CEI et al. Opening Brief in CEI v. EPA

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES  Pursuant to Circuit Rule 28, petitioners American Fuel & Petrochemical  Manufacturers, Clean Fuels Development Coalition, Competitive Enterprise  Institute, Diamond Alternative Energy, LLC, Domestic Energy Producers  Alliance, Energy Marketers of America, ICM, Inc., Illinois Corn Growers  Association, Illinois Soybean Association, Indiana Corn Growers Association,  Indiana Soybean Alliance, Inc., Iowa Soybean Association, Kansas Corn  Growers Association, Kentucky Corn Growers Association, Anthony  Kreucher, Walter M. Kreucher, James Leedy, Michigan Corn Growers  Association, Michigan Soybean Association, Minnesota Soybean Growers  Association, Missouri Corn Growers Association, North Dakota Soybean  Growers Association, Ohio Soybean Association, Marc Scribner, South Dakota  Soybean Association, and Valero Renewable Fuels Company, LLC  respectfully submit this Certificate as to Parties, Rulings, and Related Cases. 

A. Parties  

Petitioners in Case No. 22-1031 are the State of Texas, State of Alabama,  State of Alaska, State of Arkansas, State of Indiana, State of Kentucky, State  of Louisiana, State of Mississippi, State of Missouri, State of Montana, State of Nebraska, State of Ohio, State of Oklahoma, State of South Carolina, and  State of Utah.  

Petitioners 1n Case No. 22-1032 are the Competitive Enterprise  Institute, Anthony Kreucher, Walter M. Kreucher, James Leedy, Marc  Scribner, and the Domestic Energy Producers Alliance.  

Petitioners in Case No. 22-1033 are the Illinois Soybean Association,  Iowa Soybean Association, Indiana Soybean Alliance, Inc., Michigan Soybean  Association, Minnesota Soybean Growers Association, North Dakota Soybean  Growers Association, Ohio Soybean Association, South Dakota Soybean  Association, and Diamond Alternative Energy, LLC.  

Petitioner in Case No. 22-1034 is American Fuel & Petrochemical  Manufacturers.  

Petitioner in Case No. 22-1035 is the State of Arizona.  

Petitioners in Case No. 22-1036 are Clean Fuels Development Coalition,  ICM, Inc., Illinois Corn Growers Association, Indiana Corn Growers  Association, Kansas Corn Growers Association, Kentucky Corn Growers  Association, Michigan Corn Growers Association, Missouri Corn Growers  Association, and Valero Renewable Fuels Company, LLC.  

Petitioner in Case No. 22-1038 is Energy Marketers of America.  11  

Respondents are the U.S. Environmental Protection Agency and  Michael S. Regan in his official capacity as Administrator of the U.S.  Environmental Protection Agency.  

Intervenors on behalf of respondents are Advanced Energy Economy,  Alliance for Automotive Innovation, American Lung Association, Calpine  Corporation, City and County of Denver, City and County of San Francisco,  City of Los Angeles, City of New York, Clean Air Council, Clean Wisconsin,  Commonwealth of Massachusetts, Commonwealth of Pennsylvania,  Conservation Law Foundation, District of Columbia, Environmental Defense  Fund, Environmental Law and Policy Center, National Coalition for  Advanced Transportation, National Grid USA, National Parks Conservation  Association, Natural Resources Defense Council, New York Power Authority,  Power Companies Climate Coalition, Public Citizen, Sierra Club, State of  California, State of Colorado, State of Connecticut, State of Delaware, State  of Hawaii, State of Illinois, State of Maine, State of Maryland, State of  Michigan, State of Minnesota, State of Nevada, State of New Jersey, State of  New Mexico, State of New York, State of North Carolina, State of Oregon,  State of Rhode Island, State of Vermont, State of Washington, State of  Wisconsin, and Union of Concerned Scientists.  

Amici in this case include the State of West Virginia, Pacific Legal  Foundation, the National Federation of Independent Business, the Texas Oil  & Gas Association, and the Two Hundred for Housing Equity. 

B. Rulings Under Review  

Under review is the final action of the Administrator of the United  States Environmental Protection Agency, entitled Revised 2023 and Later  Model Year Light-Duty Vehicle Greenhouse Gas Emissions Standards,  published in the Federal Register at 86 Fed. Reg. 74,434 (Dec. 30, 2021).  

C. Related Cases  

Seven consolidated cases in the U.S. Court of Appeals for the District of  Columbia Circuit involve challenges to the agency action challenged here:  Texas v. EPA, No. 22-1031; Competitive Enterprise Institute v. EPA,  No. 22-1032; Illinois SoybeanAss’n. v. EPA, No. 22-1033; American Fuel &  Petrochemical Manufacturers v. EPA, No. 22-1034; Arizona v. EPA,  No. 22-1035; Clean Fuels Development Coalition v. EPA, No. 22-1036; and  Energy Marketers of America v. EPA, No. 22-1038.  

Three related cases challenge a related rule promulgated by the  National Highway Traffic Safety Administration: Natural Resources Defense  

Council v. NHTSA, No. 22-1080; Texas v. NHTSA, No. 22-1144; and  American Fuel & Petrochemical Manufacturers v. NHTSA, No. 22-1145.  

CORPORATE DISCLOSURE STATEMENT  

Pursuant to Federal Rule of Appellate Procedure 26.1 and D.C. Circuit  Rule 26.1, petitioners American Fuel & Petrochemical Manufacturers, Clean  Fuels Development Coalition, Competitive Enterprise Institute, Diamond  Alternative Energy, LLC, Domestic Energy Producers Alliance, Energy  Marketers of America, ICM, Inc., Illinois Corn Growers Association, Illinois  Soybean Association, Indiana Corn Growers Association, Indiana Soybean  Alliance, Inc., Iowa Soybean Association, Kansas Corn Growers Association,  Kentucky Corn Growers Association, Anthony Kreucher, Walter M.  Kreucher, James Leedy, Michigan Corn Growers Association, Michigan  Soybean Association, Minnesota Soybean Growers Association, Missouri Corn  Growers Association, North Dakota Soybean Growers Association, Ohio  Soybean Association, Marc Scribner, South Dakota Soybean Association, and  Valero Renewable Fuels Company, LLC hereby make the following  disclosures:  

American Fuel & Petrochemical Manufacturers is a national trade  association that represents American refining and petrochemical companies.  The Association has no parent corporation, and no publicly held company has  a 10% or greater ownership interest in it.  

Clean Fuels Development Coalition is a business league organization  established in a manner consistent with Section 501(c)(6) of the Internal  Revenue Code. Established in 1988, the Coalition works with auto,  agriculture, and biofuel interests in support of a broad range of energy and  environmental programs. It has no parent corporation, and no publicly held  company has a 10% or greater ownership interest in the Coalition.  

Competitive Enterprise Institute is a non-profit corporation organized  under the laws of the District of Columbia. CE I has no parent corporation, and  no publicly held company has a 10% or greater ownership interest in CEI.  

Diamond Alternative Energy, LLC, a Delaware limited liability  company, is a wholly owned direct subsidiary of Valero Energy Corporation,  a Delaware corporation whose common stock is publicly traded on the New  York Stock Exchange under the ticker symbol VLO.  

Domestic Energy Producers Alliance is a nonprofit, nonstock  corporation organized under the laws of the state of Oklahoma. The Alliance  has no parent corporation, and no publicly held company owns 10% or more of  its stock.  

Energy Marketers of America is a federation of 47 state and regional  trade associations representing energy marketers throughout the United States. It is incorporated under the laws of the Commonwealth of Virginia,  has no parent corporation, and no publicly held company has a 10% or greater  ownership interest in it.  

ICM, Inc. is a Kansas corporation that is a global leader in developing  biorefining capabilities, especially for the production of ethanol. It is a wholly  owned subsidiary of ICM Holdings, Inc., and no publicly held company has a  10% or greater ownership interest in ICM Holdings, Inc.  

Illinois Corn Growers Association is an agricultural organization. It  has no parent corporation, and no publicly held company has a 10% or greater  ownership interest in it.  

Illinois Soybean Association is a non-profit trade association within  the meaning of D.C. Circuit Rule 26.l(b). Its members are soybean farmers  and supporters of the agriculture and soybean industries. It operates for the  purpose of promoting the general commercial, legislative, and other common  interests of its members. The Illinois Soybean Association does not have a  parent corporation, it has no privately or publicly held ownership interests,  and no publicly held company has an ownership interest in it.  

Indiana Corn Growers Association is an agricultural organization. It  has no parent corporation, and no publicly held company has a 10% or greater  ownership interest in it.  

Indiana Soybean Alliance, Inc. is a non-profit trade association within  the meaning of D.C. Circuit Rule 26.l(b). Its members are soybean farmers  and supporters of the agriculture and soybean industries. It operates for the  purpose of promoting the general commercial, legislative, and other common  interests of its members. Indiana Soybean Alliance, Inc. does not have a  parent corporation, it has no privately or publicly held ownership interests,  and no publicly held company has an ownership interest in it.  

Iowa Soybean Association is a non-profit trade association within the  meaning of D.C. Circuit Rule 26.l(b). Its members are soybean farmers and  supporters of the agriculture and soybean industries. It operates for the  purpose of promoting the general commercial, legislative, and other common  interests of its members. The Iowa Soybean Association does not have a  parent corporation, it has no privately or publicly held ownership interests and  no publicly held company has an ownership interest in it.  

Kansas Corn Growers Association is an agricultural organization. It  has no parent corporation, and no publicly held company has a 10% or greater  ownership interest in it.  

Kentucky Corn Growers Association is an agricultural organization.  It has no parent companies, and no publicly held company has a 10% or greater  ownership interest in it.  

Anthony Kreucher is an individual residing in Michigan.  

Walter M. Kreucher is an individual residing in Michigan.  

James Leedy is an individual residing in Arizona.  

Michigan Corn Growers Association is an agricultural organization.  It has no parent companies, and no publicly held company has a 10% or greater  ownership interest in it.  

