Trump Preparing To Reverse Obama’s Fuel Economy Mandate

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Michael Bastasch DCNF Managing Editor
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The Trump administration is preparing to reverse a last-minute Obama administration decision to keep in place regulations to increase fuel economy for new cars to the equivalent of 54.5 miles per gallon by 2025.

A source told InsideEPA “action on the mid-term review” is expected for “next week, essentially to put the EPA back on the original schedule.”

The decision will reopen a mid-term review of Environmental Protection Agency (EPA) and Transportation Department (DOT) fuel economy standards meant to tackle global warming.

The Obama administration released its determination to keep the fuel economy mandate ahead of schedule, surprising the auto industry and sparking criticism from the right. EPA issued its decision on Jan. 13, days before the Senate held a confirmation hearing for Elaine Chao, the future transportation secretary.

Automakers petitioned President Donald Trump to reverse the fuel mandate. A high mandate would “threaten future production levels, putting hundreds of thousands and perhaps as many as a million jobs at risk” auto executives wrote in a letter sent to Trump in January.

In 2012, EPA and DOT pushed a fuel economy regulation requiring cars built in 2025 get 54.5 miles per gallon. The Obama administration said the rule would cut American fuel costs and global warming emissions.

Fuel economy, or CAFE, standards were put in place by Congress in 1975 to increase fuel efficiency, but former President Barack Obama unilaterally increased the mandate to 54.5 miles per gallon by 2025. Obama previously set a standard of 35 miles per gallon for cars built between 2012  and 2016.

The draft mid-term review released by EPA and DOT in July found cars would likely fall short of Obama’s 54.5 miles per gallon mandate. The Obama administration responded by saying 54.5 miles per gallon was a goal, not a requirement.

“54.5 isn’t a standard, never was a standard and isn’t a standard now. 54.5 is what we predicted, in 2012, the fleet-wide average could get to, based on assumptions that were live back then about the mix of the fleet,” a senior administration official told The Hill in July.

“That depended a lot on a variety of factors, including gasoline prices,” the senior official said. “We’re recognizing the fact that gasoline prices are lower now.”

Climate scientists have pointed out the fuel economy standards will do little for global warming — one of the stated goals of the program. Cato Institute climate scientists estimated — using EPA models — fuel efficiency standards would avert 0.016 degrees Celsius of projected warming.

Automakers say the accelerated fuel economy mandates add $3,000 to the price of a new car, outweighing projected fuel savings. The conservative Heritage Foundation found fuel economy mandates have added $6,200 to the price of a new car.

In total, EPA and DOT fuel standards for light-duty vehicles cost $156 billion, according to data compiled by the American Action Forum.

It’s fairly simple for EPA Administrator Scott Pruitt to withdraw the Obama administration’s fuel economy determination and start his own review of the standards.

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