GREEN MOUNTAIN CHRYSLER PLYMOUTH DODGE v. CROMBIE
508 F.Supp.2d 295 (2007)
GREEN MOUNTAIN CHRYSLER PLYMOUTH DODGE JEEP; Green Mountain Ford Mercury; Joe Tornabene's GMC; Alliance of Automobile Manufacturers; DaimlerChrysler Corporation; and General Motors Corporation, Plaintiffs,
v.
George CROMBIE, Secretary of the Vermont Agency of Natural Resources; Jeffrey Wennberg, Commissioner of the Vermont Department of Environmental Conservation; and Richard Valentinetti, Director of the Air Pollution Control Division of the Vermont Department of Environmental Conservation, Defendants,
Conservation Law Foundation; Sierra Club; Natural Resources Defense Council; Environmental Defense, Vermont Public Interest Research Group; State of New York; and Denise, M. Sheehan, in her official capacity as Commissioner of Environmental Conservation of the State of New York, Defendants-Intervenors.
The Association of International Automobile Manufacturers, Plaintiff,
v.
George Crombie, in his official capacity as Secretary of the Vermont Agency of Natural Resources; Jeffrey Wennberg, in his official capacity as Commissioner of the Vermont Department of Environmental Conservation; Richard A. Valentinetti, in his official capacity as Director of the Vermont Air Pollution Control Division, Defendants,
Conservation Law Foundation; Sierra Club; Natural Resources Defense Council; Environmental Defense; Vermont Public Interest Research Group; State of New York; and Denise M. Sheehan, in her official capacity as Commissioner of Environmental Conservation of the State of New York, Defendants-Intervenors.
Nos. 2:05-CV-302, 2:05-CV-304.
United States District Court, D. Vermont.
September 12, 2007.
Matthew B. Byrne, Robert B. Hemley, Ross A. Feldmann, Gravel and Shea, Debra L. Bouffard, R. Jeffrey Behm, Sheehey Furlong & Behm P.C., Burlington, VT, Lucas R. Blocher, Michael E. Scoville, Andrew B. Clubok, Ashley C. Parrish, Derek S. Bentsen, Stacey B. Hall, Stuart A.C. Drake, Tyler D. Mace, Kirkland & Ellis LLP, Charles H. Haake, Raymond B. Ludwiszewski, Gibson, Dunn & Crutcher, LLP, Washington, DC, for Plaintiffs.
Kevin O. Leske, Scot L. Kline, Vermont Attorney General's Office, Montpelier, VT, for Defendants.
OPINION and ORDERSESSIONS, Chief Judge.
TABLE OF CONTENTSPage
INTRODUCTION .................................................................................300
BACKGROUND ...................................................................................303
I. Clean Air Act ..........................................................................303
II. Environmental Policy and Conservation Act ..............................................305
III. Massachusetts v. EPA ...................................................................307
EVIDENTIARY ISSUES ...........................................................................310
I. Daubert Challenges .....................................................................310
A. James Hansen, Ph.D .................................................................312
1. Hansen's Qualifications ........................................................312
2. Hansen's Testimony .............................................................313
3. Reliability of Hansen's Testimony ..............................................316
4. Relevance of Hansen's Testimony ................................................320
B. Admissibility of Testimony of Dr. Barrett N. Rock ..................................320
1. Dr. Rock's Qualifications ......................................................320
2. Dr. Rock's Testimony ...........................................................321
3. Reliability of Dr. Rock's Testimony ............................................322
4. Relevance of Dr. Rock's Testimony ..............................................325
C. Admissibility of Testimony of K.G. Duleep ..........................................325
1. Duleep's Qualifications ........................................................325
2. Duleep's Testimony .............................................................327
a. Methodology ................................................................327
b. Validation of Results With Lumped Parameter Model ..........................328
c. Duleep's Cost Analysis .........................................................329
3. Evaluating the Reliability of Duleep's Testimony ...............................329
4. Relevance of Duleep's Testimony ................................................333
II. Discovery Violation ....................................................................333
FINDINGS AND CONCLUSIONS .....................................................................336
I. The State Regulations ..................................................................336
A. Implementation of California's AB 1493 .............................................336
B. Adoption of Vermont's GHG Emissions Standards ......................................338
C. The Global Warming Connection ......................................................339
D. The GHG Regulation Provisions ......................................................341
II. Preemption .............................................................................343
A. The Preemption Doctrines Do Not Apply ..............................................343
B. Express Preemption .................................................................350
1. De Facto Fuel Economy Standard .................................................351
2. "Related to" Fuel Economy Standard .............................................353
C. Field Preemption ...................................................................354
D. Conflict Preemption ................................................................355
1. Frustration of Congressional Intent to Maintain Nationwide Fuel
Economy Standards ............................................................356
2. Technological Feasibility and Economic Practicability, Including Restricting
Consumer Choice, Reducing Employment and Decreasing
Traffic Safety ...............................................................357
a. History of Technology-forcing Regulations ..................................358
b. Austin's Testimony .........................................................359
c. Manufacturers' Testimony ...................................................360
d. Duleep's Testimony .........................................................364
e. Conclusions ................................................................365
(1) Austin's baseline assumptions and methodology ..........................365
(2) Alternative, fuels .....................................................369
(a) Diesel .............................................................370
(b) Ethanol ............................................................373
(c) Hydrogen ...........................................................376
(d) Plug-in hybrids ....................................................376
(3) Other technologies .....................................................377
(a) GDI/turbo ..........................................................378
(b) Camless valve actuation ............................................379
(c) Rolling resistance improvements ....................................379
(d) Reductions in aerodynamic drag .....................................380
(e) Continuously variable transmission ("CVT") .........................380
(f) Electronic power steering ..........................................381
