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The Biden administration has announced the strongest rules yet for vehicle fuel efficiency, a step meant to slow polluting emissions that comes as the White House digs in to preserve threatened spending legislation loaded with proposals to slow climate change.
The Environmental Protection Agency’s final rule Monday would raise mileage standards starting with the 2023 model year, reaching a projected industry-wide target of 40 miles per gallon by 2026. That’s 25% higher than a rule finalized by the Trump administration last year and 5% higher than an earlier Biden proposal.
EPA Administrator Michael Regan said the move is “a giant step forward” in delivering on President Biden’s climate agenda “while paving the way toward an all-electric, zero-emissions transportation future.″
And, Regan suggested, households will spend less because they’ll fill up their vehicles less often.
Over the weekend, Democratic Sen. Joe Manchin, part of a very narrowly divided Senate, reportedly surprised the White House when he said he couldn’t vote to approve Biden’s $2 trillion social and environmental policy bill because it was still too costly and likely, inflationary. The White House and leading Democrats had already negotiated with Manchin, who represents coal- and oil-producing West Virginia, on changes to pare back the spending initiative, which features several environmental proposals aimed at EVs, home solar and more.
Read: Tesla, EV Stocks Are Big Losers With Manchin’s ‘No’ on Build Back Better
For instance, the Build Back Better bill includes up to a $12,500 tax credit to buyers to lower the cost of EVs, depending on the amount of American-made parts and labor in such vehicles. Smaller tax credits are also part of the proposal.
The new efficiency rules would begin with the 2023 car model year and increase emissions reductions year by year through model year 2026. The rule accelerates the rate of emissions reductions to between 5% and 10% each year from 2023 through 2026, the EPA said,
The EPA said its analysis shows the auto industry can meet the final standards with modest increases in the numbers of electric vehicles entering the fleet.
EVs and plug-in hybrids are expected to have about 7% market share in 2023, the Associated Press reported.
Transportation is the largest source of greenhouse gas emissions in the U.S., making up 29% of all emissions, according to EPA data. Within the sector, passenger cars and trucks a account for more than half of emissions and they make up 17% of overall U.S. carbon emissions.
Biden has set a goal of cutting U.S. greenhouse gas emissions by at least 50% by the end of the decade, on the way to net-zero emissions by 2050. Republicans and some Democrats have said such proposals so little to hold other global polluters accountable and risk putting the U.S. at a weakened position in global energy markets
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