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1 ENVIRONMENTAL PROTECTION AGENCY 

2 - - - 

3 PUBLIC COMMENT HEARING REGARDING WAIVER REQUEST 

4 FOR CALIFORNIA'S ADVANCED CLEAN CAR PROGRAM 

5 - - - 

6 Docket No. EPA-HQ-OAR-2012-0562 

7

8 Room 154 

9 1310 L Street, N.W. 

10 Washington, D.C. 

11 Wednesday, September 19, 2012 

12

13 The meeting was convened, pursuant to notice, at 

14 9:10 a.m., MARGO OGE presiding. 

15 PANEL MEMBERS: 

16 MARGO OGE, Presiding Officer 

17 JANET COHEN 

18 DAVID DICKINSON 

19 MICHAEL HOROWITZ 

20

21

22
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1 P R O C E E D I N G S 

2 (9:10 a.m.) 

3 MS. OGE: Good morning. Can you hear me? 

4 I'd like to welcome you to this hearing. The 

5 purpose of the hearing is to receive oral testimony 

6 regarding EPA's consideration of whether to waive Clean 

7 Air Act preemption of California's Advanced Clean Car 

8 program. This is a package of regulations containing 

9 amendments to California's Low Emission Vehicle program, 

10 or as otherwise known, the LEV III program. These 

11 regulations address smog-forming pollutants, greenhouse 

12 gas emissions, and amendments to its Zero Emission Vehicle 

13 Program, or ZEV. 

14 My name is Margo Oge. I'm the Director of the 

15 Office of Transportation and Air Quality, and I will be 

16 the Presiding Officer for today's hearing. On the panel 

17 with me, we have most of our members -- we are missing 

18 one. But let me introduce them: Janet Cohen on my right; 

19 Dave Dickinson. Both of them are with the Compliance 

20 Division. And when Michael Horowitz makes it -- I guess 

21 the trains are backed up today -- he is representing the 

22 Office of General Counsel and he will be a member of the 
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1 panel. 

2 We appreciate that a number of you, at least our 

3 California colleagues, have traveled from far away to 

4 participate in the hearing today. We recognize the 

5 significance of the hearing today for the state of 

6 California. We recognize that other states are interested 

7 in this issue, as well as industry, environmental groups, 

8 and private citizens. So I'm pleased that we have wide 

9 representation of various stakeholders at the hearing 

10 today. 

11 On June 27, 2012, the California Air Resources 

12 Board requested that EPA waive preemption of California's 

13 Advanced Clean Car program. Also, CARB seeks confirmation 

14 that its ZEV amendments are within the scope of the 

15 previously granted waiver by EPA. 

16 We are conducting this hearing in accordance 

17 with Section 209(b) of the Clean Air Act, and this hearing 

18 provides the forum for interested persons to submit oral 

19 presentations. 

20 We are having this hearing recorded and the 

21 transcript will be available for at the EPA docket, and 

22 you can find the specific information from one of my 
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1 colleagues. 

2 This hearing will be conducted informally and 

3 formal rules of evidence do not apply. However, as the 

4 Presiding Officer I'm authorized to strike from the record 

5 statements that I believe are irrelevant or needlessly 

6 repetitious and to enforce a reasonable time of the 

7 duration of any of the statements of any witness. 

8 So the witnesses are requested to state their 

9 names and affiliation prior to making their oral 

10 statement. When a witness has finished his or her 

11 presentation, members of this panel may ask questions of 

12 clarification for the record. 

13 At the conclusion of all oral presentations, 

14 CARB may respond briefly to oral statements of other 

15 parties. So that will take place at the end of all the 

16 oral presentations, if CARB feels that you need to do so. 

17 So finally, I will remind people that our 

18 Federal Register notice announcing this hearing includes a 

19 docket along with how to access CARB's waiver request and 

20 the supporting documents that go along with the request. 

21 CARB -- in the same docket, also you will find CARB's 

22 plans to adopt a "deemed to comply" provision of the 
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1 greenhouse gas standards. 

2 With that, I'm going to call the California 

3 panel to testify. I have Mr. Tom Cackette and his 

4 colleagues. Tom, before you start, if you don't mind for 

5 the recorder to have the names of your colleagues. 

