According to the Environmental Protection Agency (EPA), its emissions tailpipe rule will reduce total greenhouse gas emissions over 2027 to 2055 by 7.2 billion metric tons. Applying EPA’s climate model, the rule would reduce global temperatures in 2100 by 0.0068 degrees Celsius — an effect far too small to be detectable, which is why EPA admits it “did not…specifically quantify changes in climate impacts resulting from this rule in terms of avoided temperature change or sea-level rise.” The media, however, continues to claim it is climate related, however, as NPR did in its reporting: “The regulations are a cornerstone of the Biden Administration’s efforts to fight climate change.”

Further, EPA’s climate model exaggerates the climate effects of reductions in greenhouse gas emissions, which means the temperature reduction would actually be less. For very little alleged or real impact, the Biden administration is pushing the U.S. auto industry into potential bankruptcy, which is why automakers like Ford, GM, and Stellantis are delaying their EV goals and scaling back on EV-related investments, a move that began during the 4th quarter of 2023 as faltering demand for electric vehicles set in and China’s BYD outsold Tesla in EV sales.

Ford Motor Company announced it would delay introduction of new all-electric SUV and pickup models, and turn its focus instead to development of hybrid vehicles that American consumers might want to purchase. Its launch of three-row electric vehicles has been delayed from 2025 to 2027 and it is also delaying its EV truck deliveries until 2026, which was initially slated to begin in 2025. The additional time will allow for the consumer market for three-row electric vehicles to further develop and enable Ford to take advantage of emerging battery technology, with the goal to provide customers increased durability and better value. Ford is still continuing preparations, albeit more slowly, for the market launch of its all-new three-row electric vehicles at its assembly complex in Oakville, Ontario, for 2027.

Ford ranked second in EV sales during the first quarter of this year behind Tesla, but in overall sales ranked third. Despite that EV ranking, Ford expects that its EV division will continue to lose money—up to $5.5 billion in 2024, although that is more than offset by the money it expects to make selling commercial vehicles and gasoline-powered vehicles. Ford had to drop prices on its electric F-150 pickups — by $10,000 — in the hopes of finding buyers.

Even Tesla is making changes as the global EV market develops. Despite being the largest EV brand in the United States, it saw an 8.5 percent decline in deliveries in the first quarter 2024 and a massive overproduction glut that has led to another round of price cuts for vehicles in its inventory. It has also apparently canceled its long-promised inexpensive car that was to hit the assembly line in the second half of next year. Model 2 was expected to start at about $25,000, but global competition from Chinese electric-vehicle makers flooding the market with cars priced as low as $10,000 made the Tesla inexpensive electric car an unworthy goal. Instead, Tesla will continue developing self-driving robotaxis on the same small-vehicle platform in Texas.

GM lost $1.7 billion in the fourth quarter last year on electric vehicles, while Toyota announced $30 billion in annual profits and credited it to the company’s decision to avoid pursuing fully electric vehicles.

Despite the losses on EV sales, EV sales in the United States grew in quarter 1, but only by 3.3 percent compared to a total growth in car sales of 5.1 percent. That compares to a 47 percent increase in U.S. EV sales in 2023. Taxpayers are buying a lot of electric vehicles for government use, which may affect the numbers.

EPA’s False Accounting

EPA’s new federal legislation requires automakers to reduce the tailpipe emissions of new vehicles by around 50 percent from model year 2026 to 2032. In order to achieve this, EPA is targeting 35 percent to 56 percent of vehicles needing to be electric vehicles by 2032, and 13 percent to 36 percent needing to be plug-in hybrids by that date. EPA claims that the rule will yield “climate benefits” of $1.6 trillion, despite a near-zero effect on temperatures. To get to this value, EPA multiplies its estimated reductions in greenhouse gas emissions by the “social cost of carbon,” a fabricated number that supposedly measures damage caused by the emissions that is derived from an assumed extreme future emissions scenario. The social cost of carbon number is then used in EPA’s climate models that overstate the actual satellite temperature measurements by a factor of about 2.5.

EPA also claims fuel savings of about $30 billion annually as a benefit of the regulation. It does this so that it can ignore the flaws electric vehicles have in range, refueling time, resilience in the face of temperature and weather fluctuations, et cetera. Because of the projected fuel savings, EPA speculates people will drive more, thus receiving “drive value benefits” of an additional $2 billion per year.

EPA’s analysis also claims that if EV owners charge their vehicles when electricity demand is low, recharging costs for electric vehicles will be reduced even more, and “the overall costs of electricity generation and delivery to all electricity rate payers, not just those charging electric vehicles” will be reduced. EPA ignores the massive additional costs of the Biden administration’s electricity transition to wind and solar technologies and its electrification of everything, as well as rapidly increasing electricity prices.

Further, EPA evaluates future benefits and costs relative to those that would occur soon by using discount rates of 2 or 3 percent rather than an annual rate of about 7 percent, which was the normal rate that federal agencies had applied for decades. As Ben Zycher notes in his article, “The Biden administration has mandated the use of an artificially low discount rate across all agencies, introducing a huge bias in favor of government regulation, distorting the allocation of capital between private investment and that driven by regulatory requirements.”

Conclusion

EPA’s emission tailpipe rule will only reduce global temperatures in 2100 by 0.0068 degrees Celsius, but the agency refrains from reporting this figure in its public analysis as Americans would question the cost and the inconvenience of the transition to drivers and taxpayers if it were reported. Further, EPA’s analysis is filled with assumptions and dishonesty about the benefits electric vehicles will achieve.  It uses a fabricated social cost of carbon figure to arrive at its results, assumes low recharging costs, ignores the costs of Biden’s energy transition and electrification of everything and uses low discount rates for evaluating future benefits and costs. Americans should not be fooled by Biden’s push to electric vehicles. If Americans found them beneficial for their lifestyle, they would be buying them rather than gas-fueled vehicles. Yet, sales of gas fueled vehicles still dominate the market and traditional automakers are delaying their forays into the all-electric world.

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