California To Mandate Clean Car Availability?

By Scott Doggett December 10, 2011

New Cali CARB lede.jpg

California air-quality regulators this week proposed a plethora of rules aimed at curbing tailpipe emissions in the state, including a proposal intended to dramatically boost the number of advanced-technology automobiles and light-duty trucks on California's roads. The regulations prepared by the state Air Resources Board (CARB) and applicable to vehicles manufactured from 2015 to 2025 would be enacted into law in 2012 if approved by the state's Office of Administrative Law, which will consider the new rules on Jan. 26.

Among a great many other things, the proposed Advanced Clean Cars program would combine the control of soot, smog-causing pollutants and greenhouse-gas emissions into a single coordinated package of requirements for model years 2017 through 2025. CARB officials said that combining these standards into a single program should simplify rule making and compliance, and help the state reach a goal established in 2005 by then-Gov. Arnold Schwarzenegger to bring greenhouse-gas emissions in California by 2050 to 80 percent below their 1990 levels. The rules are designed to harmonize with recently published rules proposed for federal greenhouse gas and fuel efficiency standards through 2025.

CARB expects its emissions rules to be adopted in January -- long before the U.S. Environmental Protection Agency and other federal entities are expected to adopt theirs. However, CARB established its standards in concert with the federal agencies and it's only because the feds are abiding by different rule-making procedures that California will adopt its first, board spokesman Stanley Young told AutoObserver. "It's likely that their rules will parallel ours at the end as well, and if they do parallel ours we will be happy to accept compliance with the federal standards as equivalent to compliance with California standards. But if they don't, either now or in the future, then we continue to have those [state] standards in place."

Fig 1 ACC Summary.jpgNew ZEV Mandate
Among the proposed rules are revised mandates requiring automakers to produce increasing numbers of zero-emission vehicles -- namely, battery-electric, hydrogen fuel cell and plug-in hybrid vehicles -- for the 2018-2025 model years. The proposed program would oblige automakers doing business in California to devote 15.4 percent of their fleet -- or one in seven new vehicles sold in California -- to ZEVs by 2025. Or put another way, the program calls for 1.4 million new clean cars to be placed on California's roads from 2018 to 2025. In one scenario proposed by the CARDB staff, ZEVs would need to comprise 87 percent of the on-road fleet by 2050 to meet the greenhouse-gas goals set by Schwarzenegger six years ago.

Additionally, the program proposes that all passenger cars and light-duty trucks sold in California by required to reach the state's super-ultra-low emission vehicle, or SULEV, standards by 2025. If enacted into state law, CARB estimates that cars sold in the state in 2025 will produce 50 percent fewer greenhouse-gas emissions than current vehicles. That's the equivalent of taking 8 million cars off the road.

CARB said the steps that automakers will need to take to comply with its proposed new rules are expected to result in an average vehicle price increase of $1,900 but result in net lifetime operating savings of $4,000. "The operating cost savings from the use of more efficient vehicles will positively impact consumers and most businesses," the summary said. "Based on staff's analysis, the net effect of the program on the economy is expected to be small but positive."

Fig 2 ACC Summary.jpgDeja Vu
In an email to AutoObserver, analysts for IHS Global Insight economics and auto industry forecasting firm, noted that this is not the first time CARB has laid down the law for a ZEV mandate. The first time was in 1990, when the board mandated that automakers have 10 percent of their California sales by 2003 be electric (the mandate was eventually scrapped), and then again in 2008 rules were set for 2012-2013 (they've since been gutted). Such new mandates however may be a boon for smaller outfitters like Tesla Motors, which is working with Toyota and Mercedes-Benz on electric vehicles using Tesla technology and OEM "gliders" under contract, the analysts said.

"As the new CARB rules do not exempt smaller manufacturers as they have previously, more companies may be knocking on Tesla's door, looking for a quick fix for EVs to allow them to keep selling in the California market," the analysts wrote. "The problem with the CARB regulations however is twofold: first, there is no demand-side incentive specifically called out that will make Californians want to buy what are initially going to be more expensive, less-practical vehicles, and second, there is nothing mentioned about what the cash-strapped state will do to replace the [fuel] taxes lost when it eventually replaces petroleum-based fuels with hydrogen and electricity for its consumer vehicle fleet."

CARB's proposed program comes at a time when a powerful Congressman with a history of attacking efforts by the board and federal agencies to require automakers to build cleaner vehicles has initiated an investigation of the air board's role regarding federal corporate average fuel economy standards. CARB, along with automakers, labor unions, the EPA and the Department of Transportation, agreed last year on setting fuel economy standards for model years 2012-2016 and this year on a proposal for 2017-2025 standards. CARB had a seat at the table because, under federal law, it has the right to regulate certain tailpipe emissions to protect the quality of the air in California. Other states have the right to adopt California's standards and at least 13, plus the District of Columbia, have done so. Together, they represent half of the U.S. new-car market -- a market the auto industry cannot afford to ignore.

Fig 3 ACC Summary.jpg

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