6 PRESENTATION OF THE CALIFORNIA AIR RESOURCES BOARD 

7 MR. CACKETTE: I will do that. 

8 Good morning. Good morning and thank you very 

9 much for the opportunity to present our case for achieving 

10 a waiver of the Advanced Clean Car program. Usually we 

11 have one or two people here, but we thought we'd try to at 

12 least match you in numbers and we have a team of four 

13 people here today. 

14 PRESIDING OFFICER OGE: That's a good match. 

15 MR. CACKETTE: Here's the names of the people. 

16 I'm Tom Cackette. I'm the Deputy Director of the Air 

17 Resources Board, and I'm going to present an overview of 

18 the standards. Then Aron Livingston, our Assistant Chief 

19 Counsel, will talk about the criteria and framework for 

20 granting a waiver, and in particular will address the two 

21 first elements of the waiver, protectiveness and 

22 compelling and extraordinary conditions. 
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1 Then we'll turn it over to Paul Hughes from our 

2 Mobile Source Control Division, who will talk about the 

3 LEV III, which are the criteria and greenhouse gas 

4 emission standards that we're seeking the waiver for. 

5 Then Analisa Bevan, also from our Mobile Source Control 

6 Division, will talk about the amendments to the ZEV 

7 program; and finally, I'll just have a few concluding 

8 remarks. So we do a little shuffling here. 

9 Give me a second here while I get my computer 

10 going. 

11 (Screen.) 

12 MR. CACKETTE: This is a package of regulations 

13 that we're seeking a waiver for. I'll talk about this in 

14 three elements here. The first one is the LEV portion and 

15 that includes both the criteria pollutant standards that 

16 we've adopted and also the greenhouse gas emissions 

17 standards. 

18 (Screen.) 

19 The second part is the ZEV program. We've had a 

20 ZEV program for a long time. We've had waivers for it in 

21 the past and we've made amendments that increase the 

22 number of ZEVs that will be required to be produced in 
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1 California over the next coming decade or so. It's a 

2 technology-forcing element, whereas the LEV program is 

3 much more in the area of revisions to conventional 

4 technologies. 

5 (Screen.) 

6 The objective of the ZEV part is to get enough 

7 vehicles in the marketplace in order to achieve 

8 commercialization of these technologies, which we believe 

9 will be necessary for meeting our long-term goals. 

10 Finally, a third element is what's called clean 

11 fuel outlet. It's a regulation which I'm presenting here 

12 just as part of the package so you can see how they all 

13 work together. But it provides the fueling infrastructure 

14 necessary for the enhanced technology vehicles under the 

15 ZEV program. And we're not seeking a waiver for this 

16 because we don't need a waiver for this one. 

17 (Screen.) 

18 We'll start out with what the goals are here. 

19 As you know, California still has serious air quality 

20 problems. It made tremendous progress, as you can see 

21 from the graph on the upper right-hand corner. In fact, 

22 in the past 20 years we have cut ozone concentrations by I 
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1 think it's around 40 percent or so, and that's been 

2 despite the fact that we've had PMT and population growth 

3 in that time frame of about 25 percent. So this is a 

4 clear success story. 

5 We've also focused a lot on reducing the 

6 localized exposure of penone and other toxics to people 

7 who live close to where vehicles congregate. 

8 Our objective is also to ensure 

9 commercialization of the ultra-clean vehicles because 

10 we're going to need those in the future in order to meet 

11 our greenhouse gas goals, which this Governor, Governor 

12 Brown, and our previous Governor Schwarzenegger have both 

13 adopted under executive orders directing the state to 

14 achieve an 80 percent reduction in greenhouse gas 

15 emissions by 2050. So this is a multi-pollutant set of 

16 packages oriented at achieving these two separate goals, 

17 but doing it in a coordinated manner. 

18 (Screen.) 

19 This is the standards that we've adopted for the 

20 LEV criteria pollutant portion of the regulation. You can 

21 see that the standards become more stringent every year 

22 between 2015, and in 2025 the standard is now a combined 
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1 standard of NMOG or what we call hydrocarbons and NOx. We 

2 maintain the separate truck and passenger car -- passenger 

3 car standards, but as you can see they join in 2025 and 

4 everything at that point becomes what we call a SULEV, and 

5 this is about a 75 percent reduction in emissions. 

