---------------------------------------------------------------------------

    \164\ See California Air Resources Board (CARB), Docket No.
NHTSA-2018-0067-11873; South Coast Air Quality Management District,
Docket No. NHTSA-2018-0067-11813.
    \165\ See, e.g., Safe Air for Everyone v. United States Envt'l
Prot. Agency, 488 F.3d 1088, 1091 (9th Cir. 2007).
    \166\ Internal Revenue Service, Publication 525: Taxable and
Nontaxable Income 32 (Mar. 8, 2019), https://www.irs.gov/pub/irs-pdf/p525.pdf.
---------------------------------------------------------------------------

    Since SIPs are binding on States, the agencies recognize that
certain States may need to work with EPA to revise their SIPs in light
of this final action.\167\ As stated in the proposal, EPA may
subsequently consider whether to employ the appropriate provisions of
the Clean Air Act to identify provisions of States' SIPs that may need
review because they include preempted ZEV mandates or greenhouse gas
emissions standards.\168\ However, this practical consideration is not
grounds for ignoring EPCA's limitations on State action. SIPs are not
written in stone. They are subject to revision, including based on
changed circumstances. The Clean Air Act allows SIPs to be revised for
various reasons, including that part of the plan was approved in error,
that the plan is ``substantially inadequate,'' or that the State is
suspending or

revoking a program included in a plan. 42 U.S.C. 7410(a)(5)(iii),
(k)(5)-(6).
---------------------------------------------------------------------------

    \167\ EPA explains below that it will consider whether and how
to address SIP implications of this action, to the extent that they
exist, in separate actions; EPA believes that it is not necessary to
resolve those implications in the course of this action.
    \168\ 83 FR 42986, 43244 (Aug. 24, 2018).
---------------------------------------------------------------------------

I. NHTSA Has Appropriately Considered the Views of States and Local
Governments Consistent With Law

    NHTSA considers the views of all interested stakeholders--including
States and local governments--in carrying out its statutory obligation
to set nationally applicable fuel economy standards. However, EPCA does
not permit States or local governments to act as co-regulators with
NHTSA in the process of setting fuel economy standards. Indeed, EPCA
precludes them from doing so, with the sole exception of information
disclosure requirements identical to Federal requirements, and for
requirements for fuel economy for automobiles obtained for a State or
local governments' own use. A number of commenters urged NHTSA to work
cooperatively with California, and to negotiate with and reach a
compromise with California.\169\ NHTSA appreciates such comments, and
seeks to foster a collaborative regulatory approach to the extent
possible. That said, California is not permitted by Federal law to have
its own separate laws or regulations relating to fuel economy
standards. 49 U.S.C. 32902 makes clear that NHTSA sets nationally
applicable fuel economy standards, and NHTSA is implementing its
authority to do so through this regulation clarifying the preemptive
effect of its standards consistent with the express preemption
provision in 49 U.S.C. 32919.
---------------------------------------------------------------------------

    \169\ See, e.g., American Honda Motor Company, Inc., Docket No.
NHTSA-2018-0067-11818; Sen. T. Carper, United States Senate, Docket
No. NHTSA-2018-0067-11910; Maryland Department of the Environment,
Docket No. NHTSA-2018-0067-12044; Joint Submission from the States
of California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735; Manufacturers of Emission Controls
Association, Docket No. NHTSA-2018-0067-11994; North Carolina
Department of Environmental Quality, Docket No. NHTSA-2018-0067-
12025.
---------------------------------------------------------------------------

    The very limited exceptions to preemption set forth in EPCA--
covering vehicles for a government's own use, and for disclosure
requirements that are identical to Federal requirements--only confirm
the breadth of preemption. See 49 U.S.C. 32919(b)-(c). States or
localities cannot adopt or enforce requirements related to fuel economy
standards unless they fall into one of these two discrete exceptions.
This means requirements related to fuel economy standards for
automobiles for use by a State's citizens, and not merely the State
itself, are not permitted. Since States are not permitted to adopt or
enforce requirements related to fuel economy standards for vehicles
sold or delivered to the public, Federal law does not allow California
(or any other State or local government) to regulate in this area.
    For California, or any other State or local government, to regulate
in this area would require NHTSA to waive EPCA preemption, but
commenters did not and cannot identify any statutory authorization for
NHTSA to do so and no such authority exists, either expressly or
impliedly. The Clean Air Act requires EPA to waive Clean Air Act
preemption under a specific section of that statute unless it makes
certain findings. But because EPCA does not enable NHTSA to issue a
waiver of preemption, it also does not set forth terms upon which a
waiver would be appropriate.\170\ Thus, NHTSA lacks a legal basis for
approving of or consenting to State or local requirements related to
fuel economy standards.
---------------------------------------------------------------------------

    \170\ EPA also does not have authority to waive EPCA preemption,
under the Clean Air Act or otherwise.
---------------------------------------------------------------------------

    Absent the affirmative authority to approve of or consent to State
or locality's requirements related to fuel economy standards,
commenters appear to ask NHTSA to simply to look aside. That is
inconsistent with NHTSA's legal responsibility to set nationally
applicable standards. It is also inconsistent with the self-executing
nature of EPCA preemption, meaning that State or local requirements
related to fuel economy standards are void ab initio. Even if NHTSA
wanted to do so, it cannot breathe life into an expressly preempted
State law. And doing so would effectively result in NHTSA's purporting
to rewrite a statute, which is beyond the power of a regulatory agency.
    NHTSA also disagrees that it is appropriate to ignore EPCA
preemption as a strategy to avoid litigation over this issue, a
strategy strongly suggested by a large number of commenters. NHTSA
understands the concerns of such commenters who hope to avoid prolonged
litigation.\171\ However, NHTSA believes that long-term certainty is
best achieved by applying the law as written. NHTSA agrees with
commenters who acknowledge the disruption to the automotive marketplace
that would come if preempted standards remained in place.\172\
Addressing preemption directly, as NHTSA has done through its adoption
of regulatory text in this document, will ultimately provide the needed
regulatory certainty into the future.
---------------------------------------------------------------------------

    \171\ American Honda Motor Company, Inc., Docket No. NHTSA-2018-
0067-11818; Ford Motor Company, Docket No. NHTSA-2018-0067-11928.
    \172\ Fiat Chrysler Automobiles (FCA), Docket No. NHTSA-2018-
0067-11943.
---------------------------------------------------------------------------

    Those commenters that ask NHTSA to negotiate with California
demonstrate the nature of the problem.\173\ The underlying reason
commenters are concerned about the absence of a compromise resolution
is because of the conflict that will result if States proceed with
regulations that are inconsistent with Federal requirements.\174\ Such
commenters, appropriately, have recognized the disruptive effect of
continuing to tolerate multiple regulators in this area. Moreover, as
discussed in additional detail below, a negotiated resolution is
inconsistent with the APA's notice and comment rulemaking process.
NHTSA has no basis in law to ignore the substantive comments received
on its proposal from many stakeholders and instead determine an outcome
through negotiation with a regulatory agency in California. NHTSA is a
safety agency with different priorities than CARB, with a different set
of factors to balance, including safety implications.
---------------------------------------------------------------------------

    \173\ See, e.g., American Honda Motor Company, Inc., Docket No.
NHTSA-2018-0067-11818; Sen. T. Carper, United States Senate, Docket
No. NHTSA-2018-0067-11910; Manufacturers of Emission Controls
Association, Docket No. NHTSA-2018-0067-11994.
    \174\ See Cal. Code Regs. tit. 13, section 1961.3(c).
---------------------------------------------------------------------------

    As discussed above, many comments emphasized a desire for
maintaining a National Program. Neither California nor any other State,
of course, has the authority to set national standards in any area. If
California were to adopt and enforce requirements related to fuel
economy standards, there could only be uniform standards applicable
throughout the country if California agrees with the standards set by
NHTSA or vice versa. But EPCA requires that ``[e]ach standard shall be
the maximum feasible average fuel economy level that the Secretary''--
not a regulatory agency in the State of California--``decides that the
manufacturers can achieve in that model year.'' \175\ 49 U.S.C.
32902(a).
---------------------------------------------------------------------------

    \175\ As NHTSA explained in the proposal, it disagrees with the
implication of the district court's statement in Central Valley that
``NHTSA is empowered to revise its standards'' to take into account
California's regulations. 83 FR 42986, 43238 (Aug. 24, 2018); see
Cent. Valley Chrysler-Jeep, Inc., 529 F. Supp. 2d at 1179. NHTSA's
duty under EPCA is to balance the statutory factors, not to
acquiesce to the views of one State (which by its own assertion is
attempting to address State-specific concerns, including the
geography of its population centers). See, e.g., California Air
Resources Board (CARB), Docket No. NHTSA-2018-0067-11873 (stating
that California's ``population continues to live predominantly in
basins bounded by mountains, in which air quality is poor'').

---------------------------------------------------------------------------

    Moreover, a faithful application of EPCA requires more than just
avoiding inconsistency. For that reason, it is unavailing that CARB has
previously implemented its program purportedly consistent with the
Federal government.\176\ EPCA requires NHTSA to set nationally
applicably standards. EPCA does not permit States or local governments
to adopt or enforce even identical or equivalent standards.\177\ EPCA
allows for only a single regulator--NHTSA--to set fuel economy
standards. Moreover, it is now clear it does not intend to do so for
model year 2021 through 2026 vehicles, should the forthcoming final
SAFE rule finalize standards other than the no action alternative as
described in the NPRM.\178\ And even consistent programs subject
manufacturers to duplicative enforcement regimes, in conflict with
EPCA.\179\ State standards that are identical or equivalent standards
to the Federal standards manufacturers nevertheless obligate
manufacturers to meet more onerous requirements. That is because
States, of course, lack authority to set nationwide requirements.
Therefore, manufacturers must meet State standards within each State
that has adopted them. Since fuel economy standards are fleetwide
average standards, it is more difficult to achieve a standard in a
particular State, averaged across a smaller pool of vehicles, than it
is to achieve the Federal standard, averaged across the pool of
vehicles for all States.
---------------------------------------------------------------------------

    \176\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873.
    \177\ EPCA does allow States or local governments to adopt
identical requirements for disclosure of fuel economy or fuel
operating costs, but did not allow identical requirements in other
areas related to fuel economy. See 49 U.S.C. 32919(b).
    \178\ See Cal. Code Regs. tit. 13, section 1961.3(c).
    \179\ EPCA has an unusual civil penalty provision for violations
of fuel economy standards that enables various compliance
flexibilities, including use of banked credits, credit plans, credit
transfers, and credit trades. See 49 U.S.C. 32912. EPCA also
requires specific procedures and findings before the Secretary of
Transportation may increase the civil penalty rate applicable to
violations of fuel economy standards. 49 U.S.C. 32912(c). State and
local enforcement of even identical or equivalent requirements
interferes with this enforcement structure.
---------------------------------------------------------------------------

    In addition, there is no legal basis in EPCA or the APA for
California or any other State to receive preferential treatment for
their views in this statutory scheme or rulemaking process.\180\ Nor is
California, or any other State, entitled to negotiate the appropriate
standards with NHTSA. Commenters appear to suggest closed-door
negotiations, and not an alternative rulemaking process (such as
negotiated rulemaking), that would ensure procedural fairness.\181\
NHTSA disagrees that negotiation is the appropriate mechanism to set
nationally applicable policy with billions of dollars of impacts. The
notice-and-comment rulemaking process used by the agencies is the
appropriate mechanism for setting standards under EPCA and the Clean
Air Act, with due consideration to the views of all interested parties
and transparency. NHTSA certainly would prefer a result that is
satisfactory to all interested stakeholders, but it may not set aside
its own considered views on the appropriate standards to reach a
negotiated resolution, nor may it set aside Congress's commands in
EPCA.
---------------------------------------------------------------------------

    \180\ See Nw. Austin Mun. Util. Dist. No. One v. Holder, 557
U.S. 193, 203 (2009) (stating that ``a departure from the
fundamental principle of equal sovereignty requires a showing that a
statute's disparate geographic coverage is sufficiently related to
the problem that it targets'').
    \181\ One comment noted that prior negotiations were ``closed-
door, `put nothing in writing, ever' negotiations.'' Competitive
Enterprise Institute, Docket No. NHTSA-2018-0067-12015; see also
Sen. Phil Berger & Rep. Tim Moore, North Carolina General Assembly,
Docket No. NHTSA-2018-0067-11961.
---------------------------------------------------------------------------

    While States or local governments may not adopt or enforce
requirements related to fuel economy standards, NHTSA, of course, is
considering their views in setting appropriate standards. Many State
and local governments commented at great length on both the preemption
and standard setting portions of NHTSA's proposal.\182\ NHTSA has taken
their views into account in finalizing this rule, along with those of
other commenters. States and local governments have had and will
continue to have a say in the adoption of fuel economy standards,
consistent with the APA. Indeed, many of the technical comments
provided by California and other State and local governments and
agencies are being considered to improve the analysis regarding the
appropriate standards. In an area with express preemption, this APA
process is the appropriate means by which the Federal government should
consider the views of States and local governments.
---------------------------------------------------------------------------

