From: "Achanta, Chandana L." <Chandana_L._Achanta@omb.eop.gov>

To: William Charmley/AA/USEPA/US@EPA, "Neil.Eisner@dot.gov" <Neil.Eisner@dot.gov>, "rebecca.yoon@dot.gov" 

<rebecca.yoon@dot.gov>, "james.tamm@dot.gov" <james.tamm@dot.gov>, "Steve.Wood@dot.gov" 

<Steve.Wood@dot.gov>, "Joanne.Petrie@dot.gov" <Joanne.Petrie@dot.gov>, Maureen Delaney/DC/USEPA/US@EPA, 

Robin Moran/AA/USEPA/US@EPA

Date: 09/28/2010 05:55 PM

Subject:Summary of interagency working comments received on draft Notice and Technical Assessment under EO 12866 review

Please find attached additional interagency working comments we received under EO 12866 review of 

the draft notice and technical assessment. 

They are for your consideration and subject to further policy review.
Summary of Interagency Working Comments received on draft Notice of Intent under EO 

12866 review 

1

Below is a summary of interagency comments received during interagency review of the draft 

Notice of Intent and the draft Technical Assessment Report for MY 2017-2025 under EO 

12866. They are for your consideration and subject to further policy review. 

COMMENTS ON NOI: 

1. Regarding tailpipe-only emissions of GHG: Some of the comments we received find 

that only looking at tailpipe emissions is problematic, since in a number of the more 

stringent scenarios, a significant portion of the GHG reduction comes from EVs and 

PHEVs. The notice reports that manufacturers “expressed strong support for a 

tailpipe-only CO2 measurement.” That should not be surprising or informative. The 

commenters with this concern suggested that both environmental groups and 

economists would be in favor of counting upstream emissions. 

The text in the “notice” (p.22) is unclear as to what EPA will do. The text in 

the technical assessment (p.7-3) promises to consider the issue. 

Note: the notice reports that manufacturers actually wanted “bonus” credits for 

EVs and PHEVs, which seems like it would be an even more serious concern. 

2. Under most scenarios, this rule pays for itself, in that the fuel savings more than offset 

the cost of the technologies used. This raises the whole issue of the energy paradox 

and lost consumer welfare. Please provide a discussion of this in the NOI and TAR. 

3. The regulation and the analysis (eventually) will be organized by vehicle “footprint”, 

so all vehicles within certain size groupings have to meet the same fuel economy and 

GHG standards. Manufacturers with larger vehicle fleets would have lower fuel 

economy and GHG goals. This raises the question of whether manufacturers can 

adjust their vehicles’ footprints to game the system. In economics jargon – “footprint” 

is endogenous to the regulation. 

4. The fuel economy savings calculation assumes no baseline growth in the fuel 

efficiency of vehicles absent the regulation. Is this assumption backed by empirical 

evidence? 

5. Many commenters suggest deleting 7.1.3 of the technical assessment. GDP doesn’t 

have anything to do with this ruling. 

6. The agencies highlight the specific role of vehicle electrification, hydrogen fuel-cells, 

and flex fuel vehicles in the analysis. Would this approach capture how the agencies 
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2

would treat vehicles fueled exclusively by natural gas or bio-fuels? Specifying the 

approach for these vehicles would be a useful addition. 

7. Pages 22-23/Other Key Issue—Duration of NHTSA CAFÉ Standards: The document 

provides: “EPCA/EISA states that ‘The Secretary [of Transportation] shall . . . issue 

regulations under this title prescribing average fuel economy standards for at least 1, 

but not more than 5, model years.’ NHTSA is assessing how rulemaking will be 

structured to support the MYs 2017-2025 National Program.” This discussion might 

be expanded to more clearly seek comment on the concern that if EPA intends to issue 

greenhouse gas standards applicable to nine model years and NHTSA’s will be 

“harmonized” with EPA’s throughout, won’t that force NHTSA to somewhat prejudge 

what the standards should be for years following MY 2021? To do so, EPA and the 

National Highway Traffic Safety Administration may add a final sentence to this 

discussion: “In particular, we are examining how to ensure that CAFÉ standards for 

MY 2021 – MY 2025, while harmonized with final EPA greenhouse gas emissions 

standards, would still meet the independent standards development framework of the 

EPCA/EISA.” 

8. Page 7/Background on the MY 2012-2016 National Program/First Paragraph/Fourth 

Line from the Bottom: The text refers to “reductions in the rate of global 

warming.” A commenter suggested that the term “climate change” is now the 

preferred Administration term as it more accurately reflects the observed phenomenon. 

9. Page 6: Recommend adding language from Presidential Memo: 

“On May 21, 2010, President Obama issued a Presidential Memorandum requesting 

that the Environmental Protection Agency (EPA) and the National Highway Traffic 

Safety Administration (NHTSA), on behalf of the Department of Transportation, take 

“...additional coordinated steps...to produce a new generation of clean vehicles...” 

noting that the “...success of our efforts to achieve enhanced energy security and to 

protect the environment ... depends upon the development of infrastructure and 

promotion of fuels, including biofuels, which will enable the development and 

widespread deployment of advanced technologies.”

He specifically requested that the agencies develop “,..a coordinated national 

program under the CAA [Clean Air Act] and the EISA[Energy Independence and 

Security Act of 2007] to improve fuel efficiency and to reduce greenhouse gas 

emissions of passenger cars..”

10. Page 22: Recommend adding flexibility to conduct lifecycle assessment of biofuel 

use: 

“...Some manufacturers encouraged EPA to continue to offer flexible fuel vehicle 

(FFV) credits. EPA finalized provisions in the MYs 2012-2016 Final Rule to treat 

MY 2016 and later FFVs similarly to conventional fueled vehicles, in that FFV 
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emissions would be based on actual CO2 results from emissions testing on the fuels on 

which it operates.1

 In calculating the emissions performance of an FFV, 

manufacturers may base FFV emissions in part on vehicle emissions test results on the 

alternative fuel, if they can demonstrate that the alternative fuel is actually being used 

in the vehicles. EPA will consider whether it is appropriate to retain this approach for 

FFVs or adopt another approach which accounts for upstream emissions and carbon 

sequestration in the MYs 2017-2025 rulemaking. NHTSA will continue to provide 

incentives for dual fueled vehicles as defined in statute.2

 For all dual fueled vehicles, 

except for electric dual fueled vehicles, the maximum increase in average fuel 

economy for a manufacturer will be 0.6 mpg in 2017, 0.4 mpg in 2018, 0.2 mpg in 

2019, and there is no incentive in MY 2020 or after...” 

COMMENTS ON TECHNICAL ASSESSMENT 

1) The discussion in section 6.2, Analytical Approach, on pages 1 to 6 of Chapter 6 

 concerning the technical assessment evaluation as a single industry wide fleet, 

irrespective of individual manufacturer differences and not accounting for the more 

prescriptive CAFE statutory requirements under EPCA and EISA should also be 

highlighted (more briefly) in the executive summary before the “fundamental 

quantitative conclusions from the initial assessment” are presented. 

