EPA's Tailpipe Emission Standard Expected to Promote EV's at the Expense of Cleaner Fuels
On Wednesday, EPA finalized stringent new greenhouse
gas (GHG) emission standards for light-duty cars and trucks. The
final rule is predicted to significantly increase the domestic market
share for electric vehicles (EVs) over the 2027-2032 phase-in period. By
2032, the rule calls for automakers to meet a fleetwide average
emissions rate of 85 grams per mile, down from 192 grams for current
model year 2024 vehicles. In other words, the final rule aims for a 50
percent EV sales target by 2030 compared to the 67 percent EV sales
target by 2032 from the proposed rule. While the final rule does not
mandate any particular technology to meet the new tailpipe emission
standard, auto manufacturers are expected to comply by significantly
ramping up the manufacture of EVs. The EPA estimates the final rule will
increase EV market share to 55 percent of all new cars sold nationwide
by 2032 while electric plug-in hybrid vehicle sales will increase to 13
percent over the same period, according to the agency. By contrast, in
2023 EVs made up just 7 percent of vehicle sales and plug-in hybrids
another 2 percent. Automakers were able to convince the EPA to relax
annual GHG reduction goals during the early part of the phase-in period
to give them more time to retrofit for EV manufacturing. The new GHG
standards for light duty cars and trucks comes just one year after the
EPA proposed GHG tailpipe emission reductions for heavy-duty trucks
through model year 2032. Under the proposed rule, the EPA projected 50
percent of heavy-duty vehicles, 35 percent of short-haul trucks and 25
percent of long-haul trucks would be electric by 2032. The heavy-duty
truck rule is expected out this Spring.
Congressional Republicans seeking to overturn the rule are already
sharpening their strategy. Sens. Pete Ricketts of Nebraska and Dan
Sullivan of Alaska said Wednesday that they plan to introduce
legislation to overturn the regulation. In addition, lawsuits by the
major refiners and some environmental groups may slow down
implementation of the stringent new GHG standards.
Earlier this year, EMA’s 48 state and regional trade associations, along
with the American Farm Bureau, American Fuel & Petrochemical
Manufacturers, API, Clean Fuels Alliance America, Growth Energy,
National Corn Growers Association, NACS, NATSO, Renewable Fuels
Association, SIGMA, U.S. Chamber of Commerce and several other
organizations urged the Biden Administration to reconsider its GHG
standards proposed rule for light and medium-duty vehicles for model
years 2027 and later. Unfortunately, the focus on EV production will
fundamentally eliminate an opportunity to provide clean green liquid
fuels such as renewable diesel, biodiesel, renewable gasoline, clean
hydrogen and ethanol that immediately lower emissions not only for new
vehicles, but for the vehicles currently on the road. In addition, the
rule will limit consumer choice on cleaner internal combustion engines
and threaten the viability and jobs of small business energy marketers
around the country. CLICK
HERE to read the letter.
Even though automakers are committed to boosting EVs, many of them, as
well as members on Capitol Hill, are raising questions about the Biden
Administration’s new approach, from securing critical materials needed
for EV batteries, to the availability of EV charging stations and the
ability of electric grids to meet power needs. China’s stranglehold on
the critical minerals industry and mining in Africa is a major
concern.
“Unfortunately, President Biden’s aggressive attempt to electrify the
transportation sector will limit consumer choice on cleaner greener
ICEs, increase Americans’ utility bills to subsidize a massive expansion
of the electric grid for EV charging and threaten the viability and jobs
of small business energy marketers around the country, whether they
deliver gasoline and diesel or renewable fuels like ethanol, biodiesel
and renewable diesel,” said EMA President Rob Underwood.
Legal Challenges Playing Out
EMA is part of business groups and States who have already asked the
courts to review EPA’s prior tailpipe emissions standards for model year
2025 and 2026 vehicles and the Agency’s reinstatement of California’s
Clean Air Act waiver to issue climate-based vehicle emissions standards.
Whether California can blaze its own trail on combatting climate change
also implicates the “major questions doctrine,” which holds that courts
should not defer to agencies on questions of “vast economic or political
significance” unless Congress has provided explicit authority to the
agencies. The appeals court will be asked to decide whether Congress
authorized California in the Clean Air Act to regulate vehicle emissions
to target a phenomenon like climate change which has a global cause and
effect.
