U.S. Appeals Court Orders New Fuel Economy Standards

LOS ANGELES (Reuters) - A U.S. appeals court on Thursday ordered the federal highway commission to formulate new fuel economy standards for upcoming models of light trucks to take into account the environmental impact of their emissions.

The 9th U.S. Circuit Court of Appeals also ordered the National Highway Traffic Safety Administration (NHTSA) to close a loophole allowing SUVs and other light trucks to satisfy lower fuel efficiency standards than cars.

The opinion, which came in response to a lawsuit brought by 11 states, public interest groups and others, also requires the NHTSA to set fuel economy standards for large pickup trucks that so far have been exempt from current rules.

The court agreed with the plaintiffs that the agency had failed to assign adequate value to carbon dioxide emissions reduction, and said its environmental study of the new rule was inadequate.

The states and other entities sued to challenge what they described as "arbitrary and capricious" Corporate Average Fuel Economy, or CAFE, standards for light trucks, including sport utility vehicles, minivans and pickup trucks, for model years 2008 through 2010.

The plaintiffs included the states of California, Maine, Massachusetts, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Minnesota, the District of Columbia, the city of New York, the Sierra Club and the National Resources Defense Council Inc.

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"It's currently under review and we're considering our options," Justice Department spokesman Charles Miller said of the ruling.

(Reporting by Gina Keating, editing by Adam Tanner, Gary Hill)