Australia: Getting Your Clean Kicks On Route 66: Court Upholds California Clean Car Laws

Last Updated: 16 May 2008
Article by Peter Briggs

Key Point

  • California can regulate greenhouse gas emissions from new passenger cars, SUVs and pick-up trucks.

On 11 December 2007, United States District Judge Anthony W. Ishii ruled that California can regulate greenhouse gas ("GHG") emissions from new passenger cars, SUVs and pick-up trucks (Central Valley Chrysler-Jeep, Inc. v James Goldstone).

Major automobile manufacturers were seeking to strike down a law passed by California in 2002 setting limits on the amount of GHG emissions that can be released from new automobiles sold in California starting in 2009. In 2004, the state government agency California Air Resources Board ("CARB") approved a regulation that requires automakers to begin selling vehicles with reduced GHG emissions by 2009. Based on the regulation, the average reduction of GHG from new California cars and light trucks will be about 22 percent by 2012 and 30 percent by 2016.

In order to implement this regulation, California applied for a waiver from the United States Environmental Protection Agency ("EPA") on 21 December 2005. Under the Federal Clean Air Act ("CAA"), the EPA has the power to promulgate regulation standards relating to the emission of any air pollutant from new motor vehicles which, in the EPA's judgment, constitutes or causes air pollution. Any state that adopted standards to control emissions from new motor vehicles prior to 30 March 1966 may be granted a waiver to impose standards more stringent that those imposed by the CAA. Out of all the US states, only California regulated emissions prior to the cut-off date, and is therefore the only state that can apply to the EPA for a waiver. However, other states may adopt California's standards that are granted waiver of preemption by the EPA2 The automobile manufacturers sued California because if the EPA grants the waiver, other states would be free to adopt similar standards, which would result in automobile manufacturers having to comply with stricter, and more costly, standards.

Judge Ishii's ruling relied heavily on the U.S. Supreme Court decision in Massachusetts v EPA (127 S. Ct. 1438 (2007)) which held that GHG, including carbon dioxide, are "air pollutants" subject to the CAA, and that the EPA can regulate GHG emissions from new motor vehicles.

Judge Ishii also noted the recent Vermont decision in Green Mountain Chrysler Plymouth, et al v Crombie (508 F.Supp.2d 295 (D.Vt. 2007) which is identical to the suit that was before him. In Green Mountain, the court held that states have the power to regulate automobile GHG emissions. The federal regulation involved in Green Mountain was held not to preempt state regulation of emission standards.

Judge Ishii rejected the automobile manufacturers' argument that the emission standards imposed by California is an unconstitutional intrusion into federal regulation of average gas mileage standards. He ruled that both the EPA and California are empowered under the CAA to promulgate regulations that limit GHG emission from motor vehicles.

The ruling is hailed as a significant victory by proponents of the "clean car" laws, especially when viewed in light of the earlier Green Mountain decision. On 19 December 2007, however, the EPA decided to deny California's request for a waiver on the grounds that the Energy Independence and Security Act of 2007 was enacted . The new energy legislation introduces a mandatory standard for fuel producers to use at least 36 billion gallons of biofuel in 2022; and sets a national fuel economy standard of 35 miles per gallon by 2020. The EPA claims that this law is the national solution to reduce GHG emissions from vehicles, and will be more effective than the "confusing patchwork of state rules".

Immediately after the EPA issued its decision, the relevant committees in the U.S. Senate and the House of Representatives initiated a review of the EPA ruling noting that the EPA appears to have ignored important evidence in making its decision. Both inquiries are ongoing and the committees instructed the EPA to provide relevant documents.

On 2 January 2008, California filed a lawsuit in the U.S. Court of Appeals for the 9th Circuit challenging the EPA's decision. The EPA has since refused to fully comply with the committees' requests claiming that it has identified important Executive Branch confidentiality interest on a number of the required documents, particularly those that reflect internal deliberations and involve attorney-client communications.

On 29 February 2008, the EPA issued a notice explaining its reasons for denying the request for waiver. The EPA concluded that there are no "compelling and extraordinary conditions" justifying a separate GHG emissions standards for California. The EPA held that the effects of global warming are also well-established in other parts of the US, and any effects on California are not sufficiently different from the rest of the US to be considered compelling and extraordinary conditions justifying a separate GHG emissions standard.

Thanks to Regina Walker for her help in writing this article.


1 The almost two-year delay by the EPA in issuing a decision led Governor Arnold Schwarzenegger to file suit against the EPA (State of California v EPA) on 5 November 2007 asking the US District Court of Columbia to grant declaratory and injunctive relief to compel the EPA to decide on California's request for waiver. This case is still pending before the court, but will probably be dismissed in view of the EPA decision denying the request.

2 Sixteen other US states intend to adopt the California emission standards: Arizona, Colorado, Connecticut, Florida, Massachusetts, Maryland, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Utah, Vermont, Washington.

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