Silver and Gold: Nevada Joins California in the Gas War

Matt Posky
by Matt Posky

On Monday, Nevada Governor Steve Sisolak announced that his state will embrace California-crafted emissions rules that are at odds with the national rollback finalized by the Trump administration in March.

Officially, Sisolak said the rules would not require residents to abandon their current ride “or choose one that does not work for their lifestyle or business needs.” Nevada has, however, decided to adopt higher mpg standards, as well as the Golden State’s zero-emission vehicle (ZEV) rules that require manufacturers to sell a certain number of electric or plug-in hybrid models each year based on the total number of vehicles sold within the state.

Companies in compliance accrue ZEV credits, which can then be traded or sold to other manufacturers for money. As with the Corporate Average Fuel Economy (CAFE) system, those that cannot hit their targets (or afford to buy up credits) will be fined. Tesla actually used such arrangements to make $594 million off its rivals in 2019, with the prospect of things only getting more lucrative for the all-electric brand.

The California Air Resources Board (CARB) releases annual credit bank balances each year, as well as the total number of vehicles produced for that model year broken down by type. And it has gotten quite popular among Democrat-run states, with many vowing to support California by adhering to its emission mandates (to varying degrees) instead of the revised federal standards.

According to Reuters, Nevada plans to enact the ZEV rules beginning in the 2025 model year, though automakers will be able to start earning credits starting in the 2023 model year. It will also adhere to the Obama-era mandates, deemed unsustainable by that administration’s own EPA, in solidarity with California. This requires 5 percent annual increases in efficiency through 2026 vs the current administration’s adjusted requirement of just 1.5 percent each year.

From Reuters:

California’s vehicle emissions rules, which are more stringent than rules advocated by the Environmental Protection Agency under President Donald Trump, are currently followed by states accounting for more than 40 percent of U.S. vehicle sales.

In September, a group of 23 states sued to block the Trump administration from undoing California’s authority to set strict car pollution rules and require more electric cars.

John Bozzella, who heads an auto trade group [the Alliance for Automotive Innovation] representing General Motors, Volkswagen Group, Toyota Motor Corp. and other major automakers, noted that by 2025, the industry’s investment in electric cars will exceed $200 billion.

“[Manufacturers] are committed to working with Governor Sisolak and state regulators toward a smoother transition to ZEV adoption that includes expanded consumer awareness, infrastructure, incentives, fleet requirements, building codes, fuel requirements, and more,” Bozzella said in a statement.

Automakers have been playing both sides of this argument for some time, so don’t consume any of their messaging on the issue without a side plate of skepticism. Their main goal is to avoid being shut out of any market while also avoiding punishment from regulators. Let’s not forget that industry leaders came to Donald Trump en masse during his first days in office to beg for an emissions rollback — among other favors. Former Ford CEO Mark Fields even told the then-novice president that the Obama-era rules would put a million American jobs in jeopardy. Maintaining factory employment ultimately turned out to be one of the keystone arguments used by the DOT and EPA to rationalize the rollback.

While we cannot speak to the validity of those claims, the general assumption is that EVs’ simpler hardware requires far fewer labor hours and less regular maintenance. Environmentalists have claimed this would be offset by new positions that blossom in the wake of advancing green tech, however.

[Image: RedTango/Shutterstock]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • Oberkanone Oberkanone on Jun 24, 2020

    Revoke California exemption to set emissions standards. One nation, one standard!

    • See 2 previous
    • Inside Looking Out Inside Looking Out on Jun 24, 2020

      @28-Cars-Later There are plenty of conservatives in California too. Remember that Reagan was from California and as recently as in 2003 voters kicked out Democrat Governor and elected Republican who ruled until 2011. It is demographics that changed last years it is majority of "minorities" who overwhelmingly vote Democrat even though they are pretty conservative in their worldview. They just vote for easy handouts and unrestricted immigration.

  • -Nate -Nate on Jun 24, 2020

    Those damn leftists.... -Nate

  • Slavuta Inflation creation act... 2 thoughts1, Are you saying Biden admin goes on the Trump's MAGA program?2, Protectionism rephrased: "Act incentivizes automakers to source materials from free-trade-compliant countries and build EVs in North America"Question: can non-free-trade country be a member of WTO?
  • EBFlex China can F right off.
  • MrIcky And tbh, this is why I don't mind a little subsidization of our battery industry. If the American or at least free trade companies don't get some sort of good start, they'll never be able to float long enough to become competitive.
  • SCE to AUX Does the WTO have any teeth? Seems like countries just flail it at each other like a soft rubber stick for internal political purposes.
  • Peter You know we’ve entered the age of self driving vehicles When KIAs go from being stolen to rolling away by themselves.
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