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Biden’s Ridiculous Electric Vehicle “Transition” Doesn’t Add Up

April 11, 2024 by Leave a Comment

According to the Environmental Protection Agency (EPA), its emissions tailpipe rule will reduce total greenhouse gas emissions over 2027 to 2055 by 7.2 billion metric tons. Applying EPA’s climate model, the rule would reduce global temperatures in 2100 by 0.0068 degrees Celsius — an effect far too small to be detectable, which is why EPA admits it “did not…specifically quantify changes in climate impacts resulting from this rule in terms of avoided temperature change or sea-level rise.” The media, however, continues to claim it is climate related, however, as NPR did in its reporting: “The regulations are a cornerstone of the Biden Administration’s efforts to fight climate change.”

Further, EPA’s climate model exaggerates the climate effects of reductions in greenhouse gas emissions, which means the temperature reduction would actually be less. For very little alleged or real impact, the Biden administration is pushing the U.S. auto industry into potential bankruptcy, which is why automakers like Ford, GM, and Stellantis are delaying their EV goals and scaling back on EV-related investments, a move that began during the 4th quarter of 2023 as faltering demand for electric vehicles set in and China’s BYD outsold Tesla in EV sales.

Ford Motor Company announced it would delay introduction of new all-electric SUV and pickup models, and turn its focus instead to development of hybrid vehicles that American consumers might want to purchase. Its launch of three-row electric vehicles has been delayed from 2025 to 2027 and it is also delaying its EV truck deliveries until 2026, which was initially slated to begin in 2025. The additional time will allow for the consumer market for three-row electric vehicles to further develop and enable Ford to take advantage of emerging battery technology, with the goal to provide customers increased durability and better value. Ford is still continuing preparations, albeit more slowly, for the market launch of its all-new three-row electric vehicles at its assembly complex in Oakville, Ontario, for 2027.

Ford ranked second in EV sales during the first quarter of this year behind Tesla, but in overall sales ranked third. Despite that EV ranking, Ford expects that its EV division will continue to lose money—up to $5.5 billion in 2024, although that is more than offset by the money it expects to make selling commercial vehicles and gasoline-powered vehicles. Ford had to drop prices on its electric F-150 pickups — by $10,000 — in the hopes of finding buyers.

Even Tesla is making changes as the global EV market develops. Despite being the largest EV brand in the United States, it saw an 8.5 percent decline in deliveries in the first quarter 2024 and a massive overproduction glut that has led to another round of price cuts for vehicles in its inventory. It has also apparently canceled its long-promised inexpensive car that was to hit the assembly line in the second half of next year. Model 2 was expected to start at about $25,000, but global competition from Chinese electric-vehicle makers flooding the market with cars priced as low as $10,000 made the Tesla inexpensive electric car an unworthy goal. Instead, Tesla will continue developing self-driving robotaxis on the same small-vehicle platform in Texas.

GM lost $1.7 billion in the fourth quarter last year on electric vehicles, while Toyota announced $30 billion in annual profits and credited it to the company’s decision to avoid pursuing fully electric vehicles.

Despite the losses on EV sales, EV sales in the United States grew in quarter 1, but only by 3.3 percent compared to a total growth in car sales of 5.1 percent. That compares to a 47 percent increase in U.S. EV sales in 2023. Taxpayers are buying a lot of electric vehicles for government use, which may affect the numbers.

EPA’s False Accounting

EPA’s new federal legislation requires automakers to reduce the tailpipe emissions of new vehicles by around 50 percent from model year 2026 to 2032. In order to achieve this, EPA is targeting 35 percent to 56 percent of vehicles needing to be electric vehicles by 2032, and 13 percent to 36 percent needing to be plug-in hybrids by that date. EPA claims that the rule will yield “climate benefits” of $1.6 trillion, despite a near-zero effect on temperatures. To get to this value, EPA multiplies its estimated reductions in greenhouse gas emissions by the “social cost of carbon,” a fabricated number that supposedly measures damage caused by the emissions that is derived from an assumed extreme future emissions scenario. The social cost of carbon number is then used in EPA’s climate models that overstate the actual satellite temperature measurements by a factor of about 2.5.

