Appellate judges skeptical of industry attack on tailpipe rules

By Jeremy P. Jacobs | 01/09/2015 01:29 PM EST

Federal appellate judges appeared reluctant today to side with industry challengers to the Obama administration’s landmark fuel efficiency and greenhouse gas emissions standards for cars and trucks.

The consolidated — and complicated — cases seek to undermine U.S. EPA’s and the National Highway Traffic Administration’s first-ever nationwide program for cars and heavy-duty trucks.

In one, California trucking companies, led by Delta Construction Co. Inc. and trade associations, want to undo the September 2011 standards for heavy-duty engines, which range from large pickups to the largest sleep-cab tractors. They argue that they cannot afford the engines mandated by the so-called truck rule.

Separately, Delaware-based biodiesel engine and fuel manufacturer Plant Oil Powered Diesel Fuel Systems, or POP Diesel, claims EPA failed to adequately consider life-cycle greenhouse gas emissions and should have given its engines the same status as electric vehicles.

It argued that the rules effectively prohibit the company from bringing its product to market because it won’t qualify for fuel credits.

And in another case, largely the same California companies are asking the court to throw out EPA and NHTSA’s standards for cars or light-duty trucks. The standards are commonly called the car rule.

In all the cases, the challengers ran into the same procedural hurdle at the U.S. Court of Appeals for the District of Columbia Circuit: whether they have standing to bring their cases.

The three-judge panel voiced several problems with the California trucking companies’ arguments, in both the car and truck rule challenges.

Their chief concern was that the arguments challenged only EPA’s rules. Even if the court were to throw them out, they said, NHTSA and California’s nearly identical rules would remain in place. Therefore, said Judge David Tatel, a Democratic appointee, the court wouldn’t redress the companies’ reason for bringing the case.

Department of Justice attorney Michele Walter attempted to hammer home that point.

"Even if the court were to vacate EPA’s standards," she said, "the NHTSA regulations would still exist."

With regard to POP Diesel’s case, Senior Judge Harry Edwards, another Democratic appointee, cited D.C. Circuit precedent that held that a company in similar position is outside the "zone" or "class of litigants" that the law envisioned could bring such a case.

Further, DOJ attorney Daniel Dertke argued that POP Diesel, which makes an add-on engine that allows diesel vehicles to run on an entirely plant-based oil fuel, only sells an engine for model years 2008 and 2009, which aren’t part of the fuel efficiency standards. Therefore, he said, the rules in question don’t apply to POP’s business at this time.

Taken together, the rules are among the most significant efforts by the Obama administration to address global warming. Cars emit nearly 60 percent of all mobile-source greenhouse gases, and the May 2010 car rule will reduce those emissions by 960 million metric tons.

Similarly, trucks account for nearly 19 percent of all mobile-source greenhouse gas pollution, and EPA estimates the rule will save approximately 22.1 billion gallons of gasoline and diesel over the lifetimes of model 2014 through 2018 vehicles. It will result in the reduction of 273 million metric tons of carbon dioxide.

California, Illinois, Iowa, Maryland, Massachusetts, New York, Oregon, Vermont, Washington and New York City intervened on EPA’s behalf in the challenge to the truck rule.

In the car rule case, the same trucking companies and associations also raised a procedural issue. They contended that EPA had violated the law by not submitted the rules to its Science Advisory Board for input before finalization.

DOJ’s Walter contended that if the court were to reach that argument — meaning the court found the companies to have standing — EPA should still prevail.

She said the oversight amounted to "harmless error" and that there is nothing to suggest that the board would have recommended any substantive changes to the standards. Further, the challengers, she said, have not suggested any components of the rules — cost, technical or otherwise — that they believe the board would have changed.

Rulings in Delta Construction Co., Inc. v. EPA and California Construction Trucking Association v. EPA are expected by next summer.