Hill Heat

In a Detroit News piece entitled Dingell tours show; says state-by-state emissions rules would doom carmakers, David Shepardson writes that Dingell fully supported last month’s decision by the EPA to deny the California waiver to regulate tailpipe greenhouse gas emissions.

Dingell, D-Dearborn, chairman of the House Energy and Commerce Committee, said if California got the waiver it could impose conflicting federal and state standards. The California standards could be make automobile production “so expensive that people won’t be able to buy and second of all get so difficult that the companies won’t be able to produce anyhow.”

Dingell said the California system could lead to 50 different standards. He said the EPA decision “makes good sense.”

As has been previously discussed on Hill Heat, the specter of 50 different standards is simply false. Under the Clean Air Act only California has the authority to get waivers from national standards. Other states can then follow California or the federal standards. At most there can be two different standards.

Dingell plans to introduce a climate change bill in his committee “as fast as we can” but wants to exclude the auto industry, arguing that the CAFE standards in the 2007 energy bill are sufficient regulation: “We’ve had everybody else get practically a free ride and auto industry has to come up with a 40 percent increase in fuel efficiency,” Dingell said. “We’re going to try to see that the pain is shared equally all around.”

Update: Dingell has issued a clarification of his remarks, stating that he considers CAFE standards to be a “carbon constraint” and that the CAFE standard increase “tightens the cap on automobiles by 40 percent by 2020.” Any carbon cap would entail “further reductions” that would be have to matched by “comparable contributions” by other industries.

Shepardson also reports on an interview with Margo Oge, director of the EPA’s office of transportation and air quality. She didn’t expect the agency to issue a formal written denial “until next month at the earliest.” The EPA may be trying to argue that its the EPA press release announcing the denial isn’t actually grounds for a suit to overturn the decision. She also said that the EPA “completed its draft of its own new regulations to reduce greenhouse gas emissions” but didn’t provide details.

As California Attorney General Jerry Brown announced upon the EPA denial of the California waiver request to regulate tailpipe greenhouse emissions, California has filed a petition for review of the decision in the Ninth Circuit Court of Appeals. Fifteen other states – Massachusetts, Arizona, Connecticut, Delaware, Illinois, Maine, Maryland, New Jersey, New Mexico, New York, Oregon, Pennsylvania Department of Environmental Protection, Rhode Island, Vermont, and Washington – joined the suit.

Warming Law notes:

One interesting legal wrinkle is that the case has been filed in the 9th Circuit—not in the DC Circuit, as many (including ourselves) had suggested. In the wake of EPA’s decision, LA Times writer David Savage presciently noted that the DC Circuit might not be naturally inclined to California’s arguments. While the state’s case for a waiver was undoubtedly strengthened by the Supreme Court’s decision on standing in Massachusetts v EPA, it was the DC Circuit that had previously sided with the EPA’s position (this rationale is strongly mirrored in the EPA’s current claim that global warming doesn’t pose a unique threat to California). The state’s arguments based on statutory text and the weight of Supreme Court precedent would probably have held up in any court, but its tactical filing move certainly seems, on the surface, to bolster its odds.

(Cross-posted from Warming Law, which focuses on covering and analyzing the fight against global warming from a legal perspective.)

by Tim Dowling

“EPA Likely To Lose Suit.”

So said EPA, or at least EPA’s legal staff, when it briefed Administrator Johnson on the legal ramifications of a waiver denial. The quoted language comes from a powerpoint slide used during that briefing. As the Washington Post reports, Johnson’s waiver denial flew in the face of “the unanimous recommendation of the agency’s legal and technical staff.”

California’s legal challenge to the waiver denial will be filed in the U.S. Court of Appeals for the D.C. Circuit, and one large reason for believing EPA will lose can be found in the D.C. Circuit’s opinions in previous waiver cases. Unlike Administrator Johnson, the D.C. Circuit clearly recognizes the special, leading role California plays under the Clean Air Act with respect to controls on tailpipe emissions.

For example, in Motor & Equipment Mfrs. Ass’n v. Nichols, 142 F.3d 449, 543 (D.C. Cir. 1998), the D.C. Circuit ruled that waiver process is designed “to afford California the broadest possible discretion in selecting the best means to protect the health of its citizens and the public welfare.” (quoting the House Report).

