Auto Industry Loses Critical Greenhouse Gas Suit

The auto industry's bid to block states from implementing greenhouse gas regulations was handed a big loss Wednesday as a federal judge in Vermont said automakers had not proven that federal law preempted individual states from establishing such rules.

In a 240-page ruling handed down after a 16-day trial that ended in May, U.S. District Court Judge William Sessions told automakers he was "unconvinced" that they could not meet "the challenges of Vermont's and California's GHG (greenhouse gas) regulations."

California was the first state to approve automotive greenhouse gas limits, and 11 other states including Vermont have since followed suit. 

Legal scholars say the ruling is binding only in Vermont but is likely to be cited in identical cases pending in federal court in several other states including California.

A group of automakers, domestic and foreign, began filing the suits after California in 2004 adopted tough restrictions on automotive emissions of carbon dioxide and other gases believed to contribute significantly to global warming.

The auto industry argues that the greenhouse gas standards, calling for cars to average 43 miles per gallon by 2016 in order to reduce their carbon-dioxide emissions by 30 percent, cannot be achieved unless car companies stopped selling many models including most pickup trucks and SUVs.

The rules are slated to be phased in from 2009 through 2016 and would eliminate approximately 80 million tons of carbon dioxide a year, according to estimates filed in the case.

Automakers also argue that greenhouse gas regulation is a thinly disguised effort by the states to usurp the federal government’s exclusive right to establish national fuel-efficiency standards. Because greenhouse gases are created by burning carbon-based fuels such as gasoline, the principal way to reduce them is to increase the number of miles a vehicle can travel for every gallon of gasoline it uses.

In a separate case this summer, the U.S. Supreme Court ruled that greenhouse gas emissions can be regulated, opening the door for the states to act. 

The Alliance of Automakers, a Washington-based trade organization, has been the lead plaintiff in many of the suits to block those rules. In a statement Wednesday, Alliance President Dave McCurdy said various options including an appeal are being considered.

“Federal law is designed to ensure a consistent fuel economy program across the country," McCurdy said. “It makes sense that only the federal government can regulate fuel economy.”

But federal law already gives California the unique right among all states to set air quality rules that are stricter than those imposed nationwide by the federal Environmental Protection Agency, providing that the EPA grants the state a waiver, which it typically has done.

Other states can either follow the EPA rules or adopt California’s regulations.

So far, Arizona, Connecticut, Maine, Maryland, Massachusetts, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Utah and Washington have opted to follow California’s path. Five Canadian provinces also have said they will adopt California’s regulations.

The EPA must still grant California a waiver to implement its greenhouse gas standards, though, and many environmental groups believe the Bush administration will deny permission in order to permit federal regulators to create lesser greenhouse-gas controls for vehicles.

The Vermont ruling “will be seen as a turning point in the fight to protect Americans from the worst consequences of global warming,” said Michelle Robinson, director of the Clean Vehicles Program at the Union of Concerned Scientists.

“Automakers have the technology today to meet this global warming pollution standard in a cost-effective way,” she said. “Vermont and 11 other states have been leading the way by adopting this standard that originated in California, and now the federal government should adopt a standard that is at least as stringent.”

Sessions found that in their arguments in the Vermont case, attorneys for the auto industry had failed to prove either that car companies could not meet the standards, or that Congress had forbidden states from setting their own fuel economy rules.

"This decision should put the nail in the coffin of the failed arguments of the auto industry,” said Sierra Club attorney David Bookbinder.

In hopes of applying even more pressure on the industry, the governors of 13 states sent a jointly signed letter to automakers Wednesday asking them to drop the suits.

“The public is demanding that states, in the absence of federal action, take real and meaningful steps to reduce emissions of greenhouse gases,” the governors wrote in the letter, which was initiated by the six states in the Western Climate Initiative and coordinated by California Gov. Arnold Schwarzenegger’s office.

“Ensuring that our automobiles have a lower carbon footprint is an essential piece of our greenhouse gas reduction strategy,” the letter continued.  “We do not believe it is productive for your industry to continue to fight state implementation of clean tailpipe standards,” the governors said. “We would prefer to follow a path that encourages innovation, not litigation.”

Posted by

John O'Dell September 13, 2007, 2:02 AM

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