    \182\ See, e.g., California Air Resources Board (CARB), Docket
No. NHTSA-2018-0067-11873; Joint Submission from Governors of Texas,
et al., Docket No. NHTSA-2018-0067-11935; Joint Submission from the
States of California et al. and the Cities of Oakland et al., Docket
No. NHTSA-2018-0067-11735; Maryland Department of the Environment,
Docket No. NHTSA-2018-0067-12044; Minnesota Pollution Control Agency
(MPCA), the Minnesota Department of Transportation (MnDOT), and the
Minnesota Department of Health (MDH), Docket No. NHTSA-2018-0067-
11706; North Carolina Department of Environmental Quality, Docket
No. NHTSA-2018-0067-12025; Pennsylvania Department of Environmental
Protection, Docket No. NHTSA-2018-0067-11956; Washington State
Department of Ecology, Docket No. NHTSA-2018-0067-11926.
---------------------------------------------------------------------------

    NHTSA also disagrees with the view expressed by some commenters
that there is not a direct conflict between State regulation of
tailpipe carbon dioxide emissions from automobiles issued pursuant to a
Clean Air Act waiver and NHTSA's ability to set fuel economy standards
under EPCA. South Coast argues that when there are inconsistent
standards, automakers can avoid a conflict by complying with the more
stringent standard.\183\
---------------------------------------------------------------------------

    \183\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    NHTSA disagrees that this situation does not pose a conflict.
Higher standards than those NHTSA has determined are ``maximum
feasible'' after balancing the statutory factors negates the agency's
judgment in setting national standards, including traffic safety. NHTSA
addressed this conflict in detail in the proposal and reiterates that
discussion here.\184\ NHTSA also disagrees that all manufacturers
should simply comply with a higher standard than the standards set by
the Federal government based on statutory considerations. It may not be
technically feasible for manufacturers to comply with higher standards
or the higher standards may not be economically practicable. These are
factors that NHTSA must carefully assess and balance in setting
standards under EPCA, and the notion that a State has the unilateral
ability to veto or undermine NHTSA's determination by setting higher
standards directly conflicts with EPCA.
---------------------------------------------------------------------------

    \184\ See section f of the proposal's preemption discussion. 83
FR 42986, 43237-38 (Aug. 24, 2018).
---------------------------------------------------------------------------

    South Coast also asserted in its comments that there is no direct
conflict between the purpose of EPCA to reduce fuel consumption by
increasing fuel economy and the purpose of the Clean Air Act to protect
public health from air pollution, including by allowing California to
establish motor vehicle standards if it meets the criteria for a
waiver.\185\ While it is true that there need not be a conflict between
EPCA and the Clean Air Act, this statement is irrelevant to the
determination of whether State standards are preempted by EPCA. NHTSA
and EPA conduct joint rulemaking in this area because EPA's greenhouse
gas emissions standards are inherently related to NHTSA's fuel economy
standards. This inherent linkage was recognized by the Supreme Court in
Massachusetts v.

EPA.\186\ California and other States have, for many years, regulated
ozone-forming emissions from vehicles pursuant to a Clean Air Act
waiver without posing a conflict with NHTSA's regulation of fuel
economy. It is when States regulate the emission of greenhouse gases,
especially carbon dioxide, that the conflict arises because of the
direct and substantial relationship between tailpipe emissions of
carbon dioxide and fuel economy. Regulation in this area is related to
NHTSA's fuel economy standards and impedes NHTSA's ability to set
nationally applicable fuel economy standards.
---------------------------------------------------------------------------

    \185\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
    \186\ See Massachusetts v. EPA, 549 U.S. 497, 532 (2007).
---------------------------------------------------------------------------

    NHTSA also disagrees with comments that assert it did not properly
consider federalism concerns. Specifically, South Coast claimed that
NHTSA violated the executive order on federalism, Executive Order
13132, although South Coast acknowledges the Executive Order does not
create an enforceable right or benefit.\187\ Setting aside the
Executive Order's non-justiciability for the moment, NHTSA's action
complies with Executive Order 13132. Contrary to South Coast's
assertion, the executive order recognizes both express preemption and
conflict preemption, and it does not bar the application of conflict
preemption where a statute contains an express preemption
provision.\188\ The provisions concerning express preemption and
conflict preemption are in separate paragraphs, which are not mutually
exclusive. See E.O. 13132 section 4(a)-(b).
---------------------------------------------------------------------------

    \187\ E.O. 13132 section 11; South Coast Air Quality Management
District, Docket No. NHTSA-2018-0067-11813. South Coast also states
that NHTSA did not mention the Tenth Amendment in its proposal.
South Coast Air Quality Management District, Docket No. NHTSA-2018-
0067-11813. However, South Coast does not assert that this action
violates the Tenth Amendment, which is fully consistent with Federal
preemption. See Constitution, Article VI.
    \188\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    Moreover, the executive order supports NHTSA's action in construing
preemption through rulemaking. See id. The executive order explicitly
supports the process NHTSA used here to consider the views of States
and local governments, stating that: ``When an agency proposes to act
through adjudication or rulemaking to preempt State law, the agency
shall provide all affected State and local officials notice and an
opportunity for appropriate participation in the proceedings.'' E.O.
13132 section 4(e). NHTSA cited to Executive Order 13132 in the
preemption portion of its proposal,\189\ and specifically solicited
comments from State and local officials, as well as other members of
the public. As discussed above, NHTSA has considered the extensive
comments from State and local governments.
---------------------------------------------------------------------------

    \189\ 83 FR 42986, 43233 n.496 (Aug. 24, 2018).
---------------------------------------------------------------------------

    EPCA preemption also does not improperly impinge on the rights of
States. Several commenters argued for allowing States to regulate in
this area due to asserted benefits of State regulation.\190\ CARB's
comments went into extensive detail on its history of regulating
vehicles.\191\ It also asserted that there is industry support for its
regulation in this area,\192\ and argued that it has reliance interests
in its regulations.\193\ CARB also argued that NHTSA's proposal would
adversely impact its police power and ability to protect its
citizens.\194\ In addition, it claimed that NHTSA's proposal would
impact its State-imposed mandate for emissions reductions by 2030,
given the transportation sector's contributions to California's
greenhouse gas emissions.\195\
---------------------------------------------------------------------------

    \190\ See, e.g., California Air Resources Board (CARB), Docket
No. NHTSA-2018-0067-11873.
    \191\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873.
    \192\ Id.
    \193\ Id.
    \194\ Id.; see also Joint Submission from the States of
California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735.
    \195\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873.
---------------------------------------------------------------------------

    Notwithstanding these asserted interests of policy, Congress
determined that NHTSA should have exclusive authority to set fuel
economy standards and that States are not authorized to adopt or
enforce regulations related to those standards, with limited exceptions
described above. No commenter argued that EPCA's preemption provision
is unconstitutional. Some commenters, however, have argued that special
treatment afforded to the California is problematic.\196\ Just as
States have no valid police power to set fuel economy standards
directly, neither are they permitted under EPCA and the Supremacy
Clause to set standards related to fuel economy standards. States do
have input into the Federal fuel economy standards established by NHTSA
(as well as EPA's related greenhouse gas emissions standards) through
the notice-and-comment process, and the interests of California's
citizens as well as the citizens of the other 49 States are protected
by the standards set by the Federal agencies.
---------------------------------------------------------------------------

    \196\ E.g., Sen. Phil Berger & Rep. Tim Moore, North Carolina
General Assembly, Docket No. NHTSA-2018-0067-11961; Rep. M. Turzai,
Pennsylvania House of Representatives, Docket No. NHTSA-2018-0067-
11839.
---------------------------------------------------------------------------

    NHTSA recognizes that California may have different policy views,
as do many interested parties, including both those who expressed views
in favor of and in opposition to the proposal. However, Congress gave
NHTSA the duty to balance competing considerations. NHTSA also rejects
the notion that California has valid reliance interests in regulations
that are void ab initio. Indeed, even in the run-up to the 2012
rulemaking, California itself reserved its rights to go in a different
direction and recognized that the Federal Government may assert
preemption at a later date.\197\ The extent to which all or part of
industry does or does not support California's ability to regulate in
this area is also not a relevant consideration to whether California is
legally authorized to do so. NHTSA also notes that industry has
expressed a strong preference for one national standard, which is the
purpose of EPCA's preemption provision.\198\ California has now made
clear that it will not accept manufacturers' compliance with Federal
standards, unless the agencies adopt the no action alternative from the
proposal.\199\ EPCA preemption ensures that such State regulations are
unenforceable and that one set of national standards (the Federal
standards) will control. Not even identical standards are permissible.
---------------------------------------------------------------------------

    \197\ See Letter from M. Nichols, CARB to R. LaHood, DOT & L.
Jackson, EPA (July 28, 2011), available at https://www.epa.gov/sites/production/files/2016-10/documents/carb-commitment-ltr.pdf
(last visited Sept. 15, 2019) (making certain commitments for a
National Program, conditioned on certain events including EPA's
grant of a waiver of Clean Air Act preemption, vehicle manufacturers
not challenging California's standards on the basis of EPCA
preemption, and indicating that ``California reserves all rights to
contest final actions taken or not taken by EPA or NHTSA as part of
or in response to the mid-term evaluation'').
    \198\ See Alliance of Automobile Manufacturers, Docket No.
NHTSA-2018-0067-12073; American Honda Motor Company, Inc., Docket
No. NHTSA-2018-0067-11818; Association of Global Automakers, Docket
No. NHTSA-2018-0067-12032; Fiat Chrysler Automobiles (FCA), Docket
No. NHTSA-2018-0067-11943; Ford Motor Company, Docket No. NHTSA-
2018-0067-11928; General Motors LLC, Docket No. NHTSA-2018-0067-
11858; Jaguar Land Rover, Docket No. NHTSA-2018-0067-11916; Mazda
Motor Company, Docket No. NHTSA-2018-0067-11727; Mitsubishi Motors
RD of America, Inc. (MRDA), Docket No. NHTSA-2018-0067-12056;
Subaru, Docket No. NHTSA-2018-0067-12020; Toyota Motor North
America, Docket No. NHTSA-2018-0067-12150; Volkswagen Group of
America, Docket No. NHTSA-2017-0069-0583.
    \199\ See Cal. Code Regs. tit. 13, section 1961.3(c).
---------------------------------------------------------------------------

J. Clarifying Changes to Final Rule Text

    No commenter offered alternative regulatory text for consideration
by the

agency on preemption. Because NHTSA is finalizing its views on
preemption, it is adopting the proposed regulatory text, including an
appendix. However, based on its review of comments, NHTSA is adopting a
few minor, clarifying changes.
    While not advocating for a change to the regulatory text, comments
from South Coast and CARB persuaded us to make changes to ensure
consistency with EPCA's express preemption provision, as was NHTSA's
intention.\200\ South Coast specifically pointed out that two
provisions of the proposed regulatory text (appendix B, sections (a)(3)
and (b)(3)) did not include the word ``automobiles.'' \201\ Contrary to
South Coast's suggestion, NHTSA's intention was not to reach beyond the
statutory text. Most of the proposed regulatory text explicitly
addressed automobiles. In the two provisions identified by South Coast
as omitting that term, NHTSA addressed tailpipe carbon dioxide
emissions and fuel economy. In context, these references address
automobile emissions and automobile fuel economy. However, for clarity
and consistency, NHTSA has added explicit reference to automobiles to
these two provisions.
---------------------------------------------------------------------------

    \200\ South Coast and CARB asked NHTSA to withdraw its proposal
on preemption, rather than to change the text of the proposed rule.
California Air Resources Board (CARB), Docket No. NHTSA-2018-0067-
11873; South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813. NHTSA declines to do so for the reasons
discussed in this final rule.
    \201\ South Coast Air Quality Management District, Docket No.
NHTSA-2018-0067-11813.
---------------------------------------------------------------------------

    CARB also pointed out in its comments that the statute preempts
laws or regulations ``related to fuel economy standards,'' not simply
those related to fuel economy.\202\ While other provisions of the
proposed rule used the phrases ``relates to fuel economy standards'' or
``related to fuel economy standards,'' the word ``standards'' was
inadvertently omitted from section (a)(3) of the appendix. In the final
rule, NHTSA has added that word for clarity.
---------------------------------------------------------------------------

    \202\ California Air Resources Board (CARB), Docket No. NHTSA-
2018-0067-11873; see also Joint Submission from the States of
California et al. and the Cities of Oakland et al., Docket No.
NHTSA-2018-0067-11735.
---------------------------------------------------------------------------

    In addition, to ensure consistency throughout the regulatory text
and with the preamble discussion, NHTSA is clarifying that a State law
or regulations having either a direct or substantial effect of
regulating or prohibiting tailpipe carbon dioxide emissions or fuel
economy is a law or regulation related to fuel economy. The proposal
included this statement in the proposed regulatory text: ``Automobile
fuel economy is directly and substantially related to automobile
tailpipe emissions of carbon dioxide.'' This provides the foundation
for NHTSA's express and implied preemption analysis. NHTSA is therefore
clarifying that requirements directly or substantially related to fuel
economy are preempted by adding ``or substantially'' to two places in
the regulatory text. This is consistent with the proposal, which
explained that requirements with no bearing on fuel economy or those
with only an incidental impact on fuel economy are not preempted.\203\
Requirements with more than an incidental impact, i.e. those
requirements that directly or substantially affect fuel economy are
related to fuel economy and thus preempted. Therefore, this change in
the regulatory text of the final rule provides additional clarity on
the scope of preemption.
---------------------------------------------------------------------------

