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    Schwarzenegger: California Will Sue Federal Government
    By Brian Todd and Dugald McConnell
    CNN

    Thursday 20 December 2007

    California Gov. Arnold Schwarzenegger plans to sue the federal government over its decision not to allow a California plan to reduce greenhouse gas emissions, he announced Thursday.

    Environmental Protection Agency chief Stephen Johnson announced the decision Wednesday, refusing the state's request for a waiver that would have allowed it to cut emissions faster than a new federal plan the president signed into law Wednesday.

    "It's another example of the administration's failure to treat global warming with the seriousness that it actually demands," the governor said at a news conference Thursday.

    Bush on Thursday defended the decision of his EPA administrator.

    "Is it more effective to let each state make a decision as to how to proceed in curbing greenhouse gases? Or is it more effective to have a national strategy?" he said.

    Citing the new energy law - which sets a fuel economy standard for the whole country - Bush said Johnson "made a decision based upon the fact that we passed a piece of legislation that enables us to have a national strategy."

    But Schwarzenegger said he would like to set a higher standard for California. "Anything less than aggressive action on the greatest environmental threat of all time is inexcusable," he said.

    The new federal law will increase fuel efficiency standards by 40 percent by 2020, requiring automakers to bring their fleets to an average of 35 miles per gallon.

    The California plan, however, would cut emissions by nearly 30 percent by 2016, raising fuel efficiency standards in the state to 43.7 miles per gallon for passenger cars and some SUVs and trucks, while larger vehicles would need to reach 26.9 mpg by that year.

    In all, 16 states had either adopted California's tough standards or announced plans to do so.

    A top aide to Schwarzenegger said the governor has been frustrated with the White House over emissions standards, and was very exasperated after a February meeting with Johnson.

    EPA officials say they went the extra mile with Schwarzenegger, even taking the unusual step of holding a second hearing in California on emissions. They say they're sorry he's upset, but they believe a national standard on emissions is going to be more effective.

    A White House official would only react to Schwarzenegger's frustration by saying the administration "looks forward to working with him on a variety of issues."

    In the ebb-and-flow relationship between Schwarzenegger and Bush, sources close to the governor say this is a low point.

    "It's never been a warm, throw-your-arms-around-the-shoulders kind of relationship," said former Schwarzenegger adviser Joel Fox. "Even during the re-election campaign for the president, he would come to California and the governor wouldn't always be there to greet him."

    Fox said Schwarzenegger and Bush have cooperated on issues like immigration, but the two have differed on several issues, including stem cell research funding, the expansion of the State Children's Health Insurance Program and climate change.

    "He's got a pretty strong personality, the governor has, and wants to get things done. If the federal government is one of those obstacles, then he'll run that tank he has over it. It's not particularly anything personal, I think."

    Schwarzenegger is much closer - personally and politically - to the president's father, former President George H.W. Bush, another aide said.

 

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    EPA Ruling Puts California in a Bind
    By Felicity Barringer
    The New York Times

    Friday 21 December 2007

    San Francisco - The decision by the Environmental Protection Agency to block California's air quality standards for motor vehicles evoked angry responses from state officials on Thursday and the threat of a court battle.

    But it also left California in a bind.

    Officials here must now look elsewhere for millions of tons of carbon-dioxide reductions to meet its self-imposed mandate for curbing heat-trapping gases like carbon dioxide. And by law, the motor vehicle industry is where they must look.

    The state enacted legislation last year requiring a cutback of 173 million tons of carbon dioxide by 2020, and officials had counted on the cutbacks in vehicle emissions for 18 percent, or about 31 million tons, of the total.

    Even when the emission reductions associated with the new federal gasoline-mileage standards are taken into account, the state is about several million tons short, thanks to the E.P.A.'s decision, according to a spokesman for the California Air Resources Board. But the Legislature had prepared for the possibility when it passed last year's Global Warming Solutions Act.

    Mary Nichols, the chairwoman of the Air Resources Board, which writes the state's air pollution regulations, said in an interview: "We are going to get them from motor vehicles one way or another. I expect we will win our lawsuit and get them from" the regulations that the Bush administration just blocked.

    "If not," Ms. Nichols said, "we will pursue other ways to get these tons in ways that don't derive from the Clean Air Act," and therefore do not require a federal waiver.

    But none of those ways are likely to be easy, cheap or popular.

    No decisions have been made, Ms. Nichols emphasized, but she said some options being considered included imposing fees or penalties to be paid by auto manufacturers selling cars that fail to meet specified requirements. Alternatively, she said, the state might fall back on the authority the federal government granted it more than a decade ago to create electric cars. Perhaps that authority could be used to wring emission cuts from new cars.

    Ms. Nichols said Gov. Arnold Schwarzenegger told her in conversations on Thursday that "we should applaud" Congress and the president for the fuel-economy standard that just became law. "But," she added, "it has nothing to do with the problem of global warming. The two things are in different worlds."

    Others spoke even more sharply.

    "Californians will realize again that maybe it's time to secede from the Union," said Hal Harvey, environment director for the William and Flora Hewlett Foundation.

    "This is the first time that federal government has attacked California rather than agreeing with it" on air pollution standards, said V. John White, a longtime clean-energy lobbyist in Sacramento. "They have become a hostile force as opposed to a partner. They are an enemy, and they prefer the interests of the auto industry over the interests of the health of our people and state."

    If the E.P.A. denies the waiver, California has three options, said Barton H. Thompson Jr., the co-director of the Woods Institute for the Environment at Stanford University.