EPA also claims fuel savings of about $30 billion annually as a benefit of the regulation. It does this so that it can ignore the flaws electric vehicles have in range, refueling time, resilience in the face of temperature and weather fluctuations, et cetera. Because of the projected fuel savings, EPA speculates people will drive more, thus receiving “drive value benefits” of an additional $2 billion per year.

EPA’s analysis also claims that if EV owners charge their vehicles when electricity demand is low, recharging costs for electric vehicles will be reduced even more, and “the overall costs of electricity generation and delivery to all electricity rate payers, not just those charging electric vehicles” will be reduced. EPA ignores the massive additional costs of the Biden administration’s electricity transition to wind and solar technologies and its electrification of everything, as well as rapidly increasing electricity prices.

Further, EPA evaluates future benefits and costs relative to those that would occur soon by using discount rates of 2 or 3 percent rather than an annual rate of about 7 percent, which was the normal rate that federal agencies had applied for decades. As Ben Zycher notes in his article, “The Biden administration has mandated the use of an artificially low discount rate across all agencies, introducing a huge bias in favor of government regulation, distorting the allocation of capital between private investment and that driven by regulatory requirements.”

Conclusion

EPA’s emission tailpipe rule will only reduce global temperatures in 2100 by 0.0068 degrees Celsius, but the agency refrains from reporting this figure in its public analysis as Americans would question the cost and the inconvenience of the transition to drivers and taxpayers if it were reported. Further, EPA’s analysis is filled with assumptions and dishonesty about the benefits electric vehicles will achieve.  It uses a fabricated social cost of carbon figure to arrive at its results, assumes low recharging costs, ignores the costs of Biden’s energy transition and electrification of everything and uses low discount rates for evaluating future benefits and costs. Americans should not be fooled by Biden’s push to electric vehicles. If Americans found them beneficial for their lifestyle, they would be buying them rather than gas-fueled vehicles. Yet, sales of gas fueled vehicles still dominate the market and traditional automakers are delaying their forays into the all-electric world.

billions.

*This article was adapted from content originally published by the Institute for Energy Research.

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Biden’s Inflation Act Sending Endless Subsidies to Dem’s Favorite “Green” Companies

April 11, 2024 by Leave a Comment

A major flaw in the Inflation Reduction Act (IRA) is that there is effectively no cap on the tax subsidies that President Biden provides to his favorite “green” technologies. Despite more than four decades of subsidies for wind and solar technologies, the IRA continues to subsidize these technologies as if they were still emerging, which they are not. As Biden continues handing out taxpayer funds that promote these technologies, their intermittent production is causing instability to the electric grid and retirements of reliable coal, natural gas and nuclear generators as their reduced generation time no longer allows them to recover their costs. Further, with the radical push for wind and solar deployment, the United States is pouring money into China, who dominates the global market of solar panel exports and the critical minerals needed for wind and solar technology production.

Further, the taxpayer-funded tax incentives for Biden’s green technologies could increase even more as his Environmental Protection Agency (EPA) introduces regulations that push for even more wind and solar deployment and electric vehicle sales. The recently finalized tailpipe emissions rule and proposed power plant rule force greater adoption of these tax credit‐​eligible technologies. And these regulations keep coming with the latest rule dealing with forced sales of electric delivery trucks and semis. The Biden Administration is breaking its promise that the bill would cost $369 billion by expanding its application in ways estimated by some to now exceed $1 trillion.

Massive IRA Subsidies for “Green” Technologies

Since IRA’s passage, the estimated cost of its energy tax credits has increased dramatically. At the time of passage, CBO and the Joint Committee on Taxation (JCT) estimated the IRA’s energy and climate spending and tax breaks would cost about $400 billion through Fiscal Year 2031 and would be more than fully offset by other parts of the law. Estimates now show that due to higher projected deployment, the cost of the IRA tax credits would be greater and could be three times larger than initially projected. An April 26, 2023 estimate by the Joint Committee on Taxation (JCT) indicated the cost of the IRA tax credits would be $515 billion from 2023 through 2033. The Committee for a Responsible Federal Budget estimates that energy-related provisions from the IRA will cost almost $870 billion through 2031, more than double the original $400 billion estimate or $1.1 trillion through 2033. An April 2023 Goldman Sachs report estimated that the IRA “will provide an estimated $1.2 trillion of incentives by 2032.”