    \203\ 83 FR 42986, 43235 (Aug. 24, 2018). It is also consistent
with the Supreme Court case law interpreting ``related to'' in
preemption provisions, as discussed both in the proposal and this
final rule. See, e.g., Rowe, 552 U.S. at 375.
---------------------------------------------------------------------------

    In addition, several references throughout the proposed regulatory
text addressed a ``state law or regulation.'' Consistent with EPCA and
the discussion in the notice of proposed rulemaking, NHTSA intended to
address laws and regulations of States and their political
subdivisions. For clarity, NHTSA revised all references in its
regulatory text to cover States and their political subdivisions.
    Specifically, in the rule NHTSA is finalizing in this document,
appendix B, section (a)(3) reads: ``A law or regulation of a State or
political subdivision of a State having the direct or substantial
effect of regulating or prohibiting tailpipe carbon dioxide emissions
from automobiles or automobile fuel economy is a law or regulation
related to fuel economy standards and expressly preempted under 49
U.S.C. 32919.'' \204\ Appendix B, section (b)(3) reads: ``A law or
regulation of a State or political subdivision of a State having the
direct or substantial effect of regulating or prohibiting tailpipe
carbon dioxide emissions from automobiles or automobile fuel economy is
impliedly preempted under 49 U.S.C. Chapter 329.'' \205\
---------------------------------------------------------------------------

    \204\ Emphases added.
    \205\ Emphases added.
---------------------------------------------------------------------------

    Finally, NHTSA also added clarifying language to 49 CFR 531.7(b)
and 533.7(b) to indicate that the references to ``section 32908'' are
to section 32908 of title 49 of the United States Code.
    These clarifying changes are consistent with the discussion in the
preamble to NHTSA's proposed rule.

III. EPA's Withdrawal of Aspects of the January 2013 Waiver of CAA
section 209(b) Preemption of the State of California's Advanced Clean
Car Program

    In this section of this joint action, EPA is finalizing its August
2018 proposal to withdraw aspects of its January 2013 waiver of Clean
Air Act (CAA) section 209 preemption of the State of California's
Advanced Clean Car (ACC) program. First, subsection A provides
background regarding the ACC program. Second, subsection B finalizes
EPA's proposed determination that it has the authority to reconsider
and withdraw previously granted waivers. Third, subsection C finalizes
EPA's proposed determination that, in light of NHTSA's determinations
finalized elsewhere in this joint action regarding the preemptive
effect of EPCA on state GHG and ZEV programs, EPA's January 2013 grant
of a waiver of CAA preemption for those provisions of California's
program was invalid, null, and void; that waiver is hereby withdrawn on
that basis, effective on the effective date of this joint action.
Fourth, subsection D, separate and apart from the determinations in
subsection C with regard to the effect of EPCA preemption on the
January 2013 waiver, finalizes EPA's reconsideration of, and its
proposed determination that it is appropriate to withdraw, its January
2013 grant of a waiver of CAA preemption for the GHG and ZEV standards
in California's ACC program for model years 2021 through 2025, based on
a determination that California ``does not need [those] standards to
meet compelling and extraordinary conditions'' within the meaning of
CAA section 209(b)(1)(B). Fifth, subsection E sets forth and specifies
the terms of the waiver withdrawal. Sixth, subsection F finalizes EPA's
proposed determination that, separate and apart from the findings and
determinations described above, states other than California cannot use
CAA section 177 to adopt California's GHG standards. Seventh and
finally, subsection G sets forth EPA's understanding and intention with
regard to severability of, and the appropriate venue for judicial
review of, this action.

A. Background

    On January 9, 2013, EPA granted California's request for a waiver
of preemption to enforce its Advanced Clean Car (ACC) program
regulations under CAA section 209(b)(1).\206\ 78 FR

2112. On August 24, 2018, EPA proposed to withdraw this waiver of
preemption with regard to the GHG and ZEV standards of its Advanced
Clean Car (ACC) program for MY 2021-2025. 83 FR 43240. In the SAFE
proposal, EPA provided extensive background on the history of CAA
section 209 and waivers granted thereunder, as well as on the specific
waiver which California sought for the ACC program which is at issue
here, in the SAFE proposal.\207\ 83 FR 43240-43242.
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    \206\ As in the proposal, this final action uses ``California''
and ``California Air Resources Board'' (or ``CARB'')
interchangeably.
    \207\ A complete description of the ACC program, as it existed
at the time that CARB applied for the 2013 waiver, can be found in
CARB's waiver request, located in the docket for the January 2013
waiver action, Docket No. EPA-HQ-OAR- 2012-0562.
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    Since publication of the SAFE proposal, California has clarified
its ``deemed to comply'' provision, under which manufacturers are
afforded the option of complying with CARB's GHG standards by showing
that they comply with the applicable federal GHG standards. As amended,
CARB's ``deemed to comply'' provision now provides that compliance with
CARB's GHG standards can be satisfied only by complying with the
federal standards as those standards were promulgated in 2012. In other
words, while the content of CARB's GHG standards has never been
identical to the corresponding Federal standards, the ``deemed to
comply'' provision as originally designed, and as it existed when EPA
issued the January 2013 waiver, would have shielded automobile
manufacturers from having to comply with two conflicting sets of
standards unless they chose to do so. After the December 2018
amendment, however, CARB's regulations now contain within them a
mechanism which will automatically impose that state of affairs the
moment that the Federal government should exercise its authority to
revise its standards. California has further recently announced a
``voluntary agreement'' with four automobile manufacturers that, among
other things, requires the automobile manufacturers to refrain from
challenging California's GHG and ZEV programs. This ``voluntary
agreement'' further provides that California will accept automobile
manufacturer compliance with a less stringent standard (and one that
extends the phase-in of the GHG standard from 2025 to 2026) than either
the California program that was the subject of the 2013 waiver or the
Federal standards as promulgated in 2012. Neither California's
amendment of its ``deemed to comply'' provision, nor its more recent
announcement of the new ``voluntary agreement,'' constitute a necessary
part of the basis for the waiver withdrawal and other actions that EPA
finalizes in this document, and EPA would be taking the same actions
that it takes in this document even in their absence. Nevertheless, EPA
does not believe it appropriate to ignore these recent actions and
announcements on the State's part, and, as discussed below, believes
that they confirm that this action is appropriate.\208\
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    \208\ EPA does not take any position at this point on what
effect California's December 2018 amendment to its ``deemed to
comply'' provision, or its July 2019 ``framework'' announcement, may
of their own force have had on the continued validity of the January
2013 waiver. EPA may address that issue in a separate, future
action.
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    On January 9, 2013, EPA granted CARB's request for a waiver of
preemption to enforce its ACC program regulations pursuant to CAA
section 209(b). 78 FR 2112. The ACC program comprises regulations for
ZEV, tailpipe GHG emissions standards, and low-emission vehicles (LEV)
regulations \209\ for new passenger cars, light-duty trucks, medium-
duty passenger vehicles, and certain heavy-duty vehicles, for MY 2015
through 2025. Thus, in terms of the scope of coverage of the respective
state and federal programs, the ACC program is comparable to the
combined Federal Tier 3 Motor Vehicle Emissions Standards and the 2017
and later MY Light-duty Vehicle GHG Standards, with an additional
mandate to force the development and deployment of non-internal-
combustion-engine technology. According to CARB, the ACC program was
intended to address California's near and long-term ozone issues as
well as certain specific GHG emission reduction goals.\210\ 78 FR 2114.
See also 78 FR 2122, 2130-2131. The ACC program regulations impose
multiple and varying complex compliance obligations that have
simultaneous, and sometimes overlapping, deadlines with each standard.
These deadlines began in 2015 and are scheduled to be phased in through
2025. For example, compliance with the GHG requirements began in 2017
and will be phased in through 2025.\211\ The implementation schedule
and the interrelationship of regulatory provisions with each of the
three standards together demonstrates that CARB intended that at least
the GHG and ZEV standards, if not also the LEV standards, would be
implemented as a cohesive program. For example, in its ACC waiver
request, CARB stated that the ``ZEV regulation must be considered in
conjunction with the proposed LEV III amendments. Vehicles produced as
a result of the ZEV regulation are part of a manufacturer's light-duty
fleet and are therefore included when calculating fleet averages for
compliance with the LEV III GHG amendments.'' CARB's Initial Statement
of Reasons at 62-63.\212\ CARB also noted ``[b]ecause the ZEVs have
ultra-low GHG emission levels that are far lower than non-ZEV
technology, they are a critical component of automakers' LEV III GHG
standard compliance strategies.'' Id. CARB further explained that ``the
ultra-low GHG ZEV technology is a major component of compliance with
the LEV III GHG fleet standards for the overall light duty fleet.'' Id.
CARB's request also repeatedly touted the GHG emissions benefits of the
ACC program. Up until the ACC program waiver request, CARB had relied
on the ZEV requirements as a compliance option for reducing criteria
pollutants. Specifically, California first included the ZEV requirement
as part of its first LEV program, which was then known as LEV I, that
mandated a ZEV sales requirement that phased-in starting with the 1998
MY through 2003 MY. EPA issued a waiver of preemption for these
regulations on January 13, 1993 (58 FR 4166 (January 13, 1993). Since
this initial waiver of preemption, California has amended the ZEV
requirements multiple times and EPA has