In a more comprehensive discussion in Engine Mfrs. Ass’n v. U.S. EPA, 88 F.3d 1075 (D.C. Cir. 1996), the court explained:

Congress recognized that California was already the “lead[er] in the establishment of standards for regulation of automotive pollutant emissions” at a time when the federal government had yet to promulgate any regulations of its own. California’s Senator Murphy convinced his colleagues that the entire country would benefit from his state’s continuing its pioneering efforts, California serving as “a kind of laboratory for innovation.” This function was enhanced by the 1977 amendments, which permitted other states to “opt in” to the California standards by adopting identical standards as their own. Thus, motor vehicles must be either “federal cars” designed to meet the EPA’s standards or “California cars” designed to meet California’s standards. Rather than being faced with 51 different standards, as they had feared, or with only one, as they had sought, manufacturers must cope with two regulatory standards under the legislative compromise embodied in § 209(a). Id. at 1079-80 (citations and footnotes omitted).

The D.C. Circuit also examined the waiver process in Motor & Equipment Mfrs. Ass’n v. EPA, 627 F.2d 1095 (D.C. Cir. 1979), an unsuccessful industry challenge to EPA’s waiver grant for California rules concerning in-use maintenance of motor vehicles. Tracking the language of the statute, the court observed that EPA must grant a waiver request unless it makes one of the three findings set forth in Section 209(b)(1)(A)-(C). Id. at 1106. The issue is emphatically NOT whether the California rules are a good idea as a matter of policy, but whether EPA discharged its duties under the CAA. Id. at 1105.

Johnson’s bogus concern that a waiver grant here would create a “confusing patchwork” simply cannot be reconciled with the Clean Air Act and the applicable precedents that construe the waiver provisions in Section 209. Expect the D.C. Circuit to make short work of it.

House Oversight Committee chairman Henry Waxman has just launched an investigation into EPA administrator Stephen Johnson’s decision to deny the California waiver to implement its Clean Cars Campaign.

In his letter to the EPA, Waxman writes:

Yesterday, you announced a decision to reject California’s efforts to reduce greenhouse gas emissions from automobiles. Prior to making this decision you assured the House Oversight and Government Reform Committee, as well as the state of Califomia and many others, that you would make this decision on the merits.

It does not appear that you fulfilled that commitment. Your decision appears to have ignored the evidence before the agency and the requirements of the Clean Air Act. In fact, reports indicate that you overuled the unanimous recommendations of EPA’s legal and technical staffs in rejecting California’s petition.

Your decision not only has important consequences to our nation, but it raises serious questions about the integrity of the decision-making process. Accordingly, the Committee has begun an investigation into this matter. To assist our Committee in this inquiry, I request that you provide us with all documents relating to the California waiver request, other than those that are available on the public record. This request includes all communications within the agency and all communications between the agency and persons outside the agency, including persons in the White House, related to the California waiver request. And all agency staff should be notified immediately to preserve all documents relating to the California waiver request.

You should produce to the Committee all responsive documents from your office by January 10, 2008. All responsive documents from the Office of Transportation and Air Quality and the Office of General Counsel should be produced by January 17,2008, and all other responsive documents should be produced by January 23,2008.

Further responses (see California responses) to the waiver denial, including praise from Detroit’s lobby group.

Environmental Defense:

EPA is not following science or the law . . . This decision is like pulling over the fire trucks on their way to the blaze . . . The Administration’s first bold act on global warming – and it’s to stop the states who are trying to do something about the problem. It is just plain shocking. . . New CAFE standards, if they go into effect, do not fully phase in until 2020. The California greenhouse gas limits will occur earlier – beginning in 2009 and fully phased in by 2016. With the mounting evidence of climate change impacts occurring now, it is imperative that we are take action immediately.

NRDC:

This rejection represents bald-faced political interference with California’s decades-long authority to enforce its own clean air rules . . . The California standards are the single most effective step yet taken in the United States to curb global warming. By blocking the California standards, the administration has stuck a thumb in the eye of 18 governors from both red and blue states who have led the way on global warming by adopting these landmark rules.

Friends of the Earth:

There is absolutely no reason for the Bush administration to block California’s effort to fight global warming. Today’s EPA decision is a major setback in the global warming fight and a slap in the face to all of the states that have moved forward when the federal government would not. This decision cements the United States’ reputation as the nation that is holding the rest of the world back at a time when our leadership is desperately needed. One can only hope that the next administration will play a more constructive role.

