Americans will pay more at the pump if Donald Trump succeeds in tossing out tailpipe pollution regulations, a new analysis shows. That’s on top of job and GDP losses that could result from stifling innovation in cleaner transportation.
The Trump administration wants to do away with the Environmental Protection Agency’s ability to regulate greenhouse gas emissions, policies that have encouraged carmakers to manufacture more fuel-efficient cars and electric vehicles over time. Trump has misleadingly cast the climate pollution standards as an “EV mandate” that would force consumers to buy more costly electric cars. But Americans could wind up paying up to $310 billion extra over the next 25 years without those rules, mostly in higher gasoline prices, according to a report published today by nonpartisan climate policy think tank Energy Innovation. Broken down by household, each household is likely to pay an average of $83 extra each year in energy costs over that time period.
It’s all pretty simple, really. Rolling back pollution standards stops people from adopting cleaner, more fuel efficient technologies. Burn more fuel, pay for more gas, live in a less healthy environment.
“This will have an adverse impact not just on the US economy, but at the household level, at the kitchen-table level.”
“When you are putting fewer efficient electric vehicles on the road, you’re also driving up demand for gasoline and diesel. And as a result of that, households are going to be paying more to drive,” says Sara Baldwin, senior director of electrification at Energy Innovation. “This will have an adverse impact not just on the US economy, but at the household level, at the kitchen-table level.”
Following evidence that planet-heating pollution endangers public health, the Environmental Protection Agency has regulated greenhouse gas emissions under the Clean Air Act. Automakers might meet those requirements by developing more efficient chassis, cleaner-burning engines, or designing and selling more electric vehicles. Then in July, the Trump administration proposed rescinding the scientifically backed endangerment finding, which would ultimately repeal greenhouse gas emission limits for vehicles. Today also marks the end of the Biden-era EV tax credit that Republicans voted to sunset early this year.
Energy Innovation modeled the potential impact of finalizing that proposal to get rid of greenhouse gas standards for cars and trucks (you can see how its open-source model works here). They take into account factors including rising electricity costs in the US and higher upfront costs for electric vehicles, neither of which are enough to wipe out the economic benefits that come with a cleaner transportation sector.
Pushing companies to design more efficient vehicles winds up pumping more money into the economy, perhaps going toward hiring more scientists or designing new chassis using new materials. “That money gets passed around the economy and that results in more jobs, both from the automotive sector [and] also in steel manufacturing and aluminum manufacturing,” says Dan O’Brien, a senior modeling analyst at Energy Innovation.
There’s less of that when automakers keep selling the same old gas-guzzlers rather than designing more efficient vehicles. Eliminating the greenhouse gas tailpipe standards could lead to cumulative losses in GDP of $710 billion by 2050, the report says. The labor force could also see 110,000 fewer jobs annually over the next 25 years compared to a future that keeps those standards in place. Then there are the health costs that come with pollution. While electric vehicles still create particle pollution from the wear and tear of roads and tires, getting rid of tailpipe emissions cuts carbon dioxide plus soot and smog-forming pollutants. Repealing the greenhouse gas standards could lead to as many as 700 pollution-related premature deaths per year, the analysis finds.
The report says that zero-emission vehicles would make up a smaller percentage of new car sales in 2035 if the greenhouse gas tailpipe standards are repealed; 55 percent of new light-duty vehicle sales by 2035 compared to 70 percent if the standards stay in place. With higher demand for oil inflating prices at the pump, Energy Innovation estimates a 6-cent-per-gallon increase in the price of gas by 2030, rising to 36 cents per gallon in 2040, and 31 cents per gallon in 2050. It all adds up over time; an average household could spend as much as $400 more on gasoline by 2043, according to Energy Innovation’s analysis.
The Trump administration has its own contested estimates of the economic impact of eliminating the endangerment finding based on limited data. The EPA analysis claims that repealing all greenhouse gas regulations — for vehicles, power plants, and everything else — would save $54 billion annually. But that doesn’t include costs incurred by the consequences of climate change. It also assumes lower gas prices and only takes into account two and a half years of fuel savings, Baldwin points out. Consumers are considering a longer timeline for fuel costs when buying a car, she says, and gas prices are subject to global market pressures beyond US control.
“To assume that we’re going to see lower gas prices in the future … when you’re increasing demand for that product, that just runs counter to what basic economics tells us,” Baldwin says.