6 The significant amount of time here is in part 

7 to coordinate this, these standards, with the greenhouse 

8 gas standard so there can be a logical role-in of the new 

9 technologies. We've also recognized some of the interests 

10 of the car companies, who wanted to see a pooling concept 

11 used in the 177 states that follow these rules. I think 

12 there's like 13 or 14 states that follow California's 

13 program. This allows -- it's easier to comply, so you 

14 don't have a state by state compliance issue. Even though 

15 that's worked quite well in the past, it'll make 

16 compliance easier for the manufacturers. 

17 We also extended the durability to 150,000 

18 miles. It goes along with being a SULEV, to help ensure 

19 that the vehicles actually maintain their emissions over 

20 their full life. 

21 (Screen.) 

22 For the proposed or the adopted standards that 
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1 we're seeking a waiver for, we already have 20 percent of 

2 all the vehicles offered in the state of California meet 

3 the 2025 standard. They're SULEVs today. Even SUVs can 

4 meet them, as shown by the picture of the GM Traverse 

5 there. So we think this is clearly a technologically 

6 feasible standard, and we have again provided a long lead 

7 time to make sure that everybody can do this smoothly and 

8 do it in coordination with the greenhouse gas standards. 

9 (Screen.) 

10 We've also adopted PM standards, shown on this 

11 graph. The current PM standard is in red and you'll see 

12 that the new LEV III PM standards go down in two phases -- 

13 again, a long lead time -- a three milligram standard, 

14 2017, starting in 2017, and then a one milligram standard 

15 starting in 2025. The one milligram standard is designed 

16 to ensure that new and emerging technologies, such as a 

17 gasoline direct-injection engines, have emission levels 

18 that are no greater than the current port fuel injected 

19 and diesel engines. 

20 We are convinced that the final -- we're working 

21 with the manufacturers -- that the final standard even as 

22 far out as 2025 is going to be feasible, probably well 
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1 before then, and they have raised a number of issues 

2 about: you can't measure it, it's too small to be 

3 measured. We are working with the industry. I have to 

4 say -- I'd say we are probably between 75 and 90 percent 

5 there in terms of being able to measure the mass at one 

6 milligram per mile, which was the one barrier to effective 

7 implementation of the standard, but not until 2025. 

8 (Screen.) 

9 Now moving on to the greenhouse gas standards, 

10 this chart shows the fleet average standard and separate 

11 car and truck standards as they decline all the way from 

12 2010 through 2015. You could see the -- '16, actually. 

13 You could see the previously adopted rule, which is in 

14 line with the federal regulation, largely in line with the 

15 California program, and then the adopted regulation 

16 starting in 2017 and beyond. 

17 You can see the gradual reduction there until we 

18 achieve a 34 percent reduction in GHG emissions compared 

19 to the currently adopted standards, and it's over 50 

20 percent quicker than the pre-control area before 2010. 

21 We're using the footprint standards. This is a 

22 4.6 percent improvement per year, declining to 166 grams 
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1 per mile. This should look very familiar to you because 

2 these are the same greenhouse gas standards that EPA 

3 adopted in August. 

4 (Screen.) 

5 There are some differences in the California 

6 regulation from the final adopted EPA regulation. Just a 

7 couple of them are listed here. Most of them are minor. 

8 Upstream greenhouse gas emissions on some of the advanced 

9 technology vehicles, the ZEV-like technologies, are not 

10 included in determining compliance with the federal rule, 

11 but they are included in determining compliance with the 

12 California rule. 

13 There are some vehicle multipliers for advanced 

14 technology vehicles under the federal rule, which act as 

15 an incentive to introduce these vehicles. We did not 

16 include those in our rule because we have the ZEV program 

17 which provides a different kind of incentive for 

18 introducing those vehicles. 

19 There are minor differences in how the credits 

20 are earned for off-cycle and air conditioning 

21 technologies. Some of these were acknowledged up front. 

