The EPA May Finalize Tough New Rules To Boost EV Sales This Week

A major regulatory order this week would decide the near-term fate of the electric vehicle movement in the U.S., impacting not only millions of Americans but also how the world’s second-biggest polluting country tackles climate change.

This week, the U.S. Environmental Protection Agency (EPA) is poised to finalize emissions rules that will effectively require a certain percentage—as much as two-thirds by 2023—of new cars to be all-electric, Politico and other outlets have reported in recent days. The ruling could be announced as soon as this Wednesday.

These standards could first loosen the tough EV requirements between 2027 and 2030, but then mandate an aggressive ramping up of EV sales from 2031. In other words, these revised rules would give car companies a bit of a pass on EVs in the short term, while still pushing for a mostly-electric future starting in the next decade.

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Pushback against gas cars is about to get serious on a federal level.

The transportation sector accounts for the largest chunk of greenhouse gas emissions annually. Exhaust fumes from gas cars and trucks are directly linked to health hazards. EVs have substantially lower life cycle emissions, which is why a new ruling mandating broader EV adoption in the U.S. is imminent. 

The EPA originally proposed stringent federal emissions standards last April. The initial proposal required two-thirds of new light-duty vehicle sales to be electric by 2032, up from about 8% in 2023. It also focused on systemically eliminating criteria pollutants, including particulate matter, carbon monoxide, carbon dioxide, and nitrogen oxides from vehicle emissions—all linked to direct health hazards among the masses.

But the agency received a strong rebuttal from dealer groups, car manufacturers, and petroleum companies for its proposal. Many said the U.S. was not “ready” for such an aggressive EV push, as prices remained higher than internal combustion cars on average and the nation’s charging infrastructure is rather lacking. 

On the other hand, environmental and public health advocacy groups overwhelmingly supported the initial ruling.

However, The New York Times reported last month that the Biden administration was considering relaxing the EPA rules after pressure from carmakers. According to one estimate, the alternative ruling that’s likely to pass would require EV penetration rates to reach 32% by 2027, and then increase every year after that, finally reaching 54% by 2030 and 68% by 2032.

As of 2021, the transportation sector was the largest contributor to planet-warming greenhouse gas emissions in the U.S., accounting for 29% of total emissions.

From Politico’s story:

Those changes track with an alternative regulatory option that EPA explored in last year’s draft that ratchets down emissions limits evenly rather than front-loading them in early years.

Environmentalists at the time mostly shrugged at the prospect of EPA preparing to finalize a rule that would give car companies more time to go electric — potentially creating room for more gas- and diesel-powered cars to be sold through the late 2020s.

Manish Bapna, president of the Natural Resources Defense Council Action Fund, told reporters at a briefing Thursday morning that the anticipated final rule would still deliver 95 percent of the draft’s greenhouse gas emission cuts.

“So let’s be clear that it’s a very, very modest change in carbon pollution,” he said. 

Regardless of which alternative the EPA finalizes, the new rules would require EV sales to increase substantially from what they accounted for in 2023—just over 8%. That means carmakers would need to offer a broad range of cost-competitive EVs while the charging infrastructure would also need a major boost.

The new standards would also help the U.S. get closer to its commitment of reducing its emissions by 50% by 2030 under the Paris Climate Accords.

Nonetheless, Biden’s approach to EVs is already becoming a hot-button issue as he faces a difficult and bitter election rematch against his Republican opponent, former President Donald Trump. Trump has been beating the drum against EVs on the campaign trail in recent weeks, and at a speech in Ohio this weekend, he said there would be a “bloodbath” for the auto industry if he was not reelected.

Contact the author: suvrat.kothari@insideevs.com