Draft EPA and NHTSA Response to Interagency Comments on Upstream GHG Emissions

Draft Preamble Section II.B.4.a

a. Fuel Production-Related Upstream GHG Issues

This section discusses how the agencies plan to address the issue of upstream emissions, in the context of a program designed to provide consumers with information that will be useful when purchasing a vehicle. The agencies’ a pproach takes into account the limited amount of information that can be provided on a label, the gr eat deal of required info rmation that must be presented on the label, and the ability to provide additional and comprehensive information in a consumer friendly format on a web site. This discussion focuses on, but is not limited to (for example, the discussion also touches on the us e of renewable fuels), the advanced technology vehicles that use electricity from the grid to power the vehicle, such as the electric vehicles and plug-in hybrids that are expected to enter the market in larger numbers in the coming years.

The agencies recognize that all automo tive fuels have upstream GHG emissions associated with the production and distribution of the fuel used by the motor vehicle. This includes gasoline, diesel, and other fuels such as natural gas, electricity, and renewable biofuels. They also recognize that a signi ficant number of consumers ma y want access to information on
the total GHG emissions associated with the operation of their vehi cles, not just the tailpipe only emissions, and that access to such information can help consumers understand the full amount of GHG emissions that result from opera tion of the vehicle. However, the agencies emphasize that developing such information and providing it to c onsumers in a manner that is both accurate and
useful for the consumer will raise a number of challenging issues that are discussed below.

For example, while a full lifecycle evaluation could potentially include an evaluation of a comprehensive set of GHG and energy impacts associated with both the vehicle (extraction and processing of materials, energy us ed in assembly, distribution, us e, and disposal, etc.), and the fuel (feedstock extraction, feedstock transport, fuel processing, fuel transport, indirect effects, etc.), even the more limited accounting fo r upstream GHG emissions from production and distribution of the fuel, including electricity, is a complex challenge. Unlike fuel economy that
has been the central metric on labels in th e past, EPA does not and cannot measure upstream
GHG emissions in its vehicle tes ting. However, modeling can be performed to assist in estimating these emissions. Relying on modelin g in developing upstream GHG emissions values would need to be done carefully to avoid inac curacy and consumer confusion. For example, upstream GHG emissions from electricity generati on will vary significantly in the future, based on the different fuels used at generating stations , by as much as an orde r of magnitude between coal and non-fossil feedstocks. Additionally, while the Agency has undertaken extensive lifecycle modeling of biofuels for the Renewable Fuel Standard rulemaking in response to the requirements of the Energy Independence and Secu rity Act, that assessment was done in the context of the particular mix of biofuels requir ed nationally in 2022 by the Act. Applying that analysis to renewable fuel used in a particular vehicle at a particul ar time raises many challenges.

1One overriding consideration is whether the agencies would provide a single, national value for upstream GHG emissions from electricity generation or different values customized for various regions of the country. 1 For individual owners, a sing le national value would generally not be accurate, and the individual would need ac cess to additional information, such as regional values, to evaluate the impact of their specific vehicle. 2 In addition, the agencies would have to determine whether to use average or marginal (i.e., reflecting that increased vehicle demand might change the overall mix of electricity sour ces) upstream GHG emissions factors, and if the marginal approach is used, whether to assume all nighttime charging or a mix of daytime and nighttime charging. Finally, another major consid eration for the web site is whether to base upstream GHG emissions values on today's electr icity markets or on projected changes in the electricity market that might occur by 2020 or so me other year since vehicles produced in the next few years will remain in the fleet for 15 or20 years or more. Some states have already passed legislation that could requ ire major changes in how electrici ty is produced in those states in the future, and Congress has c onsidered landmark legislation as well, and it is clear that the question of how electricity will be produced in the future is a very fluid issue. Additionally, with respect to lifecycle emissions from biofuels, as a result of the Energy I ndependence and Security Act biofuel mandates, the agencies expect the amount of biofuel in the transportation fuel market to increase significantly over time, and the contribution of feedstocks to change over that time as well. Information that addresses lifecycle emi ssions of biofuels would need to take these considerations into account.

The agencies believe that all of these fact ors can be appropriately addressed by providing a variety of information on a website, which can go into much more depth and be changed and updated whenever needed. In addition, we unfort unately do not have a full lifecycle analysis
sufficient to draw from for labeli ng purposes across the full range of vehicles and fuels. The data reported to EPA on emissions from upstream fuel production varies across fuel types, is much more detailed for gasoline production, and it would be difficult to represent emissions from energy generation on a national label in a way that is both useful and accurate for consumers, given regional variations, how generation within regions is dispatched, and access to green power purchases.

Therefore, EPA and NHTSA are proposing that the label should limit itself to tailpipe only emissions and include a more complete discussion on energy generation and lifecycle analysis on the webpage at this time . We believe that this approach is sufficiently informative to consumers. It also allows us the opportunity to more fully discuss GHG emissions associated with energy generation for altern ative vehicles, as well as upstr eam fuel production (gasoline and biofuels). For example, a web site could provi de calculator tools that could reflect regional
variations in the GHG emissions a ssociated with electricity genera tion as well as to use national averages. Additionally, a web site could provide information on the projected fuel lifecycle impacts associated with biofue ls. The web page could be up dated over time as the mix of electricity fuel sources and bi ofuels changes. This could help the consumer understand over the

1 See http://www.eia.doe.gov/energyexpl ained/index.cfm?page=elect ricity_in_the_united_states for an overview of the national U.S. electric power industry net generation by fuel type.