22 Other ones are because EPA changed their final rule from 
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1 the proposal and so there are minor differences here. 

2 (Screen.) 

3 However, we've continued to deliver on our 

4 promises to align this as much as possible. So, 

5 notwithstanding the differences, we've continued to work 

6 with both federal agencies and the auto industry. The 

7 rule as we have it now is very close and very closely 

8 parallels federal regulation adopted in August, and as a 

9 result we believe that it will have very similar 

10 effectiveness to our rule. 

11 We therefore are following through on our 

12 commitment to adopt a "deemed to comply" provision. It's 

13 been proposed already and will be considered by our Board 

14 in November. What the "deemed to comply" provision means 

15 is that if an auto manufacturer chooses to comply with the 

16 federal rules, they send us a certificate and that will 

17 satisfy California rules. The California rules will still 

18 stay on the books and still be somewhat different. If a 

19 manufacturer wanted to comply with California rules, they 

20 could do that, but we don't really think that will happen. 

21 But we want to be clear that we are not taking 

22 the steps to make the California rule look identical word 
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1 for word to what the federal rule is. But from the 

2 manufacturers' standpoint, the "deemed to comply" will 

3 allow them to meet just one standard nationwide. 

4 We also recognize the importance of the mid-term 

5 review that was agreed to as part of the negotiations on 

6 the federal rule and the California rule, and we are fully 

7 willing and set up to participate with the federal 

8 agencies to be part of that mid-term review. Some of the 

9 work is starting already, even though the review won't be 

10 done until 2018, and we will be there side by side with 

11 our partner the federal agencies to do that. 

12 We also, by the way, are going to be doing a 

13 review of the ZEV program in the same time frame, 

14 California-unique, but again following through on our idea 

15 that this has to be a comprehensive and integrated 

16 approach to clean air for the future. 

17 (Screen.) 

18 Skipping now to the ZEV amendments, this chart 

19 shows you how we've increased the requirements for ZEV, 

20 starting in 2018 all the way through 2025, again to 

21 provide a launch point in a commercialization that would 

22 allow ZEV technologies to become the dominant technology 
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1 of the future out towards 2050, because that simply is 

2 what will have to happen if we're going to meet out 

3 greenhouse gas goals. 

4 This is based on the likely mix. We give 

5 different credits for ZEVs versus battery electric 

6 vehicles, than we do for fuel cells, than we do for plug7 in vehicles, based on their environmental performance, and 

8 so we've taken guesses as to how manufacturers will meet 

9 this requirement and, as you can see, based on our guess 

10 as to the mix, about 15 percent or one out of seven or so 

11 vehicles sold in California in 2025 will be a ZEV-type 

12 vehicle. 

13 So, with that I'm going to turn it over to Aron 

14 Livingston, our Assistant Chief Counsel, and he's going to 

15 talk about the waiver criteria. Aron. 

16 (Screen.) 

17 MR. LIVINGSTON: Thank you, Tom. 

18 I'm going to go over -- I'm going to go over the 

19 waiver criteria and the first two prongs of that, the 

20 protectiveness and the conditions justifying our program. 

21 There are only three issues before EPA today in reviewing 

22 our request for the waiver. The first is the 
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1 protectiveness prong, which is: Was California arbitrary 

2 and capricious in its determination that its program is at 

3 least as protective as the federal program? The second 

4 prong is that California continues to have compelling and 

5 extraordinary conditions justifying our program, our motor 

6 vehicle program. Then the last, which is the traditional 

7 test and focus of these waiver proceedings, is the 

8 consistency with Clean Air Act Section 202(a), which 

9 focuses on technological feasibility and lead time, with 

10 consideration to costs. 

11 As EPA reviews our submissions and others that 

12 may come up today, the burden is on the opponents of our 

13 waiver to overcome the presumption that we've presented 

14 enough evidence to you to show that we indeed meet all 

15 those prongs. When EPA does that, they tend to give 

16 deference to California's judgments, especially as to 

17 policy matters and the cost effectiveness determinations 

18 that California makes. 

19 (Screen.) 

20 First on protectiveness, it requires clear and 

21 compelling evidence to the contrary to deny our waiver. 

