UPDATE 2-California will not get US waiver on emissions

(Recasts, adds reaction from lawmakers, environmental groups, auto industry)

By John Crawley and Chris Baltimore

WASHINGTON, Dec 19 (Reuters) - The Bush administration on Wednesday said it will deny California's request to regulate carbon dioxide emissions from automobiles, a setback for environmentalists and a victory for automakers.

The administration said an energy bill signed into law hours earlier by President George W. Bush means no further action is needed to cut carbon dioxide emissions from vehicles, which account for about 30 percent of the U.S. total.

The Environmental Protection Agency, charged with making the decision, found that the landmark law to raise automobile fuel standards by 40 percent by 2020 was a "better approach" than a "patchwork" of state rules.

California needed a waiver from the EPA to implement a law it passed this year to force automakers to make vehicles that cut emissions 25 percent by the 2009 model year.

Sixteen other states have either adopted or are considering rules similar to the California standard.

"It is my intent to deny the waiver," EPA administrator Stephen Johnson said in a conference call with reporters.

The energy law provides a "clear national solution -- not a confusing patchwork of state rules," and California's situation does not meet "compelling and extraordinary conditions" for action as defined by the Clean Air Act, Johnson said.