1 VNG.co

EPA/NHTSA 2017-2025 Regulations: 

Ensuring Fair and Consistent Incentives 

for Natural Gas Vehicles

Presentation to EPA,

April 5, 2012
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VNG Strategy for NGVs

(and FCEVs)
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VNG Strategy Overview

VNG to Develop National CNG Fueling Network

• VNG will provide CNG for light-duty vehicles at retail 

locations 

— Takes fueling from private, “behind the fence” stations 

and puts it “in the market,” public access

• VNG using “fleets first” strategy to seed the market 

— Initial focus on national and large regional fleets –

government and commercial 

— Promotes consumer awareness of availability and 

pricing of fuel, viability of NGVs 

• National buildout begins with emphasis on top-50 MSAs –

most populous & important markets

— Buildout expands from initial fleet-focused stations to 

provide robust consumer access 

• Monitor opportunities to outfit stations for hydrogen 

production, dispensing as FCEV market develops (2015+)
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VNG Progress

Steady Progress On All Fronts

Automakers 

— Joint marketing [redacted]

— Senior level discussions of long-term NGV plans

Station Owners

— Letters of interest signed by owners representing 

over [redacted] retail gasoline stations

— Includes major markets across the country

Equipment Providers

— Developing equipment packages w/top suppliers

— Using state-of-the-art “pistol grip” CNG nozzle, 

unsurpassed consumer ease-of-use

Government 

— Meetings with EPA/NHTSA, White House

— Meetings with governors supporting NGV fleet 

MOU in Colorado, Pennsylvania

VNG expects to have its first 

stations built and operational in 

early 2013

Joint VNG-GM exhibit at NTEA Work 

Truck Show, Indianapolis, March 6-8
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NGV Benefits for Fleets & Consumers

Light-Duty NGVs Provide Customer Satisfaction

• Meets same preferences in model selection, 

performance, serviceability as gasoline vehicles

• CNG fuel cost savings of ~40% compared to gasoline

• Dual-fuels key for early market, no range anxiety 

Particularly Well-Suited For Light Trucks

• Low MPG but popular vehicles, esp for US OEMs

~ 1/2 of total US vehicle market

~ 2/3 of Big Three sales

• Larger vehicle envelope accommodates CNG tanks, 

while EVs are limited to smaller cars 

• Benefits from power, performance, and increasing 

efficiency of internal combustion engine platform

• ICEs will dominate market for foreseeable future

SUV

8%

Mini-vans

6%

Crossovers

20%

Pickups

13% Mid-size 

Cars

26%

Small Cars

20%

Luxury Cars

7%

Total US Light-Duty Vehicle Sales,

Feb 2012

Chrysler and GM have announced 

plans for bi-fuel NGV pickups this year
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NGVs as the Bridge to Hydrogen

NGVs and CNG Fueling Infrastructure are Essential Bridge to Hydrogen

• Hydrogen FCEVs are an essential zero-emission technology, along with EVs

• Automakers and regulators (California) anticipating rollout in 2015-2017

• NGVs and development of CNG infrastructure are essential bridge to hydrogen FCEVs:

— Reduces Capital Costs: Key NGV refueling hardware (compressors, storage tanks, 

dispensers) can be adapted for gaseous hydrogen, reducing infrastructure costs

— On-Site Hydrogen Production: Natural gas can be used as feedstock for hydrogen 

production (via steam reforming) at station level

 Recognized by DOE in 2005 as lowest-cost, lowest-emission transition pathway

— Fuel Blends: Natural gas and hydrogen can be blended and used with no 

modification in NGVs or H2 ICEs, reducing emissions and building H2 demand

— Vehicle Storage Technologies: Development of on-board storage technologies for 

NGVs will also help lower costs, weight, space requirements for H2 storage

NGV development today leverages US natural gas resources to accelerate the 

transition to hydrogen tomorrow – a new opportunity to lead in FCEV technology
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NGVs and EVs Both Essential to Hydrogen FCEV

BEV 

Electric Drivetrain

NGV

Gaseous Fuel Management 

and Storage

CNG

Gaseous Fuel Compressors, 

Dispensers, H2 Feedstock

FCEV

Zero-Emission Electric Drive 

+

Energy-Dense, Fast-Fueling Gaseous 

Hydrogen Fuel

H2 Fuel

Bridge: Distributed NG steam reforming

Long-Term: H2 via renewables 

(electrolysis, direct solar conversion, 

bio-hydrogen,...) 
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Further Steps Needed for 

Fair and Consistent 

NGV Incentives
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Summary of 2017-2025 Rules for NGVs

Agencies can play key role in supporting President’s “All of the Above” 

energy strategy with fair, consistent NGV incentives comparable to EVs

Positive Steps for Dual-Fuel NGVs in EPA/NHTSA 2017-2025 Proposal

• “Utility Factor” methodology for dual-fuel NGVs

• Performance-based credit for “game-changing” pickup trucks

• New dual-fuel rules begin on EPA side in 2012

...But More Needed for Fair Incentives, Level Playing Field 

• Consistent NHTSA credits from 2012

• Extend EPA GHG incentive on same schedule as EV 0 g/mi

• EPA multipliers for NGVs on par with PHEV/EVs

* Page numbers throughout presentation refer to Federal Register Vol. 76, No. 231
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New CAFE Dual-Fuel Rules in 2012?