The FY 2024 budget, which did not incorporate the IRA, projected energy tax credits would cost $145 billion between 2023 and 2032. The FY 2025 budget projects a cost of almost $1.1 trillion over the same period, implying the IRA energy tax credits will cost $907 billion over that time. The figure below shows the energy tax expenditure cost estimates by year from each budget.

Source: Cato Institute

The decreasing cost of the credits beyond 2030 is due to expiring provisions between 2027 and 2032 that Congress could extend and, in many cases, has historically done so. Other tax credits, such as the energy production tax credit, phases down based on a greenhouse gas emissions target which is unlikely to be hit in the next several decades, meaning the tax credits could be uncapped indefinitely.

At peak cost, the energy credits cumulatively reduce revenue by $185 billion a year, implying a ten‐​year cost of more than $1.8 trillion. The table below summarizes the major energy tax credits and their costs at various points in time.

Source: Cato Institute

Conclusion

The value of the energy tax credits in the IRA is growing as Biden’s favorite “green” technologies are forced into the market by more and more regulations and the massive incentives provided by the IRA and other Biden legislation are encouraging companies to invest. For example, Warren Buffet has acknowledged that wind energy projects are not economically viable without government tax credits. He stated, “…on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”  Despite Buffet making that statement a decade ago and wind production now capturing a 10-percent share of electricity generation, the federal subsidies persist, the U.S. grid becomes more unreliable, and electricity is more expensive for Americans, with residential rates increasing 28 percent since 2014. The worse absurdity is that the total cost of energy credits in the IRA is an unstable amount costing taxpayers trillions with effectively no cap, persisting for decades unless the legislation is repealed.  It now looks as though the Inflation Reduction Act was sold to Congress under a false premise about its limited costs and those costs are now multiplying because of deliberate actions of the Biden Administration.

*This article was adapted from content originally published by the Institute for Energy Research.

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The Unregulated Podcast #177: Money Out The Door

April 11, 2024 by Leave a Comment

On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss what spiraling inflation means for the upcoming election, recent happenings on Capitol Hill, and some not-so-good news on the future of Biden’s all EV dream.

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Biden Blocking Mines Needed For His Green Dream

April 9, 2024 by Leave a Comment

The United States could be a major global lithium producer if it were not for policies and regulations by the federal and state governments, which are hampering efforts to break China’s control of the critical minerals sector. Global lithium demand is expected to outpace supply by 500,000 metric tons annually by 2030 due to the push for a “clean” energy transition. Unless the United States can increase its lithium production, the country’s manufacturers will be reliant on China and others for supply as the end of the decade approaches. According to the U.S. Geologic Survey, identified lithium resources in the United States—from continental brines, claystone, geothermal brines, hectorite, oilfield brines, and pegmatites—total 12 million tons, out of 98 million tons worldwide, but the United States is still dependent on imports for over 25 percent of its needs. This number will grow as battery use grows to meet the Biden Administration’s drive for electric vehicles and the conversion of the U.S. electrical grid to one dependent upon intermittent and weather-driven renewable generation requiring backup.

Biden Administration Interferes with Critical Mineral Production

President Biden talks about wanting domestic production of critical minerals, but his administration has focused on making it more difficult to mine in the United States. It has revoked federal leases; used regulatory action to delay or revoke mining, air pollution, and water quality permits; and labeled a flowering plant “endangered” as ways to delay or cancel metal mines in the United States. Further, a study by finance company MSCI estimates that the majority of U.S. reserves for cobalt, lithium, and nickel are located within 35 miles of Native American reservations, causing a potential conflict with President Biden’s stated commitment to racial equity and “environmental justice.” In April 2022, the Department of Interior reversed a Trump administration decision that limited the scope of compensatory mitigation the Department could force upon projects on federal land as a condition of receiving a permit. Under the new guidance, opponents in the federal government could assess mitigation located far from the project, giving bureaucrats a blank check to request whatever they wish of a permit seeker with little controls or relationship to the project. Rather than rule on merits and science of a project, government agents are allowed to essentially require permit applicants to do “whatever the market will bear.” Details on two lithium mines pursuing development are below.