Michigan Soybean Association is a non-profit trade association within  the meaning of D.C. Circuit Rule 26.l(b). Its members are soybean farmers  and supporters of the agriculture and soybean industries. It operates for the  purpose of promoting the general commercial, legislative, and other common  interests of its members. The Michigan Soybean Association does not have a  parent corporation, it has no privately or publicly held ownership interests,  and no publicly held company has an ownership interest in it.  

The Minnesota Soybean Growers Association is a non-profit trade  association within the meaning of D.C. Circuit Rule 26.l(b). Its members are  soybean farmers, their supporters, and members of soybean industries. It  operates for the purpose of promoting the general commercial, legislative, and  other common interests of its members. The Minnesota Soybean Growers  Association is a not-for-profit corporation that is not a subsidiary of any  corporation and that does not have any stock which can be owned by a publicly  held corporation.  

Missouri Corn Growers Association is an agricultural organization. It  has no parent corporation, and no publicly held company has a 10% or greater  ownership interest in it.  

North Dakota Soybean Growers Association is a non-profit trade  association within the meaning of D.C. Circuit Rule 26.l(b). Its members are  soybean farmers, their supporters, and members of soybean industries. It  operates for the purpose of promoting the general commercial, legislative, and  other common interests of its members. The North Dakota Soybean Growers  Association is a not-for-profit corporation that is not a subsidiary of any  corporation and that does not have any stock which can be owned by a publicly  held corporation.  

Ohio Soybean Association is a non-profit trade association within the  meaning ofD.C. Circuit Rule 26.l(b). Its members are soybean farmers, their  supporters, and members of soybean industries. It operates for the purpose  of promoting the general commercial, legislative, and other common interests  of its members. The Ohio Soybean Association is a not-for-profit corporation  that is not a subsidiary of any corporation and that does not have any stock  which can be owned by a publicly held corporation.  

Marc Scribner is an individual residing in the District of Columbia.  The South Dakota Soybean Association is a non-profit trade  association within the meaning of D.C. Circuit Rule 26.l(b). Its members are  soybean farmers, their supporters, and members of soybean industries. It  operates for the purpose of promoting the general commercial, legislative, and  other common interests of its members. The South Dakota Soybean  Association is a not-for-profit corporation, is not a subsidiary of any  corporation, and does not have any stock which can be owned by a publicly  held corporation.  

Valero Renewable Fuels Company, LLC, a Texas limited liability  company, is a wholly owned direct subsidiary of Valero Energy Corporation, a Delaware corporation whose common stock is publicly traded on the New  York Stock Exchange under the ticker symbol VLO.  

INTRODUCTION  

The Environmental Protection Agency (EPA) and National Highway  Traffic Safety Administration (NHTSA) are on a mission to phase out the  internal-combustion engine and electrify the Nation’s vehicle fleet. Last year,  President Biden announced his administration’s “goal that 50 percent of all  new passenger cars and light trucks sold in 2030 be zero-emission vehicles,  including battery electric, plug-in hybrid electric, or fuel cell electric vehicles.”  86 Fed. Reg. 43,583, 43,583 (Aug. 5, 2021). Achieving that goal would require  a massive shift in behavior by manufacturers and consumers. EPA and  NHTSA are forcing that shift in three ways, each of which is currently being  challenged before this Court.  

First, EPA tried to give States a path to force electrification in ways that  federal regulators cannot. Under the Clean Air Act, EPA may grant  California a preemption waiver for its own emission standards to address its  local pollution problems, and other States may then follow California’s lead.  EPA has now afforded California such a waiver not for local pollutants but for  greenhouse gases. See Private Pet. Br., Ohio v. EPA, No. 22-1081 (D.C. Cir.  Oct. 24, 2022). California has already declared its plan to use that authority to ban new gasoline-powered cars and require “100-percent electrification by  2035.” Id. at 10 (citation omitted).  

Second, NHTSA set new average fuel-economy standards for passenger  cars and light trucks that are based in significant part on the increasing  presence of electric vehicles in automakers’ fleets. NHTSA’s rule directly  contravenes Congress’s command that NHTSA “may not consider” the fuel  economy of electric vehicles. 49 U.S.C. § 32902(h)(l). Congress has granted  NHTSA the authority to set fuel-economy standards at the maximum level  feasible for a fleet of traditional internal-combustion vehicles, but Congress  has reserved for itself-not the Executive Branch-policy judgments about  any potential transition to electric vehicles.  

Third, in the rule at issue here, EPA purported to exercise its authority  under Section 202 of the Clean Air Act, 42 U.S.C. § 7521, to set greenhouse gas emission standards for light-duty vehicles. All of EPA’s previous  greenhouse-gas rules under Section 202 were promulgated jointly with  NHTSA because vehicles’ carbon-dioxide emissions and fuel economy are two  sides of the same coin. For the first time, EPA decoupled its rulemaking from  NHTSA’s-precisely so EPA could avoid the statutory prohibition on  NHTSA’s considering electric vehicles. EPA then made the emission standards so stringent that they amount to a de facto electric-vehicle mandate,  because automakers can meet them only by decreasing production of  conventional vehicles and dedicating an increasing percentage of their fleets  to electric vehicles or subsidizing the electric-vehicle production of their  competitors.  

If that move seems familiar, it is. In West Virginia v. EPA, 142 S. Ct.  2587, 2613 n.3 (2022), EPA “announc[ed] what the market share of coal,  natural gas, wind, and solar must be, and then require[d] plants to reduce  operations or subsidize their competitors to get there.” Here, EPA has  similarly “announc[ed] what the market share of” electric vehicles “must be  and then require[d]” automakers to meet that target for their fleets “or  subsidize their competitors to get there.” Id. In both cases, EPA reached its  desired result by setting standards beyond what could be achieved with the  disfavored power source (there, coal-fired power generation; here, the  internal-combustion engine). And in both cases, EPA effectively ordered  regulated parties to phase out the disfavored technology.  

As in West Virginia, Congress has not authorized any of this. The Clean  Air Act does not allow EPA to set emission standards for motor vehicles based  on fleetwide averaging-let alone to force electrification by “averaging” in a large number of zeros for all the electric vehicles that EPA wants to see on the  market. EPA is once again straining statutory text to force a seismic shift in  the Nation’s energy policy, only this time for automobiles rather than power  plants. The question of whether and how internal-combustion vehicles should  be phased out in favor of electric vehicles is hugely consequential: it involves  millions of jobs, the restructuring of entire industries, and the Nation’s energy  independence and relationship with hostile powers. Congress has never  delegated those policy judgments to EPA. Here as in West Virginia, EPA’s  rule exceeds its statutory authority and should be set aside.  

JURISDICTIONAL STATEMENT  

This Court has jurisdiction to review EPA’s Revised 2023 and Later  Model Year Light-Duty Vehicle Greenhouse Gas Emissions Standards,  86 Fed. Reg. 74,434 (Dec. 30, 2021), under 42 U.S.C. § 7607(b)(l). The rule is  a “standard under section 7521,” and petitioners timely sought review on  February 28, 2022, ”within sixty days from the date notice of such  promulgation … appear[ed] in the Federal Register.”  

STATEMENT OF THE ISSUES  

1. Whether EPA has authority under Section 202 of the Clean Air  Act, 42 U.S.C. § 7521, to phase out conventional vehicles in favor of electric  ones by setting fleetwide-average emission standards that cannot be met solely by conventional vehicles and instead require automakers to dedicate an  increasing portion of their fleets to electric vehicles.  

2. Whether the rule is arbitrary and capricious because EPA failed  to perform an adequate lif ecycle analysis of electric vehicles’ greenhouse-gas  emissions or an adequate and evenhanded cost-benefit analysis. 

STATUTES AND REGULATIONS  

Pertinent statutes are set forth in the Addendum.  

STATEMENT OF THE CASE  

I. Statutory Background  

A. EP A’s Standard-Setting Authority  

Title II of the Clean Air Act sets forth a comprehensive scheme for  regulating motor-vehicle emissions. At the center of the scheme is Section  202, which directs the EPA Administrator to  

by regulation prescribe (and from time to time revise)  

. . . standards applicable to the emission of any air  

pollutant from any class or classes of new motor  

vehicles or new motor vehicle engines, which in his  

judgment cause, or contribute to, air pollution which  

may reasonably be anticipated to endanger public  

health or welfare.  

42 U.S.C. § 7521(a)(l). “Such standards shall be applicable to such vehicles  and engines for their useful life,” ”whether such vehicles and engines are  designed as complete systems or incorporate devices to prevent or control such pollution.” Id. The standards may not take effect until “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.” Id. § 7521(a)(2).  

Congress specified numerous emission standards applicable to  individual vehicles that EPA had to promulgate under Section 202(a) for  specific pollutants. See, e.g., 42 U.S.C. §§ 7521(a)(3)(B)(ii), 7521(b)(l)(A)-(B).  Some of these statutorily specified standards provided for phase-in periods  during which the standards applied to an increasing percentage of  manufacturers’ fleets. See, e.g., id. §§ 7521(g), 7521(h), 7521(i), 7541(c)(4)(A),  7541(c)(4)(B)(ii), 7541(c)(5). In addition, to support emission-control  technologies like “the catalytic converter and oxygen sensor,” Congress  obligated EPA to mandate diagnostic systems that could determine if those  technologies were deteriorating or malfunctioning in a way that “could cause  or result in failure of the vehicles to comply with emission standards” under  Section 202(a). Id. § 7521(m)(l).  

B. Compliance, Enforcement, and Remediation  

To determine compliance with these standards, EPA “shall test, or  require to be tested in such manner as [it] deems appropriate, any new motor vehicle or new motor vehicle engine submitted by a manufacturer.” 42 U.S.C.  § 7525(a)(l). “If such vehicle or engine” submitted by the manufacturer  complies with the standards, EPA “shall issue a certificate of conformity.” Id.  And each manufacturer must “indicate” that a certificate of conformity covers  such vehicle or engine with a “label or tag permanently affixed to such vehicle  or engine.” Id. § 7541(c)(3)(C).  

