EPA’s Claim of $1.3 Trillion in Deregulatory Savings Questioned for Accuracy

In a significant policy reversal, the Trump administration has revoked the 2009 endangerment finding that allowed the Environmental Protection Agency to regulate greenhouse gas emissions from vehicles, claiming the move will save Americans over $1.3 trillion. However, economic and environmental experts argue this figure is deeply misleading as it fails to account for any benefits of emissions standards.

EPA Administrator Lee Zeldin announced last month that eliminating these regulations would “save American taxpayers over $1.3 trillion” and reduce new vehicle prices by approximately $2,400. President Trump, OMB Director Russell Vought, and White House Press Secretary Karoline Leavitt have repeatedly cited this figure in official communications.

Economic experts, however, point out that the $1.3 trillion represents only costs avoided in making vehicles more fuel efficient between 2027 and 2055, without factoring in any offsetting benefits like reduced fuel consumption or lower maintenance costs. In fact, one of the EPA’s own calculations shows that repealing these standards could actually cost Americans $180 billion when considering increased fuel and maintenance expenses.

“This is a very biased and misleading way to talk about the effects of this rollback,” said Jason Schwartz, regulatory policy director at NYU School of Law’s Institute for Policy Integrity. “It’s actually worse than only looking at one half of the equation because they’ve also left a bunch of really important effects off the other side.”

Kenneth Gillingham, a Yale University economics professor, noted the unusual approach in the administration’s communications: “I honestly can’t recall another rulemaking where the focus of all of the fact sheets and press releases was ONLY about the costs of the policy.”

The repeal effectively eliminates meaningful fuel efficiency standards for American vehicles. While Department of Transportation standards technically remain, Congress recently set compliance penalties to zero through the One Big Beautiful Bill Act, and the administration is working to roll back these standards further.

The EPA’s regulatory impact analysis used several scenarios with different assumptions about future gasoline prices and how fuel savings should be counted. Most scenarios did show some net savings from repealing the standards, but critics note that none of these calculations included health or environmental benefits.

“A correct cost-benefit analysis – even under the Trump Administration’s Circular A-4 guidance document – must include all relevant benefits and costs,” Gillingham explained. “In this rule, they are simply arguing that the benefits don’t exist. The science is not on their side on this one.”

When the EPA previously finalized increased emissions standards under President Biden in 2024, it estimated those standards would provide $200 billion in health benefits from reduced particle pollution and $1.6 trillion in climate benefits, with an overall net benefit of $2 trillion.

Multiple economists have identified critical flaws in the EPA’s current analysis. Half of the agency’s scenarios only count 2.5 years of fuel savings, dramatically reducing the calculated benefits of standards. “This makes a gigantic difference to the costs and benefits,” Gillingham noted.

Mark Jacobsen, an economist at UC San Diego, described the EPA’s estimates as “deeply flawed,” noting that “in the past, EPA has always considered air pollution benefits as part of a cost vs benefit sort of study. Here the assumption is that the pollution benefits are all zero.”

The Environmental Defense Fund estimates that repealing these standards could result in up to 58,000 more premature deaths and as many as 37 million more asthma attacks through 2055 due to increased pollution.

Critics also point out inconsistencies in the EPA’s methodology. When estimating the cost of making vehicles more efficient, the agency assumes manufacturers preserve vehicle performance rather than adopting cheaper solutions like reducing horsepower. Simultaneously, it claims consumers lose vehicle features with more efficient cars – effectively double-counting costs while minimizing benefits.

“Every step of this analysis is biased in an effort to make their repeal look as favorable as possible and to hide from the public the real costs to consumers, to public health, and to the environment,” Schwartz concluded.