Northeast States Hit the Brakes on Carbon Emissions From Cars

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By Gerald B. Silverman and Adrianne Appel

Cars and trucks are the next target of Northeastern states, as they look beyond power plants to address climate change.

With the Trump administration walking back federal greenhouse gas limits for vehicles, Northeastern states are looking at own authorities to curb emissions from the second-largest source of climate pollution. Steps being considered would put more pressure on automakers to bring electric vehicles to the market and could include a cap-and-trade program for retail gasoline distributors modeled on a similar program in California.

“While Massachusetts has made significant strides to combat climate change, we must continue to work together across the Commonwealth and the region to achieve substantial emission reductions from every sector, including transportation, in order to chart a course that will ensure we can meet emission limits for 2050,” Republican Gov. Charlie Baker said in an Oct. 13 statement announcing a series of public hearings on transportation and climate change.

Though the federal government is considering easing greenhouse gas standards, the Northeastern states combined with California—all of which have long term goals to address climate change—carry enough clout that they might still drive automakers toward cleaner cars and trucks. The effort has a bipartisan thread in the Northeast with representatives of New York’s Gov. Andrew M. Cuomo (D) and Baker of Massachusetts discussing ways to curb emissions.

“If we get those two states to jump in, that will drive it for the region,” Daniel Gatti, a policy analyst for the clean vehicles program at the Union for Concerned Scientists, told Bloomberg Environment. “There’s real promise here.”

Would You Trade Pollution?

Transportation accounted for 44 percent of total carbon dioxide emissions among nine states in the Regional Greenhouse Gas Initiative, a pollution trading program for power plants. Those nine Northeastern states as well as California, which has also aggressively pushed for limits on vehicle emissions, account for 20 percent of all U.S. emissions from transportation.

But automakers fear a return to the Obama administration policies when California threatened to set its own vehicle emissions standards that a host of other states could adopt as well, creating a patchwork of regulations across the country and uncertainty for automakers.

“A single national program truly is in the customer’s best interest,” Wade Newton, a spokesman for the Alliance of Automobile Manufacturers, told Bloomberg Environment in an Oct. 5 email. “Consumer costs impact fleet turnover, which is critical to getting new fuel-efficient technologies out there.”

Gas Cap and Tax?

One of the options the nine states—Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont—are considering is a cap-and-trade program that would require fuel distributors to buy carbon allowances for their product.

Gatti estimated that the program could raise as much as $4.7 billion for East Coast states, but gas station owners say it would only drive up consumer costs.

“Motorists will always seek the lower cost for fuels. Bottom Line: a cap-and-trade program is essentially a hidden ‘tax’ on motorists which will result in higher prices at the pump,” Rob Underwood, president of the Petroleum Marketers Association of America, told Bloomberg Environment in an email.

Underwood couldn’t estimate what such a program would do for fuel prices in the Northeast, but he said the California Independent Oil Marketers Association had predicted an increase of 10 cents per gallon for gasoline and 13 cents for diesel under that state’s program.

Massachusetts must reduce greenhouse gas emissions from the transportation sector 3.1 percent by 2020 under its Global Warming Solutions Act. The state hasn’t released a plan for achieving that goal, but lawmakers are considering dozens of bills to reduce transportation emissions, including a tax on miles driven and a clean fuel standard like those in California and Oregon.

Cars With Less Emissions

New York and Massachusetts are already trying to encourage greater use of electric vehicles, regardless of what happens with a regional greenhouse gas program geared towards transportation.

New York provides buyers with a $2,000 rebate on the purchase of an electric car, under its $70 million Drive Clean Rebate program. Massachusetts offers a rebate of up to $2,500 to residents who purchase a new electric vehicle through a $12 million program funded through proceeds from the Regional Greenhouse Gas Initiative auctions.

Automakers are touting investments in electric vehicles and looking for state programs to help foster charging stations and other necessary infrastructure.

“There is a clear connection with states and local municipalities, who work closely with automakers and stakeholders to design financial and non-financial programs, and market adoption” for electric vehicles, Laura Toole, a spokeswoman for General Motors, told Bloomberg Environment in an email.

General Motors announced this month that it would launch at least 20 new all-electric vehicles by 2023, including two in the next 18 months.

“General Motors believes in an all-electric future,” Mark Reuss, executive vice president of product development, purchasing, and supply chain, said in a statement.

Ford also announced that it’s accelerating its work on electric vehicles and smart cars, creating a dedicated “electrification team” as part of the company’s promise to deliver 13 new electric vehicles over the next five years,

There are about 11,000 fully-electric vehicles on the road in Massachusetts, but it is hoping to increase that number to 300,000 by 2025, according to the state Department of Transportation.

Some 4,209 fully-electric cars were sold in New York this year, up from 2,609 last year, according to the governor’s office. As a result, carbon emissions would be reduced by 115,000 metric tons per year. New York also hopes to have 3,000 charging stations installed by 2018.

The transition to hybrid and electric vehicles is coming faster and sooner than expected as a result of regulations such as the federal corporate average fuel economy standards, which are currently being re-evaluated by the Trump administration, Emil H. Frankel, a senior fellow at the Eno Center for Transportation, said.

“Regulations are critically important in the absence of higher fuel prices,” he told Bloomberg Environment. “Regulation does incentivize innovation.”

To contact the reporters on this story: Gerald B. Silverman in Albany, N.Y., at GSilverman@bna.com and Adrianne Appel in Boston at aappel@bna.com

To contact the editor responsible for this story: Rachael Daigle at rdaigle@bna.com

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