22 So this is a high burden and we've provided more than a 
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1 rational basis and enough to show EPA that we have 

2 slightly more stringent criteria standards coming up, we 

3 have a few California-federal differences that Tom pointed 

4 out that would make ours more stringent than the federal 

5 GHG standard if manufacturers decided to stick with our 

6 program and didn't do the opt-in to the "deemed to comply" 

7 rule. And we're slightly more protective as a whole even 

8 if all the manufacturers choose the national program 

9 option, because we do have the additional requirement for 

10 ZEVs in California. 

11 (Screen.) 

12 So the next and second prong is that, of the 

13 waiver analysis, is that California continues to have 

14 compelling and extraordinary conditions justifying our 

15 program. California has had a longstanding and continuing 

16 problem with the conditions that are conducive to air 

17 pollution, especially in the South Coast Basin. The 

18 topography, the number of vehicles, the population, the 

19 vehicle miles traveled, and now climate is exacerbating 

20 those effects. EPA did a very thorough analysis of this 

21 in the first GHG waiver approval back in July of 2009. 

22 (Screen.) 
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1 Since that time, there has been increasing 

2 scientific certainty of the effects of global warming and 

3 its impact on rising temperatures and the consequent 

4 impact on ozone levels. So this slide shows that in the 

5 South Coast region in 2050 the orange and red areas could 

6 see levels 9 to 18 parts per billion higher due solely to 

7 global warming. 

8 So that helps to continue to establish the 

9 connection between the criteria pollutant reductions and 

10 also the greenhouse gas reductions that in turn contribute 

11 slightly to the overall reduction in temperatures and 

12 helps to lower ozone impacts that are exacerbated by 

13 global warming. 

14 (Screen.) 

15 Also, since 2009 we've also had more evidence of 

16 wildfire impacts also exacerbated by global warming, and 

17 in turn their impact on particulate emissions. This slide 

18 shows three fire regions in California on the right, with 

19 purple bars for total fires and the area under the red 

20 lines for total area burned. The largest particulate fire 

21 effects are in the already-burdened southern California 

22 region. A 46 to 76 percent particle increase and a 20 to 
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1 27 percent carbon increase at mid-century is what's 

2 predicted, and ozone is also expected to rise a few parts 

3 per billion just due to wildfire effects. 

4 The lower left photo there shows how quick and 

5 intense these fires are becoming. That one closed the 

6 main southern California to Las Vegas highway and forced 

7 1500 home evacuations. We're seeing more of these and 

8 more intense fires. 

9 (Screen.) 

10 Also, back to California's need for its own 

11 program: Some might argue that should our Board approve 

12 the proposed "deemed to comply" rule that there's really 

13 no need for the California program. That's not the legal 

14 test that EPA needs to apply, but this slide also shows 

15 that that's just factually not correct. California's 

16 separate ZEV program is needed to further clean the long17 term light-duty vehicle fleet beyond what federal 

18 standards would require. 

19 These two graphs show on-road battery electric 

20 vehicles, fuel cell vehicles, and plug-in hybrid vehicles 

21 compared to on-road gasoline vehicles meeting the criteria 

22 and greenhouse gas standards presented to you earlier. 
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1 Even on a life cycle basis, plug-in hybrids, battery 

2 electrics, and fuel cell vehicles, as shown in these two 

3 red boxes, are significantly lower emitting in both 

4 criteria pollutants and greenhouse gas emissions. So in 

5 addition this will remain an important backstop in the 

6 event the national program is weakened or terminated, 

7 which we don't expect. 

8 So, introducing the third prong of EPA's review 

9 of California's request, it is consistency with Section 

10 202(a). This is typically a two-prong test: 

11 technological feasibility, has California provided enough 

12 lead time for the technologies to develop over time and if 

13 there are little hurdles along the way, have they 

14 identified what those are and shown a feasible way for 

15 manufacturers to get there. That's closer to the NRDC 

16 test, which is probably a little more applicable in this 

17 case because we're talking about fairly long-term 

18 standards, going out to 2025. 