Ioneer Ltd.’s lithium mine in Nevada, which could supply 22,000 metric tons of lithium annually (enough for 370,000 electric cars), has seen increased costs as environmentalists claim the mine threatens Tiehm’s buckwheat, a rare flowering plant. While the Trump administration’s Interior Department refuted that claim, finding that it was actually squirrels who were threatening the buckwheat, environmentalists asked the Biden administration to list the buckwheat as an endangered species. Interior regulators subsequently proposed a listing to that effect. Ioneer changed its mine plan to avoid the buckwheat and has spent more than $1 million on botanists, greenhouses and related studies.

The Thacker Pass Lithium mine in Nevada could produce a quarter of today’s global lithium demand and support the production of batteries for up to 800,000 electric vehicles annually. It may be on track now that a judge dismissed challenges by a coalition of nearby indigenous communities, environmental groups, and a local rancher who argued Interior’s environmental review downplayed the likely effects on groundwater, streams, and a threatened species of trout and because of the mine’s location, which reportedly borders the sacred site of a massacre of more than two dozen Native Americans in 1865. The latest estimated total cost of phase one construction for the mine has been revised upward to $2.93 billion based on several factors, including the use of union labor for construction, updated equipment pricing and development of an all-inclusive housing facility for construction workers because of its remoteness. The company already spent $193.7 million on the project during the year that ended December 31 due to legal delays and environmental reviews. Mechanical completion of phase one is targeted for 2027 with full production anticipated sometime in 2028.

State Laws and Regulations Affecting Lithium Production

Across Texas, Louisiana and other mineral-rich states, developers are looking to mine lithium from salty brines in underground mines.  But, in many cases, it is unclear who owns the lithium in the brines, how the battery metal should be valued by regulators and who ultimately should pay to process it into a form usable by manufacturers.

For example, last year, the Texas legislature approved a law that instructed the state’s oilfield regulator to develop regulations for lithium extraction from brines. But the regulator, the Railroad Commission of Texas, has no timeline for when it will finish that task. The Commission plans to release its rules for public comment once they are formulated, after which the three commissioners will vote on them.

While the 1972 U.S. Clean Water Act gives Washington regulatory power over water extraction and reinjection across the country, state officials have autonomy to govern other parts of the process. Tetra has tested more than 200 brine samples from Texas, but so far has opted not to do business in the Lone Star State due to legal uncertainty.  Standard Lithium had drilled a Texas brine well with lithium concentrations nearly as high as those found in parts of Chile, which has the world’s largest lithium reserves, but Standard cannot produce the lithium until regulations are set.

In Oklahoma, which has several brine deposits, it is unclear who sets regulations dealing with lithium production. The Oklahoma Corporation Commission – which oversees oil and gas development – has no jurisdiction over lithium production and royalties, nor does the state’s Department of Mines.

In Utah, the state legislature and governor approved a bill last year to prevent water levels from dropping in the lithium-rich Great Salt Lake, which led Compass Minerals to abandon plans to produce lithium from the lake for Ford and disband its entire lithium team, as the regulatory risks had increased significantly.

In Louisiana, the lack of state guidelines is causing concerns that producers could trespass on neighboring land when they reinject brine after filtering out lithium. Reinjection is a key step to preserving underground water table levels. The Louisiana Department of Energy and Natural Resources does not have existing statutes related to lithium.

Water that is extracted alongside oil can contain lithium and can be sold for a profit. Oil companies for decades have paid to dispose of that water. With lithium demand increasing, landowners, oil producers, and companies that oversee water disposal are fighting over ownership. Last year, a Texas state appeals court ruled that COG Operating controls the water that it extracts alongside oil, but the ruling only applied to that specific case. Oilfield leases do not necessarily include clauses for who owns other minerals extracted alongside oil, generating questions as to whether lithium is covered by existing leases or if companies need to negotiate new contracts with landowners.