(g) A/C credits ........................................................381
(h) Credit trading .....................................................381
(i) Efforts to promote technology generally ............................382
(4) Consumer choice ........................................................384
(5) Product withdrawal and job loss ........................................386
(6) Safety .................................................................389
III. Foreign Policy Preemption ..............................................................392
A. National Foreign Policy on GHG Emissions ...........................................392
B. Zschernig Preemption ...............................................................395
C. Garamendi Preemption ...............................................................395
CONCLUSION ...................................................................................397
ORDER ........................................................................................399
IntroductionIn these consolidated cases, Plaintiffs, a collection of new motor vehicle dealers, automobile manufacturers and associations of automobile manufacturers, seek declaratory and injunctive relief from regulations adopted by Vermont in the fall of 2005 that establish greenhouse gas ("GHG") emissions standards for new automobiles. The
Plaintiffs in Docket No. 2:05-cv-3021 brought six claims for declaratory and injunctive relief: express and implied preemption under the Energy Policy and Conservation Act of 1975, 49 U.S.C. §§ 32901-32919 ("EPCA") (Count I); preemption under the Clean Air Act as amended, 42 U.S.C. §§ 7401-7671q ("CAA") (Count II); violation of the CAA (Count III); foreign policy preemption (Count IV); violation of the dormant Commerce Clause (Count V); and violation of the Sherman Act (Count VI). The Plaintiff2 in Docket No. 2:05-cv-304 alleged preemption under EPCA (Count I) and under the CAA (Count II).3 On May 3, 2006, five non-profit environmental advocacy groups4 were permitted to intervene as defendants in the cases, and on July 27, 2006 the State of New York was also permitted to intervene as a defendant. Prior to trial, Defendants twice sought to stay these cases, pending resolution of the related case filed in California, Central Valley Chrysler-Jeep, Inc. v. Witherspoon, No. 1:04-cv-06663-REC-LJO (E.D. Cal. filed Dec. 7, 2004), and the Supreme Court's review of Massachusetts v. EPA,415 F.3d 50 (D.C.Cir.2005), rev'd ___ U.S. ___, 127 S.Ct. 1438, 167 L.Ed.2d 248 (2007). The requests were denied, on May 3, 2006, and February 15, 2007. Defendants also sought to obtain dismissal of these cases for lack of ripeness via motions to dismiss for lack of subject matter jurisdiction (Doc. 48) and judgment on the pleadings (Doc. 162), because their regulation had not received a waiver from EPA, a necessary antecedent to enforcement. The Court concluded that the cases were constitutionally and prudentially ripe, given that the Vermont regulation had been formally enacted, those affected by the regulation had to begin now to comply with it, the constitutional challenges were currently as concrete and fit for decision as they would be in the future, and Plaintiffs' demonstration of hardship tipped the balance in favor of exercising jurisdiction on prudential grounds. Mem. Op. & Order 17-19 (Doc. 165).
1. Green Mountain Chrysler Plymouth Dodge Jeep, Green Mountain Ford Mercury, Joe Tornabene's GMC, Alliance of Automobile Manufacturers, DaimlerChrysler Corporation, and General Motors Corporation.
2. Association of International Automobile Manufacturers.
3. Some of the plaintiffs in this lawsuit have filed a similar suit in the Eastern District of California challenging California's regulations and the state law directing the California Air Resources Board to implement the regulations. See Central Valley Chrysler-Jeep, Inc. v. Witherspoon, No. 1:04-cv-06663-REC-LJO (E.D. Cal. filed Dec. 7, 2004) ("Central Valley Chrysler"). Similar plaintiffs have also filed similar lawsuits in Rhode Island. See Ass'n of Int'l Automobile Mfrs. v. Sullivan, No. 06-cv-69 (D.R.I. filed Feb. 13, 2006); Lincoln Dodge, Inc. v. Sullivan, No. 06-cv-70 (D.R.I. filed Feb. 13, 2006).
4. Conservation Law Foundation, Sierra Club, Natural Resources Defense Council, Environmental Defense, and Vermont Public Interest Research Group.
5. Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Pennsylvania, Rhode Island and Washington, in addition to Vermont, have adopted California's standards for GHG emissions, pursuant to § 7507.
6. Congress conceived of the undertaking to regulate air pollution as necessitating "cooperative federal state and local programs to prevent and control air pollution," 42 U.S.C. § 7401(a)(4), and made it a goal "to encourage or otherwise promote reasonable Federal, State, and local governmental actions . . . for pollution prevention." Id. § 7401(c). Congress also directed the EPA to "cooperate with and encourage cooperative activities by all Federal departments and agencies having functions relating to the prevention and control of air pollution, so as to assure the utilization in the Federal air pollution control program of all appropriate and available facilities and resources within the Federal Government." Id. § 7402(b). These Congressional declarations appeared with some differences in language in 1963 amendments to the Clean Air Act, Pub.L. No. 88-206, 77 Stat. 392, 393 (1963).
7. Section 208(b) of the National Emission Standards Act provided for waiver from preemption for any State that had adopted standards, other than crankcase emission standards, for the control of emissions from new motor vehicles or new motor vehicle engines prior to March 30, 1966. Pub.L. No. 90-148, 81 Stat. at 501 (codified as amended at 42 U.S.C. 7543(b)). California is the only State that satisfies this criterion.
8. In this statute "light-duty vehicle" is essentially synonymous with "passenger car." Natural Resources Defense Council, Inc. v. U.S. EPA,655 F.2d 318, 323 n. 3 (D.C.Cir. 1981). 9. EPA promulgated rules implementing the Tier II standards effective April 10, 2000. See Final Rule, Control of Air Pollution from New Motor Vehicles: Tier II Motor Vehicle Emissions Standards & Gasoline Sulfur Control Requirements, 65 Fed.Reg. 6698 (Feb. 10, 2000).
10. A "forcing" is an imposed perturbation to the planet's energy balance, measured in watts per meter squared. Tr. vol. 13-B, 10:2-10 (Hansen, May 3, 2007). Greenhouse gases absorb heat radiation, so that an increase in the amount of these gases in the atmosphere is a mechanism for making the Earth's surface warmer. Such warming can be measured in the same way as other causes of temperature change, such as changes in the sun's brightness. Id. at 12:16-24.
11. The concentration of carbon dioxide in the ambient atmosphere in the present time, averaged over the world, is about 383 parts per million, compared with 280 parts per million in the pre-industrial era. Id. at 13:8-13. This increase is due primarily to fossil fuel burning, which accounts for about eighty percent of the increase. To find carbon dioxide concentrations as high as current ones, it is necessary to look at a period two to five million years ago. Current annual increases in carbon dioxide emissions are two parts per million, up from one part per million when measurements began in 1958. They are predicted to rise to about four parts per million per year by the middle of the century under the business-as-usual scenarios. Id. at 58:15-59:3.
