U.S. automakers challenge Vermont emissions law
BURLINGTON, Vermont (Reuters) - A Vermont rule reducing greenhouse gas emissions is so strict that adhering to it would be a "financial disaster" for General Motors, an executive with the U.S. automaker testified in a lawsuit on Tuesday.
GM, DaimlerChrysler AG, local auto dealers and industry associations have filed suit against the Vermont rule, which calls for a 30 percent cut in the amount of carbon dioxide released by cars, starting with 2009 models.
"It would be a financial disaster for the company," if the rule goes into effect, said Alan Weverstad, executive director for environment and energy at GM, the world's largest automaker.
Vermont is one of 10 U.S. states that have adopted rules calling for the 30 percent cut in carbon dioxide emissions, which most scientists say contribute to global warming.
The trial began a week after the U.S. Supreme Court ruled -- over the objections of the Bush administration -- that greenhouse gases meet the definition of pollutants and told the Environmental Protection Agency to rethink its refusal to regulate them.
The lack of action on carbon dioxide emissions at the national level in recent years prompted California to adopt rules reducing how much cars can emit. Other states followed.
Vermont adopted the standard in 2005 and was sued by the automakers and others. Lawsuits have also been filed against California and Rhode Island, but the Vermont case, which started on Tuesday at the U.S. District Court in Burlington, is the first to go to trial.
Connecticut, Maine, Massachusetts, New Jersey, New York, Oregon and Washington have also adopted the rules, while Arizona, Maryland and New Mexico are considering it.
At the heart of this case is whether states have the right to regulate the emission of carbon dioxide, often called by the chemical shorthand CO2. The amount of the gas released by cars is directly related to the amount of fuel burned, and fuel economy is covered by national regulations.
"The only way we have to reduce the amount of CO2 is to improve fuel economy," said Weverstad.
Scot Kline, representing Vermont, argued that regulating greenhouse gases was part of a broader state effort.
"The greenhouse gas regulation is not a de facto fuel economy standard," Kline told the court. "It is part of a larger, comprehensive effort at the state level to address climate change."
'THE LIGHTS GO OUT'
When Vermont first adopted the rule two years ago, GM evaluated what it could do to try to comply, Weverstad said.
He said the company found that even if it revamped its entire vehicle line, adding gasoline-electric hybrid engines to more than 80 percent of its cars and trucks, at a loss of $25 billion, it would not be able to comply with the regulations by 2016, when they go into full force.
"In 2016, the lights go out," Weverstad said, explaining that GM estimated by that time it would no longer be able to sell vehicles in Vermont, California or any other state that adopted the rules.
Defense attorneys noted GM made similarly bleak predictions in the 1970s, when the United States first required catalytic converters, which reduce noxious emissions, but the company survived.
Under cross-examination, Weverstad said the scenario sketched out by the company did not include any improvements in carbon dioxide emissions related to the adoption of diesel engines, the addition of ethanol as a fuel source or other potentially emissions-reducing technologies.