19 We should note that it's slightly different for 

20 the ZEV, given the scope request for 2012 to 2017. But 

21 we've described the differences on that in our document 

22 that we originally submitted as the basis for the waiver. 
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1 Then the second prong, or the second part of the 

2 consistency test is the test procedure consistency and can 

3 the manufacturer meet the same requirements with the same 

4 test engine. We believe we've shown they can, and Paul 

5 will talk more about that. 

6 I will now turn the presentation over to Paul 

7 and Analisa, who will walk us briefly through the 

8 technological feasibility regarding these LEV III criteria 

9 pollutants and the GHG standards and the ZEV standards, 

10 respectively. So, Paul. 

11 (Screen.) 

12 MR. HUGHES: Good morning. 

13 The emission control technology has dramatically 

14 improved over the last decade and is well understood by 

15 the industry. This slide lists some of the technologies 

16 we expect manufacturers to employ on their vehicles in 

17 meeting the three criteria pollutant requirements, all of 

18 them occurring or employed to varying extents on today's 

19 vehicles. 

20 (Screen.) 

21 It seems I've gone too far. 

22 (Screen.) 
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1 With further improvements in the technology and 

2 combined with an extended phase-in period, plus combined 

3 NMOG plus NOx standards, additional emissions standards, 

4 and significant compliance flexibility, the LEV III 

5 criteria pollutant requirements are clearly technically 

6 feasible. 

7 I might add at this point that several 

8 manufacturers have indicated to us that they intend to 

9 certify LEV III vehicles beginning in model year 2014, 

10 which as you know starts in January of next year, 2013. 

11 (Screen.) 

12 We also have PM standards. They phase in at a 

13 different rate, coming in later than the other criteria 

14 pollutants. These particulate matter standards present 

15 two challenges: first, meeting the standards -- and Tom 

16 alluded to that -- and second, measuring very low 

17 particulate matter levels, which also Tom alluded to. 

18 Concerning the first challenge, meeting the 

19 standard, our test data shows that current port fuel 

20 injection engines are already meeting the one milligram 

21 per mile standard. As Tom indicated earlier, GDI engines 

22 are the most challenged in achieving low particulate 
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1 matter emissions. However, as our test data also shows, 

2 some GDI engines are approaching one milligram per mile 

3 levels today. 

4 With further refinements, such as improved fuel 

5 injectors and their placement in the cylinder head, we are 

6 convinced that technology can achieve the standard given 

7 the 15 years lead time that's been provided to 

8 manufacturers to incorporate needed technical improvements 

9 to their engines. 

10 I might also mention too that LEV III provides a 

11 relaxed in-use standard during the phase-in period for 

12 manufacturers. So that's an additional flexibility that 

13 we're giving to the manufacturers. 

14 Regarding the second challenge, measuring very 

15 low PM levels, we've already incorporated many of the 

16 practices of Part 1066, which is currently under 

17 development by the U.S. EPA, into our laboratory practices 

18 and would incorporate them into our test procedures when 

19 finalized by EPA. We also are working with EPA and the 

20 industry to further refine particulate matter test 

21 protocols. The work completed to date convinces us that 

22 the measurement procedure will not be a barrier to 
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1 complying with the more stringent PM standard. 

2 I might also add here again that one 

3 manufacturer has indicated to us that they will certify at 

4 least one test group to the three milligram per mile 

5 standard in a 2014 model year vehicle. So again, here 

6 we're talking about completing certification for that 

7 vehicle next year. 

8 (Screen.) 

9 Turning to the greenhouse gas element of LEV 

10 III, in the development of the greenhouse gas standard 

11 California participated in a joint technical evaluation 

12 with EPA and NHTSA. This joint effort examined the 

13 effectiveness and cost of a wide range of vehicle 

14 greenhouse gas technologies. Broadly, these technologies 

15 include: improvements in engines and transmissions; 

16 technologies that reduce vehicle energy loads, such as 

17 improved aerodynamics and weight reduction; more efficient 

18 accessories, such as electric water pumps and air 

19 conditioning systems; and the incorporation of hybrid and 

20 electric drive trains. 

21 Similar to the criteria element of LEV III, the 

22 greenhouse gas requirements are phased in over an extended 
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1 period of time, which will assist manufacturers in 

2 managing their resources in implementing program 

3 requirements. 