It is also unclear how lithium will be valued for royalty payouts given the cost for equipment to filter the battery metal from brine, which typically has no market value. In Arkansas, where Tetra, Exxon, Albemarle and Standard Lithium hope to produce the battery metal within a few years, state officials have been debating a royalty structure to compensate landowners since 2018. The state could charge different rates depending how much lithium is in a brine deposit. Albemarle, the world’s largest lithium producer with operations in the United States, Chile, Australia, China and elsewhere, plans to open a pilot facility in Arkansas by the end of the year, but is waiting to see how the Arkansas royalty situation evolves. Exxon also has not submitted a royalty proposal despite spending more than $100 million in Arkansas and on a Houston test facility as part of its attempt to produce lithium, but hopes the state’s royalty will be uniform across the state.

California, which has giant lithium reserves in its Salton Sea region east of Los Angeles, last year imposed a flat-rate tax for each metric ton of lithium, which has pushed back development of projects slated to supply General Motors and Stellantis. California’s governor and legislators have defended the tax as a necessary way to ensure all residents benefit from the energy transition, even though the tax goes to the government.

Nevada, which has the only commercial U.S. lithium operation – a small mine operated by Albemarle – has taxed minerals for more than 100 years, at a rate based on each facility’s revenue.

Conclusion

Federal and state laws and regulations, or lack thereof, are hampering lithium production in the United States, which is needed for Biden’s energy transition. Biden’s environmental reviews and permit approvals have delayed the development of lithium mines and caused their costs to increase. Mineral-rich states have not provided laws and regulations regarding lithium ownership, valuation, processing and royalties, delaying the development and production of lithium in their states. Industry analysts expect regulations to be eventually set in those states, but it is unclear when that might occur. In the meantime, U.S. manufacturers will be dependent on imports from China and elsewhere, to meet their lithium needs.

*This article was adapted from content originally published by the Institute for Energy Research.

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The Unregulated Podcast #176: Biden’s Bugaboo Boogaloo

April 4, 2024 by Leave a Comment

On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna cover a busy week of energy headlines and check in on the 2024 race for the White House.

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Biden Announces Diesel Truck Ban On Good Friday

April 2, 2024 by Leave a Comment

On March 29, 2024, Good Friday, Biden’s Environmental Protection Agency (EPA) rolled out its new electric truck mandate, which will require that electric semi-trucks make up an increasing share of manufacturer sales from 2027 through 2032, similar to its recent rule for passenger cars. EPA’s rule would effectively require electric models to account for 60 percent of new urban delivery trucks and 25 percent of long-haul tractor sales by 2032. The electric truck mandate is even more costly than Biden’s electric car mandate. The cost of electric trucks are typically two to three times more expensive than diesel trucks. Truckers will also have to invest $620 billion for charging infrastructure and it will likely cost utilities $370 billion to upgrade their networks. Replacing diesel trucks with electric will cost the trucking industry tens of billion dollars each year and truckers will need to pass these costs on to the customers–manufacturers and retailers, who will pass the higher costs on to Americans in higher prices for merchandise. Trucking is about to become much more expensive.

About 1.4 million chargers will have to be installed by 2032 to achieve the EPA’s mandate, about 15,000 a month. This will require major grid upgrades when there are shortages of critical components such as transformers. It could take three to eight years to develop transmission and substations in many places to support truck chargers. Despite Biden’s bill on infrastructure providing $7.5 billion for 500,000 chargers, only 7 have been installed in two years. Power generation and transmission will have to massively expand to support millions of new electric trucks. An electric semi consumes about seven times as much electricity on a single charge as a typical home does in a day. Truck charging depots can draw as much power from the grid as small cities.

According to EPA, its big-rig quotas are feasible because the Inflation Reduction Act (IRA) and 2021 infrastructure law include hundreds of billions of dollars in subsidies for electric vehicles. The subsidies include a 30 percent tax credit for charging stations, $40,000 tax credit for commercial electric vehicles, and a tax credit for battery manufacturing that can offset more than a third of the cost. Because IRA tax credits for electric trucks are not conditioned on the source of battery material, U.S. manufacturers will be dependent on China, the world’s dominant battery producer. China’s BYD, which overtook Tesla for the most electric vehicles sold, was California’s top-selling electric truck maker in 2022. Chinese green-technology manufacturers are flooding the U.S. market because of Biden’s mandates and subsidies, which are enticements for rapid deployment of electric vehicles and trucks.

