As California’s Emissions Rules Faces Court Battles, States Scramble To Save Their Climate Goals – Inside Climate News

When President Donald Trump signed legislation to revoke California’s authority to enforce stricter tailpipe emissions standards and to ban sales of gas-powered cars by 2035, the effects rippled far beyond the Golden State.

Seventeen states relied on California’s Clean Air Act waivers to adopt stronger vehicle pollution rules on their own, including New York, New Jersey, Oregon, Massachusetts, Washington.

California, joined by several states, immediately sought a court injunction, calling the revocation illegal on the basis that the waivers are not subject to congressional review and that it violated decades of legal precedent and procedure. These same states recently launched an Affordable Clean Cars Coalition to coordinate legal action and policy to defend their rights to transition to cleaner vehicles.

As the legal battle plays out, states that have relied on the waivers are leaning into expanding multimillion dollar ways to keep their EV transitions on track. Among their efforts: amping up rebates, tightening rules on the carbon intensity of fuels and cracking down on pollution where trucks congregate.

“Climate change is still around, whether we have the waiver or not. So we have to figure out ways to make sure that we’re doing what we can to address the problem at hand,” said Michelle Miano, who heads the New Mexico environment protection division of the Environment Department.

According to data from the California Air Resources Board, the states that have passed tougher pollution rules account for about 40 percent of new light-duty vehicle registrations and 25 percent of new heavy-duty vehicle registrations in the United States, where the transportation sector is the highest source of greenhouse gas emissions as of 2022.

Among these stronger rules are the Advanced Clean Cars (ACC) I and II and Advanced Clean Trucks (ACT), which require automakers to sell a growing share of electric passenger cars and medium and heavy-duty trucks to reduce emissions from gasoline-powered counterparts. 

The goal is for all new vehicles sold to be electric by 2035.

Bolstering Incentives 

Without ACC and ACT, states are betting they can increase demand for EVs by reducing the costs of buying a vehicle with rebates, vouchers and grants and boosting the number of charging stations in their states. These incentives can range from a few thousand dollars for individual EV purchases to hundreds of thousands for building charging infrastructure and fleet upgrades. 

On June 18, New York announced a $53-million expansion to its voucher program for electrifying last-mile truck fleets, offering vouchers from $340,000 to $425,000 for each truck, depending on the model.

“Despite the current federal administration’s efforts to erode certainty in the ongoing transition to cleaner vehicles, New York State will continue to act to protect our air, lands and waters,” said Amanda Lefton, commissioner of the Department of Environmental Conservation.

In Oregon, where over a third of in-state emissions are from transportation use, the government this month opened applications for $34 million in grants toward the purchase of zero-emission trucks and developing charging stations for EVs or retrofitting diesel trucks. Lawmakers are considering expanding a popular rebate program through a bill introduced in February. The program so far has given car owners almost $100 million for EV purchases. (The program has been suspended twice after running out of money. It resumed as of May 2025.)

In Massachusetts, Gov. Maura Healey promised in May to announce “dedicated additional grant funding” for electric vehicles and vowed to increase “grant funding opportunities” for charging. Advocacy groups, including the Environmental League of Massachusetts, are counting on increased funding for its MOR-EV rebate program, which provides up to $3,500 for new EV purchases. This year, the rebate program has distributed $15.7 million in total incentives, according to the program’s statistics page. 

In Washington state, lawmakers earmarked $126 million—a $16-million increase from 2024—to subsidize purchases of electric truck fleets and chargers. Many states are targeting trucks because they account for a huge share in emissions relative to their number on the road.

Will Toor, executive director of the Colorado Energy Office, credited state rebates and investments in charging infrastructure for helping Colorado reach a 20 percent electric vehicle market share in the first quarter of 2025. One in five new cars sold in the state was electric. Toor also credited the state agency’s EV buyer’s education campaign launched in late 2022, which promoted available rebates and incentives for prospective EV owners. 

The scope and generosity of these programs vary widely depending on each state’s climate priorities, budget capacity and access to federal or market-based funding streams.

“Those types of incentives can be expensive,” said Terrence Gray, director of the Rhode Island Department of Environmental Management. “In Rhode Island, our budget is tight. There’s not a lot of funding available right now, so we would have to make a very strong argument that there’s a strong cost benefit to invest in these types of areas.”

With the Trump administration threatening to cut down federal funding for EV rebates through the Biden-era Inflation Reduction Act, states will have to increasingly rely on themselves to fund these programs.

“The federal government isn’t going to come save us,” said Alex Ambrose, an analyst with the nonpartisan think tank New Jersey Policy Perspective.