12. This data is from the temperature as measured in ocean cores.
13. Hansen supports this conclusion by looking at the historical record. In the middle Pliocene period 3-½ million years ago, the temperature was two to three degrees Celsius warmer than the present global temperature, approximately the level of global warming that Hansen predicts absent regulation of greenhouse gases. Sea level rose twenty-five meters. Id. at. 28:3-9. During the past 1.3 million years, while temperature fluctuations were less dramatic, sea level was at least a few meters higher than today's during some periods, but the rise was less drastic. Id. at 38:20-24.
14. Feedbacks magnify the effect of a forcing. Even a very small forcing may have a large effect because warming will cause the release of carbon dioxide from oceans, increasing the forcing, and decrease ice cover, increasing the amount of warmth that is absorbed by the Earth rather than reflected. These feedbacks will cause still more carbon dioxide release and melting of ice. Id. at 22:22-23-1.
15. For example, in the transition from the last ice age to the current interglacial period, there was a period in which sea level increased twenty meters in four hundred years, or about one meter every twenty years, a phenomenon known as Meltwater Pulse 1A. That ice sheet was at a lower latitude than the Greenland or Antarctic ice sheets, but was subject to a much smaller forcing. Id. at 47:7-18.
16. Satellite observations support Hansen's belief that the Earth is at risk from ice sheet disintegration. Satellites show increasing meltwater on the ice sheet in Greenland during the summers. Id. at 43:9-15. Icewater finds the lowest spot and burrows a hole through the base of the sheet, lubricating the base of the sheet and speeding the discharge of giant icebergs to the ocean. On the largest ice stream in Greenland, the flux of icebergs has doubled in the last five years. Id. at 43:25-44:2. The satellite GRACE, which measures the gravitational field of the Earth to show changes in ice sheet mass, shows that the ice sheet is melting faster than it is being increased by additional snowfall. Id. at 44:17-45:3. The frequency of earthquakes in Greenland has doubled between 1993 and 1999, and again between 1999 and 2005, a pattern consistent with a nonlinear process in which the ice sheet is becoming less stable. Id. at 45:11-46:4. The ice sheet of greatest concern is the West Antarctic Ice Sheet, which sits on bedrock, below sea level, in direct contact with the ocean. This ice sheet contains sufficient water that, if melted, could cause sea level to rise a total of seven meters. Its ice shelves are now melting several meters per year. Id. at 49:2-16.
17. Although methane is a far more powerful greenhouse gas, it is not released in the same large quantities and does not have the same lengthy lifetime. A century after carbon dioxide is released a third of the carbon dioxide will remain in the atmosphere. After five hundred years, a quarter will remain. Although some carbon dioxide is taken up by the ocean, carbon dioxide taken up by the ocean exerts a back pressure on the atmosphere, so a significant fraction will remain in the atmosphere until that previously taken up has been deposited in the sediments of the ocean, a process taking thousands of years. Id. at 29:10-30:12.
18. Hansen and his students used the National Research Council report on vehicle efficiencies to determine how vehicle emissions reductions could fit in with such a scenario. By taking the improvements outlined in that report that would basically pay for themselves and forecasting a phase-in of those recommendations over a ten year period, they found that with the expected growth in vehicle numbers, those improvements actually cause a moderate decrease in total vehicle emissions, which continues for a few decades without further improvements. Id. at 63:2-64:1. That report used slightly weaker emissions requirements than those that the regulation imposes. Id. at 67:20-68:8.
19. Plaintiffs did not produce any evidence to contradict Hansen's testimony on likely species extinctions and devastating regional impacts of global warming other than ice sheet disintegration. In addition, they do not address that testimony in their Motion. Therefore, the Court assumes that their motion seeks the exclusion of Hansen's testimony as to the concept of a "tipping point" and as to his predictions regarding ice sheet disintegration and sea level rise, but does not seek the exclusion of his testimony as to the effects of global warming on species extinction or regional impacts.
20. Christy is the Alabama state climatologist. He is also a professor of atmospheric science and Director of the Earth Systems Science Center at the University of Alabama at Huntsville. Tr. vol. 14-A, 66:15-19 (Christy, May 4, 2007).
21. Christy also suggested that some data shows that snowfall increases over ice sheets resulting from global climate change will make ice sheets larger, not smaller. Id. at 116:10-117:21. Hansen's response demonstrated his familiarity with the data that Christy referenced, and referenced additional data to support his position. These differences in the experts' interpretations of the available data are not grounds for the exclusion of Hansen's testimony. In addition, it appears that the bulk of scientific opinion opposes Christy's position. In recent testimony on the IPCC's findings to the U.S. House of Representatives Committee on Science and Technology, Dr. Richard Alley noted that "melting is now widespread," including in "the great ice sheets of Greenland and Antarctica, and we see it even when there is more snow falling. And so it's really hard to blame loss of ice and of snow if there is more snow in some places, and yet it is melting faster." PX 1238.
22. In addition, the National Academy of Science ("NAS") published a 2002 report in which it found that abrupt climate change is likely in the future, referencing the concept of "thresholds" or "tipping points." National Academy of. Sciences, Abrupt Climate Change, Inevitable Surprises (2002) at page v, available at http://books.nap.edu/openbook.php? isbn=0309074347.
23. Plaintiffs' expert Dr. Christy estimated that implementing the regulations across the entire United States would reduce global temperature by about 1/100th (.01) of a degree by 2100. Hansen did not contradict that testimony.
24. His data is from the National Climate Data Center's historic climate network, and is based on data from approximately 350 monitoring sites across the region. The data includes New York in the New England region. Tr. vol. 14-A, 15123-16:6 (Rock, May 4, 2007). Overall warming in the region was 0.7 degrees Fahrenheit between 1895 and the present, while warming in Vermont was 1.6 degrees Fahrenheit. Id. at 15:12-20.
25. The first run is when the sap has the highest sugar content and lowest metabolic by-products, and makes the highest quality, Grade-A fancy syrup. Id. at 32:21-33:4.
