Inflation Reduction Act doesn’t meet Biden’s climate goals: How to close the gaps on transportation

A country wracked by extremely severe temperatures, drought, wildfires and flooding finally got some climate change relief on Aug. 16, even if it won’t be immediate. President Biden signed the Inflation Reduction Act (IRA) into law, the United States’ biggest and most ambitious climate change legislation ever. Climate policy think tank Energy Innovation and two other expert modeling groups predicted the IRA will reduce U.S. greenhouse gas (GHG) emissions about 40 percent by 2030, finally creating hope the U.S. can lead global efforts to avoid even more extreme climate change consequences.

Even by the most optimistic projections, the law will not reach Biden’s goal of halving the nation’s GHG emissions by 2030. However, the IRA’s projected 40 percent reduction puts the U.S. within reach of that target — and the law gives the U.S. Environmental Protection Agency (EPA) new tools to drive emissions down even lower. Now, EPA should use its expanded capacities to help the U.S. bridge that remaining 10 percent gap.

The IRA’s huge clean energy incentives and rebates for purchasing electric vehicles (EVs) have grabbed the most headlines, but the legislation also strengthens the EPA’s hand in dealing with the climate crisis. First, the law stated repeatedly and unambiguously that GHGs are air pollution and, thus squarely within the EPA’s regulatory purview. Until now EPA’s action on GHGs was only authorized by a 2007 Supreme Court precedent, not Congress, a weakness exploited by the U.S. Supreme Court. In June, the Supreme Court began chipping away at EPA’s authority, threatening to undo the entire climate program of America’s environmental agency by five extreme Supreme Court justices. With the IRA, the EPA’s agenda is no longer in this precarious position — the agency’s authority to regulate GHGs is now law.

The EPA’s capacity to regulate GHGs is further strengthened by IRA’s hundreds of billions of dollars in tax credits, grants, loans, and other incentives. This law ushers in an era of cheaper EVs, renewable energy and electrified appliances, meaning companies can more easily meet EPA GHG regulations. In fact, because the IRA’s incentives are economy-wide, the law effectively lowers the cost floor for any such EPA requirement.

One area that EPA should now target is the transition to zero-emission heavy-duty trucks and buses. Last March, the agency proposed a relatively weak action — only requiring about 1.5 percent of new truck and buses sales to be zero emission by 2027 — far below even voluntary industry commitments. Daimler, the world’s leading heavy-duty truck manufacturer, expects that up to 60 percent of its sales will be zero-emission vehicles (ZEVs) by 2030. The CEO of Navistar, recently acquired by Volkswagen, believes 50 percent of the company’s sales will be electric by 2030, and 100 percent by 2040. Volvo Group set a 2040 goal for 100 percent zero-emissions truck and bus sales. In Europe, a joint statement by major truck makers established a 2040 date for 100 percent ZEV sales.

These huge commitments by some of world’s biggest manufacturers all go well beyond anything EPA proposed. In May, I encouraged EPA to make a stronger proposal. Post-IRA, it’s past time to strengthen this climate action.

Stronger standards for heavy-duty trucks, buses and other commercial vehicles will have a disproportionately large impact on GHG emissions. While those vehicles make up fewer than 10 percent of vehicles on the road, they are responsible for nearly one-quarter of total U.S. transportation sector GHG emissions — the biggest single contributor. Beyond their climate impact, emissions from those vehicles have pernicious effects on human health. Tractor-trailers, delivery vans and heavier-duty pickup trucks spew 45 percent of the country’s total nitrogen oxide emissions and 57 percent of fine particulates, known as PM 2.5. Both are linked to premature death and chronic illnesses, including heart disease, lung cancer, stroke and childhood asthma.

What’s more, the oldest and dirtiest diesel trucks are concentrated in urban areas around ports, industrial warehouses and freeways near low-income communities, making this an important environmental justice concern. An Environmental Defense Fund study found that eliminating pollution from freight trucks in urban areas and other communities by 2035 and from all new trucks and buses by 2040 could prevent 57,000 premature deaths by 2050.

IRA makes cleaning up these dirty vehicles much easier by providing billions to move the heavy trucks sector toward zero-emission vehicles. For example, the EPA now can invest $1 billion in zero-emitting heavy-duty vehicles like garbage trucks, transit buses and school buses. The law also offers about $3.5 billion in tax credits for qualified commercial EVs — up to $40,000 per vehicle for larger vehicles — and up to $100,000 in tax credits per charger to build EV charging stations for trucks. Auto manufacturers will get $2 billion through 2031 to retool existing facilities for domestic production of clean vehicles. The U.S. Postal service has $3 billion to buy ZEVs and install EV charging infrastructure at its facilities. Finally, the new law offers up to $20 billion in loans to build advanced new clean vehicle manufacturing facilities in U.S.

A few days after the IRA’s signing, Elon Musk, CEO of electric vehicle company Tesla, tweeted the company would start shipping a 500-mile range semi-truck this year. When you look at the incentives the IRA offers, it’s easy to see why Tesla is so enthusiastic about the zero-emission transition in the heavy-truck sector. The EPA can’t afford to miss this historic moment. The agency should require that, at minimum, 40 percent of new trucks and buses be ZEVs by 2030.

Margo Oge served as the director of EPA’s Office of Transportation and Air Quality from 1994-2012 and is the author of “Driving the Future: Combatting Climate Change with Cleaner, Smarter Cars.”