Additionally, EMA joined as amicus curiae challenge to the National
Highway Traffic Safety Administration’s fuel-economy standards. EMA also
endorsed the American Fuel & Petrochemical Manufacturer’s (AFPM)
comments regarding EPA’s GHG standards for light-duty and medium-duty
vehicles for model years 2027 and later. EMA urged the EPA to consider
lifecycle emissions and a technology neutral approach when it comes to
promoting policies to reduce emissions. Click
here to read EMA’s comments and check out fuelmatters.org for more
information.
EMA Urges Senators to Approve Legislation to Delay CTA Filing Deadlines
This week, EMA joined 125 organizations, representing millions of small businesses, urging Senators to delay the filing deadlines of the Corporate Transparency Act (CTA) by passing S. 3625, the Protect Small Business and Prevent Illicit Financial Activity Act introduced by Senator Tim Scott (R-SC). The companion to this legislation (H.R. 5119), introduced by Representatives Zach Nunn (R-IA) and Joyce Beatty (D-OH), was adopted by the House on a bipartisan vote of 420-1 on December 12, 2023. As a reminder, under the CTA, companies must disclose the identities and other information about anyone who owns a stake of at least 25 percent or exercises significant control over the company. Existing companies have until the start of 2025 to file their disclosures.
Earlier this month, a U.S. District Court judge in Alabama has ruled that the Corporate Transparency Act (“CTA”) Beneficial Ownership final rule is unconstitutional because it “exceeds the Constitution’s limits on the legislative branch” and fails the “necessary and proper” test. The plaintiffs in this case, the National Small Business Association and one of its members, sued in November 2022, seeking a permanent injunction against the implementation of the CTA reporting rules. For now, however, the injunction only applies to the plaintiffs in the lawsuit. All other reporting companies (who are not plaintiffs in this case) are still bound by the CTA and should continue to comply for now.
This decision will not be the end of the matter. EMA expects the U.S. government will appeal the decision to the Court of Appeals for the Eleventh Circuit. Marketers should understand that court cases can be lengthy and uncertain processes, and this could easily be overturned by the Eleventh Circuit.
The S. 3625 one-year delay of the CTA’s filing deadline would 1) allow the court process begun with the decision in National Small Business Association v. Yellen to work its way through the Appellate and Supreme Courts, 2) be consistent with congressional intent to give covered entities two years to comply with the CTA’s reporting requirements, and 3) provide the business community and the Financial Crimes Enforcement Network (FinCEN) additional time to educate millions of small business owners regarding the new reporting requirements and the onerous penalties resulting if they fail to comply. To read the letter, click here.
As Congress never turns in its homework early, this week, House and Senate Leadership finally concluded negotiations on FY 2024 appropriations. Earlier today, the House passed a six bill package under suspension, sending it to the Senate for final passage. Suspension allows House members to pass a bill with a “aye” or “nay” vote without recording the individual votes. This bill largely adheres to the funding levels agreed to in last summer’s Biden/McCarthy debt limit agreement and will fund the government through September. Among the provisions of interest to EMA are the $25 million increase to LIHEAP funding, bringing the FY 2024 number to $4.025 billion. In addition, this year’s bill includes language from last year that aims to alleviate recipient concerns across fiscal years, instead ensuring that for the most part, funding levels do not drop below 97 percent of the prior fiscal year. With passage of this package of legislation expected shortly, the FY 2024 funding process will be completed (albeit 6 months late), and the FY 2025 will immediately begin in earnest.
This is not, however, the only bill being considered today, as the House will also vote on H.R. 1023, the Cutting Green Corruption and Taxes Act, which was introduced by Rep. Gary Palmer (R-AL). If passed, this bill would repeal the $27 billion Greenhouse Gas Reduction Fund, which was created by the Inflation Reduction Act. Unlike the appropriations package, while this bill will likely pass the House today along party lines, we do not expect it to pass the Democratically controlled Senate, and this assumes Leader Schumer will allow the legislation to be heard on the Senate floor. Further, given that it’s a part of one of President Biden’s signature legislation, he would likely veto the legislation if passed. However, House passage indicates the Republican majority’s position and telegraphs more of what may come if the Republican party gains control of the White House and Senate in November.