subsequently granted waivers for those amendments. Notably, however, in
the ACC program waiver request, California also included a waiver of
preemption request for ZEV amendments that related to 2012 MY through
2017 MY and new requirements for 2018 MY through 2025 MY (78 FR 2118-
9). Regarding the ACC program ZEV requirements, CARB's waiver request
noted that there was no criteria emissions benefit in terms of vehicle
(tank-to-wheel--TTW) emissions because its LEV III criteria pollutant
fleet standard was responsible for those emission reductions.\213\ CARB
further noted that its ZEV regulation was intended to focus primarily
on zero emission drive--that is, battery electric (BEVs), plug-in
hybrid electric vehicles (PHEVs), and hydrogen fuel cell vehicles
(FCVs)--in order to move advanced, low GHG vehicles from demonstration
phase to commercialization (78 FR 2122, 2130- 31). Specifically, for
2018 MY through 2025 MY, the ACC program ZEV requirements mandate use
of technologies such as BEVs, PHEVs and FCVs, in up to 15% of a
manufacturer's California fleet by MY 2025 (78 FR 2114). Additionally,
the ACC program regulations provide various compliance flexibilities
allowing for substitution of compliance with one program requirement
for another. For instance, manufacturers may opt to over-comply with
the GHG fleet standard in order to offset a portion of their ZEV
compliance requirement for MY 2018 through 2021. Further, until MY
2018, sales of BEVs (since MY 2018, limited to FCVs) \214\ in
California count toward a manufacturer's ZEV credit requirement in CAA
section 177 States. This is known as the ``travel provision'' (78 FR
2120).\215\ For their part, the GHG emission regulations include an
optional compliance provision that allows manufacturers to demonstrate
compliance with CARB's GHG standards by complying with applicable
Federal GHG standards. This is known as the ``deemed to comply''
provision. Since proposal, California has amended its regulations to
provide that the ``deemed to comply'' provision only applies to the
standards originally agreed to by California, the federal government,
and automakers in 2012. In other words, automobile manufacturers would
not be able to rely on the ``deemed to comply'' provision for any
revision to those 2012 standards. California has further entered into a
voluntary agreement with four automobile manufacturers that amongst
other things, requires the automobile manufacturers to refrain from
challenging California's GHG and ZEV programs, and provides that
California will accept automobile manufacturer compliance with a less
stringent standard than either the California program that was the
subject of the 2013 waiver or the Federal standards as promulgated in
2012.
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    \209\ The LEV regulations in question include standards for both
GHG and criteria pollutants (including ozone and PM).
    \210\ ``The Advanced Clean Cars program . . . will reduce
criteria pollutants . . . and . . . help achieve attainment of air
quality standards; The Advanced Clean Cars Program will also reduce
greenhouse gases emissions as follows: by 2025, CO2 equivalent
emissions will be reduced by 13 million metric tons (MMT) per year,
which is 12 percent from base line levels; the reduction increases
in 2035 to 31 MMT/year, a 27 percent reduction from baseline levels;
by 2050, the proposed regulation would reduce emissions by more than
40 MMT/year, a reduction of 33 percent from baseline levels; and
viewed cumulatively over the life of the regulation (2017-2050), the
proposed Advanced Clean Cars regulation will reduce by more than 850
MMT CO2-equivalent, which will help achieve the State's climate
change goals to reduce the threat that climate change poses to
California's public health, water resources, agriculture industry,
ecology and economy.'' 78 FR 2114. CARB Resolution 12-11, at 19,
(January 26, 2012), available in the docket for the January 2013
waiver action, Document No. EPA-HQ-OAR-2012- 0562, the docket for
the ACC program waiver.
    \211\ As discussed above, California has further entered into a
voluntary agreement with four automobile manufacturers that amongst
other things, purports to allow compliance with a less stringent
program than either the program that was the subject of the 2013
waiver or the Federal standards promulgated in 2012. See https://www.gov.ca.gov/2019/07/25/california-and-major-automakers-reach-groundbreaking-framework-agreement-on-clean-emission-standards/
(last visited Aug. 30, 2019).
    \212\ Available in the docket for the January 2013 waiver
decision, Docket No. EPA-HQ-OAR-2012- 0562.
    \213\ ``There is no criteria emissions benefit from including
the ZEV proposal in terms of vehicle (tank-to-wheel or TTW)
emissions.'' CARB ACC waiver request at 15 (May 2012), EPA-HQ-OAR-
2012-0562-0004.
    \214\ This kind of ZEV technology continues to present
technological challenges and in 2006, for instance, EPA granted
California a waiver of its ZEV standards through the 2011MY but due
to feasibility challenges declined to grant a waiver for MY 2012 and
subsequent model years. See 71 FR 78190; EPA, EPA ZEV Waiver
Decision Document, EPA-HQ-OAR-2004-0437 (Dec. 21, 2006).
    \215\ On March 11, 2013, the Association of Global Automakers
and Alliance of Automobile Manufacturers filed a petition for
reconsideration of the January 2013 waiver grant, requesting that
EPA reconsider the decision to grant a waiver for MYs 2018 through
2025 ZEV standards on technological feasibility grounds. Petitioners
also asked for consideration of the impact of the travel provision,
which they argue raise technological feasibility issues in CAA
section 177 States, as part of the agency's review under the third
waiver prong, CAA section 209(b)(1)(C). EPA continues to evaluate
the petition. As explained below, in this action EPA is not taking
final action with regard to the proposed determinations under the
third waiver prong. Whether and how EPA will respond to the March
2013 petition will be considered in connection with a potential
future final action with respect to the proposed third prong
determinations set forth in the SAFE proposal.
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    As explained in the SAFE proposal (83 FR 83 FR 23245-46), up until
the 2008 GHG waiver denial, EPA had interpreted CAA section
209(b)(1)(B) as requiring a consideration of California's need for a
separate motor vehicle program designed to address local or regional
air pollution problems and not whether the specific standard that is
the subject of the waiver request is necessary to meet such conditions
(73 FR 12156; March 6, 2008). We also explained that California would
typically seek a waiver of particular aspects of its new motor vehicle
program up until the ACC program waiver request. We further explained
that in the 2008 GHG waiver denial, which was a waiver request for only
GHG emissions standards, EPA had determined that its interpretation of
CAA section 209(b)(1)(B) as calling for a consideration of California's
need for a separate motor vehicle program was not appropriate for GHG
standards because such standards are designed to address global air
pollution problems in contrast to local or regional air pollution
problems specific to and caused by conditions specific to California
(73 FR 12156-60). In the 2008 GHG waiver denial, EPA further explained
that its previous reviews of California's waiver request under CAA
section 209(b)(1)(B) had usually been cursory and undisputed, as the
fundamental factors leading to California's air pollution problems--
geography, local climate conditions (like thermal inversions),
significance of the motor vehicle population--had not changed over time
and over different local and regional air pollutants. These fundamental
factors applied similarly for all of California's air pollution
problems that are local or regional in nature. In the 2008 GHG waiver
denial, EPA noted that atmospheric concentrations of GHG are
substantially uniform across the globe, based on their long atmospheric
life and the resulting mixing in the atmosphere. EPA therefore posited
that with regard to atmospheric GHG concentrations and their
environmental effects, the California specific causal factors that EPA
had considered when reviewing previous waiver applications under CAA
section 209(b)(1)(B)--the geography and climate of California, and the
large motor vehicle population in California, which were considered the
fundamental causes of the air pollution in California--do not have the
same relevance to the question at hand. EPA explained that the
atmospheric concentration of GHG in California is not affected by the
geography and climate of California. The long duration of these gases
in the atmosphere means they are well-mixed throughout the global
atmosphere, such that their concentrations over California and the U.S.
are substantially the same as the global average. The number of motor
vehicles in California, while still a notable percentage of the
national total and still a notable source of GHG emissions in the
State, is not a significant percentage of the global vehicle fleet and
bears no closer relation to the levels of GHG in the atmosphere over
California than any other comparable source or group of sources of GHG
anywhere in the world. Emissions of greenhouse gases from California
cars do not generally remain confined within California's local
environment but instead become one part of the global pool of GHG
emissions, with this global pool of emissions leading to a relatively
homogenous concentration of GHG over the globe. Thus, the emissions of
motor vehicles in California do not affect California's air pollution
problem in any way that is different from how emissions from vehicles
and other pollution sources all around the U.S. (and, for that matter,
the world) do.

Similarly, the emissions from California's cars do not only affect the
atmosphere in California but in fact become one part of the global pool
of GHG emissions that affect the atmosphere globally and are
distributed throughout the world, resulting in basically a uniform
global atmospheric concentration. EPA then applied this reasoning to
the GHG standards at issue in the 2008 GHG waiver denial. Having
limited the meaning of this provision to situations where the air
pollution problem was local or regional in nature, EPA found that
California's GHG standards did not meet this criterion. Additionally,
in the 2008 GHG waiver denial, EPA also applied an alternative
interpretation where EPA would consider effects of the global air
pollution problem in California in comparison to the effects on the
rest of the country and again addressed the GHG standards separately
from the rest of California's motor vehicle program. Under this
alternative interpretation, EPA considered whether impacts of global
climate change in California were sufficiently different from impacts
on the rest of the country such that California could be considered to
need its GHG standards to meet compelling and extraordinary conditions.
EPA determined that the waiver should be denied under this alternative
interpretation as well. 83 FR 23245-46.
    In 2009, EPA reversed its previous denial and granted California's
preemption waiver request for its GHG emission standards ``for 2009 and
later model years.'' 74 FR 32744. EPA announced that it was returning
to what it styled as the traditional interpretation of CAA section
209(b)(1)(B), under which it would only consider whether California had
a ``need for its new motor vehicle emissions program as a whole,'' id.
at 32761. It determined that California did, based on ongoing NAAQS
attainment issues. Id. at 32762-32763. In the alternative, while not
adopting either of the 2008 waiver denial's alternative approaches, EPA
also determined that California needed its GHG standards as part of its
NAAQS attainment strategy due to the indirect effects of climate change
on ground-level ozone formation, id. at 32763, and that waiver
opponents had not met their burden of proof to demonstrate that
California climate impacts ``are not sufficiently different'' to
nationwide impacts, id. at 32765. EPA also determined that there were
no grounds to deny the waiver under CAA section 209(b)(1)(A) (whether
the State's determination that its standards in the aggregate are at
least as protective as federal standards) or CAA section 209(b)(1)(C)
(whether ``such state standards'' and accompanying enforcement
procedures are inconsistent with CAA section 202(a)). Id. at 32759,
32780.

B. EPA's Authority To Reconsider and Withdraw a Previously Granted
Waiver Under CAA Section 209(b)

    In this action, EPA finalizes its proposed determination that it
has the authority to withdraw a waiver in appropriate circumstances.
EPA explains below (in this subsection, III.B) the basis for its
conclusions that it has authority to withdraw a waiver in appropriate
circumstances, and (in subsections III.C and III.D) that it is
appropriate for EPA to exercise that authority at this time.\216\
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    \216\ As a general matter, for purposes of determining if
withdrawal is appropriate, EPA may initiate reconsideration sua
sponte where CARB amends either a previously waived standard or
accompanying enforcement procedure. 47 FR 7306, 7309 (Feb. 18,
1982). See also 43 FR 998 (January 5, 1978) (Grant of
reconsideration to address portions of waived California's
motorcycle program that California substantially amended).
Additionally, if California acts to amend either a previously waived
standard or accompanying enforcement procedure, the amendment may be
considered to be within-the-scope of a previously granted waiver
provided that it does not undermine California's determination that
its standards, in the aggregate, are as at least as protective of
public health and welfare as applicable Federal standards, does not
affect its consistency with section 202(a) of the Act, and raises no
new issues affecting EPA's previous waiver decisions. See, e.g., 51
FR 12391 (April 10, 1986) and 65 FR 69673, 69674 (November 20,
2000).
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    Agencies generally have inherent authority to reconsider their
prior actions. Nothing in CAA section 209(b) indicates Congressional
intent to remove that authority with respect to waivers that it has
previously granted. The text, structure, and context of CAA section
209(b) support EPA's interpretation that it has this authority. And no
cognizable reliance interests have accrued sufficient to foreclose
EPA's ability to exercise this authority here.
    In considering EPA's authority to withdraw a waiver, it is clear
that EPA has authority to review and grant California's applications
for a waiver based on its evaluation of the enumerated criteria in CAA
section 209(b). In this action, we affirm the Agency's proposed view
that the absence of explicit language with regard to withdrawal of a
waiver does not foreclose agency reconsideration and withdrawal of a
waiver.
    As explained at proposal, California's ability to obtain a waiver
under CAA section 209(b)(1) in the first instance is not unlimited.
Specifically, CAA section 209(b)(1) provides that ``no such waiver will
be granted'' if the Administrator finds any of the following: ``(A)
[California's] determination [that its standards in the aggregate will
be at least as protective] is arbitrary and capricious, (B)
[California] does not need such State standards to meet compelling and
extraordinary conditions, or (C) such State standards and accompanying
enforcement procedures are not consistent with section [202(a)].'' CAA
section 209(b)(1)(A)-(C), 42 U.S.C. 7543(b)(1)(A)-(C) (emphasis added).
CAA Section 209(b)(1) is therefore, premised on EPA review and grant of
a waiver prior to California's enforcement of vehicle and engine
standards unless certain enumerated criteria are met.
    Congress could have simply carved out an exemption from preemption
under CAA section 209(b)(1), similar to the exemption it created in CAA
section 211(c)(4)(B) for California fuel controls and prohibitions.
Under CAA section 211(c)(4)(A), states and political subdivisions are
preempted from prescribing or attempting ``to enforce, for purposes of
motor vehicle emission control, any control or prohibition, respecting
any characteristic or component of a fuel or fuel additive in a motor
vehicle or motor vehicle engine'' if EPA has prescribed a control or
prohibition applicable to such characteristic or component of the fuel
or fuel additive under CAA section 211(c)(1). EPA may waive preemption
for states other than California to prescribe and enforce nonidentical
fuel controls or prohibitions subject to certain conditions. Further,
waivers are not required where states adopt state fuel controls or
prohibitions that are identical to federal controls or for California
to adopt fuel controls and prohibitions. CAA sections 211(c)(4)(A)(ii)
and 211(c)(4)(B). This stands in stark contrast to CAA section 209(b),
which requires EPA to make a judgment about California's request for a
waiver of preemption.\217\ Notably, CAA section 211(c)(4)(B) also
cross-references CAA section 209(b)(1): ``(B) Any State for which
application of section 7543(a) of this title has at any time been
waived under section 7543(b) \218\ of this title may at any time

