Thursday, April 05, 2007

Auto emissions ruling could cost Big Three

Tuesday, April 03, 2007
Auto emissions ruling could cost Big Three
David Shepardson / Detroit News Washington Bureau

WASHINGTON -- The U.S. Supreme Court dealt a serious blow to automakers Monday when it ruled that the Bush administration must reconsider whether to regulate auto tailpipe emissions.

The decision comes as pressure is building on automakers and Congress to reduce global warming by cutting carbon dioxide emissions from vehicles through higher fuel economy standards, a move that could cost the auto companies billions of dollars.

The 5-4 decision requires the U.S. Environmental Protection Agency to revisit its 2003 decision to reject requests by several states to limit carbon dioxide emissions. The EPA said it had no authority to regulate emissions under the Clean Air Act.

While Monday's ruling does not require the EPA to regulate emissions "as a pollutant," it makes it clear that the agency must come up with a better reason for not doing so than it has thus far.

The decision is likely to boost efforts by California and other states to require significant reductions in carbon dioxide emissions, which have been linked to global warming.

Automakers took some comfort from a section of the high court's decision that suggested states might not be successful in pre-empting federal rules. But even Republicans said the landmark decision meant new auto emissions rules are almost certain.

Ann Klee, a former EPA general counsel in the Bush administration, said the decision "will dramatically change the regulatory landscape for decades to come, laying the groundwork for far-reaching new air standards based on potential global climate change."

Climate change and automakers' contribution to it through fuel use has quickly become one of the greatest and potentially most expensive regulatory issues to confront the auto industry.

Automakers are already facing the prospect of tougher fuel economy regulations proposed by President Bush as part of his plan to cut gasoline consumption 20 percent by 2017. The goal amounts to a 4 percent annual increase in fuel economy that could cost automakers as much as $114 billion, with Detroit's Big Three accounting for about $85 billion. The companies have argued tailpipe emissions requirements could add $3,000 to the price of a car.

There is increasing concern in Congress and among the public over the rising level of carbon dioxide in the Earth's atmosphere -- which is up from around 316 parts per million in 1959, the highest in the last 420,000 years.

By 2006, it was 382 parts per million "a level thought to exceed the concentration of carbon dioxide in the atmosphere at any point over the past 20 million years," the court wrote Monday.

Even U.S. Rep. John Dingell, D-Dearborn, who chairs the powerful House Energy and Commerce committee and is an auto industry ally, conceded the court's decision was shifting the debate.

It "provides another compelling reason why Congress must enact, and the president must sign, comprehensive climate change legislation," Dingell said.

Dingell is attempting to write a bill the auto industry can live with, in part, by spreading the pain across industries, amid intense pressure from liberals in Congress.

"This decision is a major turning point in our nation's fight to protect future generations from global warming," said Abby Rubley, field director for Environment Michigan. "For six years, the Bush administration has toed the oil, coal and auto industry line on global warming, but this is their day of reckoning."

Justice John Paul Stevens, writing for the majority, said the harms from climate change "are serious and well recognized. Reducing domestic automobile emissions is hardly a tentative step."

"EPA has offered no reasoned explanation for its refusal to decide whether greenhouse gases cause or contribute to climate change," Stevens wrote. The agency "can avoid taking further action only if it determines that greenhouse gases do not contribute to climate change or if it provides some reasonable explanation as to why it cannot or will not exercise its discretion."

Justice Antonin Scalia ridiculed the majority decision. By the majority's reasoning, "it follows that everything airborne, from Frisbees to flatulence, qualifies as an 'air pollutant,' " he wrote in his dissent.

Chief Justice John Roberts filed a dissent noting that U.S. automakers' emissions could be swamped by increases in other countries and that there is simply too little connection between autos and what might happen a century from now.

He characterized vehicle emissions as playing a "bit part" in what the petitioners who brought the case "describe as a 150-year global phenomenon."

U.S. automobiles account for 6 percent of global man-made carbon dioxide emissions -- and 4 percent of greenhouse gas emissions.

Vehicles emit 315 million metric tons of carbon dioxide in the United States each year -- about 20 percent of U.S. carbon dioxide emissions.

The Alliance of Automotive Manufacturers, a trade group that represents General Motors Corp., Ford Motor Co., DaimlerChrysler AG and Toyota Motor Corp., among others, said Congress should adopt economy-wide greenhouse gas regulations.

The automakers "believe that there needs to be a national, federal, economy-wide approach to addressing greenhouse gases," said Dave McCurdy, president of the trade association.

Mike Stanton, president of the Association of International Automobile Manufacturers, acknowledged how fast the debate is moving. "There's growing momentum to regulate greenhouse gases," he said. "Whether Congress can agree on a proper course of action is something else."

At issue in the case decided Monday was Massachusetts' claim that its coast is at risk of falling into the sea over the next century because of global warming.

The court ruled that the EPA had failed to properly exercise its regulatory authority over emissions or to adequately explain why it should not regulate them.

Massachusetts isn't alone. California also wants to regulate vehicle emissions. In 2004, the state mandated a 25 percent reduction in carbon dioxide emissions by 2016, saying it would hike the cost of vehicles by $1,000 per car. The European Union is considering a similar regulation that it says could add nearly $5,000 to the price of a new car.

Under the Clean Air Act, states may adopt the California tailpipe emissions standards in lieu of the weaker federal standards. Maryland is expected to become the 11th state to do so this week.

The first such challenge, lodged by carmakers to Vermont's adoption of California's tailpipe rules, is set for trial April 10 in Burlington.

You can reach David Shepardson at (202) 662-8735 or

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