26. See K. Hayhoe et al., Past and Future Changes in Climate and Hydrological Indicators in the U.S. Northeast, 28 Climate Dynamics 381, 404 (March 4, 2007) (models "are capable of reproducing the dominant influence on regional temperature-related climate indicators"); see also K. Hayhoe et al., Quantifying the Regional Impacts of Global Climate Change, in review at Bulletin of the American Meteorological Society. Another regional study reaching similar conclusions is a report of the Climate Change Research Center, at UNH. See Clean Air-Cool Planet and C.P. Wake, Indicators of Climate Change in the Northeast, 2005.
27. The gist of Rock's testimony was not a prediction as to the exact level of warming that is likely to occur in Vermont. Rather, his testimony concerned the effects of such warming, which is also the area in which he has the most experience and knowledge. Therefore, that is the testimony to which the Court has given weight.
28. These articles include: Market Prospects for Alternative Hybrid Designs, presented at the SAR Hybrid Vehicle Technologies Symposium, San Diego CA, February 2006; Tires, Technology and Energy Consumption, presented at the International Energy Agency Workshop on Tire Rolling Resistance, Paris, France, November 2005; Prospects for Hybrid, Diesel and Hydrogen Vehicles, presented at Air Pollution as Climate Forcing: A Second Workshop, sponsored by NASA, Honolulu, HI, April 2005; Vehicle Energy Use and the Tire Contribution, presented at the Second Meeting of the Committee for National Tire Efficiency Study, National Academy of Sciences, Davis CA, March 2005; and The Potential Market and Fuel Economy Impacts of Hybrid and Diesel Technologies (co-authored with Drs. Greene and McManus) presented at the 10th Diesel Engine Emission Reduction Conference, Coronado CA, August 2004. Duleep has also authored two encyclopedia articles: Automotive Engines — Efficiency, in Encyclopedia of Energy Technology and the Environment 379 (John Wiley 1995), and Internal Combustion Engine Vehicles, in Encyclopedia of Energy 497 (Elsevier 2004). See DX 2687.
29. The NAS is an independent governmental body that responds to requests from the President's administration or Congress to study topics of interest. It is composed of leading scientists in various fields who are elected to membership. Tr. vol. 12-A, 92:14-21 (Duleep, May 2, 2007).
30. Duleep's other work for U.S. government entities includes projects for the Congressional Office of Technology Assessment, for which he fulfilled a request in the mid-1990s to examine the potential for fuel economy of vehicles until the year 2020, and for the Energy Information Administration, which he has assisted in determining how fuel economy can change in the future in response to the macroeconomic forces of fuel price, income, and other factors. Id. at 94:19-95:4, 97:17-98:4. During the 1980s and 1990s Duleep worked for EPA's Ann Arbor Motor Vehicle Emissions Laboratory on the development of new emissions standards. Id. at 95:20-96:2.
31. Due to his work for the DOE and other parties, Duleep's company has a list of such technologies and their likely availability, constantly updated based on current trade press technical journals. Id. at 118:24-119:5.
32. Duleep gathered this more detailed information on specific technologies through Society of Automotive Engineers meetings, and by discussing the issues with tier one suppliers and auto manufacturers, as well as through his attendance at technical conventions. Id. at 119:12-25.
33. Specifically, he used three representative vehicles in his PC/LDT1 category — a small compact/subcompact car, an intermediate/mid-sized car, and a large car — and three representative vehicles in his LDT2 category — the compact Ram, an intermediate sized SUV, and a large pickup. Id. at 123:9-124:4.
34. Austin is a founding senior partner at Sierra Research, Inc. ("Sierra"), a research and consulting firm in California that specializes in research and regulatory matters relating to emissions control and fuel economy. Tr. vol. 6-B, 62:23-63:10 (Austin, Apr. 20, 2007). He is the former head of CARB's motor vehicle emission control program. Id. at 69:11-22; 70:15-71:15.
35. Dr. Patterson is a professor emeritus in mechanical engineering at the. University of Michigan. Tr. vol. 16-A, 6:20-24 (Patterson, May 8, 2007).
36. Duleep started with the Ford Focus and compared it to the 2005 Honda Civic, which incorporated a subset of the technologies that Duleep modeled for the small car for his report in this case. He arrived at an estimatted fuel economy very slightly lower than the Civic's actual fuel economy, but within the margin of error. Tr. vol. 12-B, 28:9-30:11 (Duleep, May 2, 2007). He has performed similar validations in each size class that he modeled, and in each case found that he was able to predict the fuel economy of various vehicles using his model. Id. at 30:12-22; 33:4-35:1.
37. Heywood is the Sun Jae Professor of Mechanical Engineering at the Massachusetts Institute of Technology where he has taught and researched since 1968. Heywood Decl. ¶ 1. Patterson testified that he knows Professor Heywood, has used Heywood's textbook in his own teaching, and considers Heywood one of the leading mechanical engineers in the country. Tr. vol. 16-A 23:11-24:24.
38. Ross is a professor emeritus in the Physics Department at the University of Michigan, where he has taught and performed research since 1963 in the area of environmental physics, with a focus on "energy use, its impacts, and how to reduce those impacts through efficiency and conservation." Ross Decl. ¶ 1.
39. Ross also details recent research by one of his students which supports this conclusion. One of his graduate students used his model to calculate the fuel economy of approximately 1300 vehicles using only four parameters, and found that the results were accurate to within five to ten percent of the fuel economy values on the EPA Test Car List for about ninety percent of the vehicles, while many results were much closer. Ross Decl. ¶ 7. The vehicles falling outside of the five to ten percent range did so because they were "hybrids or flexible fuel vehicles whose fuel economy cannot be accurately modeled on a model designed for conventional gasoline engines," or were "very high performance European sports cars" which, are driven differently and would require adjustments to the model. Id. ¶ 8. The light-duty vehicles that Duleep modeled are in neither category.
40. Austin testified that he was not able to replicate Duleep's work using VEHSIM, because Duleep's inputs were not sufficiently detailed. Tr. vol. 15, 116:8-21 (Austin, May 7, 2007). Duleep noted in his declaration that when providing the NAS with a "second opinion" regarding Duleep's work in 2001, Austin ran the same packages that Duleep had simulated through VEHSIM. Where Duleep's inputs didn't contain enough detail, Austin used his own engine maps and assumptions. Duleep Decl. ¶¶ 13-14. It is not clear, then, why there are obstacles to Austin's use of this method of validation in this case.