prescribe and enforce, for the purpose of motor vehicle emission
control, a control or prohibition respecting any fuel or fuel
additive.'' CAA section 211(c)(4)(B).
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    \217\ ``Noteworthy is the fact that under the terms of the Act,
EPA approval of California fuel regulations is not required. See Act
section 211(c)(4)(B), 42 U.S.C. 7545(c)(4)(B).'' (Emphasis in
original.) Motor Vehicle Mfrs. Ass'n v. NYS Dep. of Envt'l
Conservation, 17 F.3d 521, 527 (2d Cir. 1994).
    \218\ CAA section 211(c)(4)(B), 42 U.S.C. 7545(c)(4)(B). This
provision does not identify California by name. Rather, it
references CAA section 209(b), which applies on its face to ``any
State which has adopted standards (other than crankcase emission
standards) for the control of emissions from new motor vehicles or
new motor vehicle engines prior to March 30, 1966.'' California is
the only State that meets this requirement. See S. Rep. No. 90-403
at 632 (1967).
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    Under the third waiver prong, CAA section 209(b)(1)(C), for
example, EPA is to review the consistency of California's standards
with CAA section 202(a), a provision of the Clean Air Act that EPA
solely implements.\219\ CAA Section 202(a) provides in relevant part
that standards promulgated under this section ``shall take effect after
such period as the Administrator finds necessary to permit the
development and application of the requisite technology, giving
appropriate consideration to the cost of compliance within such
period.''
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    \219\ EPA has explained that California's standards are not
consistent with CAA section 202(a) if there is inadequate lead time
to permit the development of technology necessary to meet those
requirements, given appropriate consideration to the cost of
compliance within that time. California's accompanying enforcement
procedures would also be inconsistent with CAA section 202(a) if the
Federal and California test procedures were inconsistent.
Legislative history indicates that under CAA section 209(b)(1)(C),
EPA is not to grant a waiver if it finds that there is: ``Inadequate
time to permit the development of the necessary technology given the
cost of compliance within that time period.'' H. Rep. No. 728, 90th
Cong., 1st Sess. 21 (1967); ``That California standards are not
consistent with the intent of section 202(a) of the Act, including
economic practicability and technological feasibility.'' S. Rep. No.
403, 90th Cong. 1st Sess. 32 (1967).
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    In tying the third waiver prong to CAA section 202(a), Congress
gave a clear indication that, in determining whether to grant a waiver
request, EPA is to engage in a review that involves a considerable
degree of future prediction, due to the expressly future-oriented terms
and function of CAA section 202(a).\220\ In turn, where circumstances
arise that suggest that such predictions may have been inaccurate, it
necessarily follows that EPA has authority to revisit those predictions
with regard to rules promulgated under CAA section 202(a), the
requirements of that section, and their relation to the California
standards at issue in a waiver request, and, on review, withdraw a
previously granted waiver where those predictions proved to be
inaccurate.
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    \220\ There is another textual indication that EPA's grant of a
waiver is not limited to a snapshot in time, with the Agency having
no authority to ever revisit, reconsider, and, where appropriate,
modify or withdraw waivers that it has previously granted. CAA
section 209(b) provides authority to waive the preemptive provision
of CAA section 209(a). CAA section 209(a) forbids states from
``adop[ting] or attempt[ing] to enforce'' vehicle emission
standards; so states cannot do so without or beyond the scope of a
waiver. EPA must presume that ``attempt to enforce'' is not
surplusage; it must mean something, and its potential meanings all
suggest some ability on EPA's part to consider actions on the
state's part separate from the state's ``adopt[ion]'' of statutory
or regulatory provisions and submission to EPA of a waiver request
for those provisions. An ``attempt to enforce'' could potentially
mean either a state's attempt to de facto control emissions without
having de jure codified emissions control requirements, or it could
refer to a state's enforcement actions under a program that it has
already ``adopt[ed].'' Under either scenario, the prohibition on
``attempt[ing] to enforce'' envisions state activity outside the
scope of what can be determined by EPA from the face of a waiver
submission. The prohibited activity is not limited to that which can
be subject to a snapshot, one-time-only waiver application, which is
further support for the conclusion that EPA has authority to
reconsider its action on such applications in light of activity
later in time than or outside the authorized scope of a waiver once
granted.
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    Under CAA section 202(a), standards are often technology-forcing
and thus involve predictions on the part of EPA with regard to future
trends in technological and economic factors. This calls for
``substantial room for deference to the EPA's expertise in projecting
the likely course of development.'' Natural Resources Defense Council
v. EPA (NRDC), 655 F.2d 318, 331 (D.C. Cir. 1981) (upholding EPA's lead
time projections for emerging technologies as reasonable). The D.C.
Circuit has recognized that EPA might modify standards ``if the actual
future course of technology diverges from expectation.'' Id. at 329. It
cannot be that EPA has the inherent authority to revisit and revise its
own determinations under CAA section 202(a), but it lacks authority to
revisit those same determinations under CAA section 209(b).\221\
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    \221\ According to one commenter, ``it would be very odd if
Sec.  209(b) waivers were a one-way ratchet that could be granted
but never rescinded. . . . For example, it would run contrary to the
statutory scheme to require EPA to leave a waiver in place even
after the compelling and extraordinary conditions that justified the
waiver are fully addressed.'' Comments of the Alliance of Automobile
Manufacturers at 182. EPA agrees.
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    Thus, the structure of the statute--where State standards may only
be granted a waiver under CAA section 209(b) to the extent that they
are consistent with CAA section 202(a)--confirms that EPA has inherent
authority to reconsider its prior determination that a request for a
waiver for California standards met the criteria of CAA section 209(b).
This renders untenable the stance taken by some commenters that EPA is
somehow precluded from conducting a subsequent review and withdrawing a
waiver even when it becomes aware that its initial predictions in this
regard have proven inaccurate.
    Further, as discussed in the SAFE proposal, the legislative history
of CAA section 209(b) confirms that Congress intended EPA's authority
under CAA section 209(b) to include the authority to withdraw a
previously granted waiver under appropriate circumstances. 83 FR 43242-
43243. See S. Rep. No. 50-403, at 34 (1967) (``Implicit in this
provision is the right of the [Administrator] to withdraw the waiver at
any time [if] after notice and an opportunity for public hearing he
finds that the State of California no longer complies with the
conditions of the waiver.'').
    Some commenters that oppose the proposed withdrawal of the waiver
concede that the agency may review California's waiver applications
under the third waiver prong but then argue that such agency review is
a ``narrow one.'' \222\ Under CAA Section 209, they contend, grants
California ``maximum authority'' to set engine and vehicle standards.
Commenters' objection to the instant withdrawal therefore appears to be
grounded in some belief that CAA section 209(b) calls for complete
deference to California. This view is erroneous. EPA has in fact
previously initiated reconsideration under the third waiver prong, CAA
section 209(b)(1)(C), in order to ``vacate that portion of the waiver
previously granted under section 209(b)'' in response to CARB's post
waiver modification for previously waived standards. 47 FR 7309. In
that reconsideration action, EPA affirmed the grant of a waiver in the
absence of ``findings necessary to revoke California's waiver of
Federal preemption for its motorcycle fill-pipe and fuel tank opening
regulations.'' 43 FR 7310. Additionally, EPA has explained that
reconsideration will be initiated where leadtime concerns arise after
the grant of an initial waiver. ``If California's leadtime projections
later prove to have been overly optimistic, the manufacturer can ask
that California reconsider its standard, if they are unsuccessful in
securing such relief, the

manufacturers could petition EPA to reconsider the waiver.'' 49 FR
18895, 18896 n.104. Further, EPA has in the past repeatedly denied
portions of several waiver requests.\223\ EPA has also historically
deferred or limited the terms of its grant of aspects of some waiver
requests as a means of ensuring consistency with CAA section
202(a).\224\ It is precisely these kinds of EPA actions that have
forestalled withdrawal of any waiver to date--not any lack of authority
on EPA's part to withdraw. None of the commenters, however, provided
explanations as to why their apparent view of maximum deference to
California is not implicated by EPA's authority to either deny a waiver
request or to modify the terms of a waiver request in the course of
granting one. And EPA's 2009 reversal of its 2008 denial supports, and
demonstrates the long-held nature of, its position that EPA has
authority to reconsider and reverse its actions on waiver
applications.\225\
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    \222\ According to several commenters, CAA section 209(b)
contains no express delegation of authority to EPA to withdraw a
waiver, and in proposing to revoke a previous waiver ``EPA has
arrogated to itself power only Congress can exercise.'' Comments of
the Center for Biological Diversity, Conservation Law Foundation,
EarthJustice, Environmental Defense Fund, Environmental Law and
Policy Center, Natural Resources Defense Council, Public Citizen,
Inc., Sierra Club, and Union of Concerned Scientists at 68. One
commenter also argued that either EPA lacks authority to revoke a
previously granted waiver or that any authority to do so is
``limited.'' ``The unique text and structure of this section limits
EPA's authority, contrary to EPA's assertion of open-ended
revocation authority in the proposal.'' Comments of the California
Air Resources Board at 340.
    \223\ 38 FR 30136 (November 1, 1973) (denial of waiver for MY
1975 HC and CO standards ``because costs of compliance within the
lead time remaining is excessive.''); 43 FR 998 (January 5, 1978)
(denial of waiver for MY 1978 test procedures due to insufficient
lead time); 40 FR 30311 (July 18, 1975) (denial of waiver due to
insufficient lead time for MY 1977).
    \224\ 58 FR 4166 (January 13, 1993) (deferring consideration of
portions of waiver request); 67 FR 54180, 81 n.1 (August 21, 2002)
(granting waiver with certain exceptions).
    \225\ In seeking reconsideration of the March 8, 2008 waiver
denial, CARB also noted that ``EPA has the inherent authority to
reconsider its previous waiver denial'' 74 FR 32747.
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    At least one commenter argued that this legislative history did not
support the position that EPA has authority to withdraw a previously
granted waiver because the legislative history relates to the original
creation of the waiver provision in the Air Quality Act of 1967,
whereas the Clean Air Act Amendments of 1977 revised language in the
root text of CAA section 209(b)(1). Specifically, Congress in 1977
amended CAA section 209(b)(1) to establish as a prerequisite for the
grant of a waiver that the State determine that its standards ``will
be, in the aggregate, at least as protective of public health and
welfare as applicable Federal standards'' for EPA to issue a waiver,
rather than the original requirement that State standards be ``more
stringent'' than corresponding federal standards.\226\ EPA disagrees
that this amendment was either intended to deprive EPA of authority to
withdraw a previously granted waiver when the Administrator finds
applicable one or more of the three criteria in CAA section 209(b)(1)
under which a waiver is inappropriate, or that the amendment can be
reasonably construed to have had such effect. There is no indication
that the amendment was intended to alter EPA's authority under the
original provision. Nor did the amendment alter the language of the
criteria enumerated in CAA section 209(b). In any event, as previously
discussed above, EPA has initiated reconsideration for purposes of
revoking a waiver since the 1977 CAA amendments. See for example, 47 FR
7306 (Feb. 18, 1982) (Agency reconsideration of grant of waiver for
purposes of withdrawal in response to CARB's post waiver modification
for previously waived standards).
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    \226\ The intent of the 1977 amendment was to accommodate
California's particular concern with NOX, which the State
regarded as a more serious threat to public health and welfare than
carbon monoxide. California was eager to establish oxides of
nitrogen standards considerably more stringent than applicable
Federal standards, but technological developments posed the
possibility that emission control devices could not be constructed
to meet both the stringent California oxides of nitrogen standard
and the stringent federal carbon monoxide standard. Motor & Equip.
Mfrs. Ass'n, Inc. v. EPA, 627 F.2d at 1110 n.32. EPA has explained
that the phrase ``in the aggregate'' was specifically aimed at
allowing California to adopt CO standards less stringent than the
corresponding federal standards, while at the same time adopting
more stringent NOX standards, as part of California's
strategy to address ozone problems. California reasoned that a
relaxed CO standard would facilitate the technological feasibility
of more stringent NOX standards. 78 FR 43247.
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    Some commenters question whether EPA has any authority at all to
reconsider a previously granted waiver. It is well-settled, however,
that EPA has inherent authority to reconsider, revise, or repeal past
decisions to the extent permitted by law. At proposal, EPA explained
that, although CAA section 209(b)(1) may not expressly communicate that
EPA has authority to reconsider and withdraw a waiver, both the
legislative history of the waiver provision and fundamental principles
of administrative law establish that EPA necessarily possesses that
authority. The authority to reconsider prior agency decisions need not
be rooted in any particular ``magic words'' in statutory text. Subject
to certain limitations, administrative agencies possess inherent
authority to reconsider their decisions. See ConocoPhillips Co. v. EPA,
612 F.3d 822, 832 (5th Cir. 2010) (``Embedded in an agency's power to
make a decision is its power to reconsider that decision.''); Dun &
Bradstreet Corp. Found. v. U.S. Postal Serv., 946 F.2d 189, 193 (2d
Cir. 1991) (``It is widely accepted that an agency may, on its own
initiative, reconsider its interim or even its final decisions,
regardless of whether the applicable statute and agency regulations
expressly provide for such review.''); Mazaleski v. Treusdell, 562 F.2d
701, 720 (D.C. Cir. 1977) (``[A]n agency has the inherent power to
reconsider and change a decision if it does so within a reasonable
period of time.''); Belville Min. Co. v. United States, 999 F.2d 989,
997 (6th Cir. 1993) (``Even where there is no express reconsideration
authority for an agency, however, the general rule is that an agency
has inherent authority to reconsider its decision, provided that
reconsideration occurs within a reasonable time after the first
decision.'').
    The commenters' position that EPA does not have any authority to
reconsider either a grant or a denial of a waiver founders in light of
these principles. As explained in the SAFE proposal, 83 FR 43242-43243,
EPA does have that authority, in part because its interpretations of
the statutes it administers ``are not carved in stone.'' Chevron U.S.A.
v. NRDC, 467 U.S. 837, 863 (1984). An agency ``must consider varying
interpretations and the wisdom of its policy on a continuing basis.''
Id. at 863-64. Notably, in response to CARB's request, EPA has
previously reconsidered and reversed a previous waiver denial.\227\
Similarly, in keeping with agency CAA section 209(b)(1) practice, EPA
has reconsidered its previous decision to grant a waiver for portions
of California's motorcycle program in response to a petition for
reconsideration from the motorcycle industry.\228\
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    \227\ EPA reconsidered the 2008 GHG waiver denial in response to
CARB's request and granted it upon reconsideration. 72 FR 32744
(July 9, 2009). See also 43 FR 998 (January 5, 1978) (Grant of
reconsideration to address portions of waived California's
motorcycle program that California substantially amended).
    \228\ 43 FR 998 (January 5, 1978).
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    Other commenters assert that EPA's proposal to withdraw the waiver
is solely based on a change in Presidential administration. There is no
basis for this claim. While EPA noted in the SAFE proposal that the
agency can review and reconsider a prior decision ``in response to . .
. a change in administration,'' National Cable & Telecommunications
Ass'n v. Brand X Internet Services, 545 U.S. 967, 981 (2005), we
further acknowledged that ``the EPA must also be cognizant where it is
changing a prior position and articulate a reasoned basis for the
change.'' FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515
(2009). 83 FR 43242-43243, 43248. In keeping with the proposed waiver
withdrawal, under the second waiver prong, CAA section 209(b)(1)(B), as
discussed below, EPA in this document finalizes a determination that
California does not

