Saying Bye-den to GHGs

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Today we’re talking about Biden’s latest move in bringing the US to a more sustainable future. This week, the President announced a series of new vehicle emissions standards focused on bringing down greenhouse gases - and it’s uncharacteristically aggressive for the US.

Uncle Sam’s Requests

Biden’s come out swinging with a whole list of changes projected to lead to a reduction of 10 billion tonnes of carbon emissions by 2055, the equivalent of two full years of emissions at today’s levels.

Who said Biden was soft on climate again?

Specifically, the proposed standards mean that two in every three new vehicles in the U.S. will have to be electric vehicles by 2032. To put it in to context, only 7% of current sales are EVs. Tesla bulls are foaming at the mouth…

Beyond this, there are additional requirements for the maximum emissions for medium and heavy trucks as well which is likely to heavily reduce scope 3 emissions (within supply chains) - if you want a refresher on what a scope 3 emission is, have a look at this post.

Impossible to Please

Despite a strong move on the part of the current administration, it looks like few are happy with the move.

While environmental groups have welcomed the effort, many argue that the proposal didn’t go far enough and could be too little too late.

On the other hand, Republican groups are arguing that the rules will make it harder for the average American to afford new vehicles.

As the disagreement goes on, The CEO of the Alliance for Automotive Innovation (aka the Big Car lobby) made a vague statement directing focus arguing that ‘Factors outside the vehicle, like charging infrastructure, supply chains, grid resiliency, the availability of low-carbon fuels and critical minerals will determine whether EPA standards at these levels are achievable.”

In other words - if we make money here, all good. If not, then it was your fault. Big Car has got it’s priorities all figured out.

Unlimited Money Machine

If the last year’s made anything clear, turning the money machine on isn’t as bullet-proof a strategy as it might seem. So how does the government justify these measures from a financial perspective?

The Environmental Protection Agency is predicting that the net benefits of the whole program range from $850bn to $1.6tn by 2055. So by spending up front, they’re expecting to heavily reduce future spending. On an individual level, by 2032 cars are expected to be an average of $1,200 more because of these policies but fuel and maintenance costs over the cars lifetime are expected to be $9,000 less.

This is a welcome move and demonstrates much-needed leadership from the US in the climate debate. Like most climate policy, however, people still disagree about what’s enough and what’s too much. If one thing’s for sure - it’s hard to keep everyone (anyone) happy.

‘Til next time

The Strawman