Two Environmental Protection Agency (EPA) regulations that are currently being finalized will leverage the agency’s authority to regulate emissions in order to force the United States’ electricity network and automotive industry to shift production to wind and solar energy and electric vehicles (EV).
However, new EPA initiatives targeting the U.S. fossil fuel industry will face legal challenges that likely will find their way to the Supreme Court and might result in landmark decisions about separation of powers in the United States, and the extent to which federal agencies, instead of elected officials in Congress, can assume broad lawmaking authority.
The EPA argues that, since Congress gave it the power to regulate emissions, it’s simply carrying out that mandate. Critics say the agency has gone beyond regulating emissions to crafting a national energy policy.
Federal agencies such as the EPA “are way outside of their mandate set by Congress,” Joe Trotter, director of the American Legislative Exchange Council’s energy, environment, and agriculture task force, told The Epoch Times. “They do not, and should not, have the power to make huge sweeping changes to the American, and ultimately the global, economy through regulatory fiat.”
“The Biden administration has proposed tailpipe restrictions at levels that are so stringent that, by their own analysis, they can only be met if electric vehicles become the vast majority of cars sold in America,” O.H. Skinner, executive director of Alliance for Consumers, told The Epoch Times.
EVs are currently in demand by consumers who drive short distances, can charge them conveniently, and are wealthy enough to afford them. The average income of EV buyers is twice the median income in America, suggesting that EVs are the car of choice for rich Americans who live in or near cities.
“Rather than allow consumers to make choices, they’re just trying to force progressive lifestyle choices on everybody, no matter where they live, no matter how much money they make,” Skinner said. “It is very, very unpopular when you tell people they have to live life a certain way that doesn’t match how they want to live it. And I think even this administration recognizes that.
“So what they seem to be doing is demanding that manufacturers basically take away these choices. Their argument is, ‘We didn’t tell you you can’t buy a gas car, the manufacturers stopped making them.’”
The ‘Major Questions’ Doctrine
Challenges to the EPA’s authority to mandate such sweeping changes, which are currently moving through the District of Columbia Circuit Court, will ultimately hinge on the court’s interpretation of what is called the “major questions” doctrine. This doctrine, set down most notably in the 2021 Supreme Court ruling West Virginia v. EPA, states that questions of major importance to Americans must be decided by elected officials in Congress and not by federal agencies—unless Congress explicitly mandated that authority to an agency.Skadden argues that the Supreme Court’s “distrust of agency action, combined with its interest in reviving the nondelegation doctrine” will lead to more legal challenges against agency authority, “but the argument won’t always gain traction.”
Support for the “major questions” doctrine is now split along party lines, with Republicans in favor and Democrats against. In December 2022, 16 Republican attorneys general filed a brief in D.C. courts challenging EPA authority on vehicle emissions. By contrast, in February, 19 AGs from liberal states wrote in support of the EPA’s right to enact its new emissions standards on utilities.
Whether Congress gave the EPA the authority to set energy industrial policy or force an EV transition on automakers will be the essential question that judges will decide in coming months. The courts have ruled on many such issues during the Biden administration in response to the administration’s habit of scouring congressional mandates to find clauses that would give sweeping powers to federal agencies.
By its own admission, the Biden administration’s new auto emissions regulations are designed to boost the market share of EVs, effectively replacing internal combustion engines, although critics say that Congress hasn’t given the EPA authority to manipulate markets in that way.
EVs Could Be a Bad Bet for Carmakers
While challenges to the EPA regulations are likely from industry groups such as corn growers associations, which produce biofuels for internal combustion engine (ICE) vehicles, the auto industry thus far has been reluctant to “fight City Hall.” Analysts can only speculate on motives, but venture to guess that this may be because automakers don’t want to be seen as climate deniers, would rather leave the fight to others, or that they relish the federal and state subsidies for investments in new battery assembly plants.Whatever the case may be, the EV bet has proven costly for carmakers thus far.
“What we’re seeing is the Biden administration effectively trying to force automakers through regulation to produce more EVs, but there’s no evidence to suggest that consumers want to buy them,” Bryce told The Epoch Times. “We could be setting up a massive pileup here, with automakers spending billions to produce cars that the vast majority of consumers don’t want.”
In addition to betting on consumer demand that may not be there, automakers may be choosing a bad time to invest billions in new manufacturing plants.
A Retreat From Impossible EPA Mandates?
There is some speculation that automakers aren’t opposing the EPA rules because, given that they are impossible to meet, the limits and deadlines ultimately won’t be enforced.Noting that the EPA standards would require 67 percent of new cars to be EVs by 2032, the Cato report states that data from the Energy Information Administration projects that EV sales will still be less than 20 percent of the market by 2050. In addition to shortfalls in demand, the ability of carmakers to source the minerals they need to make EVs in such large numbers is questionable.
“It’s just not realistic to have all these goals happen the way they’re being laid out,” Trotter said. “You’ve seen huge increases in the prices of things like lithium, copper, and aluminum, which are all necessary to make electric vehicles. Far more of it is needed for EVs than for traditional cars.
“There aren’t huge increases in supply to make up for the increase in demand,” he said.
When policies such as the new EPA emissions standards prove impossible for companies to implement, Congress often “quietly” steps in, taking action such as cutting funding to specific agencies to “restrict their ability to implement unrealistic regulations,” the Cato report says.
“The retreat from unrealism will probably be quiet,” the report states.
“But if motorists can’t buy the cars they want, the retreat will be visible and rapid.”