U.S. truck manufacturers are pleading for more handouts, noting that the rule is challenging and will require more “incentives and public investment.” (Sounds like the offshore wind industry and solar power manufacturers.) Biden is using subsidies to justify a ridiculous mandate, which then causes companies to need and lobby for more subsidies, which come from taxpayers.

There Is a Long Way to Go to Reach the Mandates

Electric trucks make up less than 1 percent of U.S. heavy-duty truck sales, and nearly all those sales are in California, which heavily subsidizes and mandates their purchase. There are no electric long-haul tractors currently in mass production. Most electric trucks cannot go more than 170 miles on a charge. Electric semis require bigger and heavier batteries, which means they must carry lighter loads to avoid damaging roads. Fleet operators will have to use more trucks to transport the same amount of goods, which will increase vehicle congestion, especially around ports and distribution centers. EPA justifies its rule as reducing emissions in “environmental justice” communities near major truck freight routes, but electric trucks also produce more soot from their wear and tear on roads and vehicle braking.

By 2030 electric trucks are projected to consume about 11 percent of California’s electricity. Most trucks will recharge at night when solar power is not available since drivers want daylight hours for driving. Fossil fuels will either be needed to produce the electricity or trucks will be stranded.

Conclusion

Biden’s EPA is mandating emissions reductions from heavy trucks that is in essence a ban on new diesel trucks. It would dramatically accelerate the adoption of electric and other zero-emission heavy vehicles, from school buses to cement mixers. The rule covers over 100 vehicle types including tractor-trailers, ambulances, and garbage trucks. It progressively tightens emission limits across manufacturers’ product lines from the 2027 model year through 2032, leaving it to the manufacturers to decide their path to compliance, using hybrids, hydrogen fuel cells, electric or enhanced fuel efficiency for conventional trucks. For example, the rule would effectively require 60 percent of urban delivery trucks to be “zero-emission” by 2032. The transition to electric trucks has considerable challenges, including their high costs and the need for extensive charging infrastructure. The mandate is impractical as it is likely to strain small businesses, disrupt existing operations, and require massive additional subsidies from taxpayers.

EPA projects its rule will “avoid” one billion metric tons in carbon dioxide emissions from 2027 through 2055—about as much as the carbon dioxide emissions from China and India increased just in 2023. As such, the truck mandate will do nothing to reduce global temperatures, but will cost American consumers and taxpayers billions.

*This article was adapted from content originally published by the Institute for Energy Research.

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California Seeking Authority From Biden To Ban Diesel Trains

April 1, 2024 by Leave a Comment

Biden’s Environmental Protection Agency (EPA) has requested comments on a waiver sought by the California Air Resources Board to implement new proposed state regulations on freight rail trains that are stricter than the current national Clean Air Act standards. Under California’s proposed rule, starting in 2030, no train older than 23 years may operate in the state, despite locomotives usually lasting 40 years. The proposal also calls for increased use of zero-emissions technology to transport freight from ports and throughout railyards. Starting in 2030, half of all new trains must be ”zero-emission,” and by 2035, all new trains must be zero-emission. The rule would essentially guarantee all train fleets would be zero-emission no later than 2058. The proposal will also ban locomotives in the state from idling longer than 30 minutes if they are equipped with an automatic shutoff. If the waiver is approved by EPA, it will not only affect rail travel in California, but nationwide as well as the same locomotive is used across state borders. Comments are to be filed by April 22, 2024.

Because transitioning from diesel-powered trains to electric trains is prohibitively expensive, California will require all train companies in the state to set aside almost a billion dollars each starting in 2026 to fund an eventual transition to a battery-powered fleet. Locomotive operators would be required to deposit funds into a trust account based on their emissions in California, which can be used to invest in newer mandated locomotives or infrastructure. Train companies cannot fund the transition now because the technology for a completely battery-powered train does not exist. Freight trains are huge and heavy and must operate in the extreme cold and climb steep heights through mountains. Cold weather and steep inclines have proven to reduce the range of truck electric vehicles by half. It would be far worse for freight trains, which carry much heavier loads.

