Oil industry funding supports campaign to roll back fuel-economy rules


Exhaust emissions from tailpipe [photo: Simone Ramella, 2005, used under Creative Commons 2.0]

Exhaust emissions from tailpipe [photo: Simone Ramella, 2005, used under Creative Commons 2.0]

A new investigative report by the New York Times has revealed the puppeteer pulling the strings in the Trump administration's efforts to undo fuel-economy and emissions improvements: no surprise, the oil industry.

Backed by America's largest refiners and organizations tied to or funded by the Koch brothers, an underground network coordinated a lobbying, advertising, bill-drafting, and letter-writing campaign, centered around two main ideas, according to the Times report: that America no longer needs to conserve oil because, after the fracking boom of the early 2010s, the country is awash in cheap oil; and that support for electric cars limits consumer choice—i.e., the choice to buy large, gas-guzzling vehicles.

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The campaign also says that these choices shouldn't be made by unelected regulators either in Washington or statehouses.

The campaign's language, drafted in a memo circulated to lawmakers by the Koch-funded American Legislative Exchange Council, is echoed in the Safer Affordable Fuel-Efficient Vehicles Act, proposed by the EPA and NHTSA in August.

"With oil scarcity no longer a concern,” Americans should be given a “choice in vehicles that best fit their needs,” reads a draft of the memo quoted in the NYT.

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After the proposal was introduced, President Trump famously noted that the proposal would increase global greenhouse-gas emissions by only 0.02 percent over the six years the rule is in effect. What he didn't say is that that's the amount of annual emissions from a mid-size developed country.

In a response to the Times, a Koch Industries spokesman pointed to the company's "long, consistent track record of opposing all forms of corporate welfare, including all subsidies, mandates and other handouts that rig the system,” referring to tax credits for electric cars that were passed by Congress.

EPA Acting Administrator Andrew Wheeler

EPA Acting Administrator Andrew Wheeler

Perhaps he wasn't referring to tax incentives for oil companies, such as deductions for drilling wells, depleting oil and gas deposits (including in shale formations), exploration and development of shale oil and shale injection solutions, and domestic manufacturing for oil and gas production, which are reportedly worth $37.7 billion in tax revenue over 10 years. Funding for electric car tax incentives has been estimated at $200 million over 10 years.

The campaign also takes issue with California's ability to set its own emissions standards, which enabled the state to set quotas for electric cars to be sold there. Those mandates are followed by 12 other states. 

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In one of the Obama administration's first acts, it engineered an agreement among major U.S. automakers, the EPA and NHTSA, and the California Air Resources Board to agree on a common set of fuel-economy and emissions standards. 

Now that the Trump administration's new fuel economy proposal undoes that agreement, the automakers are balking and say the proposal goes too far, because it may require them to make separate fleets of cars for California and 13 other states that follow its lead on fuel economy and emissions standards. (Colorado, which recently joined the coalition follows those standards but not the electric-car mandate.) 

In a recent investor call, the CEO of Marathon Oil, America's largest refiner, was already counting the increased sales the company expects from the Trump proposal: 350,000 to 400,000 barrels of gasoline a day.

 
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