2) Page 12 in Chapter 2, last sentence: “Finally, the UAW raised some concerns with the 

future projections contained in the Energy Information Administration’s Annual 

Energy Outlook reports and the accuracy of those reports projections regarding future 

improvements in fuel economy absent new standards.” 

The description of the UAW comment on EIA’s AEO projections should be 

more informative. Is the UAW concerned with the level of EIA’s AEO assumptions 

on future fuel economy improvement absent new standards, or are they concerned 

with past AEOs not accurately predicting vehicle fuel economy improvements absent 

such new standards? Some additional description of why this comment is pertinent 

to the technical assessment would be useful. 

3) Page 9 in Chapter 3, second paragraph. This paragraph should include additional 

description of the mass reduction cost curve used in the technical assessment given the 

significant impact these assumptions have on the preliminary assessment results, and 

because of the significant change in the mass reduction cost assumptions from the 

 

1

 See 75 FR at 25434. 

2

 See 49 U.S.C. 32905 and 49 U.S.C. 32906 
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2012-2016 FRM. The discussion of the costs for HEV, PHEV, EV includes a 

discussion of battery manufacturing costs that are quite detailed in this chapter. For 

the reasons described above, the mass reduction cost assumptions should be presented 

in a similar manner. 

4) Page 6 in Chapter 6, last two sentences of the first paragraph should be revised from: 

“As discussed in Chapter 3, NHTSA and EPA have undertaken a number of important, 

new safety-focused analyses to inform the future joint Federal rulemaking. The two 

agencies will include a detailed assessment of safety impacts at that time.” 

To: “As discussed in Chapter 3, NHTSA, EPA, and DOE have undertaken a 

number of important, new safety-focused analyses to inform the future joint Federal 

rulemaking. The NHTSA and EPA will include a detailed assessment of safety 

impacts at that time.” 

5) Page 10 in Chapter 6, last sentences of the first paragraph should be revised from: “As 

discussed in Chapter 3, NHTSA and EPA have a number of on-going projects in this 

area which will inform the future joint federal rulemaking.” 

To: “As discussed in Chapter 3, NHTSA, EPA, and DOE have a number of ongoing projects in this area which will inform the future joint federal rulemaking.” 

6) Section 4 pg. 23. Comment recommends that further explanation be provided that the 

chart showing hydrogen fuel cell government support options is just illustrative and 

does not necessarily reflect a recommendation that specific policies should be adopted 

at this time. The current language about how “other policies or requirements may be 

necessary as shown in the three scenario table above” might be read to suggest that the 

table represents some kind of Administration position or proposal. 

7) Page 73: Add FFVs 

“...EPA will be fully evaluating this issue for the MY 2017-2025 light-duty vehicle 

GHG emissions proposal based on the status of commercialization of EVs, PHEVs, 

and FCVs, and FFVs the potential of these technologies to provide long-term GHG 

emissions savings, the status of and outlook for upstream GHG control programs, and 

other relevant factors...” 

8) A1 Appendix A: The Baseline and Reference Vehicle Fleet 

Are these assumptions the same as in the RFS11 RIA regarding sales of FFV’s? If not 

please explain why not. 
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Please find below a few suggested edits to the draft NOI. 

I. Introduction 

This joint Notice announces plans by the Environmental Protection Agency (EPA) and 

the National Highway Traffic Safety Administration (NHTSA), on behalf of the Department 

of Transportation, to propose stringent federal greenhouse gas and fuel economy standards for 

light-duty vehicles for the 2017-2025 model years (MY) as part of a coordinated National 

Program. This rulemaking will build on the first phase of the National Program for fuel 

economy and greenhouse gas (GHG) emissions standards, for MY 2012-2016 vehicles, which 

was issued in April 2010.3

 This Notice of Intent does not propose specific standards, but 

along with the accompanying Interim Joint Technical Assessment Report (TAR) discussed 

later in this Notice, is an important step in the process that will lead to a formal proposal. 

NHTSA and EPA welcome comment on all aspects of this Notice and the 

accompanying TAR. Although this Notice discusses important initial assessments 

performed by the agencies, it also discusses the significant additional work that must be done 

to provide the agencies with information to support a joint Notice of Proposed Rulemaking 

(NPRM). EPA and NHTSA will continue to seek input from a broad range of stakeholders 

over the coming months, and we will continue to work closely with the California Air 

Resources Board (CARB) in order to ensure the continuation of a National Program. In an 

effort to guide the eventual development of the NPRM, over the next two months, EPA and 

NHTSA, working closely with CARB, will continue to analyze potential GHG and fuel 

economy standards for MYs 2017-2025 by developing and reviewing additional technical 

data and information and by considering additional stakeholder input. Based on this 

additional work, EPA and NHTSA expect to issue, by November 30, 2010, a Supplemental 

Notice of Intent that will describe further design elements for the National Program and 

present an updated analysis of potential stringencies for model years 2017-2025 standards for 

GHGs and fuel economy. A principle principal goal of the Supplemental Notice will be to 

narrow the range of potential stringencies for the future proposed standards, as well as to 

reflect new technical data and information and, as appropriate, further analysis supplementing 

the Interim Joint TAR. In recent months, the agencies have had important discussions with 

many individual automobile manufacturers and other stakeholders, and our intention is to 

continue such discussions. In order for comments to be most helpful to this ongoing process, 

the agencies encourage parties wishing to comment at this stage of the process to submit their 

comments by the end of October, 2010. The May 21, 2010 Presidential Memorandum 

discussed below called for EPA and NHTSA to include in this Notice of Intent a “schedule 

for setting those standards as expeditiously as possible, consistent with providing sufficient 

 

3

 See 75 FR 25324 (May 7, 2010). 
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leadtime to vehicle manufacturers.” The agencies plan to issue a joint Notice of Proposed 

Rulemaking (NPRM) by September 30, 2011 and a Final Rule by July 31, 2012. 

As with any notice-and-comment rulemaking process, the agencies will provide full 

opportunity for the public to participate in the rulemaking process, consistent with the 

Administrative Procedure Act, other applicable law, and Administration policies on openness 

and transparency in government.4

 EPA and NHTSA have established dockets to receive such 

information: EPA’s Docket is located at Docket ID No. EPA-HQ-OAR-2010-0799 and 

NHTSA’s docket is located at Docket ID No. NHTSA-2010-0131. The “Addresses” section 

at the beginning of this Notice provides several methods for submitting information into these 

dockets. 

