Biden Administration Exporting California’s Misguided Policies Despite National Security Risk

The U.S. Environmental Protection Agency recently proposed new GHG standards for vehicle emissions that would effectively force the transition to electric vehicles nationwide. Specifically, the proposal aims to rapidly transition the auto industry away from gasoline and diesel-powered vehicles, and have electric cars account for more than two-thirds of new car sales by 2032.

Additionally, the National Highway and Transportation Safety Administration (NHTSA) – currently led by an academic who played an integral role in the campaign to sue American energy companies – is set to release complementary rules soon. Through this pair of rules, the federal government could export California’s controversial all-electric mandate on vehicle fleets across the country, compromising energy security and risking jobs in the process.

As American Petroleum Institute executive vice president and chief advocacy officer Amanda Eversole recently explained:

“EPA’s new proposed tailpipe emissions rule is the latest move by the Biden administration to hurt consumers with higher costs and increased reliance on unstable foreign supply chains. … EPA’s proposed rule is deeply flawed and a major step toward a ban on the gasoline vehicles that Americans rely upon. … Americans need dependable transportation fueled by affordable, reliable, American-made energy sources. Americans deserve tech-neutral policies and should not be penalized through unrealistic proposals that serve to restrict market choices and pick winners and losers.”

API further outlines some key concerns with the rule, including:

“U.S. security – America would be moved into greater dependence on supply chains controlled by China.

“Critical minerals – The U.S. is heavily dependent on imported lithium, cobalt, manganese, nickel and graphite to make batteries for electric vehicles (EVs). (China dominates the global market for processing lithium, cobalt, copper and rare earth elements.)

“Market realism – U.S. automakers would be challenged to expand EV sales (less than 6% of total sales in 2022) by more than 10 times the current level in less than a decade.

“Charging stations – Is it realistic the U.S. can build a network of EV charging stations that a recent report estimated would need to number in the millions?”

Forced Shift to EVs Risks Jobs, National Security

The New York Times reported that reaching compliance with the EPA’s new standards would require a “monumental” shift across the economy:

“The government’s challenge to automakers is monumental. Last year, all-electric vehicles accounted for just 5.8 percent of new cars sold in the United States. All-electric trucks were even more rare, making up fewer than 2 percent of new heavy trucks sold.”

Compliance with the new rule would essentially require forced demand destruction for a large segment of the gasoline and refined fuels market. As API president and CEO Mike Sommers said:

“This deeply flawed proposal is a major step toward a ban on the vehicles Americans rely on… as proposed, this rule will hurt consumers with higher costs and greater reliance on unstable foreign supply chains.”

U.S. Senator Joe Manchin (D-WV) also pointed out the national security and economic implications of forcibly accelerating the production of electric vehicles without a robust domestic supply chain for critical minerals and battery technology:

“To meet these timelines will mean strengthening our reliance on minerals and technologies controlled by the Chinese. […] I don’t believe that making progress on climate change should come at the expense of our national and energy security. I fully support Congress overturning these dangerous EPA regulations.”

The Times reports that the auto industry – which would be the primary target for compliance and fines in accordance with the new EPA rule – is also skeptical:

“Some autoworkers and manufacturers fear that the transition to all-electric vehicles envisioned by the Biden administration goes too far, too fast and could result in job losses and lower profits.”

Labor unions similarly have unique concerns about the domestic electric vehicle supply chain. Electric vehicles require just under half of the necessary employees to assemble cars than those with combustion engines. In a statement on the new EPA rules, the United Auto Workers labor union pointed out that the early supply chain and labor trends in the domestic electric vehicle industry seem to “prioritize greed over economic justice.”

EPA Rules Modeled After California’s Gas Car Ban

Some view the EPA’s recent national regulation as evidence that the Biden administration is aiming to implement California’s strict zero emissions vehicle mandates across the country. CalMatters writes that the new proposal closely mirrors California regulators’ “landmark” decision to end the sales of new gas cars to reduce vehicle emissions in the state.

California is only able to implement such a strict ban due to its controversial Clean Air Act waiver that allows the state to set tailpipe emissions targets that are stricter than federal standards, and permits other states to follow California’s standards. California’s waiver was granted during the Obama administration, revoked during the Trump presidency, and reinstated in 2021 when President Biden took office.