In addition to testing these prototypes, EPA may test or require that  the manufacturer test “new motor vehicles” to determine if such vehicles “do  in fact conform with the regulations with respect to which the certificate of  conformity was issued.” 42 U.S.C. § 7525(b)(l). If after testing an individual  “new vehicle or engine,” EPA determines that “such vehicle or engine” is not  in compliance, EPA may “suspend or revoke” a certificate of conformity  “insofar as it applies to such vehicle or engine.” Id. § 7525(b)(2)(A)(ii).  

Manufacturers “shall warrant” that “each new motor vehicle and new  motor vehicle engine … is (A) designed, built, and equipped so as to conform  at the time of sale with applicable regulations under [Section 202].” 42 U.S.C.  § 7541(a)(l). Title II gives EPA several remedial options when vehicles fail to  conform. One is to seek civil penalties from automakers for each individual  vehicle they distribute, sell, or offer in commerce without an effective certificate of conformity. Id. §§ 7522(a)(l), 7524(a)-(b). In addition, where “a  substantial number of any class or category of vehicles or engines” fail to  conform, EPA must notify manufacturers, dealers, and purchasers, and  “require the manufacturer to submit a plan for remedying the nonconformity  of the vehicles or engines with respect to which such notification is given.” Id.  § 7541(c)(l)-(2).  

II. Regulatory Background  

A. Greenhouse-Gas Standards  

EPA did not regulate motor-vehicle greenhouse-gas emissions until  2010. Following the Supreme Court’s decision in Massachusetts v. EPA,  549 U.S. 497 (2007), EPA first issued an endangerment finding under Section  202(a) for ”well-mixed greenhouse gases”-i.e., carbon dioxide, methane,  nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.  See 7 4 Fed. Reg. 66,496 (Dec. 15, 2009).  

EPA then promulgated its initial greenhouse-gas emission standards in  a joint rulemaking with NHTSA, which sets corporate average fuel-economy  standards under the Energy Policy and Conservation Act, 49 U.S.C. § 32901  et seq. As the agencies explained, carbon-dioxide emissions-EPA’s central  focus in the greenhouse-gas rules-are “essentially constant per gallon combusted of a given type of fuel,” so carbon-dioxide emission standards and  fuel-economy standards are two sides of the same coin. 75 Fed. Reg. 25,324,  25,327 (May 7, 2010); see 84 Fed. Reg. 51,310, 51,315 (Sept. 27, 2019); Delta  Constr. Co. v. EPA, 783 F .3d 1291, 1294 (D.C. Cir. 2015) (“[A]ny rule that limits  tailpipe [greenhouse gas] emissions is effectively identical to a rule that limits  fuel consumption.”) (citation omitted).  

Until now, all subsequent EPA rules updating the Title II greenhouse gas emission standards for cars and light-duty trucks were also jointly  promulgated with NHTSA. See 85 Fed. Reg. 24,174 (Apr. 30, 2020);  77 Fed. Reg. 62,624 (Oct. 15, 2012). Because Congress prohibited NHTSA  from considering the fuel economy of electric vehicles in setting fuel-economy  standards, see 49 U.S.C. § 32902(h)(l), the agencies’ jointly promulgated  standards could not be so stringent that they effectively required automakers  to include electric vehicles in their fleets.  

B. The Rule At Issue  

In August 2021, EPA issued a notice of proposed rulemaking for new  greenhouse-gas emission standards. EPA proposed to replace the 2020  standards and promulgate “the most stringent vehicle [greenhouse-gas]  standard[s] … to date.” 86 Fed. Reg. 43,726, 43,746 (Aug. 10, 2021). Notably, EPA determined-for the first time-to set such standards on its own, without  engaging in a joint rulemaking with NHTSA. Id. at 43,755. Before joining the  administration, the heads of the Council on Environmental Quality and EPA’s  Office of Air and Radiation (which wrote this rule) advocated this “decoupling”  precisely so that EPA could take “a bolder approach on light duty vehicle  electrification.” Climate 21 Proj., Transition Memo: Environmental  Protection Agency 11 (2021).  

Around the same time, President Biden set “a goal that 50 percent of all  new passenger cars and light trucks sold in 2030 be zero-emission vehicles”  and directed EPA to set greenhouse-gas emission standards accordingly.  86 Fed. Reg. at 43,583. Following that directive, EPA ultimately chose  standards even more stringent than it had initially proposed. See 86 Fed. Reg.  at 74,437.  

On December 30, 2021, EPA finalized the rule at issue here, setting  revised greenhouse-gas standards for light-duty vehicles for model years  beginning with 2023. 86 Fed. Reg. at 74,434. Automakers cannot feasibly  comply with the standards unless they dramatically increase their production  of electric vehicles, due to three interlocking mechanisms of the regulation.  See id. at 74,438. First, EPA promulgated fleetwide-average standards instead of vehicle-specific standards. Second, EPA put a thumb on the scale  for electric vehicles by stipulating for purposes of the standards that such  vehicles are responsible for no emissions, meaning producers of electric  vehicles will appear to have much lower fleetwide-average emissions. Finally,  EPA offered credit-based incentives for electric vehicles.  

C. Fleetwide Averaging  

Instead of issuing greenhouse-gas emission thresholds that any given  vehicle must meet, EPA has issued its greenhouse-gas standards as a formula  setting fleetwide-average emission levels that manufacturers’ fleets must  meet. Each manufacturer is held to a fleetwide-average standard derived  from its annual sales-one standard for its fleet of cars and another standard  for its fleet of light trucks (i.e., larger SUVs, minivans, and pickup trucks). 40  C.F.R. § 86.1865-12(i).  

Manufacturers’ fleets include multiple vehicle models, each of which is  given a non-binding carbon-dioxide emission target. EPA bases these targets  on the vehicle’s size (or “footprint”). 40 C.F.R. § 86.1818-12(c)(2). A car with  the smallest footprint (41 square feet) will have a target of 145.6 grams of  carbon dioxide emitted per mile traveled (g/mile) in 2023, which reduces to  114.3 g/mile by 2026, while a car with the largest footprint (56 square feet) will have a target of 199.1 g/mile in 2023 and 160.9 g/mile in 2026. 86 Fed. Reg. at  74,450, 74,522.  

Individual vehicles are not directly required to achieve these footprint based targets. As EPA explained, “[b]ecause compliance is based on the full  range of vehicles in a manufacturer’s car and truck fleets, with lower-emitting  vehicles compensating for higher-emitting vehicles, the emission levels of  specific vehicles within the fleet are ref erred to as targets, rather than  standards.” Id. at 74,439 n.16. The targets are used as inputs to determine a  unique fleetwide-average standard for each manufacturer. That fleetwide  average is “production-weighted,” meaning it accounts for each vehicle’s share  of the manufacturer’s fleet. 40 C.F.R. §§ 86.1818-12(c)(2)(ii), 86.1865-12(i)(l).  

Compliance with the fleet average depends on sales for the entire year  and thus can be determined only once the year ends. At the end of each year,  a manufacturer must compare its actual production-weighted fleetwide average carbon-dioxide emission level to its production-weighted fleetwide  standard. 40 C.F.R. § 86.1865-12(j). If the actual average emission level is  higher than the standard, the manufacturer will be assessed a deficit in  proportion to the disparity between the performance and the standard. But if  the actual average emission level is below the standard, the manufacturer will be given a proportional number of “credits.” Id. § 86.1865-12(k)(l), (4).  Manufacturers can use credits generated for one fleet to offset a deficit in the  other fleet. If there is no such deficit, manufacturers can also “bank” credits  to offset deficits accrued in future years. And manufacturers can “trade”  credits to competitors in exchange for money. Id. § 86.1865-12(k)(7)(i), (9).  

EPA has also created other ways to generate credits. The most  significant additional credits are offered for the production of “electric  vehicles, plug-in hybrid electric vehicles, and fuel cell vehicles,” which, for  simplicity’s sake, we will call “electric vehicles.” 40 C.F.R. § 86.1866-12(a); see  id. § 86.1803-01 (defining terms). EPA regulations stipulate that, for the  purposes of calculating fleetwide targets and fleetwide performance, electric  vehicles are to be treated as if they emit O g/mi of carbon dioxide-even when  they pull electricity from a grid that is powered by carbon-emitting sources.  Id. § 86.1866-12(a). EPA inflates such credits even more by applying a  multiplier to the total number of electric vehicles each manufacturer produces  in model years 2023 and 2024. Id. § 86.1866-12(c). In this rule, EPA selected  multipliers of 1.5 and 1.3, meaning that, for example, if a manufacturer  produces a million cars in model year 2023, 100,000 of which are electric, EPA  will calculate its credits as if the manufacturer produced 150,000 electric vehicles (subject to annual cumulative credit caps). Id. § 86.1866-12(b);  86 Fed. Reg. at 7 4,458-63.  

Credits and credit-trading play a pivotal role in EP A’s compliance  regime. Manufacturers can carry forward a deficit for up to three years before  being subject to sanction. But if, after three years, the manufacturer has failed  to offset the deficit, EPA will withhold certification from a portion of the  manufacturer’s vehicles. 40 C.F.R. §§ 86.1818-12(c)(l), 86.1865-12(j), (k)(8);  see id. § 86.1865-12(k)(8)(ii)-(iii) (formula for determining which vehicles in a  noncomplying fleet must have certification withheld). The only way a  manufacturer can avoid these sanctions is by purchasing credits.  Manufacturers are also subject to financial penalties for selling vehicles not  covered by such certificates.  

D. Mandating Electric Vehicles  

In the final rule, EPA opted for the “most stringent standards  considered in the proposed rule.” 86 Fed. Reg. at 74,435. The rule projects  that the average fleetwide targets for cars and light-duty trucks will be  132 g/mi and 187 g/mi, respectively, in 2026. Id. at 74,440. Those figures are  significantly stricter than the standards from the 2020 joint EP A-NHTSA rule  (204 g/mi and 284 g/mi). See 86 Fed. Reg. at 43,732; 85 Fed. Reg. at 24,183. 