A. President’s May 21, 2010 Memorandum 

On May 21, 2010, President Obama issued a Presidential Memorandum requesting 

that the Environmental Protection Agency (EPA) and the National Highway Traffic Safety 

Administration (NHTSA), on behalf of the Department of Transportation, take “...additional 

coordinated steps...to produce a new generation of clean vehicles.” He specifically requested 

that the agencies develop “,..a coordinated national program under the CAA [Clean Air Act] 

and the EISA[Energy Independence and Security Act of 2007] to improve fuel efficiency and 

to reduce greenhouse gas emissions of passenger cars and light-duty trucks of model years 

2017-2025.”5

 The President recognized that by acting expeditiously, our country could take a 

leadership role in addressing the global challenges of improving energy security, promoting 

economic growth, and reducing greenhouse gas pollution, stating that “America has the 

opportunity to lead the world in the development of a new generation of clean cars and trucks 

through innovative technologies and manufacturing that will spur economic growth and 

create high-quality domestic jobs, enhance our energy security, and improve our 

environment.” 

 As a first step in the process, the President requested EPA and NHTSA to “[t]ake 

all measures consistent with law to issue by September 30, 2010, a Notice of Intent to Issue a 

Proposed Rule that announces plans for setting stringent fuel economy and greenhouse gas 

emissions standards for light-duty vehicles of model year 2017 and beyond, including plans 

for initiating joint rulemaking and gathering any additional information needed to support 

regulatory action. The Notice should describe the key elements of the program that the EPA 

 

4

 Upon publication of the NPRM, the agencies will open a public comment period for receiving written 

comments and will hold at least one joint public hearing to receive oral comments. We will announce all of 

these avenues for public involvement in the Federal Register notice announcing the NPRM and we will post this 

information on each agency’s website associated with this rulemaking. 

5

 The Presidential Memorandum is found at: http://www.whitehouse.gov/the-press-office/presidentialmemorandum-regarding-fuel-efficiency-standards. 
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and the NHTSA intend jointly to propose, under their respective statutory authorities, 

including potential standards that could be practicably implemented nationally for the 2017-

2025 model years and a schedule for setting those standards as expeditiously as possible, 

consistent with providing sufficient lead time to vehicle manufacturers.” 

The Presidential Memorandum also called on the agencies, working with the State of 

California, to develop a technical assessment to inform a potential rulemaking. The EPA, 

NHTSA, and CARB have completed this assessment, which is discussed in Section I.E 

below. 

B. Background on the MY 2012-2016 National Program 

On April 1, 2010, NHTSA and EPA issued joint final rules establishing standards for 

GHG emissions and fuel economy for MYs 2012-2016 passenger cars, light-duty-trucks, and 

medium-duty passenger vehicles (“light-duty vehicles”), collectively referred to as the 

National Program.6

 The agencies concluded that the automobile industry will achieve the 

substantial benefits of that first phase of the National Program based on technology that is 

already being commercially applied in many cases and that can be incorporated in these future 

model year vehicles at a reasonable expense and with social benefits far in excess of social 

costscost. This initial phase of the National Program will result in large fuel savings and large

reductions in GHG emissions and oil use, and thus in increased energy security and reductions 

in the rate of global warming. This joint rulemaking was consistent with the President’s 

announcement on May 19, 2009 of a National Fuel Efficiency Policy for establishing 

consistent, harmonized, and streamlined requirements that would reduce GHG emissions and 

improve fuel economy for new cars and light trucks sold in the United States. 

In this recent rulemaking, EPA and NHTSA established two separate but harmonized 

sets of standards, each under its respective statutory authorities.7

 The standards for both 

agencies begin with model year 2012, with standards increasing in stringency through model 

year 2016. EPA set national CO2 emissions standards for light-duty vehicles under section 

202(a) of the Clean Air Act (CAA), and NHTSA set corporate average fuel economy (CAFE) 

standards in accordance with the Energy Policy and Conservation Act (EPCA), as amended 

by the Energy Independence and Security Act of 2007 (EISA). The EPA standards will 

require light-duty vehicles to meet an estimated combined average emissions level of 250 

grams/mile of CO2 in model year 2016,equivalent to a fuel economy level of 35.5 miles per 

gallon if all the reductions were achieved through improvements in fuel economy. The CO2 

standards also allow manufacturers to earn credits for air conditioning system improvements 

that reduce GHGs other than CO2. 

 

6

 The joint final rules were published at 75 Fed. Reg. 25324 (May 7, 2010). 7

 For a detailed discussion of NHTSA’s and EPA’s respective statutory authorities, see 75 Fed. Reg. 25324, 

25348 (May 7, 2010) and 74 Fed. Reg. 49454, 49460 (September 28, 2009). 
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The NHTSA CAFE standards are only based on technologies that improve fuel 

economy and are not based on consideration of air conditioning improvements (which 

NHTSA cannot consider given that the federal test procedures used to calculate fuel economy 

for passenger cars may not include air conditioning usage). The maximum feasible CAFE 

standards should require manufacturers of passenger cars and light trucks to meet an 

estimated combined average fuel economy level of 34.1 mpg in model year 2016. These 

standards represent a harmonized approach that will allow industry to build a single national 

fleet that will satisfy both the GHG requirements under the CAA and CAFE requirements 

under EPCA/EISA. 

The NHTSA and EPA standards were informed in part by state regulatory action. In 

2004, the California Air Resources Board (CARB) adopted GHG standards for new light-duty 

vehicles covering MYs 2009-2016. Subsequently, thirteen states and the District of 

Columbia, comprising approximately 40 percent of the light-duty vehicle market, have 

adopted California’s standards. On June 30, 2009, EPA granted California’s request for a 

waiver of preemption under section 209 (b) of the CAA.8

 The granting of the waiver allows 

California and the other states to proceed with implementing the California emission 

standards. To promote the National Program for MYs 2012-2016 vehicles, in April 2010 

California revised its GHG emissions program for MYs 2012-2016 vehicles such that 

compliance with EPA’s GHG standards will be deemed to be compliance with California’s 

GHG emission standards.9

 This action makes it possible for automakers to produce a single 

fleet of vehicles nationwide that meets all the requirements of the two federal programs as 

well as those of the California program. 

As described in the recent final rule, EPA and NHTSA expect that automobile 

manufacturers will meet the MYs 2012-2016 CAFE and GHG standards primarily by using 

currently-available technologies, and simply incorporating these technologies more broadly 

across the light-duty vehicle fleet. These technologies include improvements to engines, 

transmissions, and vehicles, including increased use of start-stop technology, improvements in 

air conditioning systems, and increased use of hybrid and other advanced technologies. The 

program also provides incentives for the initial commercialization of electric vehicles and 

plug-in hybrids. NHTSA’s and EPA’s assessment of likely vehicle technologies that 

manufacturers could employ to meet the MYs 2012-2016 standards provides an important 

foundation for the agencies’ consideration of potential 2017-2025 standards. 

The MY 2012-2016 standards also provide a number of compliance flexibilities to 

manufacturers. These flexibilities are discussed further in Section III.B below. As noted, the 

benefits of these standards far exceed the costs.

 

8

 See 74 Fed Reg 32744, July 8, 2009. 