need its GHG and ZEV standards to meet compelling and extraordinary
conditions, within the meaning of those terms as they are used in the
statute, that differs from its determination on the same question made
in the course of granting the ACC program waiver. Additionally, the
agency, in response to a request by automobile manufacturers, who have
consistently expressed reservations over their ability to comply with
MY 2022-2025 GHG standards, is reconsidering standards that are the
compliance mechanism for CARB's MY 2022-2025 GHG standards. This is the
compliance mechanism that California had provided in response to
automobile manufacturers request and support for the waiver of
preemption.
    At proposal, EPA noted that California had given public notice that
it was considering amending its ``deemed to comply'' provision to
provide that that provision would be applicable only to vehicles that
meet the standards originally agreed to by California, the federal
government, and automakers in 2012. See 83 FR 43252 n.589. California
finalized that amendment to its regulations after the close of the SAFE
comment period, in late 2018. California more recently, in July 2019,
announced a ``framework'' agreement with certain automakers that
purported to establish a ``nationwide'' standards program different
from both the 2012 Federal standards and from the California program
for which EPA granted the January 2013 waiver. These actions on
California's part, while not proposed as bases for waiver withdrawal in
the August 2018 SAFE proposal, as those actions had not yet transpired
at the time of proposal, and while not necessary for the finalization
of this action, do provide further support for this action (although
EPA does not view them as necessary predicates for this action and
would be taking this action even in their absence).
    Thus, contrary to some commenters' assertions, reconsideration of
the grant of the waiver, and EPA's proposal to withdraw the waiver, was
not solely motivated by a change in Presidential administration. The
policy, technical, and legal considerations discussed in the proposal
and in this final action provide the rationale for EPA's actions here.
It is therefore distinguishable from the instance where, for example,
an agency undertook reconsideration subsequent to a change in
administration because ``the withdrawn decision was doubtful in light
of changing policies.'' Coteau Properties Co. v. DOI, 53 F.3d 1466,
1479 (8th Cir. 1995).
    Further, as earlier noted, California has now entered into a
voluntary agreement with at least four automobile manufacturers that
amongst other things, requires the automobile manufacturers to refrain
from challenging California's GHG and ZEV programs, and provides that
California will accept automobile manufacturer compliance with a less
stringent standard than either the California program that was the
subject of the 2013 waiver or the Federal standards as promulgated in
2012.\229\ This agreement appears to materially depart from the
existing grant of waiver for MY 2021-2025 GHG standards, is in tension
with California's above-mentioned amendment of the ``deemed to comply''
provision, and raises an additional reason to question whether
California ``needs'' their existing standards within the meaning of CAA
section 209(b)(1)(B), given that California has announced it is
proceeding to create a new ``voluntary'' program that would relax the
stringency of some aspects of those standards. That is to say,
California's apparent weakening of its program as it was originally
submitted for waiver calls into question whether it needs that program.
EPA believes that this provides additional support for its conclusion,
as set forth in subsections III.B and III.D, both that it has authority
to withdraw its grant of the waiver and that California does not in
fact need these waived standards to meet ``compelling and extraordinary
conditions,'' CAA section 209(b)(1)(B), if the State is itself already
proceeding to allow departures from those waived standards.\230\ EPA
further believes that California cannot claim reliance interests when
it is undertaking steps to alter the status quo.
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    \229\ https://www.gov.ca.gov/2019/07/25/california-and-major-automakers-reach-groundbreaking-framework-agreement-on-clean-emission-standards/.
    \230\ Again, neither California's late 2018 amendment to its
``deemed to comply'' provision, nor its July 2019 announcement of a
new ``framework,'' are necessary bases for the action EPA takes in
this document; instead, they provide further support for that
action.
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    In short, the text, structure, and history of CAA section 209(b)(1)
support EPA's authority to withdraw previously granted waivers.\231\ At
the same time, nothing in CAA section 209(b)(1) can reasonably be read
to preclude the agency from withdrawing a previously issued waiver
under appropriate circumstances. EPA is not persuaded by commenters'
assertions to the contrary. In this action, EPA affirms the position
that the scope of review for California waivers under CAA section
209(b)(1) includes both a pre-grant review and, where appropriate,
post-grant review of an approved waiver; that post-grant review may, in
appropriate circumstances, result in a withdrawal of a prior waiver. A
withdrawal action could be premised on any one of the three findings in
CAA section 209(b)(1)(A)-(C) that render a waiver unavailable.
---------------------------------------------------------------------------

    \231\ In 2009, EPA reconsidered the 2008 GHG waiver denial at
CARB's request and granted it upon reconsideration. 74 FR 32744. EPA
noted the authority to ``withdraw a waiver in the future if
circumstances make such action appropriate.'' See 74 FR 32780 n.222;
see also id. at 32752-32753 n.50 (citing 50 S. Rep. No. 403, at 33-
34).
---------------------------------------------------------------------------

    EPA also disagrees with some commenters' assertions that ostensible
reliance interests foreclose withdrawal of the waiver for MY 2021-2025
GHG and ZEV standards. According to these commenters, ``California, and
the section 177 states that have elected to adopt those standards as
their own have incurred reliance interests ultimately flowing from
those standards. For instance, California has incurred reliance
interests because it is mandated to achieve an aggressive GHG emissions
reduction target for 2030.'' \232\ They further state: ``[b]ut EPA
provides no justification for applying that change in policy
retroactively to upend a five-year-old decision to which substantial
reliance interests have attached.'' (Emphasis in original).\233\
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    \232\ Comments of CARB at 83.
    \233\ Comments of States of California, Connecticut, Delaware,
Hawaii, Iowa, Illinois, Maine, Maryland, Minnesota, New Jersey, New
Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont and
Washington, the Commonwealth of Massachusetts, Pennsylvania and
Virginia, the District of Columbia, and the Cities of Los Angeles,
New York, Oakland, San Francisco and San Jose at 123; Comments of
CARB at 352.
---------------------------------------------------------------------------

    The federal GHG standards that EPA promulgated in 2012 included a
commitment to conduct and complete a Mid-Term Evaluation (MTE) of the
GHG standards for MY 2022-2025, given the lengthy phase-in compliance
period, EPA projections of control technology availability or
feasibility for MY 2021-2025, and the fact that EPA promulgated those
standards in a joint action with NHTSA, where NHTSA was acting under a
statute which limited its promulgation of fuel economy standards to
periods of five years.\234\ See NRDC,

655 F.2d at 329 (upholding EPA's lead time projections for emerging
technologies as reasonable, noting a longer lead time tends to ``give[
] the agency greater leeway to modify its standards if the actual
future course of technology diverges from expectation.''). The 2012
rulemaking also established the GHG standards for MY 2021-2025 that are
the subject of the ``deemed to comply'' provision. (i.e., California
allowed automobile manufacturers to demonstrate compliance with
California's GHG standards by complying with EPA's GHG standards). The
MTE construct required EPA to issue a Final Determination by April 1,
2018 regarding whether the GHG standards for MY 2022-2025 remained
appropriate under CAA section 202(a).\235\ Specifically, the MTE would,
amongst other things, assess the relevant factors pertinent to setting
standards under CAA section 202(a), such as the feasibility and
practicability of the standards, costs to vehicle manufacturers and
consumers, impacts on the automobile industry, emissions impacts, and
safety impacts. In comments during the 2012 national GHG rulemaking,
automakers supported the MTE, and several expressly predicated their
support of the GHG standards for MY 2022-2025 on the MTE.\236\ In the
waiver action, EPA reiterated its commitment to the MTE in light of
these considerations.\237\
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    \234\ 40 CFR 86.1818-12(h). 77 FR 62624 (October 15, 2012). EPA
notes in this regard that the Supreme Court in Massachusetts v. EPA,
in rejecting the position that greenhouse gases are not air
pollutants under the general definition of that term in CAA section
302 because, if they were, EPA's regulations of GHG emissions from
the motor vehicle fleet could intrude on DOT's fuel economy
authority, opined that ``[t]he two obligations may overlap, but
there is no reason to think the two agencies cannot both administer
their obligations and yet avoid inconsistency.'' 549 U.S. 497, 532
(2007). In order for the two agencies to do so, they needed to take
account of the fact that DOT's fuel-economy authority faces temporal
constraints that EPA's emissions authority does not. They did so
through the MTE, and the MTE mechanism provided notice to all
interested parties that EPA's 2012 federal standards under CAA
section 202(a), and EPA's January 2013 waiver grounded in part on a
finding that the State provisions subject to the waiver were
compatible with CAA section 202(a), would be subject to review and
possibly revision within a few years of the waiver grant. Under
these circumstances, no reliance interests accrued sufficient to
foreclose EPA's authority to reconsider and withdraw the waiver.
    \235\ The MTE process also called for a ``draft Technical
Assessment Report'' (to be prepared no later than November 15,
2017), public comments on that draft report, and public comments on
whether the model year 2022-2025 standards are ``appropriate'' under
CAA section 202(a).
    \236\ 77 FR at 62636, 62652, 62785.
    \237\ ``EPA is committed to conducting a mid-term evaluation for
MYs 2022-2025 in close coordination with NHTSA and CARB given the
long-time frame in implementing standards out to MY 2025 and given
NHTSA's obligation to conduct a separate rulemaking in order to
establish final standards for vehicles for those years.'' 78 FR
2137.
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    In these circumstances, where GHG standards were being set far into
the future with an explicit commitment to revisit them, where
California agreed to deem compliance with certain federal GHG standards
to constitute compliance with California standards, and where all
parties were provided ample notice that EPA would be revisiting federal
standards and, accordingly, the waiver granted for a program that
acceded to those standards through the ``deemed to comply'' provision,
neither the State of California nor other parties (such as automakers)
have reasonable reliance interests sufficient to foreclose the
extension of federal standards to California. Likewise, under CAA
section 177, even though States other than California, under certain
circumstances and conditions, may ``adopt and enforce'' standards that
are ``identical to the California standards for which EPA has granted a
waiver for such model year,'' given that Title I \238\ does not call
for NAAQs attainment planning as it relates to GHG standards, those
States that may have adopted California's GHG standards and ZEV
standards for certain MYs would also not have any reliance interests as
a result of the grant of the ACC program waiver. As previously noted,
CAA section 177 States also lack reliance interests sufficient to
preclude reconsideration and withdrawal of the waiver both because they
were on notice of the commitment to review the federal standards, as
discussed above.\239\ Relatedly, with the revocation of these standards
in this action there will be no ``standards identical to the California
standards for which a waiver has been granted'' that any state may
adopt and enforce, under CAA section 177(1).\240\ (States may not
``tak[e] any action that has the effect of creating a car different
from those produced to meet either federal or California emission
standards, a so-called `third vehicle.' '' Motor Vehicle Mfrs. Ass'n of
U.S., Inc. v. New York State Dep't of Envtl. Conservation, 17 F.3d 521,
528 (2d Cir. 1994)). California also did not seek approval for MY 2021-
2025 GHG standards in its 2016 SIP approval request. 81 FR 39424, 27-28
(June 16, 2016).
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    \238\ Under title I of the Clean Air Act, EPA establishes
national ambient air quality standards (NAAQS) to protect public
health and welfare, and has established such ambient standards for
ozone, carbon monoxide, nitrogen dioxide, sulfur dioxide, lead, and
particulate matter.
    \239\ ``This new State authority should not place an undue
burden on vehicle manufacturers who will be required, in any event,
to produce vehicles meeting the California standards for sale in
California.'' H.R. Conf. Rep. No. 95-294, 95th Cong., 1st Sess. 337
(1977).
    \240\ A State may not ``make attempt[s] to enforce'' California
standards for which EPA has not waived preemption. Motor Vehicle
Mfrs. Ass'n v. NYS Dep. of Envtl Conservation, 17 F.3d 521, 534 (2d
Cir. 1994).
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    As a general matter, ``[w]henever a question concerning
administrative, or judicial, reconsideration arises, two opposing
policies immediately demand recognition: The desirability of finality,
on the one hand, and the public interest in reaching what, ultimately,
appears to be the right result on the other.'' Civil Aeronautics Bd. v.
Delta Air Lines, Inc., 367 U.S. 316, 321-22 (1961). See also
ConocoPhillips, 612 F.3d at 832 (5th Cir. 2010) (``Furthermore,
reconsideration also must occur within a reasonable time after the
decision being reconsidered was made, and notice of the agency's intent
to reconsider must be given to the parties.''); Belville Min. Co. v.
United States, 999 F.2d 989, 997 (6th Cir. 1993) (``Even where there is
no express reconsideration authority for an agency, however, the
general rule is that an agency has inherent authority to reconsider its
decision, provided that reconsideration occurs within a reasonable time
after the first decision.''); Bookman v. United States, 453 F.2d 1263,
1265 (Fed. Cir. 1972) (``[A]bsent contrary legislative intent or other
affirmative evidence, this court will sustain the reconsidered decision
of an agency, as long as the administrative action is conducted within
a short and reasonable time period.'').
    For the reasons stated above, there was no ``finality'' in the
federal MY 2021-2025 GHG standards that EPA promulgated in 2012 in the
sense required for cognizable reliance to accrue sufficient to
foreclose EPA's exercise of authority to reconsider and, if
appropriate, withdraw the waiver. Nor is such ``finality'' to be found
in the January 2013 grant of the waiver for California's MY 2021-2025
GHG and ZEV standards. As explained at proposal, in granting the waiver
for the ACC program GHG and ZEV standards, EPA had evaluated certain
compliance flexibilities allowed by California under the third waiver
prong, CAA section 209(b)(1)(C) (consistency with CAA section 202(a)).
Specifically, EPA evaluated California regulations that included an
optional compliance provision (the ``deemed to comply'' provision) that
would allow automobile and engine manufacturers to demonstrate
compliance with CARB's GHG standards for MY 2017-2025 by complying with
applicable national or federal GHG standards. 78 FR 2136. During the
waiver proceedings, most automobile manufacturers either opposed the
grant of the waiver for MY 2021-2025 GHG and ZEV standards as not
consistent with CAA section 202(a) \241\ or premised their support for

