- President Trump has announced a reversal of the ‘endangerment finding’
- This ruling found that greenhouse gases endanger public health
- Trump promises cheaper cars, but could increase cost of living
President Trump overturned a landmark ruling that found greenhouse gases endanger public health in a bid to lower auto prices and ease the burden of energy costs on American households.
According to the New York Times, for more than 17 years, the US Environmental Protection Agency (EPA) has relied on scientific findings to justify regulations that limit carbon dioxide, methane and other pollutants from oil and gas wells, tailpipes, smokestacks and other sources that burn fossil fuels.
Dubbed the “Danger Finding,” it was designed to reduce the effects of climate change and protect the health of American citizens and, possibly, the world’s population.
But this is not the view of President Trump’s current EPA administrator, Lee Zeldin. According to The Guardian, an emailed statement from a spokesperson said the hazard finding was used to “justify trillions of dollars in greenhouse gas regulations covering new vehicles and engines.”
The potential rollback of this policy is expected to increase the country’s greenhouse gas emissions by 10 percent over the next 30 years, according to the Environmental Defense Fund, an advocacy group. “We predict 58,000 premature deaths by 2055,” Peter Zalzal, a lawyer for the Environmental Defense Fund, told CNBC.
In addition to the possible effects on health and the global climate, the automotive industry is expected to face a long period of uncertainty. This compounds the earlier elimination of federal tax credits for electric vehicles, sales of which have fallen sharply, as well as the numerous trade tariffs President Trump has imposed, making it nearly financially impossible for some global automakers to export to North America.
However, the Trump administration claimed that ignoring the “hazard findings” would save automakers and other companies approximately $1 trillion, although it has declined to explain how it arrived at that estimate, according to CNBC.
Fuel prices rise, innovation stagnates
So what could the impacts be? First, eliminating emissions regulations could cause American automakers to reduce their spending on innovation and turn to polluting, less efficient vehicles. According to some industry experts, this would cause Americans to spend more money on fuel to complete the daily commute.
This increase in demand would lead to an increase in the cost of fuel, which could increase the profits of major oil companies by up to $1.4 trillion, according to Electrek.
At the same time, a reduction in incentives to innovate could cause the U.S. auto industry to fall further behind in the race to develop more efficient and environmentally friendly vehicles. This could greatly benefit China, which is already making progress in developing next-generation battery and hybrid technology.
Despite financially supporting the current administration, Elon Musk and his company Tesla have been vocal about the compromise finding, stating that it (and the vehicle emissions standards that follow from it) have provided a “stable regulatory platform for Tesla’s extensive investments in product development and production,” according to CNBC.
Currently, the company’s sales have stagnated around the world, and many claim that its lack of innovation has left it behind its rivals.
Electric Vehicle Adoption Is Actually Increasing
On the other hand, this historic policy change could actually increase demand for purely electric, hybrid, and generally more efficient vehicles, as American citizens flock toward models that could help reduce daily travel costs.
What’s more, states could step up and enact their own legislation that would overturn President Trump’s decision. California has been a champion of cleaner electric vehicle technology and overall reduction of greenhouse gas emissions at a more local level.
Due to the extremely sensitive nature of the automotive industry, most automakers build vehicles to the strictest emissions standards, rather than risk making a production line overly complicated and expensive.
This could mean that US-based manufacturers would produce cars based on the strictest standards in the strictest states.
Finally, automakers work with extremely long product development timelines, meaning this decision won’t immediately stop whatever is in the works. Electric and hybrid vehicles that hit the market in two or three years are still likely to do so.
“Even despite this, almost this war on electric vehicles — getting rid of subsidies, getting rid of regulation — I think it’s gotten to a point where you won’t see us fully pivot to electric vehicles,” Alan Jenn, a professor at the University of California, Davis Electric Vehicle Research Center, told CNBC.
Regardless, the Trump administration’s recent decision will likely lead to frustration in an industry that is currently undergoing arguably its most significant transition in 100 years.
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