By Camille von Kaenel

Economists and regulatory experts are proposing a cap-and-trade system for vehicle greenhouse gas emissions to replace existing fuel economy standards.

President Trump has vowed to review the emissions and mileage requirements to boost automotive jobs. U.S. EPA and the National Highway Traffic Safety Administration have until April 2018 to decide whether to lower the targets. Automakers have asked the administration to ease costs associated with the fuel efficiency rules given surging truck sales.

Michael Greenstone and Sam Ori from the University of Chicago’s Energy Policy Institute and Cass Sunstein, former President Obama’s head of the Office of Information and Regulatory Affairs and now a legal scholar at Harvard University, saw an opening. They put together a proposal to cap the entire sector’s pollution level and make automakers trade credits based on the lifetime emissions of their vehicles.

They hope to sell it to the Trump administration as a sleek system that cuts costs while directly achieving a set environmental outcome…

Continue reading at E&E News…

Read More

Areas of Focus: Energy Markets
Definition
Energy Markets
Well-functioning markets are essential for providing access to reliable, affordable energy. EPIC research is uncovering the policies, prices and information needed to help energy markets work efficiently.
Energy Efficiency
Definition
Energy Efficiency
Improving energy efficiency is lauded as a promising way to reduce emissions and lower energy costs. Yet, a robust body of research demonstrates that not all efficiency investments deliver. EPIC...
Transportation
Definition
Transportation
Mobility is central to economic activity. Yet, a lack of fuel diversity and continued demand growth have made the transportation industry a major contributor to global pollution and carbon emissions....
Climate Economics
Definition
Climate Economics
Climate change will affect every sector of the economy, both locally and globally. EPIC research is quantifying these effects to help guide policymakers, businesses, and individuals working to mitigate and...
Climate Law & Policy
Definition
Climate Law & Policy
As countries around the world implement policies to confront climate change, EPIC research is calculating which policies will have the most impact for the least cost.
Fuel Economy Standards
Definition
Fuel Economy Standards
Fuel economy standards are the United States’ cornerstone transportation policy aimed at reducing both oil consumption and greenhouse gas emissions. EPIC research is exploring whether these standards are structured optimally...
Transportation
Definition
Transportation
Mobility is central to economic activity. Yet, a lack of fuel diversity and continued demand growth have made the transportation industry a major contributor to global pollution and carbon emissions....
Energy Efficiency
Definition
Energy Efficiency
Improving energy efficiency is lauded as a promising way to reduce emissions and lower energy costs. Yet, a robust body of research demonstrates that not all efficiency investments deliver. EPIC...