Now: CAFE Incentives Hampered by Law

• CAFE incentives for dual-fuel CNG are 

tied to FFVs and subject to shared cap 

that declines to 0 in 2019 (p. 75396)

• Dual-fuel CNG effectively blocked from 

receiving intended credits

• Agency plans recognize that new regime 

for dual-fuels is fairer and more in line 

with intent of law 

– NHTSA plans to adopt new regime with 

no cap, utility factor methodology in 2020 

after old statutory regime expires (p. 

75419)

– EPA is free to adopt new regime in 2012 

and plans to do so (p. 75018)

Possibility for Separate Track?

•Is it possible for NHTSA and EPA to create a 

new ‘track’ for dual-fuels to allow them to 

receive credits under new regime starting in 

2012?

• Vehicles with less than 200-mile 

range on NG not covered by 

existing dual-fuel definition

• Or: Dual-fuel vehicles expected to 

fuel predominantly on NG 

(according to utility factors)

• ...Other options? 

•Starting new dual-fuel incentives for BOTH 

EPA and NHTSA in 2012 would provide fair 

and consistent support
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Extend GHG Incentive for Natural Gas

Now: CNG GHG Incentive Ends in 2016 

• Now: CNG currently counts for 0.15x 

GHG emissions of gasoline

– Harmonized with CAFE credits

• 2016+: After 2015, CNG = tailpipe 

emissions level, ~24% below gasoline

– Significantly lower incentive

But EV Incentives Last to 2025 (p. 75372)

• Now: 0 g/mi incentive value through 2021, 

despite upstream emissions

• 2022+: Upstream GHGs only counted in 

2022-2025 for certain manufacturers

– Only for manufacturers surpassing 

cumulative production caps (200-

600k from 2022-2025)

Proposal: Extend GHG Incentive To 2021+

• Maintain 0.15x emissions incentive for 

CNG through 2021 for all NGVs

• Phase in tailpipe accounting in 2022-2025, 

and only for manufacturers surpassing 

production caps (as with EVs)

Fairer, Harmonized Incentive

• Gives GHG incentives for CNG the same 

timeframe as for electricity (although 

electricity retains better incentive)

• Maintains harmony with CAFE credit, 

making incentives easier to use 

• As with EV incentive, impact on regulation 

benefits limited by duration, production 

caps
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NGV Multipliers 

Now: EV/FCV Multipliers (p. 75372) 

• Every EV/FCVs counted as 2 vehicles 

for GHG compliance calculations 

• Every PHEV counted as 1.6 vehicles

• Multipliers decline, expire after 2021

• EPA requests comments on providing 

similar multipliers to NGVs (p. 75013)

Model year EV/FCV PHEV

2017 2.0 1.6

2018 2.0 1.6

2019 2.0 1.6

2020 1.75 1.45

2021 1.5 1.3

Proposal: NGV Multipliers

• NGVs deserve multipliers as part of 

pathway to FCV – develops 

technologies, fueling infrastructure

• Dual-Fuels = same multiplier as PHEV

• Consistent with same utility factor 

treatment for dual-fuel and PHEVs

• Dedicated NGVs = same as EV

Model year Dedicated Dual-Fuel

2017 2.0 1.6

2018 2.0 1.6

2019 2.0 1.6

2020 1.8 1.45

2021 1.6 1.3
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“Game-Changing” Pickup Truck Credits

Performance-Based Standard for Game-Changing Technologies (p. 75385)

• 10-20 g/mi per pickup (plus equivalent CAFE) for use of “game-changing” technologies

• GM, Chrysler introducing NGV pickups – increasing recognition of natural gas as an 

important “game-changer” for reducing emissions for larger light-duty vehicles

• Performance-based credit – NGVs should qualify, potentially even dual-fuels

• Assuming 24% tailpipe emissions reduction for CNG, a dual-fuel pickup would only 

need a range of 80 miles on CNG to qualify for 20% threshold

• 20 g/mi credit likely attainable for most pickup NGVs, available through 2025

• But: minimum penetration rates overly aggressive – should be lowered/eliminated 

• We also support expanding eligibility to smaller pickups – good potential for NGVs

Level Minimum Penetration Duration Value

15% GHG reduction 15%-40% of pickups 2017-2021 10 g/mi

20% GHG reduction 10% of pickups 2017-2025 20 g/mi
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Conclusion

• ICE Emissions and Petroleum Use: 24% lower GHG emissions, 0% 

petroleum use for ICEs – which will remain dominant tech for years

• Economic Practicability/Consumer Choice: Low production costs, 

applicable to full range of vehicles including light trucks (consumer choice)

• Minimal Technology Risk: Established, commercial technology, with 14 

million NGVs on the road worldwide, OEM production for overseas markets

• Consumer Acceptance: Full range of vehicles (including minivans, pickups, 

SUVs), similar range/refueling as gasoline, superior safety

• Bridge to Hydrogen: Proliferation of NGVs lowers barriers for hydrogen ICE 

and FCEV, particularly fueling

• Contributes to Other Regulations: Low criteria pollutant emissions helps 

compliance for Tier 3/Lev III; biogas a low-cost, low-emission compliance 

option for RFS2 advanced biofuels requirements

NGVs are a uniquely valuable compliance pathway in both near and 

long term and deserve broadly similar incentives as EVs
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Questions? 

Contact us:

• Paul Kouroupas

Vice President, Regulatory & Government Affairs

973-886-7675

pkouroupas@vng.co

• John Atkinson

Manager, Public Policy

646-734-7209

jatkinson@vng.co