9

 See CARB April 1, 2010 action at http://www.arb.ca.gov/regact/2010/ghgpv10/ghgpv10.htm. 
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C. Stakeholder Support for Continuing the National Program in 2017 and Beyond 

During the public comment period for the MY 2012-2016 proposed rulemaking, many 

stakeholders strongly encouraged EPA and NHTSA to begin working toward standards for 

MY 2017 and beyond that would maintain a single nationwide program. Following the 

President’s May announcement, several major automobile manufacturers and the CARB sent 

letters to EPA and NHTSA in support of the 2017 to 2025 MY rulemaking initiative outlined 

in the President’s Memorandum.10

D. Presidential Memorandum’s Request for EPA, NHTSA, and California to Develop a 

Technical Assessment 

In addition to the President’s request for EPA and NHTSA to issue this Notice 

announcing plans “for setting stringent fuel economy and greenhouse gas emissions standards 

for light-duty vehicles of model year 2017 and beyond,” the May 21, 2010 Presidential 

Memorandum also requested that the agencies work with the State of California to develop a 

technical assessment to inform the rulemaking process. The memorandum states that the 

report should reflect input from an array of stakeholders on relevant factors, including “viable 

technologies, costs, benefits, lead time to develop and deploy new and emerging technologies, 

incentives and other flexibilities to encourage development and deployment of new and 

emerging technologies, impacts on jobs and the automotive manufacturing base in the United 

States, and infrastructure for advanced vehicle technologies.”11 

EPA and NHTSA have worked collaboratively with CARB to develop this technical 

assessment based on currently available data, consistent with the President’s request. The 

agencies are releasing an Interim Joint Technical Assessment Report (TAR) in conjunction 

with this Notice.12 The TAR provides an initial technical assessment for this Notice and 

discusses the significant additional technical information and analysis that will be needed to 

support the rulemaking development process. While the TAR is an important step in a 

continuation of the National Program, significant work remains to be done to support a future 

federal rulemaking, as discussed below in Section I.E.4. The key elements and findings of the 

TAR are discussed further in this Notice. 

 

10 These commitment letters are posted at http://www.epa.gov/otaq/climate/regulations.htm and at 

http://www.nhtsa.gov/Laws+&+Regulations/CAFE+-+Fuel+Economy/Stakeholder+Committment+Letters. 11 Presidential Memorandum, section 2(a). 

12 “Interim Joint Technical Assessment Report: Light-Duty Vehicle Greenhouse Gas Emission Standards and 

Corporate Average Fuel Economy Standards for Model Years 2017-2025,” issued jointly by EPA, NHTSA and 

CARB, September 2010. Available at [add web site links]. 
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1. Stakeholder Outreach Conducted to Inform the Technical Assessment 

During June through August 2010, EPA, NHTSA, and CARB held numerous 

meetings with a wide variety of stakeholders to gather input to consider in developing the 

TAR, and to ensure that the agencies had available to them the most recent technical 

information. These stakeholders included the automobile original equipment manufacturers 

(OEMs), automotive suppliers, non-governmental organizations, states and state 

organizations, infrastructure providers, and labor unions. The agencies sought these 

stakeholders’ technical input and perspectives, consistent with the President’s request, on the 

key issues that should be considered in assessing a continued National Program to reduce 

greenhouse gas emissions and improve fuel economy for light-duty vehicles in model years 

2017-2025. The input from these stakeholders is discussed in detail in Chapter 2 of the TAR. 

In response to the agencies’ request, OEMs provided detailed and confidential input 

regarding several key areas including technology development, key regulatory design 

elements, infrastructure issues, perspective on the impacts on the U.S. manufacturing base and 

jobs, costs, and potential regulatory incentives and flexibilities. A common theme across the 

auto firms is that they are all heavily investing in advanced technologies including hybrids 

(HEVs), plug-in hybrid electric vehicles (PHEVs), electric vehicles (EVs), next generation 

internal combustion engines, and mass reduction technologies, and companies expect to 

increase their offerings and sales of these technologies significantly in the future. The 

companies generally stated, however, that the degree to which these advanced technologies 

will penetrate the U.S. market in the MYs 2017-2025 timeframe cannot be foreseen in 

advance and is dependent upon a number of challenges and factors, including future gasoline 

fuel prices, future decreases in battery costs, future regulatory fuel economy/GHG 

requirements, and government incentives for vehicle purchasers and owners such as the 

existing tax credits for EVs and PHEVs. EPA, NHTSA and CARB also met with a cross 

section of automotive suppliers as well as advanced technology infrastructure providers. 

The agencies also requested input from numerous non-governmental organizations, 

including environmental organizations and labor organizations, and from state and local 

governments and their organizations. All of tThese stakeholders strongly supported the 

President’s call for continuing the National Program approach and setting new fuel economy 

and greenhouse gas standards for light-duty vehicles for the 2017-2025 model years. Chapter 

2 of the TAR provides an overview of the input we received during discussions with these 

organizations. 

2. Overview of Initial Assessment of Available Technologies, Costs, Technology 

Effectiveness, and Lead-time 

EPA and NHTSA, working with CARB, have conducted an initial assessment of the 

expected technology costs, effectiveness, and lead-time for potential MYs 2017-2025 GHG 

emission standards and the equivalent fuel economy. The agencies and CARB assessed over 
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30 vehicle technologies that manufacturers could use to improve the fuel economy and reduce 

the CO2 emissions of their vehicles during MYs 2017-2025. The technologies considered fall 

into five broad categories: engine technologies, transmission technologies, vehicle 

technologies (including mass reduction), electrification/accessory technologies, and 

hybrid/vehicle electrification technologies. The agencies and CARB considered not only 

technologies that are readily available today, but also other technologies that may not 

currently be in production but are beyond the research phase and under development, and 

which are expected to be in production in the MYs 2017-2025 timeframe. Although the 

prediction of the impacts of new technology up to 15 years in the future is inherently 

uncertain, tThe agencies and CARB have initially determined that there are a wide range of 

technologies capable of achieving significant reductions in CO2 emissions and significant 

improvements in fuel economy and available at reasonable costs in the 2017 to 2025 MY 

timeframe. 

Consistent with stakeholder input obtained over the summer, we believe that in addition to 

advanced gasoline and diesel vehicles, electric drive vehicles can be an important part of the 

vehicle mix that will likely be used to meet future fuel economy and GHG emission 

standards. Electric drive vehicles including HEVs, PHEVs, EVs, and hydrogen fuel cell 

vehicles (FCVs), can dramatically reduce petroleum consumption and tailpipe GHG 

emissions compared to conventional technologies. 

The initial assessment by EPA, NHTSA, and CARB of technology, costs, effectiveness,

and lead-time issues is presented in Chapter 3 of the TAR. The TAR introduces a number of 

new studies that are in progress and several that have been completed since the 2012-2016 

MY light duty vehicle rule was issued. These studies have resulted in new estimates for costs 

and effectiveness for a number of technologies including engines, transmissions, batteries, 

and mass reduction. All of these are critical technologies in the 2017-2025 MY timeframe. 

The agencies and CARB expect to update these estimates going forward as more information 

becomes available from on-going studies of technology, effectiveness, and costs, as well as 

mass reduction and safety, as discussed in Section I.E.4 below. 

