Today’s historic Clean Air Act settlement keeps key climate change effort on track

By Cynthia Giles

Our rules to combat climate change – like all environmental protection rules – only work when they are implemented in the real world. Today, we are delivering on our commitment to make sure that happens, through a settlement with the automakers Hyundai and Kia who sold more than 1 million vehicles that will emit close to 5 million more metric tons of GHGs than what they had certified to us.

Hyundai and Kia will forfeit 4.75 million GHG emission credits that they can no longer use to comply with the law, or sell to other automakers. That’s 4.75 million metric tons of greenhouse gases that could have been emitted if we hadn’t taken this action, equal to the emissions that come from powering more than 433,000 homes for one year.

They will also pay a $100 million penalty, the largest in Clean Air Act history. The size of this penalty demonstrates how significant these violations are, and reinforces our commitment to level the playing field for automakers that play by the rules. Hyundai and Kia will also spend millions of dollars on a series of steps—including improved vehicle testing protocols—to prevent future Clean Air Act violations.

Today’s action shows that the system works. Our audit process caught these violations, and we’re following through by holding companies that violated rules accountable. We developed standards for GHG emissions from light duty cars and trucks that took effect with model year 2012. One way automakers may comply with the standards is through banking and trading GHG emission credits. If a vehicle emits less GHGs per mile than the standard for that model year, that automaker generates a credit that they can use to claim compliance, or sell to other automakers whose vehicles may have fallen short of the standard.

The program requires automakers to test and certify to us that their vehicles meet the fuel economy and GHG emissions standards, giving consumers the information they need as they shop the marketplace. The program has already made great impact – our annual report shows model year 2013 car and truck fuel economy is at an all-time high.

But it only works when the automakers provide accurate fuel economy readings. Even small differences in what automakers report can have major impacts on fuel costs and emissions. A car model whose estimated fuel economy is off by a single mile per gallon can cost customers millions of extra dollars at the pump, and emit significant excess carbon pollution over its lifetime.

We are committed to oversight of this program and to tough enforcement of laws that mitigate climate change. Our regular audit testing identified these violations. Our efforts to deter other violations, to ensure accurate fuel economy labels for consumers, and to protect the integrity of this program is what got us to this important agreement.

As Administrator McCarthy said to the American Bar Association last month, “our environmental protection enterprise, and our system of commerce, only works if you can trust the fuel economy sticker on your car, so to speak.” I take this charge seriously both as the chief enforcement officer at EPA, but also someone who cares deeply about protecting companies that play by the rules, and those, like me, who want to reduce their impact on climate change.

Read more about the settlement

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