The damage from California’s freight rail regulation would be devastating. Since trains do not switch when crossing state borders, train fleets would be forced to update their entire fleet to make sure they complied with the ban on engines older than 23 years. Also, since almost all freight train companies operate in California, they would all be forced to start contributing almost a billion dollars a year to the mandatory transition fund. Since 40 percent of all long-haul freight traffic is delivered by train, it would mean price increases for almost all consumers. Finally, since an operative commercially available prototype does not exist, every train company would face regulatory uncertainty as the 2030 and 2035 fleet mandates kick in.

The waiver and the proposal in unnecessary as the national Clean Air Act standard for trains ensures that diesel freight is not contributing to bad air quality or other health concerns. U.S. rail can move a ton of freight nearly 500 miles on a single gallon of fuel, which is much cleaner than if the merchandise was moved by truck. Freight railways transport roughly 1.6 billion tons of goods nationwide across nearly 140,000 miles.

California is setting unrealistic targets and unachievable timelines that will undoubtedly lead to higher prices for the goods and services and fewer options for consumers. California is the nation’s largest agriculture producer, which means that increased costs for freight will drive food inflation, as well as goods coming from China that are imported into California ports.

Further, its push for a zero-emission transportation sector is useless since China is currently adding two new coal plants every week and is the world’s largest emitter of greenhouse gases. Rail accounts for only about 2 percent of the greenhouse gas emissions from the U.S. transportation sector. If President Biden is looking for an opportunity to lower prices for consumers, he should start by rejecting California’s freight rail waiver.

Conclusion

California started the EV car mandate that grew to 17 states and nationwide regulations when the Obama Administration granted California a waiver to set its own fuel economy standards. EPA also recently approved California rules requiring zero-emission trucks to make up between 40 percent and 75 percent of sales by 2035, depending on the type. California is now set to use the same ploy for rail, with a waiver application into the Biden administration that will let California set its own emission standards for locomotives that are designed to force electric locomotives to replace diesel. Because a locomotive is not switched across state lines, the locomotive mandate will be forced upon the rail industry nationwide, which will increase prices on consumers as 40 percent of U.S. freight is moved by rail. The California rail mandate clearly interferes with the interstate commerce clause in the Constitution that guarantees the free flow of commerce.

California’s rule will be expensive for rail companies and increased costs for them will mean higher prices for many goods that move by rail for Americans, who are looking for lower costs having been hit by Bidenomics and its inflationary effects for over three years.

*This article was adapted from content originally published by the Institute for Energy Research.

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AEA Statement on the EPA’s Heavy Truck Rule

March 30, 2024 by 1 Comment

WASHINGTON DC (03/29/2024) – Today, the Environmental Protection Agency (EPA) released the final version of their emission standards for heavy-duty trucks, which would impose significant reductions in CO2 emissions for heavy-duty trucks from the model year 2027 through 2032 as well as a push toward full electrification in later years.

An EPA analysis estimated the rule would result in truck makers needing to use battery electric or hydrogen fuel cell vehicles for anywhere from 10 to 40 percent of their fleet. A recent analysis from the Clean Freight Coalition estimated the infrastructure costs of electrifying the entire commercial truck fleet to be $1 trillion alone.

AEA President Thomas Pyle issued the following statement:

The EPA is setting unachievable emission reduction targets, this time targeting heavy-duty trucks which are responsible for an enormous portion of freight movement in the U.S. The technology needed to electrify the trucking industry is nowhere near ready, and this rule is setting us on a collision course for supply chain disasters.

By increasing the cost of shipping with this rule, the Biden administration is once again demonstrating their lack of concern for American families who have been hit hard by inflation and the onslaught of rules and regulations that are making it increasingly difficult to do business in the U.S.


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The Unregulated Podcast #175: The Last American

March 27, 2024 by Leave a Comment

On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss recent movement on Capitol Hill and cover a litany of headlines from a busy week in the beltway and beyond.

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The Unregulated Podcast #174: Chop Choppy

March 22, 2024 by Leave a Comment

On this episode of The Unregulated Podcast Tom Pyle and Mike McKenna discuss recent primary contests, Biden’s latest stories, and the EPA’s “not-a-ban” ban on gas powered vehicles.

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