EPA Finally Grants the California GHG Waiver

In the category of dog bites man, EPA today announced it was granting the State of California a waiver that will allow California to regulate greenhouse gas emissions from motor vehicles. The granting of the waiver was expected after Obama’s election and became pretty much inevitable after the administration announced in February that it was reconsidering the waiver request.

Substantively, it is not clear that the waiver matters that much, given the announcement on May 19 of the “grand bargain” among California, the federal government, and automakers to improve fuel economy nationwide. The real significance of today’s notice is that it is further evidence of a coordinated national strategy by the administration to address climate change. Although the administration has not yet finalized its endangerment finding with respect to GHGs, EPA’s notice today stated in part that California had a need to regulate GHG due to “compelling and extraordinary conditions”  resulting from the cumulative impacts of GHG on California and the US as a whole. Sounds like endangerment to me.

In other words, in light of the close vote in the House on the Waxman-Markey bill, interest groups on both sides of the bill should keep in mind their BATNA – one acronym that has stuck with me in 25 years since the Kennedy School – their best alternative to a negotiated agreement.  If there isn’t a bill, is there any doubt at this point that EPA will regulate GHGs on the basis of existing authority? Furthermore, is there any doubt that such regulations would be uglier, messier, more complicated, and less efficient than whatever might come out of Congress?

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