U.S. set to roll out pollution limits for vehicles

WASHINGTON — The Biden administration is preparing to roll out the toughest-ever limits on pollution from the nation’s cars and light trucks after making changes likely to mollify some automakers.

Emissions limits set to be finalized by the Environmental Protection Agency within days would propel electric vehicle sales well beyond current levels. The EPA has projected that to meet proposed mandates, electric models would need to make up roughly two-thirds of car and light truck sales in 2032 — up from less than a tenth last year.

The measure, which sets limits on smog-forming pollution, soot and carbon dioxide emissions, is seen as one of the most consequential climate regulations being imposed by President Joe Biden. It’s also key to helping the U.S. fulfill its Paris Agreement commitment to at least halve the country’s greenhouse gas emissions by 2030. The transportation sector is the biggest source of planet-warming pollution in the U.S. today.

“Cars and light trucks on their own are roughly 20% of the carbon footprint,” said Manish Bapna, head of the Natural Resources Defense Action Fund. Cutting that is “absolutely essential to real, concrete progress.”

Yet the regulation requires a delicate balancing act for Biden, who is courting voters in the swing state of Michigan, including autoworkers uneasy about a too-rapid transition to electric vehicles.

U.S. carmakers warned the initial proposal wasn’t achievable — with EV penetration dependent on the installation of charging stations and other factors beyond the industry’s control.

The next few years are “absolutely critical” for developing the necessary supply chain and charging infrastructure, said John Bozzella, head of the Alliance for Automotive Innovation. “It is appropriate for policymakers and regulators to focus not only on the endpoint but what the next three or four years look like.”

In response, the EPA plans to adopt standards requiring less stringent year-over-year emission reductions in the near term, while essentially reaching the same 2032 target, according to people familiar with the matter who asked not to be named because the rule isn’t final.

That could make the standards easier to fulfill — but at the expense of greater greenhouse gas emissions. Where the proposal would keep some 1.5 billion metric tons of carbon dioxide out of the atmosphere between 2026 and 2040, according to an analysis by consulting firm ERM, the anticipated final approach would unleash an additional 171 million metric tons.

“The rule doesn’t meet the moment,” but still creates “some guarantees around movement toward zero-emission vehicles nationwide,” said David Cooke, a senior analyst with the Union of Concerned Scientists. “We will end up with more EVs on the road as a result of these rules than if we didn’t have them.”

The administration also is setting a new petroleum equivalency factor — a formula for calculating the effective fuel economy of electric vehicles. The Energy Department had proposed slashing the equivalent fuel economy rating of a battery electric vehicle some 72%. Automakers said that would unfairly expose them to hefty fines for failing to hit U.S. fuel-economy targets.

The coming petroleum equivalency factor will give carmakers assurance federal tailpipe rules will be aligned and validate the requirements are achievable without amassing large fines, said people familiar with the rulemaking.

Oil industry allies and former President Donald Trump have seized on the plan, casting it an EV mandate. The American Fuel and Petrochemical Manufacturers association is running ads in battleground states saying the administration wants to force “new car buyers to go electric when the country simply isn’t ready.”