Institute for Policy Integrity

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Analyzing EPA’s Vehicle-Emissions Decisions

Analyzing EPA’s Vehicle-Emissions Decisions

Why Withdrawing the 2022-2025 Standards Is Economically Flawed

By Bethany Davis Noll, Peter Howard, and Jeffrey Shrader
May 1, 2018

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Filed under Climate Change and Energy Policy, Policy Briefs, Safety and Consumer Protection, Transparency

The Environmental Protection Agency sets greenhouse gas emissions standards for cars and light trucks, and it periodically reevaluates these standards to make sure that car manufacturers can comply. In April 2018, EPA withdrew its previous determination that standards for model year 2022–2025 vehicles were appropriate and would improve public welfare, now saying that more recent information suggests that the standards are too stringent.

Our policy brief shows that EPA’s claim—that new information indicates that the assumptions underlying the previous determination are unrealistic—is not supported by the evidence. In fact, the opposite is the case. Recent trends in fuel prices, vehicle sales, automaker compliance, and safety all indicate that the existing 2022–2025 standards can be met at low cost while delivering large benefits to consumers and the economy. EPA’s decision to withdraw the standards will instead cause regulatory uncertainty that will hurt the automotive sector while also harming the environment.