41. At trial, Plaintiffs took issue with aspects of the NESCCAF study's methodology and conclusions. Plaintiffs' criticisms included suggestions that some modeled vehicles did not maintain performance characteristics such as 'launch," acceleration time from fifty to seventy miles per hour, and gradeability; that NESCCAF did not properly model the performance of turbo-charged engines; and that NESCCAF improperly used blended engine maps. These criticisms are limited in scope and are disputed by representatives of CARB and workers on the NESCCAF study whose depositions have been admitted into evidence in this case. See, e.g., Cooper Dep. Tr., 218:11-15 (Sep. 13, 2006) (performance was held constant in modeled vehicles, and NSCCAF would have rejected any package that decreased performance); Brueckner Dep. Tr. 58:10-20; 63:1-6 (Sep. 15, 2006) (launch was implicit in the NESCCAF study insofar as zero to sixty mph was held constant); id. at 72:4-73:2 (many options are available to correct any problems in launch arising from the technologies chosen); id. at 81:16-86:5 (the modeling used in the study kept the transmission in top gear when accelerating between fifty and seventy miles per hour, when a real vehicle would downshift, eliminating deteriorations in fifty to seventy mph time); Cooper Dep. Tr. 151:6-153:2; id. at 167:3-169:5 (gradeability was an issue with some of the trucks modeled, but none of the final packages showed any problems in gradeability); Brueckner Dep. Tr. at 101:3-10 (turbo lag was explicitly modeled in all turbo-charged models); id. at 140:12-16 (blended engine maps are used routinely in evaluating automobile technologies). Plaintiffs also argued that NESCCAF used too low a retail price equivalent (RPE) adjustment factor and improperly adjusted its costs to account for unforeseen innovation during the time period of the regulation. Record evidence disputes the conclusion that the RPE used was incorrect; for example, the NAS used the same RPE in its 2002 study. See DX 2007 at 41. Furthermore, it is not clear to the Court that an adjustment in costs to account for potential innovation over the next ten years is incorrect. In any case, the NESCCAF study is not the basis for the Court's conclusions in this case; rather, the Court has based its understanding of the regulation's feasibility on the expert testimony that Plaintiffs and Defendants presented in far more detail at trial.
42. Lost savings were calculated using an assumed gasoline price of $1.74 per gallon.
43. The LEV II standards have received a waiver of preemption from EPA. See Notice of Decision: California State Motor Vehicle Pollution Control Standards, 68 Fed.Reg. 19,811 (Apr. 22, 2003).
44. In its recent decision in Massachusetts v. EPA, the Supreme Court endorsed Moye's view that partial solutions to the problem of global warming are valid. In confirming that Massachusetts had standing to challenge EPA's refusal to regulate, the Court declared:
EPA overstates its case in arguing that its decision not to regulate contributes so insignificantly to petitioners' injuries . . . that there is no realistic possibility that the relief sought would mitigate global climate change and remedy petitioners' injuries. . . . Agencies, like legislatures, do not generally resolve massive problems in one fell swoop . . . but instead whittle away over time, refining their approach as circumstances change and they develop a more nuanced understanding of how best to proceed. . . . Leaving aside the other greenhouse gases, the record indicates that the U.S. transportation sector emits an enormous quantity of carbon dioxide into the atmosphere . . .
Massachusetts, 127 S.Ct. at 1442 (internal citations omitted).
45. The IPCC report lists a variety of scenarios, of which these scenarios are by no means the most drastic. See PX 1197.
46. Predictions of climate future depend on an understanding of climate sensitivity. Climate sensitivity is the amount of global warming for a given unit of forcing, measured in degrees Celsius per watt per meter squared. Tr. vol. 13-B, 16:16-19 (Hansen, May 3, 2007). Climate models show a sensitivity of about ¾ of a degree Celsius for each watt of forcing. This number is confirmed by comparing the climate sensitivity implied by temperature changes in historical periods for which there is data on various climate forcings. Id. at 20:23-21:1.
47. Achieving that limitation on warming would mean keeping additional forcing, from this time forward, below 1-½ watts, so that with some decrease in methane, carbon dioxide does not exceed about 450 or 475 parts per million. Id. at 34:23-35:8.
48. During the last thirty years, the period in which most global warming has occurred, rapid movement of isotherms, or temperature zones, has been occurring. The total movement of isotherms has been generally smaller than the size of the climatic zone in which a species can exist up to this time, but under the business-as-usual scenario, the rate of migration of isotherms will be twice as large by the end of the century and will be cumulative during that period, causing stress on many species and many extinctions. Id. at 54:5-18.
49. Because there is a mathematical relationship between fuel consumption and carbon dioxide emissions, it is possible to express these emissions standards as fuel economy standards in miles traveled per gallon of gasoline consumed. Plaintiffs have determined that for PC/LDT1s the mileage equivalents are 27.6 mpg in model year 2009, increasing to 43.7 mpg in model year 2016. For LDT2s, they calculate the mileage equivalents as 20.3 mpg in model year 2009, increasing to 26.9 mpg in model year 2016.
50. The parties agree that enforcement of Vermont's GHG standards is preempted by Section 209(a) of the Clean Air Act, 42 U.S.C. § 7543(a), unless and until the EPA Administrator grants California a waiver under Section 209(b), 42 U.S.C. § 7543(b), for its identical GHG regulations. California applied for a waiver from preemption on December 21, 2005. See Cal. State Motor Vehicle Pollution Control Standards; Request for Waiver of Federal Preemption; Opportunity for Public Hearing, 72 Fed.Reg. 21,260 (April 30, 2007). The EPA scheduled public hearings on California's request on May 22 and May 30, 2007. See id., 72 Fed.Reg. 26,626 (May 10, 2007). The deadline for submission of written comments was June 15, 2007. 72 Fed.Reg. 21,260. By law, the State of Vermont is not permitted to enforce its GHG regulation before EPA grants California a waiver. See MVMA III, 17 F.3d at 534 (waiver, is a precondition to enforcement, not adoption). Plaintiffs' CAA counts are therefore moot. This section addresses the question of preemption under the Energy Policy and Conservation Act, assuming EPA will grant California's waiver application.
51. "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; . . . shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." U.S. Const. art. VI, cl. 2.
