President Joe Biden has announced the strictest regulation on vehicle exhaust emissions ever introduced in the US in a bid to accelerate the auto industry’s shift to electric cars.
It includes a target for 56% of all new US vehicles sold to be electric by 2032 – a huge increase from current levels.
In a concession to car-makers, the goal was softened from last year’s draft.
But the Biden administration says it will still dramatically reduce planet-warming gases.
Wednesday’s regulation will prevent 7bn tonnes of carbon dioxide emissions over the next 30 years, according to the Environmental Protection Agency.
The new measure increasingly limits year by year the amount of pollution permitted from vehicle exhausts. Car-makers that do not meet the new standards will face stiff fines.
Companies will still be able to make petrol-powered vehicles, so long as they are a shrinking percentage of their total product line.
The US is taking a more moderate approach than the European Union and UK, which will ban all sales of petrol-powered cars from 2035.
UK Prime Minister Rishi Sunak announced last year he was delaying the British ban by five years from its original deadline of 2030.
The American car industry pointed to slower electric vehicle (EV) sales growth in objecting to a draft of the rules last year that would have ensured such vehicles accounted for 67% of all new cars sold in 2032.
EVs made up less than 8% of all new car sales last year.
The Alliance for Automotive Innovation, a trade group representing the car industry, welcomed the slower pace of the rollout, but said the goal was still “extraordinarily ambitious”.
Environmental groups broadly welcomed the finalised measure, though some activists expressed disappointment that it was not stronger.
But the rules are expected to face legal challenges from the oil industry and Republican-led states. It could ultimately be settled by the Supreme Court.
The policy highlights the political tightrope Mr Biden must walk.
As he runs for re-election against his Republican challenger, Donald Trump, the president is trying to win over car workers in the potentially pivotal state of Michigan, while also taking steps to address climate change, a key issue for many Democrats.
Mr Trump has pledged if he wins in November to roll back environmental regulations enacted by Mr Biden.
A spokeswoman for the Trump campaign, Karoline Leavitt, said the rules “will force Americans to buy ultra-expensive cars they do not want and cannot afford while destroying the US auto industry in the process”.
The average sale price of an EV was around $53,500 last year, according to trade publication Kelly Blue Book, some $5,000 more than petrol-powered cars.
The average annual salary in the US is about $59,000.
The Republican Speaker of the House of Representatives, Mike Johnson, also criticised the policy as “another radical, anti-energy crusade that will limit consumer choices, raise costs on American families and devastate auto manufacturers”.