Plug In America: California Created Giant Loophole in New Electric Car Rule

By · January 30, 2012

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Plug In America says CARB chairwoman Mary Nichols would not allow discussion of a loophole in its new zero-emissions rules.

Many environmentalists and electric car fans cheered last week when California adopted new rules that require 15 percent of all cars sold in the state to be electric, plug-in hybrid, or hydrogen-powered by 2025. Even automakers were onboard. But the devil is in the details, and some plug-in car advocates believe the California Air Resources Board simultaneously engineered a positive spin on the rules—while creating a giant loophole allowing more modest gains in electric car adoption.

“Unfortunately, the California Air Resources Board, and particularly CARB chairwoman Mary Nichols controlled the spin battle on this one,” said Jay Friedland, legislative director for Plug In America, an electric car advocacy group. Friedland is referring to a so-called “greenhouse gas overcompliance provision,” which allows automakers to only produce about half the number of required pure electric cars it needs to produce between 2018 and 2021 under the new rule—in exchange for reducing the carbon emissions from its entire fleet by 2-gram-per-mile beyond targets.

“Honda, Hyundai, and Toyota are once again trying to game the system,” said Friedland. “CARB has let them off the hook just we see the great progress being made by Nissan, GM, Ford, Mitsubishi, Tesla, Coda, and other automakers truly committed to building a sustainable business around electric vehicles. The GHG overcompliance provision is a bad deal for California and for the United States."

Meanwhile, the oil industry, automakers and some environmentalists—strange bedfellows—praised the ruling. “The most heartening aspect of this process is how far we’ve come. The level of consensus is the highest I’ve ever seen,” said Cathy Reheis-Boyd of Western States Petroleum Association, in an interview with Christian Science Monitor. Auto companies “have seen the handwriting on the wall," she said. "This really is a whole new chapter with the car in California, the US, and across the globe.”

“This is a very powerful and history-making moment in which California is pushing the US and the world toward pollution-free cars,” said Vickie Patton, general counsel for the Environmental Defense Fund. “It’s a trifecta for America’s economy, competitiveness and security that depletes our dependence on foreign oil, protects human health, and saves families money during a devastating economic downturn.”

No Discussion Allowed

Plug In America, the most vocal group focusing on the loophole, accused CARB of railroading it through. “Mary Nichols would not even allow a vote by the Board on the GHG Overcompliance provision. Several Board members had asked for at least consideration of moving from 2-grams-per-mile to 5-grams-per-mile, but Ms. Nichols dismissed the issue and indicated she would not even consider it,” said Friedland of Plug In America, which represents the interests of rank-and-file electric car owners. “This will result in a gaping loophole, which will cause the loss of hundreds of thousands of plug-in cars in California.”

A number of environmental organizations, including the Union of Concerned Scientists, Natural Resources Defense Council and Sierra Club, had objections to the overcompliance provision. EV-producing automakers, including Tesla, General Motors and Ford, also expressed concern.

Most media and bloggers highlighted the 1.4 million potential number of electric cars by 2025—in California and other states that follow California's emission rules. However, for carmakers using the overcompliance loophole, that number could collectively be reduced by 400,000 to 500,000 between 2018 and 2021. “CARB is trying to have their cake and eat it too, by claiming the big number and waiving off the loophole as something carmakers won't take advantage of,” said Friedland. “It's also unfortunate that we have history on our side and CARB has consistently reduced goals over time, so I expect this to get watered down even more.” CARB is considered one of the culprits in the killing of the previous generation of electric cars, such as the EV1. The agency is also accused in 2008 of spinning that year’s version of the ever-changing Zero Emissions Vehicle requirements as a three-fold increase, which in reality decreased the requirements by 70 percent.

According to Plug In America, EV drivers and fans will have to wait another three years until the next CARB review to have input again.

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