52. Vermont enacted its GHG regulations pursuant to Section 177 of the CAA, which allows a state to adopt and enforce standards relating to control of emissions if the standards are identical to the California standards for which a waiver has been granted and both states adopt the standards at least two years before commencement of the applicable model year. 42 U.S.C. § 7507.
53. See New State Ice Co. v. Liebmann,285 U.S. 262, 311, 52 S.Ct. 371, 76 L.Ed. 747 (1932) (Brandeis, J., dissenting) ("It is one of the happy incidents of the federal system that a single courageous State may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country."). 54. See also Final Rule: Light Truck Average Fuel Economy Standards Model Years 2005-2007, 68 Fed.Reg. 16,868, 16898 (Apr. 7, 2003) (CARB and § 177 States' standards discussed in section VIII.B. "Federal Motor Vehicle Emissions Standards"); Final Rule: Light Truck Average Fuel Economy Standard, Model Year 2004, 67 Fed.Reg. 16,052, 16057 (Apr. 4, 2002) (CARB and § 177 States' standards discussed in section V.B. "Effect of Other Federal Standards on Fuel Economy"); Final Rule: Light Truck Average Fuel Economy Standards, Model Years 1996-1997, 59 Fed.Reg. 16,312, 16,317 (Apr. 6, 1994) (California standards discussed in section IV.B. "Other Federal Standards: Revised Emissions Standards"); Final Rule: Light Truck Average Fuel Economy Standards Model Year 1995, 58 Fed.Reg. 18019, 18023-24 (Apr. 7, 1993) (California standards discussed in section IV.B. "Other Federal Standards: Revised Emissions Standards"); Final Rule: Light Truck Average Fuel Economy Standards: Model Years 1993-1994, 56 Fed.Reg. 13,773, 13,779 (Apr. 4, 1991) (California standards discussed in section IV.3. "Effect of Other Federal Standards"); Final Rule: Light Truck Average Fuel Economy Standards: Model Years 1990-91, 53 Fed.Reg. 11,074, 11,078 (Apr. 5, 1988) (California standards discussed in section IV.B. "Effect of Other Federal Standards"); Final Rule, Light Truck Average Fuel Economy Standards Model Year 1989, 52 Fed.Reg. 6564, 6570 (Mar. 4, 1987) (California standards discussed in "Other Federal Standards" section); Final Rule: Light Truck Average Fuel Economy Standards, Model Year 1988, 51 Fed.Reg. 15,335, 15,341 (Apr. 23, 1986) (California standards discussed in "Other Federal Standards: Environmental Standards" section); Final Rule: Light Truck Average Fuel Economy Standards, Model Years 1983-85, 45 Fed.Reg. 81593, 81,597 (Dec. 11, 1980) (California standards discussed in section e. "The effects of other Federal Standards on Fuel economy"); Final Rule: Light Truck Fuel Economy Standards, 43 Fed.Reg. 11,995, 12,009-10 (Mar. 23, 1978) (California standards discussed in section e. "The Effect of Other Federal Motor Vehicle Standards").
55. See, e.g., Motor Vehicle Pollution Control: California State Standards, 38 Fed.Reg. 30136 (Nov. 1, 1973) (waiver granted in part and denied in, part); California State Motor Vehicle Pollution Control Standards: Waiver of Federal Pre-Emption, 40 Fed.Reg. 30,311 (July 18, 1975) (delay of implementation); California State Motor Vehicle Pollution Control Standards: Waiver of Federal Pre-Emption, 43 Fed.Reg. 998 (Jan. 5, 1978) (denial of one of three requests for waiver); California State Motor Vehicle Pollution Control Standards: Waiver of Federal Pre-Emption, 58 Fed.Reg. 4166 (Jan. 13, 1993) (deferring consideration of portions of waiver request); California State Motor Vehicle Pollution Control Standards: Waiver of Federal Preemption, 67 Fed.Reg. 54180 (Aug. 21, 2002) (granting waiver with certain exceptions).
56. Section 32919(a) provides:
When an average fuel economy standard prescribed under this chapter is in effect, a State or a political subdivision of a State may not adopt or enforce a law or regulation related to fuel economy standards or average fuel economy standards for automobiles covered by an average fuel economy standard under this chapter. 49 U.S.C. § 32919(a).
57. The numerator of the equation represents the grams of carbon per gallon of fuel; the denominator shows carbon fractions in the three carbon-containing compounds in the exhaust multiplied by a coefficient, which is the carbon fraction that is in the hydrocarbons. Tr. vol. 5-A, 20:12-23 (Haskew, Apr. 19, 2007). The ultimate outcome of the equation is a measure of miles traveled per gallon of fuel. Id. at 21:22-25.
58. To change the equation to reflect the characteristics of diesel fuel, for example, it would be necessary to adjust the numerator to reflect the fact that diesel has a larger number of grams of carbon per gallon than gasoline. Id. at 24:1-11; PX 966.
59. Methane has about twenty-five times the global warming potential of carbon dioxide, and nitrous oxide has almost three hundred times the global warming potential of carbon dioxide. Emissions rates for these gases are very low compared to carbon dioxide emissions, but the regulation takes their potency into account in calculating the amount of carbon dioxide to which each is considered equivalent. Id. at 40:7-14; 41:7-17.
60. Haskew is the president and principal engineer of Harold Haskew and Associates, an emissions consulting group in Milford, Michigan. Id. at 7:23-25.
61. Plaintiffs do not contend that it is physical impossible to comply with EPCA standards and Vermont's regulations.
62. In discussing the legislation, one legislator commented:
Do not forget not too many years ago when this Congress asked the auto industry to build catalytic converters the industry said it could not be done, the technology was not there, impossible; that is, they could not reduce tail-pipe emissions 90 percent, could not be done. Congress determined, 'Well, we, hear you, auto industry, but it is such a great problem we think you should proceed. By the way, we think you can. We trust you. We have more faith in you, auto industry, than you have in yourself. We think you can develop the new technology to reduce the tail-pipe emissions 90 percent.' And guess what? It happened. Tailpipe emissions were reduced 90 percent. It happened not in 15 years, not in 23 years, but in 5 years. In 5 years, the auto industry developed catalytic converters to reduce tailpipe emissions by 90 percent. I have great faith in American industry. They can do the job.