3. Other Issues Addressed in the Technical Assessment 

Beyond the issues of the technology, cost, effectiveness, and lead time for potential 

MYs 2017-2025 standards, the Presidential Memorandum requested that the technical 

assessment include input on some other areas, including impacts on jobs and the automotive 

manufacturing sector, and infrastructure for advanced vehicle technologies. 

In the TAR, the agencies and CARB include a discussion of input from stakeholders, 

including the OEMs and labor unions, on the potential impacts of standards on jobs and the 

automotive sector. Several OEMs and the labor unions noted that Federal government 

Recovery Act investments, as well as incentives provided by some state and local 

governments, were an important factor in locating manufacturing operations for advanced 

Formatted: Indent: First line: 0.25"
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battery, electric motor, and vehicle assembly plants in the U.S., and that continuation of this 

type of investment would be an important consideration to in the decision whether to 

locateing future facilities in the U.S. Chapter 7 of the TAR also includes a discussion of the 

key issues surrounding the potential employment impacts of more stringent light duty vehicle 

GHG and fuel economy standards. With the global drivers of competitiveness and increased 

importance of clean and efficient technologies, auto companies have already begun to invest 

in new technologies that can help meet future GHG/fuel economy standards. These 

investments will help the U.S. auto sector to stay on the cutting edge of auto technology. The 

agencies expect that the new standards will have effects on vehicle sales. For the forthcoming 

rulemaking, EPA and NHTSA will further investigate the impacts of the proposed standards 

on the auto industry, including employment, and the domestic economy in general. 

The TAR also includes a discussion of the electric charging and infrastructure 

development needed to support successful deployment of certain types of advanced 

technology vehicles. In the case of EVs and PHEVs, electric charging systems are needed to 

facilitate market penetration of these vehicle technologies. Based onOn the basis of

stakeholder input, the agencies expect that these charging systems are will be located most 

often at homes. In addition, charging systems at workplaces and potentially also at public 

facilities such as parking lots or retail stores could become important enablers for significant 

market penetration of these vehicles. In the case of fuel cell vehicles, hydrogen fueling 

stations are needed to support commercialization. Chapter 4 of the TAR provides an 

assessment of current charging systems and infrastructure technologies and costs, prospects 

for technology improvement, infrastructure deployment programs underway, and further 

infrastructure needs. The agencies and CARB worked closely with the Department of Energy 

(DOE) in our assessment of infrastructure issues, as well as other aspects of the TAR. 

The TAR also includes an initial assessment of the costs, benefits, and technology that 

could be used to achieve a range of potential future stringencies, as discussed in section II.A 

below. SHOULDN’T WE HAVE A BRIEF SUMMART OF THAT ASSESSMENT HERE?

4. Future Technical Work and Analysis for the Joint Federal Rulemaking 

The two agencies have a number of significant, on-going projects which that will 

inform the joint proposed rule for MYs 2017-2025 vehicles. These include new technical 

assessments of advanced gasoline, diesel, and hybrid vehicle technology effectiveness; 

several new projects to evaluate the cost, feasibility, and safety impacts of mass reduction 

from vehicles; and an ongoing project to improve our cost estimates for advanced 

technologies.13 For the MYs 2017-2025 rulemaking, NHTSA and EPA will conduct an 

analysis of the effects of the proposed standards on vehicle safety, including societal effects. 

 

13 This ongoing work is discussed in Chapter 3 of the TAR. 
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EPA and NHTSA are coordinating with CARB on their study of the safety effects of a future 

vehicle designed for high levels of mass reduction. In addition, EPA and NHTSA will 

continue to meet with and consider input from the full range of stakeholders as we develop 

the joint Federal rulemaking. All of this future information will enhance the accuracy of our 

technological assessment. 

II. Key Elements of the MY 2017-2025 National Program 

A. Initial Assessment of a Range of Potential MY 2017-2025 GHG and CAFE Scenarios 

1. Overview of Scenarios Analyzed and the Agencies’ Approach to the Analysis 

In the technical assessment, the agencies and CARB conducted an initial fleet-level 

analysis of improvements in overall average GHG emissions and fuel economy levels. We 

analyzed a range of potential stringencies for model years 2020 and 2025. Specifically, we 

analyzed four potential GHG targets, representing a 3, 4, 5, and 6 percent per year decrease in 

GHG levels from the MY 2016 fleet-wide average of 250 gram/mile (g/mi). Thus, the MY 

2025 targets analyzed range from 190 g/mi (equivalent to 47 mpg) under the 3 percent per 

year reduction scenario to 143 g/mi (equivalent to 62 mpg) under the 6 percent per year 

scenario.14 For purposes of an initial assessment, this range represents a reasonably broad 

range of stringency increases for potential future GHG emissions standards and is also 

consistent with the increases suggested by CARB in its letter of commitment in response to 

the President’s memorandum. 

The specific average required GHG and MPG equivalent levels analyzed are shown in 

Table 1: 

Table 1: GHG and MPG Equivalent Levels Analyzed for Scenarios1

 

Scenario Level in MY 2025 

(gram CO2/mile 

MPGequivalent 

3% per year 190 47 

4% per year 173 51 

 

14 The modeled stringencies, like the EPA’s MY 2012-2016 standards, include the potential use of air 

conditioning emission reductions, estimated at 15 grams (compared to a 2008 baseline) in 2025 for all four 

technology paths. The estimates for further air conditioning reductions are largely due to an anticipated increase 

in the use of alternative refrigerants. 
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5% per year 158 56 

6% per year 143 62 

1. Real-world CO2 is typically 25 percent higher and real-world fuel economy is typically 20 percent 

lower. Thus the 3% to 6% range evaluated in this assessment would span a range of real-world fuel 

economy values of approximately 37 to 50 mpg, which correspond to the regulatory test procedure 

values of 47 to 62, respectively. 

For each of these levels of stringency, we also analyzed four “technological pathways” 

by which they could be met. We chose this “technological pathway” approach to capture both 

the diversity in strategies expressed by OEMs in this summer’s stakeholder meetings, and 

uncertainties in forecasting 10-15 years into the future the potential costs and use of various 

advanced technologies in the light-duty vehicle fleet. We defined each of these technology 

pathways to emphasize a different mix of advanced technologies, by assuming various 

degrees of penetration of advanced gasoline technologies, mass reduction, hybrids, plug-in 

hybrids, and electric vehicles. For purposes of the assessment, the agencies denominated the 

pathways as Pathway A, Pathway B, Pathway C and Pathway D, respectively. 

 Pathway A represents an approach where the industry focuses on HEVs, with 

less reliance on advanced gasoline vehicles and mass reduction, relative to 

Pathways B and C. 

 Pathway C represents an approach where the industry focuses most on 

advanced gasoline vehicles and mass reduction, and to a lesser extent on 

HEVs. 

 Pathway B represents an approach where the industry utilizes advanced 

gasoline vehicles and mass reduction at a more moderate level, higher than in 

Pathway A but less than in Pathway C. 

