EPA pollution limits aim to boost EV sales in the US

WASHINGTON (AP) – The Biden administration is proposing tough new emission limits for cars that would require up to two-thirds of new vehicles sold in the U.S. to be electric by 2032, a nearly 10-fold increase over current electric vehicle sales .

The proposed regulation, announced by the Environmental Protection Agency on Wednesday, would set emissions limits for the 2027 through 2032 model years, which are the strictest ever imposed – and will require far more new EV sales than the auto industry did before fewer than two years had agreed .

If completed as expected next year, the plan would represent the biggest push yet towards a once-nearly unthinkable switch from petrol-powered cars and trucks to battery-powered vehicles.

A look at what the EPA is proposing, how the plan serves President Joe Biden’s ambitious goal of halving America’s planet-warming greenhouse gas emissions by 2030, and whether the auto industry can meet the new EV targets:

Q. What is the EPA proposing?

A, The proposed exhaust pollution limits do not require a certain number of electric vehicles to be sold each year, but instead impose limits on greenhouse gas emissions. Depending on how automakers meet the requirements, the EPA projects that by 2030 at least 60% of new passenger vehicles sold in the US will be electric, and by 2032 up to 67%.

For slightly larger, medium-duty trucks, the EPA projects that 46% of new vehicle sales in 2032 will be electric vehicles.

EPA Administrator Michael Regan called the proposal “the most ambitious pollution standards ever for cars and trucks” and said it would reduce dangerous air and climate pollution and reduce fuel and maintenance costs for families.

The agency will choose from a number of options after a public comment period, Regan said. The rule is expected to become final next year.

Q. What does the auto industry say about the proposed rules?

A. John Bozzella, CEO of the Alliance for Automotive Innovation, a trade group that represents most automakers, called the EPA proposal “aggressive in every way” and wrote in a statement that it missed the 2030 sales target announced by the Biden administration of 50% electric vehicles surpassed less than two years ago.

Reaching the half has always been a “stretch target,” dependent on manufacturing incentives and tax credits to make EVs more affordable, he wrote. It remains to be seen whether these provisions are sufficient to support EV sales at the levels proposed by the EPA, he wrote.

“The question is not whether this can be done, but how soon it can be done,” Bozzella wrote. “How quickly depends almost entirely on having the right policies and market conditions in place.”

Q. How will the proposal benefit the environment?

A. The proposed standards for light-duty cars and trucks are expected to result in a 56% reduction in projected greenhouse gas emissions compared to existing standards for the 2026 model year, according to the EPA. The proposals would improve air quality for communities across the country and avoid nearly 10 billion tons of carbon dioxide emissions, more than double the total US carbon emissions last year, the EPA said.

The plan would also save thousands of dollars over the lifetime of vehicles sold and reduce the US’ reliance on about 20 billion barrels of oil imports, the agency said.

Q. Is the EPA proposal realistic?

A. With electric vehicles accounting for just 7.2% of U.S. vehicle sales in the first quarter of this year, the industry still has a long way to go to even get close to the Biden administration’s goals. However, the proportion of EV sales is growing. Last year it was 5.8% of new car sales.

Many auto industry analysts say automakers will have a hard time hitting the projected sales percentage. Consulting firm LMC Automotive, for example, said new electric vehicle sales could reach 49% in 2032 but are unlikely to exceed that, citing high prices for electric vehicles compared to gas-powered cars.

A new poll released Tuesday shows many Americans are still unconvinced to go electric in their next cars, with high prices and a shortage of charging stations being the main deterrents. Just 19% of US adults say it’s “very” or “extremely” likely that their next car purchase will be an electric vehicle, while 22% say it’s somewhat likely. About half, 47%, say they are unlikely to drive electric, according to the survey by the Associated Press-NORC Center for Public Affairs Research and the Energy Policy Institute at the University of Chicago.

White House climate adviser Ali Zaidi said EV sales have tripled since Biden took office and the number of EV models available has doubled. Analysts have repeatedly revised their forecasts upwards since Biden, a Democrat, took office and the industry announced over $100 billion in electric vehicle investments, Zaidi told reporters on Tuesday.

“Automakers have … the technology, infrastructure and supply chain to do this with the lead time they have,” Zaidi said.

Q. Why is the tailpipe rule so important?

A. Transportation is the largest source of carbon emissions in the US, accounting for approximately 27% of US greenhouse gas emissions in 2020, according to the EPA. At 25%, electricity generates the second largest share of greenhouse gas emissions.

Environmental groups say stricter exhaust pollution standards are needed to clean the air we breathe and slow the effects of severe weather events like hurricanes, tornadoes and wildfires.

“Done right, these (new rules) will put the US on track to end pollution from vehicle tailpipes – while reducing our dependence on oil, creating good domestic jobs and saving consumers money on fuel,” said Manish Bapna, President and CEO of the Natural Resources Defense Council.

Q. What else is the Biden administration doing to encourage electric vehicles?

A. Along with tougher environmental rules, tax credits for the manufacture and purchase of electric vehicles included in the sweeping inflation-reducing legislation passed last year will help meet the tougher requirements, the White House and its allies have said.

Currently, many new EVs manufactured in North America are eligible for a $7,500 tax credit, while used EVs can receive up to $4,000. However, there are price and buyer income limits that make some vehicles ineligible. And starting April 18, new Treasury Department requirements will result in fewer new electric vehicles being eligible for a full $7,500 tax credit.

A smaller loan may not be enough to attract new buyers to electric vehicles, which now average $58,600, according to the Kelley Blue Book.

Krisher reported from Detroit.

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