    "One, you sue," Mr. Thompson said. "Two, you look for a legislative fix that would require Congress to clarify" that the Clean Air Act allows the state to regulate greenhouse-gas emissions from tailpipes. "Three, you wait for the next administration."

    "You are not going to get any relief from the courts any faster than that," he added.

    A lag of a year or two in carrying out the California standards represents a significant saving for the automobile industry, Mr. White, the clean-energy advocate, said. "This is fundamentally about delaying investment," he said.

    Jim Marston, a climate policy expert with Environmental Defense, said the industry might have second thoughts. "The automobile manufacturers may have violated the rule about be careful what you wish for," Mr. Marston said. "California is serious about its numbers. You can't get there if the biggest single source is exempted."

 

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    Denial of California Bid on Emissions Should Have Been Foreseen
    By John M. Broder and Micheline Maynard
    The New York Times

    Friday 21 December 2007

    Washington - The Bush administration's decision to deny California the right to regulate greenhouse gases from vehicles exploded like a grenade here and in California. But it was hiding in plain sight for weeks.

    The ruling was foreshadowed in White House letters, floor statements by members of Congress, public arguments from automobile industry officials and hints from the Environmental Protection Agency.

    Stephen L. Johnson, the environmental administrator, announced the decision on Wednesday, the day President Bush signed the first major change in vehicle mileage standards passed by Congress in 32 years.

    Mr. Johnson said the new law made the proposed California standards unnecessary.

    Addressing criticism that the White House had dictated the agency's decision, Mr. Bush emphasized on Thursday that the ruling had been made solely by Mr. Johnson, a 27-year employee of the agency. Mr. Johnson also said he had acted on his own.

    The ruling answered the pleas of industry executives. They reluctantly accepted the fleetwide standard of 35 miles a gallon by 2020, the centerpiece of the energy bill, but feared even tougher rules under the proposed California standard. Those rules would have required a fleet average of 36 miles a gallon by 2016.

    Automobile executives specifically cited apprehension over the California rules at meetings in October and November with Vice President Dick Cheney, other top White House officials and influential members of Congress.

    The White House, in a letter last week to lawmakers, said the energy bill should set a "single national regulatory standard," rather than allowing states to set their own rules.

    Senator Carl Levin, a Michigan Democrat and longtime ally of the auto industry, said in a floor statement that he was voting for the fuel efficiency measure based on assurances that it would not be "undercut" by future rules from the environmental agency on emissions of heat-trapping gases like carbon dioxide.

    The agency's decision faces legal challenges and Congressional reviews, and a new president could reverse it. But, for now at least, automakers gained something from the administration that they could not have obtained from Congress or the courts.

    They have blocked California and other states from creating what Mr. Johnson repeatedly called a "patchwork of state rules" for fuel efficiency and for the carbon dioxide produced by every internal combustion engine.

    Under the Clean Air Act, the automakers have for decades chafed under separate, tougher state standards for other tailpipe emissions like those that cause smog.

    The industry pushed for the new ruling as part of its overall lobbying on the energy bill, which also calls for a huge increase in ethanol and other biofuels over 15 years.

    In meetings in October with Mr. Cheney and sessions with White House staff members, auto executives made clear that they were concerned not just about the fuel economy measures in the bill but also about the California proposal for stricter emissions standards.

    California developed rules in 2004 to reduce tailpipe emissions of carbon dioxide and other pollutants that scientists say contribute to global warming. The state applied to Washington in December 2005 for a waiver from the Clean Air Act to let it apply the tougher standards. Eventually, 16 states joined the application for the exception.

    Since 1970, such waivers have been routinely granted more than 50 times involving tailpipe pollutants that foul the air in some states more than in others. But none faced the political atmosphere surrounding the California proposal, which dealt with a gas that affects the world climate, not that of a particular state.

    The environmental agency had two hearings on the waiver and received more than 100,000 comments. Insiders said the technical and legal staffs at the agency were never asked for formal analyses of the California plan, and no documentation was released with the ruling, as has been routine in waiver cases.

    Senator Barbara Boxer, the California Democrat who leads the environment committee, said she believed that the administration never intended to grant the state's request. Ms. Boxer said Mr. Johnson refused to meet her on the question and evaded questions about White House pressure at a hearing before her panel.

    She said the signing of the energy bill on Wednesday provided Mr. Johnson convenient timing and a rationale to reject the waiver.

    "They used the energy bill - I'd say misused it - as a way to justify what they wanted to do all along," Ms. Boxer said.

    Other lawmakers and environmental advocates expressed suspicion that the decision had been made weeks or months ago and pointed to White House statements raising questions about the fuel-economy measure as it moved through Congress.

    The White House expressed concerns that the bill did not clarify the relative roles of the environmental agency and the Transportation Department, which regulated mileage rules.

    A White House official, speaking on background last week, said it was critical that the new standard not be supplanted by a new program from the environmental agency or the states.

    "If Congress says they have to meet 35 by 2020, that's what it should be," the official said. "Not what it should be until someone says it's something different."

    Although the California rule would have addressed just emissions of heat-trapping gases, it would in effect be a fuel economy standard, because the main way to cut emissions is to cut fuel use.

    Auto company executives told the White House and sympathetic members of Congress that they feared that the fuel economy standards and the California waiver would force them to reduce emissions and raise fuel economy on a faster timetable than the energy bill that became law.

    "We had California, and we had all these other issues colliding into that," said a senior auto company official who insisted on anonymity. He called the California situation "one of our worry beads."

    Executives at two companies said they did not know the precise timing of the decision until Wednesday afternoon, when the White House made courtesy calls to members of Congress.

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    John M. Broder reported from Washington, and Micheline Maynard from Detroit.