 Pathway D represents an approach where the industry focuses on the use of 

PHEV, EV, and HEV technology, and relies less on advanced gasoline 

vehicles and mass reduction.15 

All four of these technology pathways include significant amounts of mass reduction, 

relative to 2008 model year vehicles, ranging from 15 to 30 percent in 2025. The ability of 

the industry to reduce mass at the higher end of this range, while not adversely affecting 

safety and other vehicle attributes, is an open technical issue which the agencies are carefully 

evaluating and will continue to as we move forward. The agencies and CARB note that these 

 

15 Further information on the four technology pathways is provided in Section II.A.3. below and Section 6.3 of 

the TAR. 
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pathways are meant to represent ways that manufacturers could respond to eventual standards, 

and do not represent ways that they must or necessarily will respond to those standards. We 

further believe it is appropriate to consider more than one potential technology pathway, since 

technology is difficult to predict in advance, and since NHTSA, EPA, and CARB have ongoing technology cost, effectiveness, and safety work which has not been completed, as 

discussed further in Section I.E.4 above. 

For this initial assessment, we analyzed the vehicle fleet as one single industry-wide 

fleet, irrespective of individual manufacturer differences. This analysis focuses on the 

technology itself, independent of the individual manufacturer, and produces results that 

indicate how the single fleet could hypothetically achieve greater GHG reductions and 

improved fuel economy in the most efficient manner. Treating the entire fleet as a single fleet 

assumes, for example, averaging GHG performance across all vehicle platforms is possible 

irrespective of who the individual manufacturer is for a particular vehicle platform. This can 

be thought of as analyzing the fleet as if there was a single large manufacturer, instead of 

multiple individual manufacturers. In addition, this analysis assumes there are no statutory or 

other limits on manufacturers’ ability to transfer credits between passenger car and light truck 

fleets, no limits on the ability to trade credits between manufacturers, and that all 

manufacturers fully utilize such flexibilities with no transfer costs in doing so. This approach 

also allows an assessment to be performed without consideration of the particular shapes of 

the passenger car and light truck attribute-based curves. 

These analyses build upon methods and information applied for the final rule for MY 

2012-2016 vehicles, as well as updated forecasts of the future light-duty vehicle fleet, updated 

projections of technology costs and effectiveness, and updates to several key inputs such as 

fuel prices16 and vehicle miles traveled projections.17 We did not explicitly model any 

crediting schemes in this analysis. However the assumption of full car-truck credit transfer 

and inter-manufacturer trading is inherent in analyzing a single industry-wide fleet. Air 

conditioning emission reductions were also accounted for, as a fundamental component of 

EPA’s MYs 2012-2016 program. The agencies used the OMEGA model, developed by EPA 

for the MY 2012-2016 light-duty vehicle rulemaking.18 The key inputs for this analysis (e.g., 

the technology costs and effectiveness) are a result of the joint technical assessment of EPA, 

CARB, and NHTSA, as described in Chapter 3 of the TAR. 

 

16 The fuel prices used are based on the Energy Information Administration’s Annual Energy Outlook 2010, 

which includes an estimated gasoline price in 2025 of approximately $3.50 per gallon. 17 See the TAR, Chapter 3 for a full discussion of technology costs and effectiveness, Chapter 6 for a full 

description of the modeling methods, Appendix A for a description of the future vehicle fleet projections, and 

Appendix E for the key inputs used in the modeling analysis. 

18 See 75 Fed. Reg. at 25446 (May 7, 2010). 

Comment [A1]: Explain what attributes standards 

and curves mean? This precedes the discussion of 

attribute-based standards, so this will confuse anyone 

not intimately familiar with the previous rulemaking. 

Please expand here what this means. 
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EPA and NHTSA believe that the approach used for these analyses permits an

tentative, initial, and highly approximate evaluation of the potential costs and benefits of the 

fleetwide stringency levels modeled. This approach incorporates significant simplifying 

assumptions that are useful for this initial assessment. However, the simplified analyses 

would not be appropriate in the context of the future joint federal rulemaking, taking into 

account each agency’s respective statutory requirements. Consequently, in the full 

rulemaking analysis, both EPA and NHTSA will perform additional analyses before 

proposing standards. These simplifying assumptions and their relationship to the future 

federal rulemaking are discussed in detail in Section II.A.4 below and in Chapter 6 of the 

TAR. 

2. Summary of Preliminary Costs and Benefits for Potential Scenarios 

The agencies and CARB assessed four scenarios for potential fleet-wide average GHG 

levels, with annual CO2 reductions in the range of 3 to 6 percent per year, which would be 

equivalent to 47 to 62 mpg if all improvements were due to fuel-economy improving 

technologies, for MY 2025 light-duty vehicles, and four potential technology pathways, as 

described above, for each of these stringency levels. We evaluated the costs and benefits of 

these scenarios based on five broad metrics: increased cost per vehicle, lifetime fuel 

reductions, lifetime greenhouse gas reductions, consumer net lifetime savings, and payback 

period. 

The results presented in Tables 2 and 3 indicate that substantial reductions in fuel 

consumption and GHGs can be achieved with the use of advanced technologies. The 

preliminary estimated per-vehicle cost increases for a MY 2025 vehicle ranged from $770 to 

$3,500 across the range of stringency targets and technology pathways. Due to the fuel 

savings consumers experience by purchasing vehicles with improved fuel economy, the net 

lifetime owner savings would be $5,000 to $7,400, or a payback period of 1.4 to 4.2 years, for 

these same scenarios.19 The aggregate fuel reductions achieved by these scenarios would 

range from 0.7 to 1.3 billion barrels over the lifetime of MY 2025 vehicles.

20. Total 

greenhouse gas reductions would range from 340 to 590 million metric tons (MMT) over the 

lifetime of MY 2025 vehicles, depending on the stringency target and technology pathway.21

(It is important to recognize that the preliminary estimates in Tables 2 and 3 do not include all 

relevant costs, which will be analyzed in detail in connection with the rulemaking.)

 

19 The gasoline price used for this estimate is $3.49/gallon in 2025 and increases over time to a maximum of 

$4.34/gallon in 2050 

20 For comparison, the MY 2016 standards by themselves are projected to result in fuel reductions of 0.6 billion 

barrels and CO2-e reductions of 325 million metric tons (MMT) over the lifetime of MY 2016 vehicles. 