4 (Screen.) 

5 This slide lists some of the greenhouse gas 

6 technologies that are currently incorporated in vehicles 

7 in increasing numbers in response to current greenhouse 

8 gas requirements. As new greenhouse gas requirements 

9 phase in, these technologies will be employed to an even 

10 greater extent across the light duty fleet. 

11 (Screen.) 

12 Diesel vehicles also have a role in reducing 

13 criteria and greenhouse gas emissions. New and innovative 

14 emission control systems have been developed to reduce 

15 criteria emissions from these vehicles and manufacturers 

16 are working toward achieving SULEV emission levels for 

17 these also. 

18 (Screen.) 

19 Diesel vehicles inherently emit lower CO2 

20 emissions than their gasoline counterparts and with 

21 further improvements in diesel technology can achieve even 

22 lower greenhouse gas emissions levels. 
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1 (Screen.) 

2 From a technology perspective, the California 

3 standards will push many off-the-shelf and emerging 

4 internal combustion technologies into the mainstream. 

5 These new low greenhouse gas technologies include new 

6 sophisticated valve trains, gasoline direct injection, 

7 more downsized and turbocharged engines, transmissions 

8 with more gears and optimized dual-clutch controls, use of 

9 lightweight materials, low rolling resistance ties, 

10 sleeker aerodynamics, and greatly improved accessories. 

11 Increasing use of the cleaner gasoline 

12 technologies is shown in blue on the slide here. In 

13 addition, greenhouse gas standards will also usher in the 

14 initial ramp-up of ultra-low greenhouse gas plug-in 

15 electric and fuel cell vehicles required by the ZEV 

16 regulations, shown in green here. That is critical to 

17 achieving California's climate goals beyond 2025. 

18 I'll now turn it over to Analisa to discuss the 

19 technology feasibility of the ZEV regulations as amended. 

20 (Screen.) 

21 MS. BEVAN: Thank you, Paul. 

22 I'll walk through the high-level amendments and 
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1 technological feasibility of the ZEV regulation. We've 

2 narrowed the types of technologies that can be used to 

3 meet the ZEV regulation to three starting in 2018: 

4 battery electric vehicles, hydrogen fuel cell vehicles, 

5 and plug-in hybrids. 

6 Two other technologies that have been used in 

7 our program historically can continue to be used to comply 

8 with the regulations through 2017, but they've become 

9 fully commercial and we expect them to be used as 

10 compliance strategies in the LEV, GHG and LEV criteria 

11 pollutant programs. These include the advanced technology 

12 partial zero emission vehicles, or conventional hybrids, 

13 and the clean gasoline vehicles, the partial zero emission 

14 vehicles, PZEV. 

15 In making these changes, we also adjusted the 

16 credit relationships between plug-in hybrids and ZEVs and 

17 so it's important that this waiver request is granted in a 

18 timely manner so that the adjustments can take effect so 

19 that the expected vehicle volumes are achieved. 

20 (Screen.) 

21 Regarding technological feasibility, since 1990 

22 battery and fuel cell vehicles have made huge 
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1 technological achievements. No manufacturer has been out 

2 of compliance with the ZEV regulations since the beginning 

3 of the program, since its implementation started in the 

4 mid-2000s, about 2005. Most have overcomplied, creating a 

5 bank of extra credits, and these credits give 

6 manufacturers flexibility when introducing new 

7 technologies in increasing numbers. Every regulated 

8 manufacturer has announced plans to market a ZEV or PHEV, 

9 plug-in hybrid, in the next three model years, in numbers 

10 that surpass the 2015 to 2017 model year requirements. 

11 (Screen.) 

12 As we brought these amendments to our Board in 

13 January, the car companies were no longer arguing the 

14 technologies were not ready for commercial launch. How 

15 could they? With all these cars already available to 

16 consumers now or announced to have production dates in the 

17 near term, two to three years, all the cars listed on this 

18 slide, a wide variety of plug-in hybrids, battery 

19 electrics, and fuel cell vehicles are here or on their way 

20 from all of the regulated manufacturers and several 

21 startups. 

