EPA Inspector General Challenging Reversal of Obama Fuel Efficiency Standards

On July 27, the U.S. Environmental Protection Agency’s Inspector General (IG) announced a rare challenge to an Agency rulemaking. The IG’s office will investigate whether the reversal of the Obama-era fuel efficiency standards violated government rules.

EPA officials have been told to provide documents which auditors will use in their investigation of whether the agency followed the EPA’s process for developing final regulatory actions, including transparency, record-keeping, and docketing requirements.

In March, the EPA and the National Highway Traffic Safety Administration (NHTSA) issued a final rule that makes significant reductions in federal mileage standards for cars, pick-up trucks and SUVs.

The Safer Affordable Fuel Efficient Vehicles rule is important to fuel marketers because federal fuel efficiency standards have a direct impact on consumer demand for transportation fuels.

Under the final rule, automakers are now required to improve average fuel efficiency by only 1.5 percent per year between model years 2021 and 2026, far below from the 5 percent annual rate required over the same period under current efficiency standards.

The lower improvement rate translates into an average fleetwide mileage standard of 40.4 mpg as opposed to 46.7 mpg under the 5 percent rate.

The 1.5 percent improvement requirement matches auto manufacturers historic efficiency rate achieved by voluntary technological advancements.

Notably, auto manufacturers are split over support for the new less stringent standards.

Those who oppose are concerned that if California wins its lawsuit to maintain authority to impose more stringent efficiency standards, including electric vehicle mandates, auto manufacturers will be forced to build cars according to two widely different fuel efficiency standards.

Opponents also include governors from 23 states who plan to challenge the new rule in court, including 13 governors representing states that have already signed onto California fuel efficiency and zero emission standards.

Finally, the rule does not extend extra MPG credits that automakers can earn for selling zero-emission electric vehicles.

EPA’s spokesperson James Hewitt defends the rule as “a sensible, single national program that strikes the right regulatory balance, protects our environment, and sets reasonable targets for the auto industry.”

PMAA supports the Trump Administration’s fuel efficiency standards.

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