Tough New EPA Rules for Electric Cars Coming Soon

A set of new Environmental Protection Agency rules for electric cars aren't actually "rules" per se and are instead a set of emissions standards — the toughest the agency has ever proposed — that would represent a nearly 66% reduction in tailpipe emissions of carbon dioxide and other greenhouse gases by 2032 compared to a decade earlier. The EPA typically manages air quality and has no authority to tell automakers what kind of cars and trucks to build. Instead, it regularly sets tailpipe emissions limits. The only way to meet the proposed EPA standards with current technology, though, is through vehicle electrification.

In its toughest scenario, the agency proposal would have fully electric cars and light trucks making up ever-increasing portions of new vehicle production — starting at 36% in 2027 and climbing to 67% in 2032.

Most automakers have already committed to EVs in varying degrees, with some of the largest — like General Motors and Volkswagen — saying they'll be all-electric between 2030 and 2035. The EPA's proposed plan wouldn't change that but would require car companies to speed up the pace of electrification — or to invent essentially emissions-free gas engines.

Right now, the consensus among automakers and industry analysts is that EVs could hit a 40% to 50% market share by 2030. The EPA's proposed plan would raise that to 60% and up to 67% in 2032. That's a bigger leap than President Biden's goal that EVs make up 50% of sales by 2030.

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What will the new EPA regulations do?

The EPA's proposed regulations on electric cars outline a plan for reaching emissions goals in annual stages from 2027 through 2032.

The EPA wants to see tailpipe emissions from new passenger cars, SUVs, crossovers, vans and light pickups cut to a fleetwide average of 82 grams per mile. That's down from 233 grams per mile in 2022 and about half of what current emissions rules have set as the 2026 goal of 161 grams per mile.

To get there, the 2027-2032 plan calls for average annual emissions cuts of about 7% and suggests a variety of ways automakers can achieve the reductions. Most involve increasing levels of electrification — which include battery electric cars, plug-in hybrid vehicles and even fuel cell electric vehicles — as well as continued improvements to traditional internal combustion engines including downsizing and turbocharging.

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Can I still buy a new gas-powered vehicle?

There won't be as many new internal combustion engine vehicles available in coming years, but there's nothing in the proposed EPA standards that outlaws them.

The reality of current vehicle emissions technology, however, is that barring an enormous breakthrough in gas engine technology, there must be fewer internal combustion engines made each model year for automakers to comply with the new EPA standards.

Still, the plan would leave room for around 5 million new gas-powered cars and light trucks in 2032.

There typically are about 220 million registered passenger vehicles in the U.S., and about 15 million new passenger vehicles and light trucks are sold each year. If nothing but EVs were built, it would still take more than 15 years from the production of the last internal combustion engine vehicle for the U.S. fleet to become all-electric.

When do the new rules take effect?

The EPA is in the process of finalizing its proposal after a lengthy public comment session and private meetings between Biden administration environmental officials and automakers.

The final rules, which could be watered down somewhat, are expected to be published in late March to early April and would take effect starting in 2027 when the current emissions rules expire.

The EPA has the authority to issue the emissions rules without a congressional vote, so the final rules are just that, unless overturned in court or by a new political administration. That's happened only once before — when Donald Trump took office in 2017.

What's the 67% EPA rule on electric cars?

Some call the EPA plan a "mandate" that requires 67% of all new passenger cars and trucks built in 2027 to be EVs, but the EPA cannot mandate any type of vehicle. Instead, the plan suggests several routes to achieving the emissions standards using varying mixes of electric, plug-in hybrid and conventional internal combustion engine vehicles. The EPA's preferred plan shows EV production at 67% in 2032.

One pathway suggests no new EVs would be needed if automakers relied heavily on plug-in hybrids, which combine small, efficient gas engines and electric powertrains and use rechargeable batteries that are much smaller than those needed by EVs.

Still, any path forward means profound changes in the types of new cars and trucks consumers will be able to buy, with increasing numbers of all-electric vehicles necessary to meet national clean air and fuel efficiency goals.

But aren't EV sales slowing?

That's a misinterpretation. The rate of sales growth for EVs slowed in the latter part of 2023, but actual sales numbers are rising. EVs accounted for 6.8% of sales in 2022, jumped to 9.3% in 2023, and are projected by most major industry analysts to account for 10% to 12% of U.S. passenger vehicle sales this year.

Who's for and against these new EPA regs?

As usual when the agency issues a new multi-year emissions plan — the first was in 2010 — strong opposition has been voiced by the National Auto Dealers Association and the trade group representing most automakers.

The plan also has enraged a number of Republican state attorneys general who are threatening to sue to block the plan. Republicans in the House have passed a bill prohibiting the EPA from enforcing the regulations, but it is expected to die in the Senate and would certainly be vetoed by Biden if approved by both houses of Congress.

Most environmental groups and a smaller trade association representing vehicle electrification support industries and EV-only automakers such as Tesla and Rivian have voiced support. Some, including the Union of Concerned Scientists, have said the EPA plan should be even tougher in light of worsening air quality linked to changing climate conditions.

What's next?

After meetings with the White House, many in the auto industry are hoping to see the EPA publish a final plan that cuts the speed at which they'd have to make EVs the bulk of their production each year.

Others, including the Zero Emission Transportation Alliance, believe it's more likely the EPA will publish a final rule that follows a timeline reducing EV production in the first four years but increasing it in the final two years to achieve the 82-grams-per-mile emissions goal in 2032.

Edmunds says

The EPA's new regulations push EVs a lot faster than the auto industry wants to go but not as fast as some environmentalists would like. Look for a court battle once the final rule is published. Adding to automakers' woes, the National Highway Traffic Safety Administration has proposed a fleetwide average fuel efficiency of 58 mpg by 2032, up from 36.7 mpg now. That's expected to be finalized later this year.

And all bets are off if Democrats lose the White House in November.

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