In a much-awaited release, the EPA published Administrator Stephen Johnson’s formal rationale for denying California’s waiver application under Section 209(b) of the Clean Air Act on Friday, February 29.

“I have concluded that section 209(b) was intended to allow California to promulgate state standards applicable to emissions from new motor vehicles to address pollution problems that are local or regional. I do not believe section 209(b)(1)(B) was intended to allow California to promulgate state standards for emissions from new motor vehicles designed to address global climate change problems; nor, in the alternative, do I believe that the effects of climate change in California are compelling and extraordinary compared to the effects in the rest of the country.” (emphasis added)

The decision indicates that California could not meet its statutory burden, primarily as a result of the global - rather than local - nature of climate change. All of California’s previous waiver applications focused on local effects of air pollution (e.g., attempts to reduce smog); with greenhouse gas emissions, however, the location of the emissions source is irrelevant to the impact on the increase in the atmospheric concentration of carbon dioxide.

A significant portion of the decision is spent detailing the relationship of the impacts of climate change in California to impacts on the rest of the country, eventually concluding that they are “not sufficiently different to be considered ‘compelling and extraordinary conditions’ that merit separate state GHG standards for new motor vehicles.” This was based on comparing California to the rest of the country as a whole, rather than to individual states, despite the fact that “proponents of the waiver claim that no other state experiences the impacts in combination as does California[.]” California sued the EPA to overturn the denial (which was originally announced in December 2007), and this basis of comparison is likely to play a significant role in the forthcoming litigation.

Earlier this week, Representative Dingell, Chairman of the Energy and Commerce Committee, stated in a White Paper that “motor vehicle greenhouse gas standards should be set by the Federal Government, not by State governments . . . .”

Perhaps the most compelling portion of the decision is found in an early footnote. In the April 2007 Supreme Court case Massachusetts v. EPA, the court remanded the case to EPA to determine whether greenhouse gas emissions endanger public health or welfare. No decision has been reached yet on the remand. If the agency does find such an endangerment, it will be required to regulate greenhouse gas emissions from new motor vehicles.

In a footnote to the decision, Administrator Johnson notes that “[t]his document does not reflect, and nothing in this document should be construed as reflecting, my judgment regarding whether emissions of GHGs from new motor vehicles or engines cause or contribute to air pollution ‘which may reasonably be anticipated to endanger public health or welfare,’ which is a separate question involving different statutory provisions and criteria; nor should it be construed as reflecting my judgment regarding any issue relevant to the determination of this questions.”

Readers are left to speculate whether this footnote is an indication that a decision on the remand, which was supposed to be reached before the end of 2007, will be coming soon, and whether this means that the agency will reach a negative determination, thus sparing itself from regulating auto emissions. The EPA has been hostile to regulating auto emissions previously, a decision that was the genesis of the original Mass. v. EPA suit. If this footnote is indeed prophetic in this manner, it will likely become the most significant part of the decision. ClimateIntel.com will analyze future impacts of this decision, including the issue of federal preemption of greenhouse gas regulation.

For further information about this topic, please contact Akin Gump.