2 Regional values could be provide d on a web site. EPA has a website ( http://www.epa.gov/cleanenergy/ene rgy-and-you/how-clean.html ) on which consumers can enter their zip code and find out what fuel mix is used to produce the electricity they use.

2lifetime of their vehicles how their upstream emi ssions impacts might be changing. At this point in time the web is the better place, compared to the label, to address these complex issues.

This is consistent with the Energy Policy and Conservation Act (EPCA), as amended by the Energy Independence and Security Act (EIS A) of 2007, which states that NHTSA must require vehicles to be labeled with information “reflecting an automobile’s performance ... [with respect to] greenhouse gas ... emissions ... of the automobile.” 3 NHTSA believes that a reasonable interpretation of this provision is th at only GHG emissions dir ectly from the vehicle itself are required for the label. Those would be the direct “automobile’s performance” with respect to “greenhouse gas emissions.” NHTSA be lieves that it would be reasonable to interpret the statutory language such that the required label information on GHG emissions would include information on the upstream GHG emissions associated with electricity or other fuels used by the vehicle, insofar as the upstream GHG emissions are indirectly related to the automobile’s GHG performance.

We invite comment on the propos al to provide such upstream information on a web site. We encourage commenters to be as specific as possible with any recommendations on how to address upstream GHG emissions on the web. Fo r example, the agencies invite comment on whether information on upstream emissions should be provided on websites? In general, if information on upstream emissions is provided on a web site, what information? The agencies specifically invite comment on how to address upstream emissions a ssociated with the electricity used to power the advanced tec hnology vehicles starti ng to enter commerce, electric vehicle and plug-in hybrid vehicles. Th e agencies also invite comment on how to address lifecycle emissions from biofuels on a web site. Should upstream emissions be provided specifically for the emissions associated with the combustion of fuel to prod uce electricity? Should such upstream emissions be determined on a regional or a national basis? Should upstream emissions be provided as a relative comparison to a gasoline or diesel fuel, the current predominant fuels? For the convenience of commenters, we have prepared the table below as an illustrative example of one simplified way that some upstream emissions information could be accounted for on a web site, based on certain assumptions. 4 Consistent with the discus sion above, it is important to emphasize that the tailpipe + upstream values in the table below are based on 2005 national average electricity upstream GHG emissions, and c ould be very different for certain regions of the country today and for the nation in the futu re if there are major changes in the mix of methods used to generate electricity or in th e GHG emissions associated with its generation.

Proposal--TailpipeOnly Tailpipe + Upstream

3 49 U.S.C. 32908(g)(1)(A)(i). 49 U.S.C.32908(g)(1)(A)(ii) also refers to GHG “emi ssions of automobiles,” and further requires a designation of automobiles “with the lowest greenhouse gas emi ssions over the useful life of the vehicles.”
4 The key assumptions underlying the illustrativ e numbers in the right-hand column are th at:EV and PHEVs all assumed to use 200 W att-hours per mile when operating on electricity over the EPA test and assuming a 30% range (43% electricity consumption) shortfall from test to road.

• PHEV 1 assumed to operate on electricity 50% of the time.

• PHEV 2 assumed to operate on electricity 25% of the time.

• Uses 2005 nationwide average value of 0.642 grams of upstrea m GHG per Watt-hour at powerplant (adjusted to include GHG emissions from feedstock extraction, tran sportation, and processing as well) from MY2012-2016 light-duty vehicle GHG final rule (75 Federal Register 25437).

• Assumes typical 7% electricity grid transmission losses.

• Uses 2250 grams upstream GHG per gallon of gasoline.

34 Vehicle CO2/mile CO2/mile

EV 0 197

PHEV 1 89 210

PHEV 2 133 217

Toyota Prius HEV 178 224

Honda Civic HEV 212 266

Honda Insight HEV 217 273

Ford Fusion HEV 228 287

In general, for purposes of providing in formation on the web, the agencies invite comment on the appropriate metrics to use and the specific suggestions for content and format, if appropriate. The agencies also request comment on which web resources it should prioritize for development that would provide the mostuseful information to consumers.

With respect to the label itself, the agenci es are requesting comme nt on an alternative option for the label for EVs and PHEVs that is under serious consideration, similar to a coproposal. This alternative would further high light that the label in cludes tailpipe only
information. Under this alternat ive, the EV label would continue to reflect the "0" CO2g/mile number currently displayed on the co-proposed labels (Figures III-2, III-10) but the label would be modified by adding either a symbol or an as terisk and explanatory text which states, "The only C02 emissions are from electricity generati on". Likewise, the agen cies would modify the co-proposed PHEV labels (Figures III-3, III-6, III- 1, III-12) inserting eithera symbol or asterisk next to the current CO2g/mile number displayed with the following explanatory text, “Does not include CO2 from electricity generation.” This alternative may provide more clarity for purchasers by more explicitly indicating that th e CO2 emissions from generation of electricity
are not reflected in the CO2 numbers on the la bel. The agencies request comment on this alternative option.

In addition, the agencies invite comment on a different approach which would include information on lifecycle emissions on the label. In view of the above discussion, we are not sure what information, if any, would be appropriate a nd seek ideas from the public. We also ask for comment on how each of the challenges outlined a bove for consideration for a web site could be addressed if considered for a label. In additi on, commenters should take into consideration the limited amount of information that can be provid ed on a label. NHTSA specifically invites comment on the effects of incorporating into a label additional information concerning upstream emissions from vehicle production and fuel production and distribution.