CARB Proposes to Repeal Advanced Clean Fleets Regulation

The California Air Resources Board (CARB) has proposed to repeal the High-Priority and Drayage components of the Advanced Clean Fleets (ACF) regulations. The proposal also includes changes to the Low Carbon Fuel Standard (LCFS) regulations and implements AB 1594 (flexibility for public utilities).

CARB attributes the ACF proposed repeal to U.S. EPA’s inaction on its waiver application under the previous administration and the current administration’s hostility to CARB’s regulation, though CARB is also subject to court orders where it agreed to propose the repeal. Sidley represented plaintiffs Specialty Equipment Market Association (SEMA) and National Truck Equipment Association (NTEA) in litigation challenging the legality of ACF. The litigation resulted in CARB committing to propose a repeal of the High-Priority Fleet and Drayage Fleet Requirements of the ACF regulation by October 31, 2025; CARB is now taking action on that commitment.

Repeal of Advanced Clean Fleets Provisions

CARB is proposing to repeal the elements of the ACF regulation applicable to High-Priority, Federal, and Drayage Fleets, which require those Fleets to phase in zero-emissions vehicles (ZEVs) as they replace certain medium- and heavy-duty vehicles. The proposed rule would completely excise the Drayage Truck Requirements (Title 13, Section 2014 through 2014.3) and the High Priority and Federal Fleet Requirements (Title 13, Section 2015 through 2015.6). CARB states in its rulemaking notice that the proposal “will allow CARB to refocus its efforts to achieve emissions reductions in this sector in light of U.S. EPA’s lack of final action and the current administration’s past and continued hostility to CARB’s emissions control program, and allow CARB to consider approaches that would better ensure its ability to retain elements of the ACF regulation and accordingly better preserve its emissions benefits.”

CARB points to federal hostility to explain its repeal of the regulations and does not discuss any of the litigation challenging the legality of the ACF regime, which has been stayed pending CARB’s proposed repeal. CARB explains that it is repealing the applicable ACF provisions in order to provide greater certainty to the regulated community in the absence of a waiver from EPA, especially as the Trump administration’s EPA is unlikely to grant CARB a waiver of federal preemption authority. Nonetheless, CARB reaffirms its commitment to reduce vehicle emissions in California and states it will continue to develop new programs serving that mission.

In discussing the proposal, CARB focuses on the provisions of ACF that will continue to exist (e.g., for state and local fleets), which it states will result in minor reductions in emissions. It also reasons that if the proposed amendments are adopted, industry members who adopt zero-emissions technologies will be eligible for certain grants that would not otherwise be available when regulations mandate such adoption, thereby making funding more accessible for incentivizing the adoption of clean vehicle technology.

The state and local government requirements of ACF would remain in effect, subject to proposed amendments allowing state and local governments to more gradually and flexibly phase out internal combustion engine vehicles.

Amendments to the Low Carbon Fuel Standard (LCFS)

CARB also proposes a modest change to its LCFS regulation, modifying the crediting system for medium- and light-duty hydrogen refueling infrastructure (HRI) to improve incentives for hydrogen stations and accelerate the development of HRI. The amendment would allow public stations to receive credits for 100% of their nameplate capacity (up to 1200 kg/day) and private stations for 50% of capacity, an increase on the current limit of 62.5% for public stations and 31.5% for private stations. CARB states that this change is intended to better support the development of hydrogen stations suitable for medium-duty vehicles, though it does not raise the overall cap on HRI credits.

Flexibility for Public Utilities

The proposed amendments would also increase flexibility for public utilities in meeting ZEV milestones in compliance with AB 1594, which mandated certain changes to the ACF requirements. Under the proposed amendments, public entities providing water, electricity, or wastewater services may continue purchasing replacements for their vehicles in order to “maintain reliable service and respond to major foreseeable events.”

Business Impacts

CARB’s repeal of the High-Priority and Drayage components of ACF, if approved by its Board, would help to provide certainty for large fleets and drayage truck operators who have remained in limbo regarding CARB’s implementation of the requirements.  Fleets should continue to monitor developments through CARB’s final action on the proposed repeal.  However, California will seek other ways to reduce vehicular emissions, such as through proposed indirect source rules.  Fleet should therefore remain vigilant in monitoring and engaging with CARB’s proposed rulemakings and planning for impacts of any new requirements.

CARB welcomes members of the public to submit written comments on the proposed ACF repeal by September 15, 2025. It is scheduled to conduct a public hearing on the proposed amendments on September 25, 2025, which interested participants may attend in-person or remotely by Zoom.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.