The analysis underpinning the Trump administration's rollback of U.S. vehicle greenhouse-gas standards rests on fundamental errors in how it accounts for environmental benefits and consumers' future fuel savings, according to a Policy Article by Antonio Bento and colleagues. Correcting those errors, the authors argue, would reverse the economic justification for eliminating these federal standards. Vehicle efficiency standards are a major policy tool for reducing transportation emissions in the United States, but their status has repeatedly shifted between presidential administrations. The economic justification for the current Trump administration rollback on emissions standards hinges in part on how regulators assess the future fuel savings consumers receive from more efficient vehicles. Here, Bento et al. examine the regulatory cost-benefit analysis underlying the 2026 US vehicle emissions standard rollback, focusing particularly on how regulators value the fuel savings consumers receive from more efficient vehicles. The findings show that consumers typically pay less than $1 for a vehicle that provides $1 in discounted fuel savings. However, Bento et al. argue that both the Biden and current Trump administrations have misinterpreted what this finding means. In its 2026 analysis, the US Environmental Protection Agency (EPA) credits consumers with receiving only 23 cents of benefit for every dollar of fuel savings, a treatment the authors say wrongly removes billions of dollars in benefits from vehicle emissions standards.
The authors developed a framework for translating evidence on consumer behavior into cost-benefit analyses more consistently and transparently. They conclude that correcting the EPA's treatment of fuel savings – along with its decision to exclude environmental benefits – would reverse the economic justification for eliminating federal greenhouse-gas standards for vehicles. “Application of our framework to deal with valuation could correct errors from multiple administrations, providing analytical consistency that could help improve and stabilize policy,” Bento et al. write.
For reporters interested in trends, a December 2018 Policy Forum by Antonio Bento and colleagues highlighted fundamental flaws and inconsistencies in a 2018 proposal to freeze the 2016 U.S. vehicle fuel-economy and greenhouse-gas standards.