136 Cong. Rec. S592-02, at S620 (Jan. 31, 1990) (statement of Sen. Baucus).
63. There are ten auto manufacturers, or original equipment manufacturers ("OEMs") affected by the regulation. These OEMs serve ninety-five percent of the market. They are General Motors, Ford, DaimlerChrysler, Honda, Toyota, Hyundai, Nissan, BMW, Volkswagen and Porsche. Tr. vol. 7-A, 9:10-10:7 (Austin, Apr. 23, 2007).
64. Hybrid vehicles combine internal combustion and electricity. A typical hybrid gets its electricity generated by the alternator on the vehicle, or through regenerative braking, in which the vehicle's slowing turns the generator to put energy back into the battery. Plug-in hybrids can also be plugged into wall circuits to recharge the battery. Tr. vol. 1-A, 117:9-21 (Weverstad, Apr. 10, 2007).
65. Many of the witnesses at trial used vehicle simulations of this type, including the manufacturer witnesses. See Tr. vol. 10-A, 29:9-30:23 (Patton, Apr. 30, 2007).
66. The VEHSIM model, like other models referenced at trial, uses a driving cycle based on the Federal Test Protocol. Tr. vol. 7-B, 36:6-38:16.
67. Martec provided information on cost of components manufactured by supplies to OEMs. For components that OEMs make themselves, Harbour Consulting provided data on costs of engine components, transmissions, and body changes. For subsystems for which neither firm had solid data, Austin relied on what he heard from OEMs. Id. at 64:14-66:16.
68. Austin predicted that if the regulations were deployed nationwide, then manufacturers would be required to introduce a slightly different technology mix, which would reduce the average cost per vehicle. However, there would still be a differential between high and low-cost manufacturers that would make it difficult for some manufacturers to remain in the passenger car market. Tr. vol. 7-A, 84:13-25.
69. Alan Weverstad is the Executive Director of the General Motors Environment and Energy Staff. Tr. vol. 1-A, 104:4-5 (Weverstad, Apr. 10, 2007).
70. The maximum technology scenario is meant to illustrate the maximum application of technology possible without constraints such as timing and cost, and is not meant to illustrate a scenario which is feasible for General Motors, that General Motors can actually afford, for which General Motors has the necessary manpower, or which General Motors could reasonably implement within the time frame of the regulation. Tr. vol. 2-A, 15:15-16:12 (Weverstad, Apr. 11, 2007).
71. Reginald Modlin is the Director of Environmental Affairs at DaimlerChrysler Corporation.
72. Duleep's methodology is detailed in the section addressing the Daubert challenge to the admissibility of his testimony. See supra pp. 66-71.
73. Representative vehicles in the PC/LDT1 category were the Ford Focus, the GM Buick Lacrosse, and the Ford Crown Victoria; representative vehicles in the LDT2 category were the Dodge Grand Caravan, the Ford Explorer, and Ford F-150 2WD. Tr. vol. 12-A 125:7-9; 133:15-23:140:19-141:1; 143:13-25; 145:9-15; 147:9-14.
74. Austin's expertise is primarily in the area of engineering. He does not have corporate financial analysis credentials, or credentials related to the prediction of consumer behavior.
75. Robert Lee, the Vice President of Powertrain Engineering for DaimlerChrysler Corporation, testified that his model Raptor, which is a vehicle simulation model with characteristics similar to VEHSIM, has a very high degree of precision, but how close its predictions are to reality is a function of the quality of the input data. Tr. vol. 4B, 18:19-19:23 (Lee, Apr. 19, 2007).
76. Other initiatives in California include AB 32, the California Global Warming Solutions Act of 2006, which sets goals for reductions in greenhouse gases through various energy use sectors in California. Tr. vol. 11-A, 50:17-51:13 (Jackson, May 1, 2007). In addition, California's Governor Schwarzenegger has signed an executive order attempting to develop a regulation which will remove at least ten percent of the carbon from California's transportation fuels by 2020, including through the use of alternative fuels. Id. at 51:14-53:7.
77. Additional factors are also relevant to differences in GHG emissions and fuel economy between the United States and European Union vehicle fleets; for example, ninety-two percent of vehicles sold in the United States have automatic transmissions, while eighty percent of those sold in Europe have manual transmissions. Tr. vol. 9-A, 104:14-22 (McMahon, Apr. 25, 2007); PX 1129. There are also differences in engine size and configuration. Twenty-three percent of American buyers purchase eight-cylinder engines, forty-seven percent purchase six-cylinder engines, and just twenty-eight percent purchase four-cylinder engines. In Europe, eighty-four percent of engines sold are four-cylinder engines and five percent are three-cylinder engines. Id. at 105:3-106:5; PX 1130.
78. Kevin McMahon is a principal and shareholder of The Martec Group, Inc., which provides technical and scientific marketing research services. McMahon manages the firm's transportation practice, primarily for automotive technology suppliers, some vehicle manufacturers and trade associations. Tr. vol. 9-A, 84:14-86:9.
79. Ultra-low sulfur fuel must have less than fifteen parts per million of sulfur to meet the standard. Tr. vol. 11-B, 24:22-24; 25:16-20 (Jackson, May 1, 2007).
80. Ethanol may be produced from either corn or sugar cane. Corn is fairly energy intensive to grow, so the upstream benefit for corn-E85 is relatively small. Tr. vol. 11-A, 142:4-143:6 (Jackson, May 1, 2007). The upstream benefit from sugar-cane E-85 is much larger, but, sugar-cane .E-85 is less readily available in the United States. Id. at 144:7-25. The regulation does not differentiate between cellulosic or sugar cane ethanol. Tr. vol. 11-B, 9:18-21 (Jackson, May 1, 2007).
81. In its final rule establishing regulations to implement the renewable fuel program, EPA notes that today's domestic ethanol production capacity already exceeds 2007's renewable fuel requirement, with additional production capacity currently under construction. Final Rule, Regulation of Fuels and Fuel Additives: Renewable Fuel Standard Program, 72 Fed.Reg. 23900, 23954 (May 1, 2007). EPA states that the market already has the necessary production and distribution mechanisms in place in many areas, and the ability to expand these mechanisms into new markets, and expects that E85 will be increasingly available. Id. at 23903.
82. The blender's credit applies whether ethanol is blended as a low-level blend in gasoline or as E-85. Tr. vol. 11-B, 32:7-19 (Jackson, May 1, 2007).
