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New pollution standards for cars and trucks recently announced by the U.S. Environmental Protection Agency will significantly reduce greenhouse gas emissions, but will also push the auto industry to produce more electric vehicles (EVs) in order to be in compliance.
The new rules, announced in late March, will build on the existing emission standards, and will cover model year vehicles 2027 through 2032. While a proposed rule called for tougher standards more quickly, the final rule will be phased in to give automakers more time to comply and allow EV technology and infrastructure to be developed.
EV sales have grown rapidly in recent years, accounting for almost 8% of the auto market, but have slowed recently due to concerns about range, lack of charging stations, and high prices. Those challenges must be overcome to convince consumers to purchase an EV.
The rules will cover passenger cars, light-duty trucks, and medium-duty vehicles, and are projected to prevent more than 7 billion tons of carbon emissions and result in annual net benefits of almost $100 billion in the next 30 years, including $46 billion in yearly fuel savings. In addition, the EPA estimates that the air pollution reductions will result in $13 billion in annual health benefits, by reducing the amount of fine particulates and volatile organic compounds (VOCs) that contribute to respiratory diseases.
The rules will be phased in starting in 2027 and when fully implemented in 2032, new vehicle emissions must be cut nearly in half compared in 2032. In order to meet these ambitious goals, automakers will have to decide on the mix of vehicles they will offer, which may include gasoline-powered, hybrids and plug-in hybrids, and full battery EVs.
“EPA anticipates that manufacturers will continue to employ a diverse range of technologies to comply with the standards, but also recognizes that manufacturer investments and consumer interest in electric vehicles in growing,” the regulatory announcement states. It also acknowledges that the standards will be phased in to allow additional time for adjustments in product plans and technology applications.
The EPA projects that in model years 2030 through 2032, about 30% to 56% of light-duty vehicles will be battery EVs, and 20% to 32% of medium-duty vehicles will be EVs.
While the EPA estimates that complying with the new rules will raise the technology costs to manufacturers by about $1,200 per light-duty vehicle, it notes that may not correlate into a higher purchase price due to state and federal incentives for EV purchases.
It remains to be seen if the move to EVs is adopted by motorists, and if the infrastructure and technology to meet these aggressive rules can be put in place. Some lawmakers are opposed to the push toward EVs and believe the goals are too ambitious. U.S. Sen. Shelly Moore Capito, (R-WV) ranking member of the Senate Environment and Public Works Committee, noted in a statement that the new rules come at the same time the EPA is putting tough new limits on power plants that provide the electricity for EVs, and said they are “yet another step toward an unrealistic transition to electric vehicles that Americans do not want and cannot afford.” She promised to lead efforts to overturn the rule, and industry groups indicated legal challenges are likely.