1st Greenhouse Gas Emission Rules to Give Detroit a Low-Carbon Makeover

President Obama sketched out a roadmap for a green revival of the struggling U.S. auto industry today, basing it on tough new fuel efficiency standards and the first nationwide regulation of greenhouse gas emission from cars and trucks.

At the same time, he sent a message to other polluters that the deal reached between the auto industry and federal and state regulators is an example for how industry and government can and should work together to begin weaning the nation off its fossil fuel addiction.

“In the past, an agreement such as this would have been considered impossible,” the president said. “That is why this announcement is so important, for it represents not only a change in policy in Washington, but the harbinger of a change in the way business is done in Washington.”

At the heart of the auto industry's green makeover is the highest increase in fuel efficiency standards that the United States has seen in decades – a leap from a fleetwide average of about 25 mpg to 35.5 mpg by 2016. The increases start in 2012, rising 5 percent each year to get cars to 39 mpg and trucks to 30 mpg. 

By meeting that fuel efficiency standard, automakers will be lowering their greenhouse gas emissions enough to comply with the second part: a planned EPA rule that tailpipe emissions be below 250 grams per mile by 2016.

Together, the two federal standards are expected to cut tailpipe emissions by 30 percent, eliminate the need for 1.8 billion barrels of oil, and prevent the production of 900 million metric tons of greenhouse gases for the life of vehicles produced through 2016.

That's the equivalent of taking 177 million cars off the road or shutting down 194 coal plants, White House Climate Advisor Carol Browner said.

To get to this point required automakers calling a truce after years of fighting regulators and agreeing to work out a deal that would help the struggling industry reinvent itself.

The Obama administration began working on stronger vehicle emissions standards shortly after its arrival in January. Several swift actions by the new EPA, on top of pressure from the automakers' federal bailouts, likely helped convince the auto industry that it was time to give up the fight and make a deal.

First, the EPA suggested it would approve a waiver that would let California and other states set stricter tailpipe emissions limits than the federal government's.

The second move was the EPA's proposed ruling, following the U.S. Supreme Court’s 2007 decision in Massachusetts v. EPA, that would declare greenhouse gas emissions a danger to the public health and welfare and begin regulating them under the Clean Air Act.

The industry prefers a coordinated national standard, rather than facing the prospect of individual state standards. Under the agreement with Obama, California will accept the federal standard through 2016, which is only slightly lower than what the state approved in 2004.

California Gov. Arnold Schwarzenegger skipped a special election on Tuesday to be at the White House for the announcement.

“California’s relentless push for greenhouse gas reductions from automobiles is paying off, not just for our state, but for all Americans, for our environment, for automakers and our economy,” Schwarzenegger said. “This historic agreement to reduce greenhouse gases will mean cleaner air for our children and grandchildren, greater economic security as we rely less on foreign oil, and a chance at renewal for our auto industry.”

Also joining the president in the rose garden for the announcement were 10 auto industry CEOs, the governors of Michigan and Massachusetts, labor leaders, regulators and environmental groups.