House Committee Passes Revision of the NAAQS Process
On Wednesday, the Energy and Commerce Committee advanced 28 bills to the Full House regarding supporting patients, securing communications infrastructure from adversaries, and furthering American energy and environmental leadership. Of interest for marketers is H.R. 7650, The Air Quality Standards Implementation Act of 2024, which was led by Rep. Buddy Carter (R-GA), and was reported to the Full House, without amendment, by a roll call vote of 26 Yeas to 21 Nays.
H.R.7650 would revise the National Ambient Air Quality Standards (NAAQS) process in several keyways. The bill would extend the current NAAQS review cycle from five years to ten years, require EPA to consider attainability of tighter standards, add more State air pollution control agencies to the scientific advisory committee CASAC, and require CASAC to consider economic and energy effects of tightening the standards in addition to health effects. Unfortunately, the democratic controlled Senate is not expected to consider the legislation.
EMA Washington Conference and Day on the Hill – May 15-17, 2024: Please Make Your Hotel Reservation and Register Now
EMA’s annual Washington Conference and Day on the Hill will be held
in Washington, DC from May 15-17 at The Mayflower
Hotel. Our industry continues to have many important legislative
and regulatory issues to discuss and the Day on the Hill remains the
primary focus of this conference for you to meet with your members of
Congress and network with other marketers from across the country!
Hotel reservations will close the earlier of April 23 6:00pm
Eastern or when the room block is sold out.
Tuesday night sold out on February 16, 2024.
EMA Room Block is
95% sold out! Thursday night is almost sold out. Please refer to
Additional Hotel Information #3
here.
Registrations must be received by April 26 to be included in
our hotel guarantee.
CLICK HERE FOR INFORMATION ON EMA’S DC CONFERENCE |
Continue to Urge Congress to Support the Credit Card Competition
Act!
EMA continues to urge all jobbers and retailers to reach out to their Senators and ask them to VOTE YES on the Credit Card Competition Act. This bill would reduce swipe fees and allow retailers a choice of network to handle the transaction through competition which would save Americans and businesses around $15 billion in swipe fees per year. Our industry’s share of that comes to around $9,000 per store per year.
CLICK HERE TO URGE SENATORS TO SUPPORT THE CREDIT CARD COMPETITION ACT |
Federated Insurance: Risk Management Corner
Hiring the Right Person for Your Business
When it comes to hiring new employees, you want the best
to represent your company and work with your current team. Knowing that
a poor hiring decision can result in costly replacement expenses, strain
on management, and diminished morale among current employees, it’s
important to thoroughly vet new hires to ensure they are the right fit
for your business.
To read the article in its entirety, please click here.
Please always feel free to contact your Federated regional representative or EMA’s new National Account Executive Patrick Cunningham at 507.455.8935 for any additional information or risk management questions. Federated is a Partner in EMA’s Board of Directors Council.
At Federated Insurance, It’s Our Business to Protect
Yours®
This article is for general information and risk prevention
only and should not be considered legal or other expert advice. The
recommendations herein may help reduce, but are not guaranteed to
eliminate, any or all risk of loss. The information herein may be
subject to, and is not a substitute for, any laws or regulations that
may apply. Qualified counsel should be sought with questions specific to
your circumstances. © 2024 Federated Mutual Insurance Company.
Weekend Reads
Hertz
CEO Stephen Scherr resigns after EV push goes bust | Fox Business
(Video)
Maine
board rejects mandate to boost electric vehicle sales by 2032 | Portland
Press Herald
New Report Pegs Cost of Electrifying U.S. Commercial Truck Fleet at $1 Trillion
As Electric-Vehicle Shoppers Hesitate, Hybrid Sales Surge | Wall Street Journal
Shell
to unload 1,000 retail locations in pivot to EV charging
'We
should abandon the fantasy of phasing out oil and gas': Saudi oil CEO |
CBS News
EMA Member Services Spotlight Featuring: Batteries Plus
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Sign up with NPP for free to activate this offer and many more. NPP is a member benefit provider of EMA, offering savings on products and services that businesses and employees use every day.
Restrictions may apply. See www.mynpp.com for details.