Sen. Sheldon Whitehouse (D-R.I.):

The EPA’s ruling is disgraceful. The Bush administration’s refusal to carry out the duties imposed on it by the Clean Air Act have polluted our air and water, further endangered the health of millions of Americans, and cost us precious time in our fight to address the looming threat of global warming. We can’t afford to delay strong steps to address global climate change. We will keep fighting to pressure this administration to do the right thing and allow states like Rhode Island to take action.

Alliance of Automobile Manufacturers:

We commend EPA for protecting a national, 50-state program. Enhancing energy security and improving fuel economy are priorities to all automakers, but a patchwork quilt of inconsistent and competing fuel economy programs at the state level would only have created confusion, inefficiency, and uncertainty for automakers and consumers. . . Under the new national fuel economy law, automakers will make dramatic, 30-percent reductions in carbon dioxide.

Selected responses from the California congressional delegation and executive branch to EPA’s denial of the California waiver yesterday.

Rep. Henry Waxman (D-Calif.), chairman of the Committee on Oversight and Government Reform:

EPA’s decision ignores the law, science, and commonsense. This is a policy dictated by politics and ideology, not facts. The Committee will be investigating how and why this decision was made.

Sen. Dianne Feinstein (D-Calif.):

Candidly I find this disgraceful. The passage of the Energy Bill does not give the EPA a green light to shirk its responsibility to protect the health and safety of the American people from air pollution.

Gov. Arnold Schwarzenegger (R-Calif.):

While the federal energy bill is a good step toward reducing dependence on foreign oil, the President’s approval of it does not constitute grounds for denying our waiver. The energy bill does not reflect a vision, beyond 2020, to address climate change, while California’s vehicle greenhouse gas standards are part of a carefully designed, comprehensive program to fight climate change through 2050 . . . California sued to compel the agency to act on our waiver, and now we will sue to overturn today’s decision and allow Californians to protect our environment.

Sen. Barbara Boxer (D-Calif.), chair of the Committee on Environment and Public Works:

With Members of Congress leaving town, and with the news on global warming getting worse with each passing day, EPA Administrator Stephen Johnson has delivered the worst possible news to the good people of California and the 12 other states who have proven they are leaders in fighting for the survival of the planet.

It is ironic that this waiver denial comes during the season when we are supposed to work to make our country and the world a better place. And to hide behind the newly-passed Energy Bill as an excuse flies in the face of the Supreme Court’s findings and the Energy Bill itself.

This ill-advised denial turns its back on science, turns its back on fairness, turns its back on states’ rights, and turns its back on precedent.

I have informed the state of California that I am prepared to take all measures to overturn this harmful decision.

Calif. Attorney General Jerry Brown (D):

It is completely absurd to assert that California does not have a compelling need to fight global warming by curbing greenhouse gas emissions from cars. There is absolutely no legal justification for the Bush administration to deny this request – Governor Schwarzenegger and I are preparing to sue at the earliest possible moment.

EPA administrator Stephen Johnson’s denial of California’s petition to regulate tailpipe greenhouse gas emissions following the White House energy bill signing ceremony was deservedly front page news from coast to coast. The Supreme Court forced the EPA to consider California’s December 2005 Clean Air Act waiver request in April 2007 (Massachusetts v. EPA). In testimony before the Senate and the House earlier this year, Johnson signaled his lack of desire to grant the waiver. Now that decision has come in, with justifications even EPA’s own laywers and policy staff don’t believe. This is the first time in the history of the Clean Air Act that the EPA has denied a section 209 California waiver request.

[Ed.—Warming Law has superior analysis of the decision, from which I’ll steal some key insights.]

The EPA, which is yet to release the formal denial, announced in its press release that the increased CAFE standards in the new energy law to justify its denial of the California waiver:

EPA has determined that a unified federal standard of 35 miles per gallon will deliver significant reductions in greenhouse gas emissions from cars and trucks in all 50 states, which would be more effective than a partial state-by-state approach of 33.8 miles per gallon.

Warming Law says “EPA appears to be attempting to add a new test to the Clean Air Act” in requiring that California prove a local interest in addition to the “compelling” and “extraordinary” standards the Supreme Court said this problem meets.

Warming Law’s Tim Dowling notes that Johnson’s claim the waiver would create a “confusing patchwork of state rules” is typical industry rhetoric that is specious—only two sets of standards, national and California, would apply. “Johnson failed to explain how EPA has been able to grant EVERY other 209 waiver request in history without creating a confusing patchwork, but can’t do so here.”