The rule’s stringent standards are expressly designed to force  manufacturers to produce a certain percentage of electric vehicles as a share  of the new-vehicle market. When the final rule issued, EPA estimated that  electric vehicles made up about 3.6% of the year’s vehicle sales. 86 Fed. Reg.  at 74,486. EPA projects-and its data confirm-that to meet the new  standards, manufacturers must increase the market share for electric vehicles  to 7% in model year 2023 and to 17% in model year 2026. Id. at 74,485; see id.  at 74,438 ( explaining that the standards are achievable ”with a growing  percentage of electrified vehicles”). Manufacturers thus must double  production of electric vehicles within a year, and more than quadruple it within  a few years.  

Natural market forces would not produce that growth rate. EPA  acknowledged that the projected 17% market-penetration rate for electric  vehicles is “driven” by “the increased stringency of our final standards.”  86 Fed. Reg. at 74,484. Compliance with those standards ”will necessitate  greater implementation and pace of technology penetration,” including of  electric vehicles. / d. at 74,493. Indeed, EPA projected that, if it had  maintained the 2020 standards, the electric-vehicle penetration rate in 2026  would be just 7%, less than half the 17% rate under the new standards. 

Regulatory Impact Analysis (RIA) 4-27 tbls. 4-27 & 4-28. EPA’s new rule is  thus clearly intended to force electrification of the Nation’s vehicle fleet.  

SUMMARY OF ARGUMENT  

I. EPA’s rule must be set aside because it exceeds the agency’s  authority under Section 202 of the Clean Air Act.  

A. EPA has claimed a power of incredible consequence: to phase out  combustion-engine vehicles in favor of electric ones. There can be no denying  the ”vast economic and political significance” of that authority. West Virginia,  142 S. Ct. at 2605. The costs of EPA’s proposed transition make this one of  the most expensive agency rules, if not the most expensive, in the Nation’s  history. By the agency’s own estimates, the rule will cost billions of dollars  annually and $300 billion in total-far more than what the Supreme Court has  found to be economically significant in other major-question cases. Moreover,  EPA’s rule would eliminate millions of jobs and force the restructuring of  multiple industries.  

EPA’s rule also goes to the heart of a critically important political  question. As in West Virginia, the rule preempts an active debate in Congress  and among the States about the future of conventional vehicles. See 142 S. Ct.  at 2614. And it puts EPA in the position of deciding a host of major national policy questions on which it lacks expertise. Among other policy concerns,  electrification will make the automotive industry dependent on supply chains  dominated by China and other hostile nations. See id. at 2612. Importantly,  Congress has previously considered and rejected proposed bills that would  force vehicle electrification. Instead, Congress’s broader plan for tackling  motor-vehicle greenhouse-gas emissions has focused on renewable fuels  rather than forced electrification.  

B. Given the vast economic and political significance of EPA’s rule, it  “must point to ‘clear congressional authorization’ for the power it claims.”  West Virginia, 142 S. Ct. at 2609. Because Congress nowhere provided clear  authorization for EPA to effectively mandate electrification of the Nation’s  vehicles, the rule cannot stand. On the contrary, Congress clearly precluded  EPA from using Section 202(a) to phase out internal-combustion vehicles.  EPA achieves that result only by misconstruing the standard-setting tools at  its disposal.  

EPA could accomplish its objective of compelling automotive  manufacturers to dedicate an increasing percentage of their fleets to electric  vehicles only by setting emission standards on a fleetwide-average basis. But  the statute’s text and structure foreclose EPA from proceeding in this manner.  

They require that emission standards under Section 202(a) apply to all vehicles  individually, not manufacturers’ fleets on average. EPA must therefore set  emission standards that are achievable by individual combustion-engine  vehicles on their own.  

Even if fleetwide averaging were generally permissible under Section  202(a), the statute forecloses EPA from using fleetwide averaging to mandate  electrification. Section 202(a) authorizes EPA to set “standards” for  “emission[s]” from “any class or classes of new motor vehicles or new motor  vehicle engines, which … cause, or contribute to,” potentially harmful air  pollution. 42 U.S.C. § 7521(a). In EPA’s judgment when setting standards,  electric vehicles do not actually “emi[t]” carbon dioxide-the relevant  pollutant-or “cause, or contribute to,” air pollution. Thus, EPA may set  standards for internal-combustion vehicles, but it may not include electric  vehicles in the class, let alone make the standard so stringent that only an ever increasing number of electric vehicles will enable manufacturers to meet the  “average” emissions level.  

In the alternative, EP A’s rule must be set aside because it is  arbitrary and capricious. In multiple ways, EPA irrationally put a thumb on  the scale in favor of its preferred technology.

A. EPA treated electric vehicles as a pure environmental good that  contributes zero emissions. It did so by focusing myopically on tailpipe  emissions and avoiding other lifecycle emissions in its standards. EPA  asserted that ignoring lifecycle emissions “is appropriate” given the agency’s  “goal of encouraging further transition to electric vehicles.” Response to  Comments (RTC) 6-64. That is the very definition of arbitrary  decisionmaking: the agency ignored emissions that did not support the answer  it wanted.  

B. EPA’s cost-benefit analysis was also flawed, on both sides of the  ledger. To justify the rule’s $300 billion price tag, EPA claimed $320 billion in  cost savings to consumers from more fuel-efficient cars. EPA acknowledged  that if electric vehicles really provided those benefits to consumers, one would  expect consumers to buy the vehicles without the need for government  intervention. But it asserted without credible evidence that consumer  behavior would be driven by irrational economic decision-making. On the  other side of the ledger, EPA unreasonably discounted the rule’s costs,  assuming energy prices that defy reality.  

STANDING  

Petitioners include entities that produce or sell liquid fuels and the raw  materials used to produce them, along with associations whose members  include such entities. By design, EP A’s emission standards reduce the  demand for liquid fuels and their raw materials by displacing an increasing  number of combustion-engine vehicles with electric vehicles that use little to  no liquid fuel. See 86 Fed. Reg. at 74,503 (“Through 2050, our rule will reduce  gasoline consumption by more than 360,000 million gallons.”). As shown in the  accompanying declarations, depressing the demand for those fuels injures  petitioners and petitioners’ members financially. This economic injury  constitutes injury-in-fact under Article III that is caused by the challenged  regulatory action and redressable by vacatur of the rule. See, e.g., American  Fuel & Petrochemical Mfrs. v. EPA, 3 F.4th 373, 379-380 (D.C. Cir. 2021).  Petitioners also include four individuals and a nonprofit whose board members  will be harmed in their individual ability to find affordable gasoline-powered  vehicles to purchase. See Competitive Enter. Inst. v. NHTSA, 901 F.2d 107,  111-113 (D.C. Cir.1990);ActiononSmoking&Healthv.DepartmentofLabor,  100 F .3d 991, 992 (D.C. Cir. 1996).  

The petitioners that are membership associations also have associational  standing to challenge EPA’s decision. See Hunt v. Washington State Apple  Advert. Comm’n, 432 U.S. 333, 342-343 (1977). Their members have standing  to sue in their own right, for the reasons described. The interests petitioners  seek to protect are germane to their organizational purposes, which include  safeguarding the viability of their members’ businesses. And neither the  claims asserted nor the relief requested requires the participation of individual  members.  

STANDARD OF REVIEW  

This Court “shall hold unlawful and set aside agency action” that is  “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance  with law,” or “in excess of statutory jurisdiction, authority, or limitations, or  short of statutory right.” 5 U.S.C. § 706(2)(A), (C).  

ARGUMENT  

I. EPA Lacks Statutory Authority To Set Greenhouse-Gas Emission  Standards That Effectively Mandate Electric Vehicles.  

EPA’s rule should be set aside because it exceeds the agency’s statutory  authority. See 5 U.S.C. § 706(2)(C); 42 U.S.C. § 7607(d)(9)(C). The rule  implicates a “major question,” which means that EPA must point to clear  congressional authorization for the power it asserts. Yet Congress did not clearly authorize EP A’s approach. On the contrary, Congress denied EPA the  power to use fleetwide averages, and at a minimum it did not allow averaging  in zeros to represent the electric vehicles EPA would force onto the market.  

A. EPA Must Show Clear Congressional Authorization To Force  Electrification.  

Under the major-questions doctrine, a court may not construe a statute  to “authoriz[e] an agency to exercise powers of ‘vast economic and political  significance’ “unless the statute does so in “clea[r ]” terms. Alabama Ass’n of  Realtors v. HHS, 141 S. Ct. 2485, 2489 (2021) (quoting Utility Air Regul. Grp.  v. EPA, 573 U.S. 302, 324 (2014)). Thus, an agency seeking to exercise such  significant powers must identify “something more than a merely plausible  textual basis for the agency action.” West Virginia v. EPA, 142 S. Ct. 2587,  2609 (2022) (quoting Utility Air, 573 U.S. at 324). “The agency instead must  point to ‘clear congressional authorization’ for the power it claims.” Id.  

In assessing the economic and political significance of a rule, the  Supreme Court has considered both the rule’s direct effects and the  implications of the agency’s underlying claim of authority. For example, in  West Virginia, although EPA’s Clean Power Plan only incrementally shifted  power generation, EPA had asserted the “highly consequential power” to  “announc[e] what the market share of coal, natural gas, wind, and solar must be, and then requir[e] plants to reduce operations or subsidize their  competitors to get there.” 142 S. Ct. at 2609 & 2613 n.4; seeAlabamaAss’n of  Realtors, 141 S. Ct. at 2489 (considering the “sheer scope of the [agency’s]  claimed authority” in addition to the rule’s “economic impact”). An agency  cannot avoid the need for clear backing from Congress by claiming an awesome power but exercising only a little of it in the first instance.  This case directly parallels West Virginia at both a broad and a more  specific level. Broadly, just as in West Virginia, EPA is claiming the power to  effect a wholesale shift in energy policy: moving the Nation’s vehicle fleet from  vehicles powered by internal-combustion engines that use liquid fuels to  vehicles powered by battery-operated electric motors. The only difference is  that EPA is waving its wand over motor vehicles instead of power plants. At  a more specific level, the Supreme Court in West Virginia identified several  clues from the statutory and regulatory scheme indicating that EPA needed  clear congressional authorization for its Clean Power Plan. Those same clues  are present here in spades. The lesson should be unavoidable: EPA needs  clear support from Congress to replace the kind of vehicles America drives on  its roads. 

