The Trump administration announced Wednesday that it is rescinding a Department of Energy provision that had effectively rewarded automakers for producing electric vehicles under federal fuel-economy calculations.
What was rescinded - The provision, known as the "fuel content factor," allowed automakers to assign electric vehicles artificially high fuel-economy values when totaling fleetwide averages under Corporate Average Fuel Economy (CAFE) rules.
Why it mattered - By permitting those elevated fuel-economy values, the provision functioned as an incentive for automakers to include more electric vehicles in their fleets in order to meet federal fuel economy requirements.
Criticism and legal basis - Environmental groups had long objected to the calculation method, arguing it overstated the energy savings attributed to electric vehicles. The Energy Department said it was acting in response to a September appeals court decision, which it cited as the basis for removing the provision.
Next steps signaled - The department also stated it plans to propose additional revisions to how fuel economy is calculated in the future, though it did not provide further details in the announcement.
The department's action closes a chapter on a specific regulatory approach to crediting electric vehicles under CAFE while signaling further adjustments to methodology may be forthcoming. The decision, as described by the department, was directly linked to an appeals court ruling and to critiques from environmental groups about the transparency and accuracy of current calculations.
Summary of the announcement
- The Energy Department rescinded the "fuel content factor" provision.
- The provision previously allowed EVs to be counted at elevated fuel-economy values for fleetwide averages under CAFE.
- The department cited a September appeals court decision and noted plans for further methodological revisions.