Some are already ahead on this. California and Washington State have devised carbon markets that charge major polluters—like oil refiners, power plants, large industrial facilities and fuel suppliers—for each ton of carbon dioxide they release. California’s auctions bring in about $3 to $4 billion per year, which support programs such as public transit and EV rebates. Washington’s system, launched in 2023, covers around 97 major emitters and has raised over $3 billion in its first two years, funding clean transportation, air quality devices and EV chargers.

The states of New York, New Jersey, Massachusetts and other Northeast and Mid-Atlantic states have signed up to the Regional Greenhouse Gas Initiative or RGGI, which is a cooperative cap-and-invest program launched in 2009 that limits emissions from the power sector and reinvests proceeds into clean energy programs like EV rebates.

Making Fuels Greener

While many states focus on promoting electric vehicles, others are also targeting the fuel of gas-powered cars, by adopting or developing standards that lower the carbon intensity.

These policies require fuel producers and importers to blend cleaner alternatives like biofuels, renewable diesel or electricity into the fuel mix.

Patterned after California, Washington has a clean fuel standard in effect since 2023, targeting a 20 percent reduction in carbon intensity of transportation fuels by 2034 compared to 2017 levels. 

Oregon has a similar program in place that aims to reduce carbon intensity in fuels by 37 percent by 2035.

New Mexico approved its Clean Transportation Fuel Standard in March 2024. A formal adoption hearing before the Environmental Improvement Board is scheduled to begin in September.

“We know that those (electric) vehicles aren’t for everyone and so we are very respectful of folks that decide to not purchase them,” said Miano, New Mexico’s environment protection division head. 

No East Coast states have enacted a clean fuel standard, but New York state legislators may change that. 

There are bills in the State Senate and Assembly that, if passed, would require fuel providers to reduce the carbon intensity of their transportation fuels by at least 20 percent by 2030. (Legislation has passed the Senate but remains at the committee level in the Assembly as of June.)

Michigan also had bills introduced in its Senate and House in 2023, but neither passed before the 2024 session ended. Similar bills have not been introduced since then.

Some of these clean fuel standards have faced criticism from environmental advocates, who argue that they allow polluters to buy their way out of reducing emissions.

But Trisha DelloIacono, policy head at advocacy group CALSTART, said the fuel standards remain one of the few politically viable tools to gradually shift the transportation sector toward cleaner fuels.

“What we need to be looking at right now is incremental changes and incremental progress in a place where we’re fighting tooth and nail to hold on to what we have,” DelloIacono said.

Where Trucks Congregate

There’s also a policy tool called indirect source rules or ISR. 

The rules are called “indirect” because they don’t regulate the vehicles themselves, but the facilities that attract emissions-heavy traffic, like large warehouses, ports or rail yards. The rules hold the facilities owners or operators responsible for reducing or offsetting the pollution from their profitable traffic.

Studies show that the pollution from these trucks often ends up in nearby neighborhoods, which are disproportionately lower-income and communities of color.

California is currently the only state enforcing ISRs.

In southern California, large warehouses must take steps to reduce the pollution caused by truck visits, either by switching to electric vehicles, installing chargers or paying into a clean air fund. It’s the first rule of its kind in the country and it survived a court challenge in 2023, paving the way for other states to consider similar action.

New York is one of them. Its lawmakers introduced a bill in January that could require warehouses with over 50,000 square feet to reduce emissions from trucks by meeting certain benchmarks, such as hosting electric deliveries or offering bike loading zones. New York City has its own version of the rule under deliberation in the Council. As of June 2025, the bill remains stalled in the environmental committee. City Council has until December to act before the bill expires. 

In New Jersey, where warehouse growth has boomed, legislators in 2024 proposed a bill that would require “high-traffic facilities” to apply for air pollution permits and provide plans to reduce diesel truck pollution.

“This is really being pushed by the community groups and environmental justice communities, especially in North Jersey. But also, warehouses are starting to pop up even in very rural parts of South Jersey. So this is very quickly becoming a statewide issue in New Jersey,” said Ambrose of the New Jersey Policy Perspective.

In Colorado, its regional air quality council in April announced plans to ask its air quality control commission to use ISR for areas with the worst air quality.

Industry groups, especially in the logistics sector, are pushing back. The industry group Supply Chain Federation told the Wall Street Journal that the southern California ISR was a “backdoor approach [that] does little to cut emissions and instead raises costs, disrupts supply chains.”

Still, experts say this may be one of the few options left for states to cut emissions from traffic-heavy facilities. Because these rules don’t directly regulate the car companies or trucks themselves, they don’t need federal approval.

“We definitely have to be nimble and fluid and also understand the kind of landscape in the state,” DelloIacono said.