1. EPA claims a power of vast economic significance.  At the threshold, the rule’s economic significance is staggering, in both  its direct effects and the implications of the authority EPA claims. Several  considerations underscore the rule’s enormous economic cost.  Direct Compliance Costs. EPA projects that the rule will cost $300  billion by 2050. 86 Fed. Reg. at 74,509. This would be one of the most  expensive agency rules, if not the most expensive, in the Nation’s history. In  2023 alone, it will cost the economy $6 billion, rising to $19 billion by 2030. Id.  at 74,509 (using 2018 dollars). Even accounting for inflation, that is twice the  economic cost of the Clean Power Plan, which the Supreme Court in West  Virginia found significant enough to trigger the major-questions doctrine.  See West Virginia, 142 S. Ct. at 2610; EPA, Regulatory Impact Analysis for  the Clean Power Plan Final Rule 3-22 (projecting up to $3 billion in costs in  2025 and up to $8.4 billion in costs in 2030).  

Transformation of the Vehicle Market. The underlying authority EPA  claims in the rule is even more economically significant. In substance, EPA  has asserted the power to phase out conventional vehicles. The rule effectively  mandates that a decreasing percentage of the fleet be gasoline-powered, and  an increasing percentage be electric. It does so by setting greenhouse-gas emission standards so strict that manufacturers cannot meet them with  conventional vehicles alone, but must instead increase the share of electric  vehicles in their overall production.  

In West Virginia, the Court explained that EPA had sought to  “substantially restructure the American energy market.” 142 S. Ct. at 2610.  Here, EPA seeks to “substantially restructure” the American vehicle market,  and with it, much of the Nation’s energy market. As EPA explained,  “[c]ompliance with the final standards will necessitate … further deployment  of [electric-vehicle] technologies.” 86 Fed. Reg. at 74,493 (emphasis added);  see id. at 74,485 (“[T]he final standards can be met with a fleet that achieves a  gradually increasing market share of [electric vehicles].”). EPA explained that  the final standards “are achievable primarily through the application of  advanced gasoline vehicle technologies but with a growing percentage of  electrified vehicles.” Id. at 74,438 (emphasis added). And it “project[ed] that  during the four-year ramp up of the stringency of the [greenhouse-gas]  standards, the standards can be met with gradually increasing sales of plug-in  electric vehicles in the U.S. from about 7 percent market share in [model year]  2023 … up to about 17 percent in [model year] 2026.” Id. at 74,438.

Furthermore, EPA made clear that it set greenhouse-gas standards not  merely to require the level of electrification the market would otherwise  provide, but to “driv[e]” electric-vehicle production. 86 Fed. Reg. at 74,484.  EPA acknowledged that in a “no-action” scenario-i.e., a scenario in which it  promulgated no new greenhouse-gas standards and maintained the status  quo-the electric-vehicle market-penetration rate in model year 2026 would  be just 7%, less than half the 17% penetration rate under the new standards.  RIA 4-27 tbls. 4-27 & 4-28. EPA thus claims the power to accelerate the  electrification of the fleet (and the corresponding demise of conventional  vehicles) by using greenhouse-gas standards to require electric-vehicle  penetration rates at whatever level EPA believes feasible-a judgment it  claims is entitled to “particularly great deference.” 86 Fed. Reg. at 74,452.  

Elimination of American Jobs. EPA’s electrification goal would  overhaul the American automobile industry, which “supports 10 million direct  and indirect jobs” and “accounts for more than three percent of GDP.”  Securing America’s Future Energy (SAFE), Comment 5 (Sept. 27, 2021); see  U.S. Chamber of Commerce, Comment 7 (Sept. 27, 2021). The United States  is unlikely to replace those jobs with jobs manufacturing electric vehicles,  because battery and battery-cell production is dominated by Asia and, to a lesser extent, Europe. See Jim Barrett & Josh Bivens, The Stakes for Workers  in How Policymakers Manage the Coming Shift to All-Electric Vehicles,  Economic Policy Inst. 7-8 (Sept. 22, 2021). Moreover, electric-vehicle  production is far more automated, “requir[ing] 30% less manufacturing labor  when compared with conventional cars.” Carlos Waters, How Electric Vehicle  Manufacturing Could Shrink the Midwestern Job Market, CNBC.com (Sept.  4, 2022), https://www.cnbc.com/2022/09/04/ev-manufacturing-may-shrink-us 

midwest-auto-parts-trade.html.  

The effects of EPA’s rule would extend well beyond the automobile  industry. Electrification would overhaul the American oil and natural gas  sector, which “supports more than ten million U.S.jobs.” American Petroleum  Inst., Comment 1 (Sept. 27, 2021). With two-thirds of petroleum demand  coming from the transportation sector, most of those jobs in drilling, refining,  and distribution depend on the conventional-vehicle market. See U.S. Energy  Info. Admin., Monthly Energy Rev. 78 (July 2022). Countless supply chains  and end products such as asphalt, chemicals, and lubricants would be affected.  Phasing out conventional vehicles would also devastate the biofuels industry.  According to one industry group, a ban on conventional vehicles by 2035 would  reduce U.S. GDP by $321 billion and cost 255,000 jobs, concentrated in a few corn-producing states. Agricultural Retailers Ass’n, Economic Impacts to  U.S. Biofuels, Agriculture, and the Economy from Subsidized Electric  Vehicle Penetration 13, 16 (Oct. 2020).  

By any relevant economic measure-“the amount of money involved for  regulated and affected parties, the overall impact on the economy, [or] the  number of people affected,” U.S. TelecomAss’n v. FCC, 855 F.3d 381, 422-423  (D.C. Cir. 2017) (Kavanaugh, J., dissenting from denial of rehearing en  banc)-EPA’s asserted power to force a transition from gasoline-powered  vehicles to electric ones represents “an enormous and transformative  expansion in [its own] regulatory authority,” affecting “a significant portion of  the American economy.” Utility Air, 573 U.S. at 324 (citation omitted).  

2. EPA claims a power of vast political significance.  The rule’s political significance is just as vast. In West Virginia, the Court identified several considerations that are equally present here.  Ongoing Policy Debate. The target of EPA’s rule-to say nothing of  climate change more generally-is “the subject of an earnest and profound  debate across the country.” West Virginia, 142 S. Ct at 2614. While  California is moving aggressively to accelerate electrification by regulatory  fiat, see Cal. Code Regs. Tit. 13, § 1962.4 (Zero-Emission Vehicle Standards for 2026 and Subsequent Model Year Passenger Cars and Light-Duty Trucks),  other States oppose efforts to shift energy-investment and generation from  petroleum to other sources, see, e.g., Act Relating to Financial Institutions  Engaged in Boycotts of Energy Companies, 2022 W. Va. Legis. Ch. 235.  

Congress itself is debating this very issue, which makes EPA’s claim to  policymaking authority “all the more suspect.” West Virginia, 142 S. Ct. at  2614; see FDA v. Broum & Williamson Tobacco Corp., 529 U.S. 120, 155  (2000). Congress has yet to reach an answer and remains in factfinding mode  as it considers the benefits and risks of electrification. Just a month before  EPA promulgated the rule, Congress enacted the Infrastructure Investment  and Jobs Act of 2021, which requires several agencies-notably not EPA-to  prepare three separate reports for Congress on the implications of electrifying  the Nation’s vehicle fleet. Pub. L. No.117-58, §§ 25006, 40435, 40436, 135 Stat.  429, 845-49, 1050 (2021) (requiring reports on “the cradle to grave  environmental impact of electric vehicles” and “the impact of forced labor in  China on the electric vehicle supply chain,” among other things).  

Balancing National Policy Considerations. In West Virginia, the  Court found it significant that EP A’s rule would put the agency in the position  of “balancing the many vital considerations of national policy implicated in deciding how Americans will get their energy.” 142 S. Ct. at 2612. The Court  was concerned that the agency would decide “how much of a switch from coal  to gas” the grid could tolerate, and “how high energy prices [could] go” before  becoming “exorbitant.” Id. at 2612. Here, too, EPA’s rule puts it in the  position of deciding “how much of a switch” to electrification the nation’s power  grids can tolerate, and how high vehicle and energy prices can climb without  being “exorbitant.” See Texas Br. 15-22.  

As the State petitioners’ brief explains more fully, EPA’s asserted  authority also implicates another key “consideration[] of national policy”:  national security. See Texas Br. at 22-24. NHTSA has acknowledged that the  United States “has very little capacity in mining and refining any of the key  raw materials” for electric vehicles. 86 Fed. Reg. 49,602, 49,797 (Sept. 3, 2021).  And unlike biofuels and petroleum, most of the supply of critical components  of batteries and motors for electric vehicles is controlled by hostile or unstable  foreign powers, in particular China. Shifting to electric vehicles would thus  make the American automotive industry critically dependent on one of the  Nation’s primary geopolitical rivals.  

Specifically, China is by far the largest source of graphite, which is used  for lithium-ion batteries, and rare-earth elements like neodymium, which are used for permanent-magnet motors. By some estimates, a transition to  electric vehicles would raise demand for graphite by 2500% and rare-earth  elements by 1500%. International Energy Agency, The Role of Critical  Minerals in Clean Energy Transitions 97 (Mar. 2022) (May 2021 ed. cited in  Alliance for Automotive Innovation (AAI), Comment 101-102 (Oct. 26, 2021)).  Another key component of lithium batteries, cobalt, is controlled by the  Democratic Republic of the Congo, which is implicated in significant human rights concerns (including child labor), and Chinese state-owned enterprises  have a controlling interest in 70% of Congo’s cobalt mines. AAI Comment at 108.  

