WASHINGTON, D.C. --- President Obama is expected to direct the EPA this week to reconsider a Bush Administration decision that stopped California and more than a dozen other states from setting their own stricter limits on auto emissions, the Los Angeles Times reported.

If the EPA issues a waiver from federal rules, states could require automakers to increase the fuel efficiency of cars and trucks far above federal limits now in effect. Passenger vehicles are estimated to emit 25 percent of the greenhouse gas emissions in the U.S.

At least 17 other states have adopted or are considering California's rules, and a waiver also would let them regulate tailpipe emissions. California emissions rules are more rigorous than federal fuel standards passed in 2007. The California rules set caps on carbon emissions and would effectively require vehicles to reach as much as 42 mpg by 2020, according to some estimates. In contrast, the federal standards would raise the national fleet average to 35 miles per gallon by 2020.

The Bush Administration's waiver denial prompted California Gov. Arnold Schwarzenegger to sue the federal government. Also, Congress launched an investigation on the decision-making process at the EPA, which must grant California the waiver before the state has authority to regulate emissions of carbon dioxide and other greenhouse gases.

Last week, according to the L.A. Times, Schwarzenegger sent a letter to President Obama asking that the agency reconsider the matter. "Your administration has a unique opportunity to . . . move America toward global leadership on addressing climate change," the letter said. Also last week, Mary Nichols, chairwoman of California's Air Resources Board, asked the EPA to open a "reconsideration process" in a letter she sent to Lisa Jackson, the EPA's new administrator.

Earlier this month, Jackson pledged to reconsider the request during a Senate hearing into her nomination. After Obama turns the matter over to the EPA, the agency is expected to take several months to reach a final decision on whether to reverse the Bush denial, the Times reported.