Why is California’s waiver so important? In emails obtained through public records requests, Ann Carlson, current NHTSA Acting Administrator and nominee for NHTSA head, spelled it out clearly while she was an environmental law professor at UCLA. In emails to a journalist right before the 2020 Presidential election, Carlson said of California’s preliminary ICE vehicle ban:

“Off the top of my head, the ban on engines would be on very strong footing if the state gets a waiver from EPA, something I would guess it would seek if Biden is elected. […] The question of whether the state can proceed without a waiver is I think a novel one: does an engine ban ‘relate to the control of emissions,’ which is preempted by the Clean Air Act without a waiver?”

Carlson later characterized the success of California’s ban as “highly dependent on a Biden win.” California’s waiver, which was reinstated by Biden EPA, is currently subject to a constitutional challenge. Last year, 17 Republican attorneys general led by Ohio Attorney General Dave Yost filed suit challenging the legality of California’s “special status.” The New York Times reported that the new proposed EPA rules will “surely face legal challenges” as well, likely from a similar coalition of attorneys general.

California Connections: NHTSA’s Role

EPA shares jurisdiction for regulating tailpipe emissions with NHTSA. The agency, which is primarily responsible for minimizing traffic injuries and fatalities, is currently led by Acting Administrator Ann Carlson. Fox News recently reported on Carlson’s plan to turn NHTSA into a climate agency:

“President Biden’s nominee to lead a little-known Department of Transportation safety subagency privately boasted that she would use her position at the agency to push aggressive climate policies.

“‘I view my appointment (and a number of others) as evidence that the Biden Administration is truly committed to a ‘whole of government’ approach to addressing climate change,’ Carlson wrote.” (Emphasis added)

As Acting Administrator, Carlson has already indicated she plans to follow EPA’s lead and use NHTSA’s authority to enact climate policy. Earlier this year, Reuters reported that NHTSA plans to release complementary vehicle emissions regulations later this month:

“Acting NHTSA Administrator Ann Carlson told reporters on Tuesday the agency aims to release its proposal by late April and finalize it within a year. […] One big question is whether the new rules will be consistent with California’s aggressive efforts to ramp up zero emission vehicles and phase out new gasoline-powered vehicles by 2035.” (Emphasis added)

In the Reuters article, California Air Resources Board (CARB) Executive Officer Steven Cliff – who was Biden’s NHTSA Administrator for a mere three months before leaving for CARB – urged NHTSA and EPA to “look at stringency that’s equivalent to our rules.”

How do EPA, NHTSA, and California’s special status all fit together? In another email to a journalist, Ann Carlson speculated how a prospective Biden administration could use a “throw everything at the wall and see what sticks” strategy to enact climate policy unilaterally, with or without friendly leadership in Congress:

“I think one big strategy that will be important for a Biden Administration without a Democratic Senate is to have a suite of climate policies rather than relying too heavily on any single policy – think of it as the ‘don’t place all your eggs in the same basket’ approach.

“Many climate policies don’t face the kind of legal vulnerability the Clean Power Plan did. This includes tightening efficiency standards, tighter fuel economy standards, limiting drilling on public lands, investing in infrastructure, appointing FERC commissioners who can factor carbon into their decision-making, continuing tax incentives to encourage renewable energy and R&D investments, and many international efforts…”

On the nexus of EPA, NHTSA, and California specifically, in a book she authored and edited, Carlson made it clear which entity she thinks really guides federal policy:

“But these policies [CAFE] have now been yoked, and both EPA and NHTSA must sustain cross-agency collaboration while also remaining sensitive to continuing input from California, different congressional oversight committees and changes in elected executives.”

Bottom Line: As Sen. Manchin said, the Biden EPA’s new vehicle emissions standards are a “Trojan horse” for bypassing Congress and enacting climate policy that harms industry and workers. Through NHTSA and EPA, Biden Administration appointees are aiming to use backdoor regulation to export California’s electric vehicle mandates across the country. Ironically, California’s grid is still not reliable enough to handle increased electricity demand and currently operates predominately on fossil fuels.

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