Lack of Agency Expertise. To force electrification, EPA would need to  understand and weigh “many vital considerations of national policy.” West  Virginia, 142 S. Ct. at 2612; see pp. 29-31, supra. The policy judgments here  involve not only potential climate impacts but millions of jobs, the  restructuring of entire industries, the Nation’s energy independence and  relationship with hostile powers, and supply-chain and electric-grid  vulnerabilities. EPA does not have any expertise in those matters. It  implicitly conceded as much when it declined to consider in the rulemaking the  “shifts in employment associated with the transition from gasoline vehicles to [electric vehicles]” or the “security risks associated with the manufacture and  importation of different types of vehicles and vehicle components.”  RTC 22-11, 19-18. The judgments here are not ones “Congress presumably  would” entrust to an “agency [with] no comparative expertise,” but are “ones  that Congress would likely have intended for itself.” West Virginia, 142 S. Ct.  at 2612-2613.  

Prior Rejections by Congress of Similar Policies. As evidence that  the judgments here belong to Congress rather than the Executive, both  Houses of Congress have previously “considered and rejected” multiple bills  with effects similar to EPA’s rule. West Virginia, 142 S. Ct. at 2614 (quoting  Broum & Williamson, 529 U.S. at 144). Congress even rejected one bill that  would have mandated a level of electric-vehicle penetration roughly equal to  the 50%-by-2030 target EPA embraces in the rule. See, e.g., Zero-Emission  Vehicles Act of 2019, H.R. 2764, 116th Cong. (2019); Zero-Emission Vehicles  Act of 2018, S. 3664, 115th Cong. (2018); see also 116 Cong. Rec. 19238-40  (1970) (proposed amendment to Title II that would have banned internal combustion vehicles by 1978). Congress’s “consistent judgment” against the  very sorts of mandates imposed by EPA undercuts any claim of congressional authorization. Brown & Williamson, 529 U.S. at 147-148, 160; accord West  Virginia, 142 S. Ct. at 2614.  

Conflict with Congress’s Broader Design. EPA’s rule is also  inconsistent with the broader statutory scheme and Congress’s plan for  tackling climate change. See Utility Air, 573 U.S. at 321. When Congress has  sought to address greenhouse-gas emissions from the transportation sector, it  has done so by promoting corn ethanol and other biofuels, which are used in  conventional vehicles and which-unlike electric-vehicle components-are in  abundant domestic supply. See, e.g., Inflation Reduction Act of 2022,  Pub. L. No. 117-169, §§ 13202, 13404, 22003, 136 Stat. 1818, 1932, 1966-1969,  2020 (2022). Indeed, Congress has consistently legislated against the  background expectation that conventional vehicles powered by liquid fuels will  remain on the market.  

For example, in Title II’s Renewable Fuel Program, Congress  mandated that “gasoline sold or introduced into commerce in the United  States” must contain a year-over-year increasing share of renewable fuels.  42 U.S.C. § 7545(o)(2)(A)(i). Under that standard, gasoline in the U.S. market  in 2022 must include tens of billions of gallons of renewable fuel. Id.  § 7545(o)(2)(B); see 87 Fed. Reg. 39,600 (July 1, 2022). EPA is thus working at cross-purposes with Congress, which has required increases in liquid  renewable fuels at the same time that EPA is seeking to eliminate vehicles  that use such fuels. The obvious reason for the mismatch is that Congress has  not decided to mandate electrification-nor has it placed that power in EPA’s  hands.  

3. EPA claims an unheralded power with staggering  implications.  

In asserting the sweeping power to mandate increasingly high levels of  electrification, EPA claims to have “discover[ed] in a long-extant statute an  unheralded power to regulate ‘a significant portion of the American  economy.”‘ Utility Air, 573 U.S. at 324 (quoting Brown & Williamson,  529 U.S. at 159). The novelty and broad implications of the agency’s approach  are powerful clues that Congress never authorized it.  

Novel Assertion of Agency Authority. Skepticism is warranted when  an agency asserts an “unheralded power representing a transformative  expansion in its regulatory authority.” West Virginia, 142 S. Ct. at 2610  (internal quotation marks omitted). Never before has EPA claimed that Title  II of the Clean Air Act authorizes it to use emission standards to mandate  electric-vehicle production, let alone to phase out conventional vehicles.  Rather, in prior rules setting greenhouse-gas emission standards, EPA has treated electric vehicles as a compliance “option” or “flexibility.” See, e.g.,  77 Fed. Reg. at 62,917 (“[E]lectrification is an option for compliance but is not  required under this rule.”).  

Indeed, forced electrification has never before even been on the table.  As discussed above, EPA’s previous standards were always jointly  promulgated with NHTSA. See pp. 9-10, supra. Congress prohibited NHTSA  from considering the fuel economy of electric vehicles in setting fuel-economy  standards, see 49 U.S.C. § 32902(h)(l), so the agencies’ joint rules could never  force electrification. Cooperating and coordinating with NHTSA was no real  constraint, however, because EPA has never claimed the authority to mandate  electric vehicles. EPA decoupled its rulemaking from NHTSA’s only when it  purported to discover new authority in old provisions of the Clean Air Act.  

Future Implications of the Agency’s Claimed Power. EPA has made  no secret of the significance of the power it exercised here. In its proposed  rule, EPA “expect[ed] that electrification would continue to play a relatively  modest role” in compliance. 86 Fed. Reg. at 74,442. But around that time,  President Eiden set as “a goal that 50 percent of all new passenger cars and  light trucks sold in 2030 be zero-emission vehicles” and directed EPA to set  greenhouse-gas emission standards accordingly. Id. at 43,583. 

In response to the President’s directive, EP A’s final rule was much more  aggressive. EPA ratcheted up the final emission standards from its initial  proposal, explaining that the more stringent standards “provide a more  appropriate transition to new standards for [model year] 2027 and beyond,”  “[c]onsistent with the direction of Executive Order 14037.” 86 Fed. Reg. at  74,437. EPA did not hide its commitment “to encouraging the rapid  development and deployment of zero-emission vehicles.” Id. at 74,494. As in  West Virginia, there is no reason to believe that EPA will stop here. “[O]n  this view of EPA’s authority, it could go further, perhaps forcing” car  manufacturers to “cease making” internal-combustion vehicles altogether.  142 S. Ct. at 2612.  

Indeed, that is exactly where EPA is headed. When EPA promulgated  its final rule, the Administrator declared the rule “a giant step forward” in  “paving the way toward an all-electric, zero-emissions transportation future.”  EPA, EPA Finalizes Greenhouse Gas Standards for Passenger Vehicles,  Paving Way for a Zero-Emissions Future (Dec. 20, 2021),  https://bit.ly/3wJFsTD. And in one of the companion cases before this Court,  EPA authorized California to adopt its own greenhouse-gas emission  standards-an authority California is already citing to ban new combustion engine vehicles and require “100-percent electrification by 2035.” Private Pet.  Br. 10, Ohio v. EPA, No. 22-1081 (D.C. Cir. Oct. 24, 2022) (citation omitted).  Both parts of EPA’s strategy reveal the agency’s goal to convert America to  electric vehicles.  

B. EPA Lacks Clear Statutory Authority To Use  Fleetwide Averaging To Mandate Electric Vehicles.  

Given the vast economic and political significance ofEPA’s rule, it “must  point to ‘clear congressional authorization’ for the power it claims.” West  Virginia, 142 S. Ct. at 2609. There is not one word in the Clean Air Act about  a nationwide agency-led transition from conventional internal-combustion  vehicles to electric vehicles. To be sure, EPA has the power to set emission  standards for air pollutants from motor vehicles, just as EPA had the power  in West Virginia to set emission standards for air pollutants from power  plants. But what EPA claims here for the first time is the authority to set  standards in such a way that manufacturers can comply only by abandoning  internal-combustion vehicles in favor of electric vehicles. And nothing in the  Clean Air Act authorizes that.  

EPA has effectively conceded as much before. EPA is requmng  electrification by setting average emission standards for manufacturers’  nationwide fleets and “averaging” in more and more zeros to represent the electric vehicles it wants to see in future years. Manufacturers that exceed the  standards may bank credits and trade them to other manufacturers that fall  short. EPA has previously acknowledged that the Act is silent on those  mechanisms: averaging, banking, and trading. When EPA first adopted  fleetwide averaging, it recognized that “Congress did not specifically  contemplate an averaging program when it enacted the Clean Air Act.”  48 Fed. Reg. 33,456, 33,458 (July 21, 1983). And “[j]ust as the statute does not  explicitly address EP A’s authority to allow averaging, it does not address the  Agency’s authority to permit banking and trading.” 54 Fed. Reg. 22,652,  22,665 (May 25, 1989); see 55 Fed. Reg. 30,584, 30,593 (July 26, 1990) (same).  By definition, then, the Act does not address-let alone clearly authorize-the  use of averaging, banking, and trading to electrify the Nation’s vehicle fleet.  

That should be the end of the analysis. Section 202 of the Clean Air Act  does not itself “direct [conventional vehicles] to effectively cease to exist.”  West Virginia, 142 S. Ct. at 2612 n.3. EPA has instead relied on mechanisms  that are not themselves spelled out in the statute and that have never before  been used to mandate electric vehicles. Just as in West Virginia, EPA has  nothing “close to the sort of clear authorization” necessary for such a  transformational policy shift. 142 S. Ct. at 2614.

But in truth, the problem is far worse for EPA than that. As explained  below, the Act unambiguously precludes fleetwide-average emission  standards under Section 202(a). And even if the statute permitted some  fleetwide averaging, it does not allow EPA to take the additional step of  incorporating non-emitting vehicles into emission averages and thus forcing  the market toward electric vehicles. EPA is not merely stretching vague  statutory language. It is defying clear statutory text.  

EPA may not set fleetwide-average standards.  1. 