21 While fuel savings are the same for each technology pathway at a given stringency level, CO2 reductions vary 

as a function of the penetration of PHEVs and EVs projected for a given technology pathway, due to an increase 

in upstream CO2 emissions. 
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Table 2: Projections for MY 2025 Preliminary Per-Vehicle Cost Estimates, 

Vehicle Owner Payback, and Net Owner Lifetime Savings 1

Scenario 

Technology 

Path 

Preliminary 

Per-Vehicle 

Cost Estimates 

($) 

Payback 

Period 

(years) 

Net Lifetime 

Owner Savings 

($) 

3%/year 

A $930 1.6 $5,000 

B $850 1.5 $5,100 

C $770 1.4 $5,200 

 D $1,050 1.9 $4,900 

4%/year 

A $1,700 2.5 $5,900 

B $1,500 2.2 $6,000 

C $1,400 1.9 $6,200 

 D $1,900 2.9 $5,300 

5%/year 

A $2,500 3.1 $6,500 

B $2,300 2.8 $6,700 

C $2,100 2.5 $7,000 

 D $2,600 3.6 $5,500 

6%/year 

A $3,500 4.1 $6,200 

B $3,200 3.7 $6,600 

C $2,800 3.1 $7,400 

 D $3,400 4.2 $5,700 

1. Per-vehicle costs represent the increase in costs to consumers from the MY 2016 standards. 

Payback period and lifetime owner savings use a 3% discount rate and AEO 2010 reference case 

energy prices. The gasoline price used for this estimate is $3.49/gallon in 2025 and increases over 

time to a maximum of $4.34/gallon in 2050. 

Table 3: Estimated Total CO2e and Fuel Reductions for the Lifetime of MY 2025 

Vehicles1,2

Scenario 

Lifetime CO2e 

Reduction 

(million metric 

tons, MMT) 

Lifetime Fuel 

Reduction 

(Billion Barrels) 

3%/year 340 0.7 

4%/year 440 0.9 

5%/year 520-530 1.1 

6%/year 530-590 1.3 

Comment [A2]: What about including the MY 

2020 estimates in this NOI for those technology 

paths (A-C) where it’s available? Wouldn’t this 

dampen the criticism that EPA/DOT’s analysis 

focuses on a model year 15 years in the future that 

many of the car companies say they have trouble 

predicting? 

Comment [A3]: Suggest noting that the total 

CO2 and fuel reductions that will be achieved by the 

program are significantly greater than the MY 2025 

vehicle lifetime reductions alone. 
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1. Fuel reductions are the same for each of the four technology pathways, but CO2e reductions vary as a 

function of the penetration of EVs and PHEVs in each of the four technology pathways evaluated (due to an 

increase in upstream emissions). 

2. For reference, the National Program in MY 2016 is projected to reduce 0.6 billion barrels of fuel and 325 

MMT CO2e over the lifetime of MY2016 vehicles. 

The results presented for this initial assessment represent what the agencies expect a 

hypothetical full-line vehicle manufacturer could achieve, if the composition of the 

manufacturer’s fleet has the same vehicle types and sales mix as the aggregate fleet and the 

availability, cost, and effectiveness of various technologies are the same as estimated in this 

assessment. Note that the results presented here assume trading between auto firms, which

may or may not occur in the future. The results also assume that the transfer of credits 

between car and light truck fleets are unlimited, whereas there are statutory limits for CAFE. 

Among actual full-line vehicle manufacturers, we expect that a manufacturer-specific 

assessment based on footprint-attribute standard curves will result in costs which are in 

aggregate higher than those presented here and will be higher for some manufacturers and 

lower for others due to the differences among their offerings. With respect to smaller volume 

manufacturers and very low volume manufacturers (many of whom only produce highperformance luxury vehicles), the agencies would expect that, in general, the level of 

technology they would require and the costs they would incur would generally be higher than 

for full line manufacturers. 

In the full analysis for the rulemaking, as required by EPCA/EISA and as permitted by the 

CAA, the agencies will make more refined assessments, including separate analyses for car 

and light truck vehicle fleets, year-by-year attribute-based standards, and manufacturerspecific estimates of potential attribute-based standard targets and costs, and other statutory 

requirements. NHTSA and EPA also will perform a more thorough assessment of the impacts 

of proposed standards, as was done for the MY 2012-2016 rulemaking, including analysis of 

improved energy security, monetized benefits of CO2 reductions, co-pollutant impacts, an 

assessment of the societal costs and benefits of potential standards, an assessment of potential 

safety impacts, an assessment of impacts on automobile sales and related employment, and 

other relevant impacts. 

3. Potential Technology Penetration Estimates for Various Pathways 

As described above, the agencies and CARB analyzed four potential technology 

pathways to achieve more stringent targets, recognizing there are a wide range of pathways 

manufacturers could pursue. To illustrate several alternative ways that the industry as a whole 

could achieve a given level of stringency, each of these four technology pathways was applied 

to each of the four stringency targets. As noted above, Pathway A focuses on HEVs, Pathway 

C focuses most on advanced gasoline vehicles and mass reduction, Pathway B represents a 

more moderate level of advanced gasoline vehicles, between Pathway A and Pathway C, and 

Comment [A4]: Same comment as above. 

Without full explanation of attribute- or footprintbased standards, this will confuse some people. 

Possible to simplify? 

Comment [A5]: Suggest being as specific as 

possible about why (and in what way) we think costs 

would be higher on aggregate than shown here. For 

example, it seems from this sentence that we think 

our cost assessment for the rulemaking will be 

higher, but isn’t it possible that technology costs 

estimates will come down and counteract the effect 

of constraints on trading, etc? Can we instead say 

more specifically that incorporating constraints on 

transfers/trading (or transaction costs, etc.) would 

increase our cost estimates slightly? 
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Pathway D focuses most on PHEV, EV, and HEV technology.22 The results of the 

assessment presented in the TAR are presented in Table 4. 

Table 4: Technology Penetration Estimates for MY 2025 Vehicle Fleet 

Scenario 

Technology 

Path 

New Vehicle Fleet Technology Penetration 

Mass 

Reduction1

Gasoline & 

Diesel 

Vehicles HEVs PHEVs2 EVs 

3%/year 

Path A 15% 89% 11% 0% 0% 

Path B 18% 97% 3% 0% 0% 

Path C 18% 97% 3% 0% 0% 

 Path D 15% 75% 25% 0% 0% 

4%/year 

Path A 15% 65% 34% 0% 0% 

Path B 20% 82% 18% 0% 0% 

Path C 25% 97% 3% 0% 0% 

 Path D 15% 55% 41% 0% 4% 

5%/year 

Path A 15% 35% 65% 0% 1% 

Path B 20% 56% 43% 0% 1% 

Path C 25% 74% 25% 0% 0% 

 Path D 15% 41% 49% 0% 10% 

6%/year 

Path A 14% 23% 68% 2% 7% 

Path B 19% 48% 43% 2% 7% 

Path C 26% 53% 44% 0% 4% 

 Path D 14% 29% 55% 2% 14% 

1. Mass reduction is the overall reduction of the 2025 fleet relative to MY 2008 vehicles. 

2. Our assessment considered both PHEVs and EVs. These initial results indicate a higher relative percent 

of EVs compared to PHEVs. The agencies do believe that PHEV technology may be used more 

broadly than what this analysis indicates. 