those standards on California's permitting compliance through the
``deemed to comply'' provision.\242\ In comments on the proposed
withdrawal, California did not contest this aspect of the waiver
proceedings. For example, California in its comments on the SAFE
proposal, at page 57, states ``[b]ecause the federal program was
expected to achieve GHG emission reductions that are equivalent to the
California program, CARB modified its LEV III GHG regulation to
continue to allow the `deemed to comply' option beyond model year 2016,
by accepting federal compliance with the EPA standards as sufficient to
demonstrate compliance with California's standards for the 2017 through
2025 model years.'' Additionally, most automobile manufacturers
indicated that they would comply with California's GHG standards
through the ``deemed to comply'' provision. Both California and some
automobile manufacturers also alluded to their expectations that
standards would be revised in the future in light of technological
feasibility and cost considerations surrounding MY 2022-2025 GHG
standards.243 244
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    \241\ 78 FR 2132 (manufacturers suggested that EPA should grant
California's waiver request after CARB finalized its regulatory
amendments to allow for a national compliance option; manufacturers
oppose granting the waiver for the ZEV program past the 2017 MY,
asserting that those standards will not be feasible either in
California or in the individual CAA section 177 States given the
status of the infrastructure and the level of consumer demand for
ZEVs; dealers suggest that EPA should not grant California a waiver
for its ZEV and GHG emission standards past MY 2018 and 2021,
respectively, asserting that technical capabilities after that time
are uncertain.).
    \242\ ``[T]his national compliance option is integral to the
commitment letters the industry and California signed in July 2011
and to the single national GHG/fuel economy program all stakeholders
sought to achieve.'' 78 FR 2138.
    \243\ 78 FR 2128. A waiver ``will remain an important backstop
in the event the national program is weakened or terminated;''
manufacturers note that both the federal and the California GHG
emission standards provide for a comprehensive mid-term evaluation
of the MYs 2022-2025; manufacturers clearly state that ``[a]ny
amendments to California's GHG emission standards made as a result
of the mid-term evaluation will require analysis to determine
whether the amendments fall within the scope of this waiver, or, if
not, whether they qualify for a separate waiver under Section 209(b)
of the Clean Air Act.'' 78 FR 2132. See also, e.g., comments of the
National Automobile Dealers Association, n.43. On March 11, 2013,
the Association of Global Automakers and Alliance of Automobile
Manufacturers filed a petition for reconsideration of the January
2013 waiver grant, requesting that EPA reconsider the decision to
grant a waiver for MYs 2018 through 2025 ZEV standards on
technological feasibility grounds. Petitioners also asked for
consideration of the impact of the travel provision, which they
argue raise technological feasibility issues in CAA section 177
States, as part of the agency's review under the third waiver prong,
CAA section 209(b)(1)(C). EPA continues to evaluate the petition. As
explained below, in this action EPA is not taking final action with
regard to the proposed determinations under the third waiver prong.
Whether and how EPA will respond to the March 2013 petition will be
considered in connection with a potential future final action with
respect to the proposed third prong determinations set forth in the
SAFE proposal.
    \244\ Since the grant of the ACC waiver program, engine and
vehicle manufacturers who voiced concerns about the stringency of MY
2021-2025 GHG and ZEV standards during the waiver proceedings have
requested both reconsideration of the grant of the waiver for the
ZEV standards (which is a compliance mechanism for the GHG
standards) and aspects of the national GHG program.
---------------------------------------------------------------------------

    Regarding whether EPA is foreclosed from reconsidering its January
2013 waver grant due to the passage of time, on January 12, 2017, well
in advance of the April 2018 deadline that it had set for itself, EPA
completed the Mid-Term Evaluation called for under the 2012 national
GHG standards, determining that the MY 2017-2025 GHG standards
promulgated in that rulemaking were appropriate. Automobile
manufacturers, however, petitioned EPA for reconsideration of that
January 2017 determination. In March 2017, EPA granted this petition
for reconsideration. 82 FR 14671 (Mar. 22, 2017). In March 2017
California completed its own Mid-Term Evaluation review, in which it
arrived at different conclusions on technological feasibility and costs
for these standards than those that EPA would later reach.
Subsequently, in April 2018, consistent with the timing specified in
its regulations, EPA revised its finding on the appropriateness of the
federal MY 2022-2025 GHG standards, concluding that those standards
``are not appropriate and, therefore, should be revised.'' \245\ This
finding provided notice of a reasonable possibility that these federal
GHG standards would likely be changing.\246\ In the April 2018 action,
EPA also withdrew the January 2017 finding. 83 FR at 16077. Since then
California has challenged this revised finding; that challenge is
pending in the United States Court of Appeals for the District of
Columbia. California v. EPA, No. 18-1114 (D.C. Cir. argued Sept. 6,
2019). Moreover, California in December 2018 amended the ``deemed to
comply'' provision in its regulations after the publication of the SAFE
proposal, and in July 2019 announced a putative nationwide framework
for vehicle standards, as discussed above.
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    \245\ Mid-Term Evaluation of Greenhouse Gas Emissions Standards
for Model Year 2022-2025 Light-Duty Vehicles: Notice; Withdrawal. 83
FR 16077 (Apr. 13, 2018).
    \246\ 82 FR 14671 (Mar. 22, 2017).
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    These procedural aspects of the federal GHG standards and the grant
of a waiver for California's ACC program are indicative of the absence
of the possibility of reasonable reliance in the ``finality'' of the
waiver, contrary to commenters' assertion of reliance interests. For
instance, as shown above, the engine and vehicle manufacturers have not
only complained about the stringency of MY 2021-2025 GHG and ZEV
standards, but also requested reconsideration of both the waiver as it
relates to the ZEV standards, and the 2017 Mid-Term Evaluation that
addresses the ``deemed to comply'' provision, which California provided
in response to their request. EPA has also initiated joint rulemaking
with NHTSA that proposes amended EPA GHG standards and fuel economy
standards for MY 2021-2026. See, the Safer Affordable Fuel-Efficient
(SAFE) Vehicles Rule for Model Years 2021-2026 Passenger Cars and Light
Trucks. 83 FR 42986 (Aug. 24, 2018). As also previously noted,
automobile and engine manufacturers operated under the assumption that
both California and national standards would, or at least could, be
revised.\247\ These circumstances are sufficient to put California and
others on notice that standards were in flux such that they could not
give rise to reasonable reliance interests. Further, CAA section 177
States do not have any reliance interests that are engendered by the
withdrawal of the waiver for the MY 2021-2025 GHG and ZEV standards. As
previously explained, although CAA section 177 allows States other than
California to adopt standards that are promulgated by California and
for which a waiver of preemption is granted by EPA pursuant to CAA
section 209, CAA section 177 States may do so only subject to certain
conditions and circumstances. None of these conditions and
circumstances, however, are at issue in this waiver decision, in light
of EPA's determination that CAA section 177 does not apply to states
seeking to adopt and enforce CARB's GHG standards. As also previously
noted, with the revocation of these standards in this action, there
will be no ``standards identical to the California standards for which
a waiver has been granted'' that any state may adopt and enforce, under
CAA section 177(1).\248\ States may not ``tak[e] any action that has
the effect of creating a car different from those produced to meet
either federal or California emission standards, a so-called `third
vehicle.' '' Motor

Vehicle Mfrs. Ass'n of U.S., Inc. v. New York State Dep't of Envt'l
Conservation, 17 F.3d 521, 528 (2d Cir. 1994).
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    \247\ ``The manufacture of automobiles is a complex matter,
requiring decisions to be made far in advance of their actual
execution. The ability of those engaged in the manufacture of
automobiles to obtain clear and consistent answers concerning
emission controls and standards is of considerable importance so as
to permit economies in production.'' S. Rep. No. 403, 90th Cong., at
730 1st Sess. (1967).
    \248\ A State may not ``make attempt[s] to enforce'' California
standards for which EPA has not waived preemption. Motor Vehicle
Mfrs. Ass'n v. NYS Dep. of Envtl Conservation, 17 F.3d 521, 534 (2d
Cir. 1994).
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    California's comments argue that EPA cannot revisit its waiver with
respect to the ZEV standards in particular because EPA, in a SIP
approval action, approved ZEV provisions into the State's SIP. Final
CARB Detailed Comments, at 351. But in so doing, EPA noted that
California's GHG provisions were not part of California's SIP
submission.\249\ At the time, EPA explained that ``CARB has expressly
excluded from the August 14, 2015 SIP submittal certain sections or
subsections of California code that have been authorized or waived by
EPA under CAA section 209.'' \250\ Further, in the SAFE proposal, EPA
explained that the proposed withdrawal of the waiver for MY 2021-2025
ZEV standards was premised in part on California's explicit indications
that compliance with those standards formed part of the compliance
mechanism for MY 2021-2025 GHG standards. For instance, at proposal, we
explained ``because the ZEV and GHG standards are closely interrelated,
as demonstrated by the description above of their complex, overlapping
compliance regimes, EPA is proposing to withdraw the waiver of
preemption for ZEV standards under the second and third prongs of
section 209(b)(1).'' 83 FR 43243. California's responses to the SAFE
proposal do not rebut the Agency's views that the ZEV standards for MY
2021-2025 are inextricably interconnected with the design and purpose
of California's overall GHG reduction strategy.\251\ According to
California, for example, CARB's GHG standards for the 2017 through 2025
MYs are designed to respond to California's identified goals of
reducing GHG emissions to 80 percent below 1990 levels by 2050 and in
the near term to reduce GHG levels to 1990 levels by 2020;'' ``In 2009,
CARB staff analyzed pathways to meeting California's long-term 2050 GHG
reduction goals in the light duty vehicle subsector and determined that
ZEVs would need to comprise nearly 100 percent of new vehicle sales
between 2040 and 2050, and commercial markets for ZEVs would need to
launch in the 2015 to 2020 time frame.'' Analysis in support of
comments of the California Air Resources Board on the SAFE proposal,
pg. 54, 59 & 83. EPA reviewed California's SIP submission, including
ZEV measures, as a matter of NAAQS compliance strategy. But in the
2012-2013 CAA section 209(b) waiver proceeding, CARB presented its ZEV
program to EPA solely as a GHG compliance strategy--indeed, CARB
expressly stated that the ZEV program did not confer NAAQS pollutant
benefits. ``There is no criteria emissions benefit from including the
ZEV proposal in terms of vehicle (tank-to-wheel or TTW) emissions.''
CARB ACC waiver request at 15, EPA-HQ-OAR- 2012-0562-0004.\252\
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    \249\ 81 FR 39424, 27-28 (June 16, 2016).
    \250\ 81 FR 29427-28. ``The excluded provisions pertain to:
Greenhouse Gas (GHG) exhaust emission standards 2009 through 2016
Model Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles,
and 2017 and subsequent Model Passenger Cars, Light-Duty Trucks, and
Medium Duty Vehicles.''
    \251\ Analysis in support of comments of the California Air
Resources Board on the SAFE proposal, at 342. ``For example, and
relevant here, California's Legislature has established an
aggressive GHG emissions reduction target for 2030.'' ``The ZEV
mandate is a crucial part of this strategy; it `act[s] as the
technology forcing piece of the 2016 Draft TAR program' which is
necessary because `the new vehicle fleet [in California] will need
to be primarily composed of advanced technology vehicles . . . by
2035' in order to meet the State's 2050 GHG goal.'' Id. at 369-70
(Internal citations omitted). ``This increasing ZEV deployment is
critical to achieving the statewide 2030 and 2045 GHG requirements
and 2031 South Coast SIP commitments (the 2016 State SIP Strategy
identified the need for light-duty vehicles to reduce NOX
emissions by over 85 percent by 2031 to meet federal standards).''
Id. at 373.
    \252\ CARB in its SAFE proposal comments refers to this as an
``alleged[ ]'' statement, Final Carb Detailed Comments at 351. The
SAFE proposal cited the Waiver Support Document in which CARB made
this statement, 83 FR at 43248 n.580. The statement is directly
quoted above. California's comments on the SAFE proposal do not
contest that California's ACC waiver request expressly disclaimed
criteria pollutant benefits from the ZEV program, nor do they
establish that EPA is foreclosed from revisiting the grant of the
waiver in light of the interpretation of 209(b)(1)(B) adopted below.
EPA notes in this regard that California's approach in its ACC
waiver request differed from the state's approach in its waiver
request for MY 2011 and subsequent heavy-duty tractor-trailer GHG
standards, where California quantified NOX emissions
reductions attributed to GHG standards and explained that they would
contribute to PM and ozone NAAQS attainment. 79 FR 46256, 46257
n.15, 46261, 46262 n.75 (August 7, 2014).
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    Similarly, some commenters argued that EPA reconsideration would
constitute impermissible retroactive action, citing Bowen v. Georgetown
Univ. Hosp., 488 U.S. 204 (1988). However, the rulemaking which the
Supreme Court held was impermissibly retroactive in that case had been
proposed in February 1984 and had purported to establish reimbursement
rates effective July 1, 1981. By contrast, here EPA is reconsidering a
previous grant of a waiver of preemption for future model years 2021-
2025.\253\ Reconsideration of aspects of a prior adjudication whose
effects have not yet ripened is not barred by Bowen's proscription on
retroactive rulemaking--otherwise any reconsideration of agency action
would likewise be barred.
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    \253\ As explained above, to the extent that NHTSA's final
determination that EPCA preempts State GHG and ZEV programs, the
implications of that determination for prior EPA waivers of such
programs are effective upon the effective date of this joint action.
Separate and apart from that analysis, to the extent that EPA is
withdrawing the waiver based on its determination that the waiver
does not meet the CAA section 209(b)(1)(B) criterion, that
withdrawal is for model years 2021-2025, as proposed in the SAFE
proposal.
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    For all these reasons, EPA concludes it has authority under CAA
section 209 to reconsider its prior grant of the ACC waiver and to
withdraw the waiver for MY 2021-2025 GHG and ZEV standards, consistent
with the SAFE proposal.

