administration wants them, about 68 percent of all car sales, is going to be unlike any other time in the 150-year history of the auto industry. industry.
The effort to make this happen should be absolutely enormous
Take last January, for example: EVs accounted for 7.83 percent of new vehicle sales in the United States, with 66,416 battery electric vehicles and 14,143 plug-in hybrid vehicles sold. That same month, 950,000 new ICE light vehicles were also sold, as well about another 3 million used ICE vehicles. The EPA under President Biden is basically trying to turn those numbers around.
According to Chris Harto, senior policy analyst for transportation and energy at Consumer Reports, this shouldn’t come as a surprise to policymakers or automakers. The EPA has indicated for some time that these new standards will be released this spring and are roughly in line with Biden’s climate goals. Immediately after taking office, the president signed an executive order outlining his vision to make half of all new car sales emission-free by 2030.
As for how chaotic this shift will be, a lot will depend on how the auto industry responds, Harto said. “Technology transitions tend to get messy when companies don’t respond effectively to rapid shifts in consumer demand,” he said in an email. “Automakers that respond most nimbly to changes in consumer demand will be the most successful, and those that don’t could quickly fall behind.”
And of course we have California to thank for this new way of doing business. Last year, the California Air Resources Board issued new rules first rolled out by Governor Gavin Newsom in 2020 that would require 100 percent of new cars sold in the state to be carbon-free by 2035. California is the largest car market in the US and one of the largest in the world, and emissions regulations passed by the state tend to trickle down to the rest of the country.
“Automakers that respond most nimbly to changes in consumer demand will be the most successful, and those that don’t could quickly fall behind”
Indeed, other states have since followed California’s lead in setting their own deadlines to phase out gas-powered car sales, including Maryland, Massachusetts, New Jersey, New York, Oregon and Washington.
But inevitably the federal government would have to adopt a different tactic. President Joe Biden probably doesn’t want to expose himself to too much criticism by issuing an executive order banning the sale of gasoline cars. The attack ads practically write themselves. And Republicans are already resisting the president’s push for more EV sales, albeit somewhat incoherently. Instead, we get “new light-duty greenhouse gas (GHG) rules and emission criteria for model years 2027 through 2032” – which doesn’t exactly roll off the tongue.
The EPA’s proposal follows new rules from the Treasury Department regarding which vehicles qualify for a $7,500 tax credit passed as part of the Inflation Reduction Act of 2022. The new rules address outstanding issues related to to the source of the critical minerals contained within an EV battery and are expected to result in fewer EVs qualifying for the credit.
Harto said the new rules will help sync federal rules with state efforts to limit sales of gas-powered vehicles, which will be good for businesses and good for consumers. “For at least the next few years, the biggest bottleneck in EV adoption will be vehicle delivery,” he said. “Consumers can’t buy vehicles that car manufacturers don’t build. These standards will ensure that car manufacturers actually deliver the kind of vehicles that consumers want.”
Biden probably doesn’t want to expose himself to too much criticism by issuing an executive order banning gasoline car sales
The auto industry is already bracing itself for the big news. On April 6, the Alliance for Automotive Innovation, which represents virtually all major auto companies, sent out a memo to its members outlining what it knows about the EPA’s upcoming rules.
The new rules “will result in significantly stricter greenhouse gas and emissions standards than ever before,” the Alliance says, while also praising all the money auto companies said they have already spent or pledged to spend (an estimated $1.2 trillion). in total) about the EV transition.
The auto industry is proud of that figure; it talks about it a lot in its PR statements. And to be sure, it’s a big number! But automakers aren’t exactly embracing the administration’s efforts to force a faster EV transition. Private interests rarely get excited about new regulations. Instead, they warn of a “challenging” future if the government’s rules come into effect.
“This will require a massive, 100-year change in the US industrial base and the way Americans drive,” the Alliance memo concludes. “A clear assessment of market readiness is required. The answer to the feasibility of rules is: it depends.”
Of course, the EPA has bigger concerns than whether the auto industry thinks its new rules will be feasible. Transport is a major source of carbon emissions, much of which is due to exhaust pollution. The climate crisis does not matter whether the car market is ready or not. The future is now being written and for ICE vehicles their days are numbered.
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