83. Evaporative emissions are hydrocarbons, which result from evaporation and permeation rather than from combustion. Certain blends of ethanol and gas have higher vapor pressure and a higher tendency to evaporate and to permeate the walls of rubber hoses or plastic fuel tanks. Tr. vol. 8-A, 35:23-38:13 (Austin, Apr. 24, 2007.)
84. GDI (gasoline direct injection) technology facilitates lean-burn engine operation for light-load conditions, resulting in lower carbon dioxide emissions. A turbo-charged engine compresses air coming into the engine, which boosts engine power. The combination can result in lower carbon dioxide emissions with no loss of engine performance.
85. This issue relates purely to the vehicle's performance in the hands of consumers, not to the vehicle's performance on the certification test which is used for determining compliance with the regulation. The test uses a special gasoline called indolene, which has a fairly high level of octane, and so the full benefits of GDI/turbo show up on the test. Tr. vol. 12-A, 136:20-137:3 (Duleep, May 2, 2007).
86. With camless valve actuation, valve motion is initiated and controlled through either electrical energy or hydraulic energy instead of a camshaft mechanism. Camless valve actuation enhances engine performance by allowing valve timing to vary based on engine RPMs.
87. Compare DX 2687 (Duleep's resume) to PX 1016 (Austin's resume).
88. CVT offers an infinite range of gear ratios, as opposed to the usual four to six, which improves engine operating conditions and power transmission efficiency.
89. Obviously if more states apply stringent GHG emissions standards, withdrawal from those states' markets becomes a less viable strategy. While it is possible to imagine a manufacturer deciding to withdraw significant product from Vermont alone, given that Vermont is a relatively small market, it is hard to believe that a manufacturer would choose to withdraw a significant number of products from numerous states, including populous states such as New York and California, rather than comply with a regulation.
90. Berck is a professor of agricultural and resource economics and is the S.J. Hall Professor at the University of California at Berkeley. He has a bachelor's degree in economics and mathematics from the University of California at Berkeley and a Ph.D. in mathematics from MIT, and has authored fifty or sixty peer-reviewed publications in the field of economics, as well as several books and book chapters. Tr. vol. 14-B, 4:21-5:24 (Berck, May 4, 2007); DX 2718.
91. Dr. Harrison is an economist and the Senior Vice President of National Economic Research Associates ("NERA"), where he chairs the firm's global environmental economics program. Tr. vol. 5-A, 82:23-83:11 (Harrison, Apr. 19, 2007).
92. Harrison's model is a "nested logit model," based essentially on the steps in customers' decision-making process. Id. at 94:3-95:13.
93. Ronald Harbour is the President of Harbour Consulting, which works with companies on improving productivity, quality, and cost, as well as doing competitive benchmarking and performance analysis. Tr. vol. 6-A, 5:20-7:6 (Harbour, Apr. 20, 2007).
94. Vehicle manufacturers have four major businesses: they make "stampings," coils of steel used to stamp the shape for doors, roofs, and other structural portions of a vehicle; they have plants that make engines; they typically make the vehicle's gear box or transmission; and they assemble the vehicles. Id. at 16:4-17:10. Suppliers provide items like steel, paint, carpeting, seats, and equipment for use in OEMs' plants. Id. at 18:17-19:7.
95. Harbour testified that the assumption that remaining automakers would pick up the slack was conservative, since to do so each would have to increase its production by almost sixty-eight percent in a very short time, which would be difficult. Id. at 33:9-35:21,
96. The description of Harbour's procedure is taken from his analysis of the PC/LDT1 fleet. However, his analysis of the LDT2 fleet was identical except that there was no need for any adjustment because there was no prediction that manufacturers would withdraw from the LDT2 market. Id. at 71:20-75:15.
97. Harbour predicted that there would be about 7,000 direct job losses at OEMs, about 20,000 jobs lost in vehicle sales and distribution, and about 37,000 jobs lost in supporting industries such as suppliers. See PX 1000.
98. Harrison's analyses for the PC/LDT1 and LDT2 fleets were identical. Citations above are to his explanation of his analysis of the PC/LDT1 fleet, because he explained that analysis in detail while merely noting that his analysis for the LDT2 category is identical and similarly shows an increase in older vehicles and decrease in newer vehicles on the roads. See Tr. vol. 5-A, 136:2-16 (Harrison, Apr. 19, 2007).
99. Harrison calculated that for Vermont, a one percent increase in vehicles' average fuel economy measured in miles per gallon would cause a percent change in vehicle miles traveled of -0.069 in the short term, and -0.335 in the long term. PX 0994. Harrison prepared similar calculations for New York and California.
100. Marais is a professional statistics and applied mathematician in private practice as a consultant with William E. Wecker Associates, Inc., where he is a vice president and principal consultant. Tr. vol. 8-B, 57:14-23 (Marais, Apr. 24, 2007).
101. Marais applied an adjustment to his results to account for safety improvements, because fatality and injury rates have declined over time due to improvements in vehicle safety. Id. at 69:13-17. Another Plaintiffs' expert, Mr. Robert Shelton, testified that in his opinion based on his professional experience, which included several positions at NHTSA including Executive Director, Marais had correctly accounted for safety improvements over time. Tr. vol. 8-B, 8:3-13:18 (Shelton, Apr. 24, 2007) (describing Shelton's career at NHTSA); id. at 26:13-19.
102. Dr. Greene is employed by Oak Ridge National Laboratory of the Department of Energy, where he specializes in studying transportation energy policy research, including work on fuel economy standards and their relationship to safety. Tr. vol. 15, 10:17-11:19 (Greene, May 7, 2007).
103. The reason that passengers of the lighter vehicle will be at a disadvantage is that the ratio of changes in velocity of the two vehicles will be inversely proportional to their masses, so the lighter vehicle will experience the greater change in velocity due to the crash. The probability of an injury or fatality is highly correlated with the change in the vehicle's velocity. Id. at 24:17-25:2.
104. In Massachusetts v. EPA, the Supreme Court rejected the contention that regulating greenhouse gases domestically might impair the President's ability to negotiate with developing nations to reduce emissions: "[w]hile the President has broad authority in foreign affairs, that authority does not extend to the refusal to execute domestic laws." 127 S.Ct. at 1463.