The text and structure of Section 202, and of Title II more broadly,  unambiguously require that emission standards under Section 202(a) apply to  individual vehicles, not manufacturers’ fleets on average. EPA claims to find  authority for fleetwide averaging in Section 202(a), which authorizes EPA to  issue “standards applicable to the emission of any air pollutant from any class  or classes of new motor vehicles … which in [its] judgment cause, or contribute  to, air pollution which may reasonably be anticipated to endanger public health  or welfare.” 42 U.S.C. § 7521(a).  

On its face, that provision authorizes EPA to set standards for vehicles  that emit harmful air pollutants. It says nothing about averaging across fleets.  As noted, when EPA first adopted fleetwide averaging, it acknowledged that “Congress did not specifically contemplate an averaging program when it  enacted the Clean Air Act.” 48 Fed. Reg. at 33,458. EPA claimed to have the  authority because the Act “does not explicitly preclude standards” based on  averaging. 54 Fed. Reg. at 22,666 (emphasis added). EPA was wrong. “[T]he  broader context of the statute as a whole,” Robinson v. Shell Oil Co., 519 U.S.  337, 341 (1997), makes clear that Section 202(a) does not permit fleetwide  averaging.  

a. Other provisions in Section 202 demonstrate that emission standards may not be based on averaging.  

1. Title II is replete with provisions that necessarily apply to vehicles  individually, not to fleets on average. That is evident first in the emission  standards prescribed by Section 202 itself. In Section 202(b ), the Act sets forth  specific light-duty vehicle emission standards that EPA must promulgate in  “regulations under” Section 202(a). 42 U.S.C. § 7521(b). For example, for  vehicles in model years 1977 to 1979, the standards must provide that  “emissions from such vehicles and engines may not exceed 1.5 grams per  vehicle mile of hydrocarbons and 15.0 grams per vehicle mile of carbon  monoxide.” Id. § 7521(b)(l)(A). 

Those provisions require that the “regulations under [Section 202(a)]”  apply to ”vehicles and engines,” not ”vehicles and engines on an average basis  across a fleet.” Construing those provisions to allow averaging would, in effect,  add words to the statute that change its meaning. Neither courts nor agencies  may “supply words . . . that have been omitted.” Antonin Scalia & Bryan  Garner, Reading Law: The Interpretation of Legal Texts 93 (2012); accord  Rotkiske v. Klemm, 140 S. Ct. 355, 360-361 (2019). And supplying the extra  words “on average” would have a significant substantive effect: “roller coaster  riders must be 48 inches tall” means something very different from “roller  coaster riders must be 48 inches tall on average.”  

The testing requirements accompanying the Section 202(b) standards  confirm that those standards apply to all vehicles. In particular, EPA must  “test any emission control system incorporated in a motor vehicle or motor  vehicle engine . . . to determine whether such system enables such vehicle or  engine to conform to the standards required to be prescribed under [Section  202(b) of the Act].” 42 U.S.C. § 7525(a)(2). If the system complies, EPA must  issue a ”verification of compliance with emission standards for such system.”  Id. Those requirements plainly contemplate standards that apply to individual  vehicles and their emission-control systems. Not only does the statutory text frame the inquiry as whether an individual ”vehicle” or “engine” conforms to  the emission standards, but the provision’s foundational premise-that an  emission-control system can enable a vehicle to meet emission standards depends on individually applied standards.  

11. Other parts of Section 202 further demonstrate that emission  standards under Section 202(a) cannot rely on averaging. Section 202(b)(3),  for example, authorizes EPA to grant waivers from certain nitrogen-oxide  emission standards-which, again, are standards “under” Section 202(a), see  42 U.S.C. § 7521(b)(l)(B)-for no “more than 5 percent of [a] manufacturer’s  production or more than fifty thousand vehicles or engines, whichever is  greater.” Id. § 7521(b)(3). This provision would be nonsensical under a  fleetwide-averaging regime. It contemplates a default under which every  vehicle meets a standard, then gives manufacturers a waiver from that default  for up to 5% of the fleet. But under fleetwide averaging, no waiver is needed.  Instead, a vast proportion of a manufacturer’s fleet-perhaps 50% or more effectively has a ”waiver” so long as a sufficient number of vehicles outperform  the standard. Likewise, Section 202(g), which specifies an increasing  “percentage of each manufacturer’s sales volume” of each model year’s vehicles that must comply with specified emission standards, is fundamentally  incompatible with averaging. Id. § 7521(g)(l).  

Similarly, under Section 202(m), EPA must require  manufacturers to install on “all” new light-duty vehicles and trucks “diagnostic  systems” capable of identifying malfunctions that “could cause or result in  failure of the vehicles to comply with emission standards established under  this section.” Id. § 7521(m)(l). As this requirement makes clear, individual  vehicles must “comply with emissions standards established under [Section  202].” Id. Otherwise, requiring diagnostic equipment on “all” vehicles makes  no sense. In a fleetwide-averaging regime, this requirement would be  pointless, as the deterioration or malfunction of an individual vehicle’s  emission-related systems would provide virtually no information about  whether the fleet as a whole is compliant.  

b. Title H’s compliance and enforcement provisions for emission standards confirm that EPA cannot use fleetwide averaging.  

Fleetwide averaging also clashes with “the design and structure of [Title  II] as a whole.” Utility Air, 573 U.S. at 321 (citation omitted). Title II sets  forth a comprehensive, interlocking scheme for enforcing emission standards  through testing, certification, warranties, remediation, and penalties. 

Fleetwide-average standards are incompatible with these provisions, which  are “designed to apply to” individual vehicles and “cannot rationally be  extended” to fleets. Id. at 322.  

1. Testing and Certification. Under Title II, EPA must “test, or  require to be tested in such manner as [it] deems appropriate, any new motor  vehicle or new motor vehicle engine submitted by a manufacturer to determine  whether such vehicle or engine conforms with the regulations prescribed  under [Section 202].” 42 U.S.C. § 7525(a)(l). If the ”vehicle or engine  conforms to such regulations,” EPA must issue the manufacturer a “certificate  of conformity.” Id. EPA may later test a manufacturer’s vehicles and engines,  and if “such vehicle or engine does not conform with such regulations and  requirements, [EPA] may suspend or revoke such certificate insofar as it  applies to such vehicle or engine.” Id. § 7525(b )(2)(A)(ii). A manufacturer may  not sell a vehicle or engine not “covered by a certificate of conformity.” Id.  § 7522(a)(l).  

Fleetwide averaging is incompatible with these requirements in at least  two respects. First, by using the singular terms ”vehicle” and “engine,” along  with “any” and “such,” the statute contemplates that individual vehicles may  be tested, determined to “not conform” with the standards, and have their certificates of conformity suspended or revoked. In a fleetwide-averaging  regime, testing an individual vehicle or engine does not enable EPA to  determine whether it “conforms with the regulations prescribed under  [Section 202],” 42 U.S.C. § 7525(a)(l), because conformity turns not on an  individual vehicle’s emissions but on the fleet’s average performance overall.  

Second, fleetwide averaging also makes it impossible to determine  compliance with applicable emission standards before a vehicle is sold, as  required to obtain the certificate of conformity needed for a sale. See 42 U.S.C.  § 7522(a)(l). Under fleetwide-average standards, a vehicle’s “conform[ity]  with the regulations prescribed under [Section 202]” cannot be determined  until the manufacturer calculates its production-weighted average at “the end  of each model year,” when the manufacturer knows the quantity and model of  ”vehicles produced and delivered for sale.” 40 C.F.R. §§ 86.1818-12(c)(2)(2),  86.1865-12(i)(l), (j)(3).  

For similar reasons, fleetwide averaging is inconsistent with the  statutory definition of an “emission standard,” which “limits the quantity, rate,  or concentration of emissions of air pollutants on a continuous basis.”  42 U.S.C. § 7602(k). It is impossible to know on a “continuous basis” whether  a manufacturer’s fleet complies with EPA’s average standards, because a manufacturer cannot calculate its production-weighted average until the end  of the year. Simply put, an after-the-fact compliance regime is incompatible  with the Act’s testing and certification scheme.  

11. Warranties and Remediation. Fleetwide-average standards  similarly clash with Title II’s warranty provisions. Under Section 207, a  manufacturer must ”warrant to the ultimate purchaser and each subsequent  purchaser” “at the time of sale” that each new vehicle complies with applicable  regulations under [Section 202]. 42 U.S.C. § 7541(a)(l) (emphasis added). Yet,  as with certificates of conformity, manufacturers cannot warrant conformity  with fleetwide-average emission standards at the time of sale, because  compliance can be determined only at the end of the year. See 40 C.F.R.  § 86.1865-12(i)(l) (requiring manufacturers to compute their “production weighted fleet average” by “using actual production [ data]” for the year in  question).  

Fleetwide-average emission standards are also inconsistent with Title  II’s remediation and notification provisions. Those provisions state that if  EPA “determines that a substantial number of any class or category of  vehicles or engines . . . do not conform to the regulations prescribed under  [Section 202],” the manufacturer must remedy “the nonconformity of any such vehicles or engines.” 42 U.S.C. § 7541(c)(l). If “a motor vehicle fails to  conform,” the manufacturer bears the cost. Id. § 7541(h)(l). Further,  “dealers, ultimate purchasers, and subsequent purchasers” must be given  notice of any nonconformity, id. § 7541(c)(2), which requires identification of  specific nonconforming vehicles. None of this is possible where the  nonconformity is tied to a fleet on average.  

Ill. Penalties. Finally, EPA’s fleetwide-averaging regime Is  inconsistent with the statute’s penalty provision. Under Section 205, any  violation “shall constitute a separate offense with respect to each motor vehicle  or motor vehicle engine,” with each offense subject to its own civil penalty of  up to $25,000. 42 U.S.C. § 7524(a) (emphasis added). Under EPA’s approach,  however, no individual vehicle or engine violates the applicable standard, only  the fleet as a whole. The statute provides no method for calculating penalties  when a fleet fails to meet its fleetwide-average standard-because it does not  authorize fleetwide-average standards.  

c. The broader text and history of Title II confirm that the rule exceeds EP A’s authority.  

