Republicans call it the first in an expected “cascade” of federal greenhouse gas regulations. The Obama Administration, unveiling higher average fuel efficiency standards for cars and light trucks, said Thursday it was beginning a deliberate, somewhat slow approach to emission restrictions.

Business groups said they fear the Environmental Protection Agency would impose further emission controls under the Clean Air Act.  If Democrats fail to move the currently stalled cap and trade proposal in the Senate, the administration could extend greenhouse gas restrictions to factories and power plants

Lisa Jackson, the EPA’s administrator, insisted Thursday that the agency would impose no new regulations beyond automobile standards “this year”. 

The Obama Administration said it prefers to regulate carbon emissions with a cap and trade system written by Congress. 

Even if the agency begins regulating other sources of greenhouse gasses, “only a small number of sources will be immediately impacted,” said Jackson.  “The sky will not fall.  There will not be Armageddon.”

The oil and natural gas industry disagreed.

“It’s about EPA overreaching to create an opportunity for regulating greenhouse gas emissions from virtually every firm and business in America, no matter how unwieldy, intrusive and burdensome such regulation might be,” said the American Petroleum Institute in a statement. “The Clean Air Act was intended to control traditional pollutants, not greenhouse gas emissions that come from every vehicle, home, factory and farm in America.”  

The administration imposed an average auto fleet efficiency standard of 35.5 miles per gallon by the 2016 model year.  The previous target, signed into law by President George W. Bush in 2007, mandated a fleet average of 35 miles per gallon by 2020.

The new standards will add about $950 to the price of a new, 2016-model-year car, but the owner could save up to $3,000 dollars in fuel costs over the life of the auto, according to the administration, citing its calculations.

The car dealers’ lobby said it is not buying the administration’s sales pitch.

“These new rules are the most expensive fuel economy mandates in history, said Ed Tonkin, chairman of the National Automobile Dealers Association.  “Under these new mandates, the price of new cars and light trucks will rise significantly, meaning fewer Americans will be able to buy the new vehicles of their choice.”

Transportation Secretary Ray LaHood said the new regulations will cost the auto industry $52 billion dollars up front, but that automakers would eventually benefit with $190 billion dollars in overall profits. 

“We expect them to fulfill their commitments as soon as possible,” said LaHood of the industry.

The American auto industry, once opposed to stronger efficiency standards and now partially owned by the federal government, has commended the administration’s mandates. 

“While these requirements are very challenging, we feel confident that GM will be able to achieve the mandated fleet fuel economy targets,” said General Motors in a statement.  “Looking ahead, we urge the Administration to continue pursuing a national approach for setting vehicle fuel economy requirements beyond the 2016 model year as well.”

The new federal regulations also provide auto makers with national standards.  Under the previous system, a handful of states were independently regulating fuel efficiency standards, leaving car makers with a growing set of different requirements.