Juliet Eilperin of the Washington Post reveals that Johnson overrode his staff.

In a PowerPoint presentation prepared for the administrator, aides wrote that if Johnson denied the waiver and California sued, “EPA likely to lose suit.”

If he allowed California to proceed and automakers sued, the staff wrote, “EPA is almost certain to win.”

The technical and legal staffs cautioned Johnson against blocking California’s tailpipe standards, the sources said, and recommended that he either grant the waiver or authorize it for a three-year period before reassessing it.

“Nobody told the administration they support [a denial], and it has the most significant legal challenges associated with it,” said one source, in an interview several hours before Johnson’s announcement, who spoke on the condition of anonymity because the official is not authorized to speak for the agency. “The most appropriate action is to approve the waiver.”

From the New York Times Editorial blog:

The Energy Bill: A Hero and a Villain

President Bush has just signed into law an energy bill that could have been even better but still remains an impressive achievement. The long struggle to produce that bill yielded the usual quotient of heroes and villains, but two deserve special mention:

John Dingell, who could have been a villain but chose to be a hero; and Mary Landrieu, who could have been a hero but chose to be a villain.

Mr. Dingell was a most unlikely hero. A Michigan Democrat and a reliable defender of the automobile industry, he had long resisted efforts to mandate new fuel efficiency standards, which had not been updated for more than 30 years.

But there has always been a softer, “greener” side to this crusty octogenarian that people often overlook. An architect of the original Clean Water Act of 1972, he cares a lot about wetlands preservation, endangered species and other environmental causes. He is also a fairly recent convert to the climate change issue, describing the global warming threat with phrases like “Hannibal is at the gates.”

So when Nancy Pelosi, the House Speaker, made a personal pledge to upgrade fuel efficiency standards, Mr. Dingell agreed, in exchange for one or two modest concessions, to get out of the way. He did more than that. When environmentalists complained that the Senate’s mandate for a huge increase in ethanol could threaten forests, wetlands and conservation areas, Mr. Dingell made sure the final bill contained the necessary safeguards. He also insisted on a provision requiring that ethanol from corn or any other source produce a net benefit in terms of greenhouse gas emissions.

Ms. Landrieu was an altogether different story. The Louisiana Democrat broke ranks with her Democratic colleagues and gave President Bush and the Republican leadership the one-vote margin they needed to strike a key provision that would have rescinded about $12 billion in tax breaks for the oil industry and shifted the money to research and development of cleaner sources of energy.

The White House argued that these tax breaks were necessary to insure the oil industry’s economic health and to protect consumers at the pump. Given industry’s $100 billion-per-year profits, these arguments were absurd on their face, but Ms. Landrieu promoted both of them and added one of her own: The energy bill was “one-sided policymaking” that left “Louisiana footing the bill.”

Never mind that the rest of the country is footing the bill for the repair and restoration of Louisiana in the aftermath of Hurricane Katrina. That is a just and worthy cause and one that the nation is willing to help pay for. But isn’t reducing oil dependency and global warming emissions by rewarding traditional fossil fuels a bit less, and rewarding newer, cleaner fuels a bit more, also a just and worthy cause? One that Louisiana could help pay for? That is something Ms. Landrieu might ask herself the next time she puts her state’s interest ahead of the nation’s.

By a vote of 314-100, the House of Representatives approved the Senate version of the energy bill this afternoon.

The bill, which contains a major biofuels mandate (also known as the renewable fuels standard) and increased fuel economy, building, and appliance standards, has been given the okay by the president.

The New York Times today looks into the possible implications of the ethanol mandate.

After Sen. Reid dropped the oil-for-renewable tax package following a failed cloture vote on the energy bill this morning, Republicans removed the filibuster threat and President Bush dropped his veto threat, having achieved a bill that met essentially all of the White House conditions.

This evening, the senatorial candidates having left the city, the Senate moved directly to a vote (ending debate by unanimous consent) on the final revision of the energy bill, which retains strengthened CAFE, appliance, and building standards, and a strong biofuels mandate with White House-approved tax adjustments for revenue.

The bill passed 86-8, Sen. Stabenow (D-Mich.) joining seven Republicans (Wyoming, Oklahoma, Hatch, DeMint, and Kyl) in opposition.