Other indicia of statutory meaning demonstrate that the rule exceeds  EPA’s statutory authority under Section 202(a). Elsewhere in Title II,  Congress showed that it knew how to legislate with respect to “average annual aggregate emissions.” 42 U.S.C. § 7545(k)(l)(B)(v)(II) (directing EPA to take  certain actions if “the reduction of the average annual aggregate emissions of  toxic air pollutants in a [designated district] fails to meet” certain standards).  Thus, “if Congress had wanted to adopt an [averaging] approach” for motor 

vehicle standards under Section 202(a), “it knew how to do so.” SAS Inst., Inc.  v. lancu, 138 S. Ct. 1348, 1351 (2018); see Rotkiske, 140 S. Ct. at 360-361  (“Atextual judicial supplementation is particularly inappropriate when, as  here, Congress has shown that it knows how to adopt the omitted language or  provision.”). It did not choose that approach in Section 202(a).  

The Energy Policy Conservation Act, enacted just two years before the  1977 Clean Air Act amendments, reinforces that conclusion. There, Congress  directed the Secretary of Transportation to issue regulations setting “average  fuel economy standards for automobiles manufactured by a manufacturer” in  a given model year. 49 U.S.C. § 32902(a). That Congress has not used similar  language in Section 202(a) of the Clean Air Act is a “telling clue” that the Act  does not permit fleetwide averaging. Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612,  1626 (2018).  

The Clean Air Act’s history also reflects Congress’s understanding that  emission standards would apply to all vehicles individually. Congress was so focused on reducing emissions at the level of the individual vehicle that, in the  1970 amendments, Congress permitted EPA to test any individual vehicle as  it comes off the assembly line. See Pub. L. No. 91-601, § 8, 84 Stat. 1676, 1694- 1696. Such a vehicle-by-vehicle test was meant to supplement the pre-1970  testing of prototypes. Congress explained that while testing of prototypes  ”will continue,” “tests should require each prototype rather than the average  of prototypes to comply with regulations establishing emission standards.”  H.R. Rep. No. 91-1146, at 6 (1970). And if Congress forbade averaging across  prototypes, it certainly did not permit averaging across entire fleets.  

d. EP A’s lack of authority for a credit-trading scheme further confirms its lack of authority to set fleetwide averages.  

As explained above, see pp. 12-14, supra, the credit banking and trading  program is critical to EP A’s electrification mandate. But the agency also lacks  authority under Title II to establish a credit scheme as part of its emission  standards under Section 202(a).  

As with fleetwide averaging, EPA has previously acknowledged that  Title II says nothing about banking and trading credits in connection with  motor-vehicle emission standards. See 54 Fed. Reg. at 22,665. What EPA has  ignored, however, is that Title II is not silent regarding banking and trading in other contexts. Indeed, in multiple other provisions under Title II,  Congress expressly authorized the use of bankable and tradable credits. See,  e.g., 42 U.S.C. § 7545(k)(7) (reformulated gasoline credits);  § 7545(o)(2)(A)(ii)(II)(cc), (5)(A)(i) (renewable fuel credits); id.  § 7545(o)(2)(A)(ii)(II)(cc), (5)(A)(ii) (biodiesel credits); id.  § 7545(o)(2)(A)(ii)(II)(cc), (5)(A)(iii) (small refineries credits); id. § 7586(f)  (clean-fuel fleet-operator credits); id. § 7589(d) (California pilot test program’s  clean-fuel vehicle manufacturer credit).  

Under EPA’s approach, those provisions would all be superfluous,  because EPA already had the discretion to adopt a credit-trading regime for  any program. If Congress had wanted to permit credits in connection with  emission standards under Section 202(a), it knew how to and would have done  so expressly. See SAS Inst., 138 S. Ct. at 1351.  

* * *  

For all these reasons, this Court has cast substantial doubt on EPA’s  authority to set fleetwide-average emission standards. As the Court explained  in NRDC v. Thomas, 805 F .2d 410 (D.C. Cir. 1986), the “engine specific thrust”  of Title II’s “testing and compliance provisions” is evident both in Congress’s  choice to “spea[k] of ‘any,’ ‘a,’ or ‘such’ motor vehicle or engine” in the text of the statute and in the “troubling” legislative history recounted above. Id. at  425 n.24. The arguments were not dispositive in Thomas only because the  parties there had failed to present them. Id. But the Court nevertheless  recognized that the arguments were relevant to “future proceedings,” id., like  this one.  

2. At a minimum, EPA may not use fleetwide averaging to  require electrification.  

Despite the absence of statutory authorization for fleetwide averaging,  EPA has long employed that mechanism without significant industry  pushback. That is likely because fleetwide averaging has generally been  offered as an accommodation to regulated parties, allowing them flexibility  that the statute does not in fact permit. In its new rule, however, EPA is not  offering an extrastatutory accommodation. It is taking an additional step  away from the statutory text by using fleetwide averaging to mandate  electrification.  

To be clear, in prior rules EPA set an average emission standard and  allowed manufacturers to make some vehicles that emitted more and some  that emitted less. Here, EPA has set tailpipe greenhouse-gas emission  standards at a level so stringent that manufacturers must incorporate an  increasing percentage of electric vehicles-which EPA treats as zero-emission vehicles-into their averages in order to comply with the “standards.” See p.  13, supra. Put differently, the agency is setting an emission standard that is  artificially low because it incorporates electric vehicles, which EPA treats as  emitting zero pollutants for averaging purposes.  

Whatever the permissibility of fleetwide averaging, the text and  structure of Title II make plain that EPA cannot manipulate averaging as a  means to force production of an increasing market share of electric vehicles.  Section 202 does not grant EPA the power to make the internal-combustion  engine go the way of the horse and carriage. At the very least, Section 202 is  hardly clear in granting that awesome power-which is what matters under  West Virginia. For automobiles as for power plants, EPA has purported to  discover in the Clean Air Act the authority to “forc[e]” manufacturers to  “cease making” a particular type of energy “altogether.” 142 S. Ct. at 2612.  We have seen that play recently before, and it should end the same way.  

a. The statutory text demonstrates Congress’s focus on technologically achievable emission controls.  

1. Section 202(a)(l) provides that EPA shall prescribe “standards  applicable to the emission of any air pollutant from any class or classes of new  motor vehicles or new motor vehicle engines, which in [its] judgment cause, or  contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare.” 42 U.S.C. § 7521(a)(l). The statute, of course, does  not expressly specify which vehicles are to be included in any average emission  standard-because, as discussed above, it does not contemplate averaging in  the first place. But to the extent averaging is permissible, the text makes clear  that the vehicles included in such averaging must, in EPA’s judgment, actually  emit the relevant pollutant.  

To begin with, the statute focuses on standards for the “emission” of an  air pollutant, which immediately indicates Congress’s focus on vehicles  deemed to actually “emi[t]” the relevant pollutant. 42 U.S.C. § 7521(a)(l)  (emphasis added). Here, EPA’s rule stipulates that electric vehicles are to be  treated for averaging purposes as if they emit no carbon dioxide ( even when  they pull electricity from a grid that is powered by carbon-emitting sources).  40 C.F .R. § 86.1866-12(a). EPA has thus decided that electric vehicles as a  class do not “emi[t]” the relevant pollutant. 42 U.S.C. § 7521(a)(l). And given  the textual focus on harmful emissions, it would be extremely unusual for EPA  to include non-emitting vehicles in the standards that EPA calculates and  imposes.  

Next, the statute is explicit that the things for which EPA sets standards  must “in [EPA’s] judgment cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare.” 42 U.S.C.  § 7521(a)(l). The key textual question is thus what exactly EPA must  “judg[e]” to “cause, or contribute to” potentially dangerous air pollution. The  grammatical structure of the provision offers only two plausible options.  Because the verbs “cause” and “contribute” are in the plural form, their  subject must be plural as well. See Scalia & Garner, supra, at 140 (“Judges  rightly presume … that legislators understand subject-verb agreement.”).  The only plural nouns that could plausibly “cause” or “contribute” to pollution  are either the “new motor vehicles or new motor vehicle engines,” or the “class  or classes” of those vehicles or engines.  

Under either reading, all of the covered vehicles must emit the relevant  pollutant. If it is the ”vehicles” or “engines” that EPA must judge to “cause,  or contribute to, air pollution,” then Section 202(a) authorizes EPA to set  standards only for “new motor vehicles or new motor vehicle engines which in  [EPA’s] judgment cause, or contribute to” potentially dangerous pollution. In  other words, EPA may set standards only for motor vehicles that in its  judgment actually emit the regulated pollutant-here, combustion-engine  vehicles that emit carbon dioxide. The converse is equally true: Section 202(a) does not authorize EPA to set standards for vehicles that it deems not to cause  or contribute to harmful pollution.  

That is the natural reading of the statute under the “grammatical ‘rule  of the last antecedent,”‘ which provides that a “limiting clause or phrase …  should ordinarily be read as modifying only the noun or phrase that it  immediately follows.” Barnhart v. Thomas, 540 U.S. 20, 26 (2003). Here, the  relevant limiting phrase is: ”which in [EPA’s] judgment cause, or contribute,  to air pollution.” And the immediately antecedent phrase is “new motor  vehicles or new motor vehicle engines.” The rule of the last antecedent thus  indicates that it is the “vehicles” in the class that must “cause, or contribute”  to the pollution, and not the “class” as a whole.  

This Court and others have adopted that natural reading. This Court  has observed that Section 202(a) “requires the EPA to set emissions standards  for new motor vehicles and their engines if they emit harmful air pollutants.”  Truck Trailers Mfrs. Ass’n v. EPA, 17 F .4th 1198, 1201 (D.C. Cir. 2021)  (emphasis added); see NRDCv. EPA, 954 F.3d 150,152 (2d Cir. 2020) (Section  202(a) “requires EPA to regulate emissions from new motor vehicles if EPA  determines that the vehicles ’cause, or contribute to,’ [potentially dangerous]  air pollution”) ( emphasis added).

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