Farmers, gas stations sue Gov. Tim Walz over Minnesota 'clean car' rule

Though they have yet to take effect, Minnesota's "clean cars" standards to limit climate pollution from tailpipes are under legal assault.

A coalition of soybean farmers, gas stations, convenience stores and ethanol industry players has sued Gov. Tim Walz and state pollution regulators in federal court saying the requirements violate federal law and will damage their business.

Minnesota can't regulate vehicle fuel economy beyond federal standards, even if California was granted a federal waiver to do so, the plaintiffs argue in the lawsuit filed Tuesday in U.S. District Court in Minnesota. They claim Minnesota's more stringent emissions standards will significantly cut demand for liquid fuel and hurt gas stations, along with the state's significant ethanol and biodiesel industries.

Plaintiffs include the Clean Fuels Development Coalition, an ethanol advocacy group in Maryland; the Minnesota Soybean Growers Association; the Minnesota Service Station & Convenience Store Association; the National Association of Convenience Stores; and Kansas-based ICM Inc., which has designed, built or maintains many of Minnesota's ethanol plants.

Defendants include Gov. Tim Walz, the Minnesota Pollution Control Agency (MPCA), and the agency's top officials.

In an interview, Bob Worth, president of the Minnesota Soybean Growers Association, said he's concerned the state standards will lead to other actions that shrink biodiesel demand. While most ethanol is corn-based, soybean oil goes into biodiesel fuel. Minnesota mandates blending diesel fuel with biodiesel, a requirement that increases the price of a bushel of Minnesota soybeans by $1.50, he said. Any drop in demand could be devastating, he said.

"We're really concerned about this whole situation," Worth said. "It's about profitability."

Asked about the dire need to cut climate pollution, Worth said biodiesel is a clean fuel that addresses that.

"We started biodiesel 20 years ago for this reason, to stop the emissions," Worth said.

According to Worth, Minnesota's biodiesel mandate cuts tailpipe emissions equivalent to the output of 245,000 cars per year.

Walz spokeswoman Claire Lancaster said via email that Consumer Reports has endorsed the clean cars plan as an "effective way" to increase options for Minnesota car buyers.

"The Governor stands by the plan, which would bring more models to Minnesota's lots and allow Minnesotans to continue to drive whatever vehicle they choose," Lancaster said.

MPCA spokeswoman Andrea Cournoyer said via email that the new emissions policy was approved by an administrative law judge and upheld by the state Court of Appeals.

"While the Minnesota Pollution Control Agency reviews this latest legal action, we are confident these standards will continue to stand and remain focused on implementing the standards, building out Minnesota's electric vehicle infrastructure and advancing Minnesota's Climate Action Framework," she said.

Minnesota is one of more than a dozen states that have followed California's lead in adopting more protective tailpipe emissions limits to fight global warming. While the change stood out in 2021, when the state adopted it through a rulemaking process, the program is now just one part of the state's sweeping Climate Action Framework. It aims to cut greenhouse gases in half by 2030.

A key part of the lower emissions standards is requiring carmakers operating in the state to supply more zero- and low-emissions vehicles to sales lots. The rules take effect in January 2024 starting with 2025 models of light- and medium-duty vehicles: passenger cars, pickups, minivans and SUVs.

EV sales are growing in Minnesota. There are about 30,000 EVs on the road now, including plug-in hybrids, according to the state Department of Transportation. Yet that remains a small fraction of total vehicles.

It's the second legal challenge to Minnesota's protective car requirements. The Minnesota Automobile Dealers Association fought the requirements but lost at the Court of Appeals last year. It has petitioned the state Supreme Court to hear the case.

Environmental Defense Fund spokeswoman Sharyn Stein said her organization has been tracking such litigation and is unaware of any other current legal challenges to state programs. Two lawsuits challenging Colorado's clean-car standards were unsuccessful. The U.S. Environmental Protection Agency has been sued for reinstating California's waiver to adopt stricter motor vehicle emissions standards.