C. The Effect of Preemption Under the Energy Policy and Conservation
Act (EPCA) on EPA's Previously Granted Waiver Under CAA Section 209(b)
With Regard to California's GHG and ZEV Standards

    In the SAFE proposal, EPA explained its historical practice of
reviewing waiver requests under the prism of CAA section 209.
Specifically, EPA has ``historically declined to consider as part of
the waiver process whether California standards are constitutional or
otherwise legal under other Federal statutes apart from the Clean Air
Act.'' 83 FR 42340. See also Motor & Equip. Mfrs. Ass'n, Inc. v. EPA,
627 F.2d 1095, 1115 (D.C. Cir. 1979) (MEMA I) ``[T]he Administrator
operates in a narrowly circumscribed proceeding requiring no broad
policy judgments on constitutionally sensitive matters. Nothing in CAA
section 209 requires him to consider the constitutional ramifications
of the regulations for which California requests a waiver.''). This
historic position was reflected in granting the initial ACC program
waiver where EPA explained: ``Evaluation of whether California's GHG
standards are preempted, either explicitly or implicitly, under [the
Energy Policy and Conservation Act] EPCA, is not among the criteria
listed under section 209(b). EPA may only deny waiver requests based on
the criteria in section 209(b), and inconsistency with EPCA is not one
of those criteria.'' 78 FR 2145. But EPA, in the past, has also
solicited comments on ``whether the Energy Policy and Conservation Act
(EPCA) fuel economy provisions are relevant to EPA's consideration of
the request and to California's authority to implement its vehicle GHG
regulations'' and in response to comments opted to ``take[ ] no
position regarding whether or not California's GHG standards are
preempted under EPCA.'' 74 FR 32744, 32782-83 (July 8, 2008).

    In the January 2013 waiver, EPA stated: ``Evaluation of whether
California's GHG standards are preempted, either explicitly or
implicitly, under EPCA, is not among the criteria listed under section
209(b). EPA may only deny waiver requests based on the criteria in
section 209(b), and inconsistency with EPCA is not one of those
criteria. In considering California's request for a waiver, [EPA]
therefore [has] not considered whether California's standards are
preempted under EPCA.'' 78 FR at 2145.
    EPA believes that this January 2013 statement was inappropriately
broad, to the extent it suggested that EPA is categorically forbidden
from ever determining that a waiver is inappropriate due to
consideration of anything other than the ``criteria'' or ``prongs'' at
CAA section 209(b)(1)(B)(A)-(C). The statements quoted above, and EPA's
historical practice of disregarding issues of ``[c]onsistency with
EPCA'' in the context of evaluating California's waiver applications,
were made in the context of EPA acting on its own to administer CAA
section 209(b) in considering such applications. The context here is
different: EPA is undertaking a joint action with NHTSA. In the SAFE
proposal, EPA noted that NHTSA had proposed and could well finalize a
determination that California's GHG and ZEV standards are both
explicitly and implicitly preempted under EPCA.\254\ EPA explained that
such a determination would present a threshold question as to
California's ability to enforce these standards and proposed to
conclude that standards preempted under EPCA cannot be afforded a
waiver of preemption under CAA section 209(b). Unlike the Clean Air
Act, EPCA does not allow for any waiver of its express preemption
provision. EPCA contains no language that can be read to allow States
to either prescribe or enforce regulations related to fuel economy
standards. Consistent with this view, at SAFE proposal, NHTSA explained
that, ``when a State establishes a standard related to fuel economy, it
does so in violation of EPCA's preemption statute(sic) and the standard
is therefore void ab initio.'' 83 FR 43235. At the same time, NHTSA
explained that certain other GHG requirements that do not relate to
fuel economy, such as regulations addressing leaking refrigerants,
would likely not be preempted under EPCA. 83 FR 4324-35.
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    \254\ 49 U.S.C. 32919(a). See 83 FR 43233.
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    EPA does not intend in future waiver proceedings concerning
submissions of California programs in other subject areas to consider
factors outside the statutory criteria in CAA section 209(b)(1)(A)-(C).
But the unique situation in which EPA and NHTSA, coordinating their
actions to avoid inconsistency between their administration of their
respective statutory tasks, address in a joint administrative action
the issues of the preemptive effect of EPCA and its implications for
EPA's waivers, has no readily evident analogue.\255\ EPA will not dodge
this question here.
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    \255\ See Massachusetts v. EPA.
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    Consistent with the SAFE proposal, NHTSA is finalizing a
determination that EPCA preempts State GHG and ZEV standards. EPA
agrees with commenters that EPA is not the agency that Congress has
tasked with administering and interpreting EPCA. This is especially so
because ``[t]he waiver proceeding produces a forum ill-suited to the
resolution of constitutional claims.'' MEMA I, 627 F.2d at 1115. In the
SAFE proposal, EPA took the position that it is, at a minimum,
reasonable to consider NHTSA's conclusions about the preemptive effect
of EPCA. To the extent that NHTSA has determined that these standards
are void ab initio because EPCA preempts standards that relate to fuel
economy, that determination presents an independent basis for EPA to
consider the validity of the initial grant of a waiver for these
standards, separate and apart from EPA's analysis under the criteria
that invalidate a waiver request. In the context of a joint action in
which our sister agency is determining, and codifying regulatory text
to reflect, that a statute Congress has entrusted it to administer
preempts certain State law, EPA will not disregard that conclusion,
which would place the United States Government in the untenable
position of arguing that one federal agency can resurrect a State
provision that, as another federal agency has concluded and codified,
Congress has expressly preempted and therefore rendered void ab initio.
    This conclusion is consistent with the Supreme Court's holding in
Massachusetts v. EPA, 549 U.S. 497 (2007). While this case did not
address EPCA preemption, the Supreme Court anticipated that EPA and
NHTSA would administer their respective authorities in a consistent
manner. (``The two obligations [for NHTSA to set fuel economy standards
under EPCA and for EPA to regulate motor vehicle GHG emissions under
CAA section 202] may overlap, but there is no reason to think the two
agencies cannot both administer their obligations and yet avoid
inconsistency.'' Id. at 532.) Considering that California cannot
enforce standards that are void ab initio, even assuming arguendo that
there existed a valid grant of waiver under CAA section 209(b), NHTSA's
determination renders EPA's prior grant of a waiver for those aspects
of California's regulations that EPCA preempts invalid, null, and void,
and, to the extent that administrative action is necessary on EPA's
part to reflect that state of affairs, EPA hereby withdraws that prior
grant of a waiver on this basis.
    EPA's finding that California's GHG and ZEV standards are preempted
as a result of NHTSA's finalized determinations, issued in this joint
action, with respect to EPCA's preemptive effect on State GHG and ZEV
standards, is effective upon the effective date of this joint action.
This finding is separate and apart from findings with respect to EPA's
2013 waiver for CARB's Advanced Clean Car Program as it pertains to its
2021 through 2025 MY relating to GHG and ZEV standards and accompanying
withdrawal of the waiver, pursuant to CAA section 209(b)(1), as set
forth in subsection D below; as a matter of EPA's administration of CAA
section 209(b), without reference to EPCA's preemptive effect as
determined by NHTSA, that withdrawal applies to 2021 through 2025 MY
GHG and ZEV standards, as proposed in the SAFE
proposal.256 257
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    \256\ EPA acknowledges that its action in this document may have
implications for certain prior and potential future EPA reviews of
and actions on state SIPs that may incorporate certain aspects of
California's state program, either California's own SIPs or SIPs
from states that have adopted one or more aspects of California's
state program pursuant to CAA section 177. EPA will consider whether
and how to address those implications, to the extent that they
exist, in separate actions. But EPA believes that it is not
necessary to resolve those implications in the course of this action
because the effects of EPCA preemption, as set forth in subsection
III.C, and the proper interpretation and application of CAA section
209(b)(1)(B) to California's GHG and ZEV program, as set forth in
subsection III.D, provide sufficient reason to take this final
action and that the potential implications for prior and future SIP
actions are not a sufficient basis to alter the rationale for or
terms of this final action. The questions of what EPCA means and
what its preemptive effect on certain state regulations is, and what
CAA section 209(b)(1)(B) means and what its limitations on
California's ability to obtain a waiver for its state programs are,
do not depend on whether one or more SIP actions pertaining to NAAQS
attainment and maintenance strategies may directly or indirectly be
affected by the agencies' resolution of those questions.
    \257\ In the August 2018 SAFE proposal, EPA solicited comment on
whether one or more of the grounds supporting the proposed
withdrawal of this waiver would also support withdrawing other
waivers that it has previously granted. 83 FR at 43240 n.550. At
this time, EPA does not intend to take action with respect to any
prior waiver grants other than those specified above.

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D. Reconsideration of January 2013 Waiver and Determination That It Is
Appropriate To Withdraw EPA's January 2013 Waiver of CAA Section 209
Preemption for California's GHG and ZEV Standards for Model Years 2021-
2025, Pursuant to CAA Section 209(b)(1)(B)

1. Interpretation of CAA Section 209(b)(1)(B)
    Under CAA section 209(b)(1)(B), EPA cannot grant a waiver request
if EPA finds that California ``does not need such State standards to
meet compelling and extraordinary conditions.'' \258\ In the August
2018 SAFE Proposal, EPA proposed to determine: (1) That it was
reasonable and appropriate to interpret the scope of ``such State
standards'' to authorize a consideration of whether California needs to
have its own GHG vehicle emissions program specifically, rather than
whether California needs any separate vehicle emissions program at all;
and (2) that California did not ``need'' its own GHG and ZEV programs
``to meet compelling and extraordinary conditions'' within the meaning
of the statute. EPA finalizes those determinations in this document.
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    \258\ EPA notes that Congress provided no definition of the
phrase ``compelling and extraordinary conditions,'' and that the
phrase appears to be entirely unique, not found anywhere else in the
United States Code.
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    EPA notes in this regard that regulation of emissions from new
motor vehicles and new motor vehicle engines under CAA section 202(a)
is triggered by a determination that ``the emission of any air
pollutant from any class or classes of new motor vehicles or new motor
vehicle engines . . . cause, or contribute to, air pollution which may
reasonably be anticipated to endanger public health or welfare.'' This
``endangerment finding,'' which triggers EPA's ability to use the CAA
section 202(a) regulatory authority which CAA section 209(a) preempts
the states from exercising (subject to the availability of a CAA
section 209(b) preemption waiver), links (1) emission of pollutants
from sources; to (2) air pollution; and (3) resulting endangerment to
health and welfare.\259\
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