The penetration of HEVs, EVs, and PHEV in MY 2025 varies considerably depending 

on the technology pathway and scenario, as can be seen in Table 4. As discussed in Chapter 

6.3 of the TAR, Pathway A is intended to portray a technology path focused on HEV 

technology, with less reliance on advanced gasoline vehicles mass reduction, relative to 

Pathways B and C. Thus, in the 3%/year scenario, Pathway A results in 11% HEV 

penetration, and the most stringent 6% scenario increases HEV penetration to 68% for Path A, 

all with approximately a 15% reduction in mass for the new vehicle fleet. Pathway C 

represents an approach where the industry focuses most on advanced gasoline vehicles and 

mass reduction, and to a lesser extent on HEVs, resulting in a penetration of HEVs that ranges 

from 3% up to 44% of the new vehicle fleet. Given the approach that Pathway C represents, 

 

22 Further description of these technology pathways can be found in Chapter 6 of the TAR. 
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the penetration of gasoline and diesel vehicles for each of the stringency scenarios is highest 

for Pathway C, as is the degree of mass reduction. Pathway B represents an approach where 

advanced gasoline vehicles and mass reduction are utilized at a more moderate level, higher 

than for Pathway A but less than for Pathway C. Pathway D represents an approach focused 

on the use of PHEV, EV, and HEV technology, and less reliance on advanced gasoline 

vehicle and mass reduction. 

4. Future Analysis of Potential Standards for MY 2017-2025 

The agencies emphasize that the analysis presented in this notice, while reasonable for 

conducting an initial assessment, is a first step. Much more work must be completed for the 

upcoming NPRM. As noted above, we expect to issue updated assessments by November 30 

of this year. The upcoming rulemaking to develop the next phase of the National Program 

will be based on a full analysis that is consistent with both the statutory framework that 

NHTSA must account for, and the flexibilities that EPA may account for, just as the detailed 

analysis for the MYs 2012-2016 was conducted.23 While the single fleet analysis approach 

simplifies some aspects of the analysis and offers some advantages, there are also important 

limitations which will be addressed during the rulemaking process. 

For the same reasons discussed in detail in the MYs 2012-2016 rulemaking, NHTSA 

and EPA expect to develop new standards for CAFE and GHG emissions that are consistent 

with each other and can be met by each auto manufacturer through the production of one 

single fleet. NHTSA and EPA believe the TAR provides a useful means of comparing the 

scenarios discussed above. 

As the agencies proceed to develop a joint proposed rulemaking for light-duty vehicle 

GHG emissions and fuel economy, we will continue technical and policy discussions with a 

broad range of stakeholders. We expect to gain information through these conversations, as 

well as from ongoing technical assessments by the agencies and other parties, that will build 

on the work presented in this Notice and the TAR as we continue to respond to the May 21, 

2010 Presidential Memorandum. 

B. Form of the Standards, Compliance and Flexibilities, and Other Key Elements 

EPA and NHTSA sought initial input about the appropriate design of a MYs 2017-

2025 National Program from a range of stakeholders. Most of the program design input that 

we have received to date has come from OEMs, although many of their suggestions relate to 

specific potential compliance strategies that the companies consider confidential. However, 

there was consensus among all stakeholders that a National Program should continue, and that 

 

23 For further information on the kinds of comprehensive analyses performed for the MYs 2012-2016 

rulemaking, see 75 Fed. Reg. at 25348-396. 
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the program’s design should allow a single national fleet to comply with federal GHG 

standards, federal CAFE standards, and California GHG standards. 

1. Form of the Standards 

In the future rulemaking, the agencies plan to continue an attribute-based approach to 

setting the MYs 2017-2025 standards, as was done for the MYs 2012-2016 program and as 

required for CAFE standards per EPCA/EISA. In our outreach with stakeholders, we heard 

general support for continuing an attribute-based approach and for continuing to use vehicle 

footprint as the attribute. Under an attribute-based standard, each manufacturer has a required 

GHG and CAFE fleet average unique to its fleet, depending on the attributes and production 

levels of the vehicle models that a manufacturer produces. The MYs 2012-2016 rule was 

based on vehicle footprint, which is essentially the area enclosed by the points at which the 

four wheels meet the ground. In developing a proposed rule, we plan to consider continuing 

the footprint-based attribute, for which most stakeholders generally offered support. 

A key consideration for the MYs 2017-2025 standards that has not yet been addressed 

will be development of the separate attribute-based standards, or “curves,” for passenger cars 

and light trucks. The attribute-based curves for passenger cars and light trucks essentially 

assign a GHG/fuel economy level or “target” to an individual vehicle’s footprint value. For 

each manufacturer, the CO2/mpg values are then weighted, based on that manufacturer’s 

production mix to determine that manufacturer’s fleet average standard for its cars and trucks. 

Compliance is determined by comparing the actual CO2 or mpg values for the vehicles, 

production-weighted, to this fleet average standard. 

In developing the MYs 2012-2016 footprint-based curves, the agencies considered 

many key issues, including the steepness of the slopes of the curves and the difference 

between the car and truck curves for vehicles of the same footprint. We expect that these 

issues will again be key considerations in developing the methodology and the shape of the 

curves for the MYs 2017-2025 standards. Several OEMs expressed support for the 

continuation of separate attribute-based standards for cars and trucks, which is required for 

CAFE standards under EPCA/EISA and which the agencies will also evaluate further for the 

rulemaking. 

2. Potential Regulatory Flexibilities 

During the agencies’ outreach discussions with stakeholders, manufacturers provided 

early input that several of the flexibility provisions in place for MYs 2012-2016 should be 

retained for MY 2017 and later. Environmental groups also provided early input, as discussed 

below. As EPA and NHTSA develop the proposal for the MYs 2017-2025 program, the 

agencies will continue to consider the potential need for and benefits of incentives and 

flexibility provisions beyond those mandated by statute. The agencies will consider whether 

and how some of the flexibility provisions included in the MYs 2012-2016 program might be 
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applied to the new program and if appropriate expanded, consistent with each agency’s 

statutory authority. 

Some manufacturers encouraged EPA to continue to offer flexible fuel vehicle (FFV) 

credits. EPA finalized provisions in the MYs 2012-2016 Final Rule to treat MY 2016 and 

later FFVs similarly to conventional fueled vehicles, in that FFV emissions would be based 

on actual CO2 results from emissions testing on the fuels on which it operates.24 In 

calculating the emissions performance of an FFV, manufacturers may base FFV emissions in 

part on vehicle emissions test results on the alternative fuel, if they can demonstrate that the 

alternative fuel is actually being used in the vehicles. EPA will consider whether it is 

appropriate to retain this approach in the MYs 2017-2025 rulemaking. NHTSA will continue 

to provide incentives for dual fueled vehicles as defined in statute.25 For all dual fueled 

vehicles, except for electric dual fueled vehicles, the maximum increase in average fuel 

economy for a manufacturer will be 0.6 mpg in 2017, 0.4 mpg in 2018, 0.2 mpg in 2019, and 

there is no incentive in MY 2020 or after. 

 

24 See 75 FR at 25434. 

25 See 49 U.S.C. 32905 and 49 U.S.C. 32906 

Comment [A6]: This incentive probably needs 

better explanation.