RL34099 - California's Waiver Request to Control Greenhouse Gases Under the Clean Air Act
10-Feb-2009; James E. McCarthy and Robert Meltz; 17 p.
Update: Previous releases:
March 4, 2009
October 1, 2007
Abstract: California has adopted regulations requiring new motor vehicles to reduce emissions of greenhouse gases (GHGs), beginning in model year 2009. The Clean Air Act (CAA) generally preempts states from adopting their own emission standards for mobile sources. However, the act allows such standards in California, if the state obtains a waiver of CAA preemption from EPA.
California requested this waiver in 2005, but EPA took until December 19, 2007, to decide that it would deny the request. On that day, EPA Administrator Stephen Johnson wrote California Governor Schwarzenegger to say, “I have decided that EPA will be denying the waiver and have instructed my staff to draft appropriate documents setting forth the rationale for this denial in further detail....” According to press reports, the decision was taken against the unanimous advice of the agency’s technical and legal staffs. On February 29, 2008, the Administrator issued a decision document denying the waiver that will be published in the Federal Register.
Following EPA’s December 19 letter, California and environmental groups petitioned for review in the Ninth Circuit, with multiple states intervening on California’s side. The interest of the intervening states derives from the fact that under the CAA, states other than California may adopt motor vehicle emission standards identical to California’s and avoid CAA preemption if California is granted a waiver. At least 14 states have adopted such regulations.
This report reviews the nature of EPA’s, California’s, and other states’ authority to regulate emissions from mobile sources, the applicability of that authority to GHGs, and issues related to the California waiver request. The conditions for granting or denying a waiver request under CAA are four: whether the state has determined that its standards will be, in the aggregate, at least as protective of public health and welfare as applicable federal standards; whether this determination was arbitrary and capricious; whether the state needs such standards to meet compelling and extraordinary conditions; and whether the standards and accompanying enforcement procedures are consistent with CAA Section 202(a). California appears to have a sound argument that it has met these tests; EPA, however, has decided that climate change is simply beyond the scope of its preemption waiver authority.
This report does not analyze whether California is preempted from regulating mobile-source GHGs by the Corporate Average Fuel Economy (CAFE) requirements of the Energy Policy and Conservation Act of 1975, or the newly enacted provisions of the Energy Independence and Security Act of 2007 (P.L. 110-140). Under these laws, authority to set fuel economy standards is reserved to the federal government — specifically, the National Highway Traffic Safety Administration (NHTSA). In several court cases and in other venues, the auto industry is maintaining that the regulation of mobile-source GHG emissions is simply another method of regulating fuel economy, so California’s GHG standards (and identical standards adopted by other states) are preempted. Two federal district courts have rejected this argument, but one decision has been appealed and the other likely will be.