22 (Screen.) 
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1 An additional modification that we've made to 

2 the zero emission vehicle regulation is the inclusion of a 

3 new category called the range extended battery electric 

4 vehicle, or BEVx. We've added this new category, which is 

5 a battery electric vehicle equipped with a small engine 

6 for limited range extension. This is different from plug7 in electric hybrids because they have very limited 

8 gasoline range, and we expect that they will have 

9 considerably increased zero emission miles driven. 

10 We're particularly interested in this because it 

11 provides flexibility for manufacturers as another 

12 compliance option and it has the potential to expand the 

13 BEV market beyond current market estimates by giving 

14 interested consumers an extra measure of confidence about 

15 vehicle range while achieving closer to 100 percent zero 

16 emission miles operation compared to a current plug-in 

17 hybrid. 

18 This amendment also needs a waiver approval to 

19 take effect, allowing introduction and appropriate 

20 treatment in this coming model year. 

21 (Screen.) 

22 We added another provision to increase 
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1 compliance flexibility while encouraging more rapid 

2 compliance with the GHG standards, what we're calling the 

3 GHG overcompliance provision. This supports manufacturers 

4 who have consistently or are consistently overcomplying on 

5 the greenhouse gas fleet average with credits that can be 

6 used to meet a portion of the zero emission vehicle 

7 requirement. The proposal was included in California's 

8 July 28, 2011, commitment letter for the national program. 

9 (Screen.) 

10 California is committed to commercializing zero 

11 emission vehicles far beyond the zero emission vehicle 

12 regulation. 

13 I'm struggling with this mike. 

14 In March of this year, Governor Brown signed 

15 Executive Order B-16-2012, in which it sets the following 

16 goals: 1.5 million ZEVs on California roads by 2025, 

17 infrastructure to support 1 million ZEVs by 2020, and a 

18 requirement that state fleet purchases include 10 percent 

19 ZEVs by 2015 and 25 percent ZEVs by 2020. 

20 We also have a clean vehicle rebate program that 

21 provides $2,500 per zero emission vehicle and $1,500 for 

22 plug-in hybrids. As Tom mentioned, we have a clean fuels 
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1 outlet regulation which ensures infrastructure will be 

2 available for ZEVs, which is particularly important for 

3 hydrogen fuel cell vehicle commercialization. And we have 

4 several public-private partnerships with industry, 

5 nongovernmental organizations, and other government 

6 organizations in both the plug-in vehicle arena and the 

7 fuel cell arena. These are put together to build public 

8 awareness, community-level policies, and with a specific 

9 focus on expanding fuel infrastructure. 

10 (Screen.) 

11 I'll turn now to a summary of a couple of items 

12 that cover the entire suite of programs. First, cost. 

13 All three programs, including the ZEV regulation, result 

14 in an incremental cost increase to the vehicle of $1,900 

15 or an increase of about 8 percent. However, we expect a 

16 payback due to fuel savings within three years, and the 

17 GHG regulation is responsible for the majority of that 

18 vehicle price increase. 

19 This is an appropriate consideration of costs, 

20 showing that they are not prohibitive for manufacturers, 

21 especially since the $1900 figure is for a 2025 model or 

22 2025 models on average and is much lower in the interim 
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1 years. 

2 (Screen.) 

3 Next, we've worked to reduce compliance burdens 

4 as much as possible. We worked with EPA to make the test 

5 procedures as consistent as possible. Manufacturers can 

6 use the same vehicle or engine to meet both federal and 

7 California requirements, using common test cycles and test 

8 procedures. And California will align its test procedures 

9 with any changes to current federal procedures if and when 

10 Tier 3 is finalized by EPA. In addition, we're working 

11 with EPA on our revisions to the test procedures for 

12 hybrid electric vehicles. 

13 With that, I'll turn it back to Tom. 

14 (Screen.) 

15 MR. CACKETTE: Let me wrap it up with a few 

16 slides to summarize what you just heard. We're convinced 

17 that the LEV III criteria pollutants, the NMOG plus NOx 

18 standards, are feasible today. That's because one in five 

19 new vehicles already complies. We give lots of lead time, 

20 12 years before everyone has to be a SULEV for the gaseous 

21 pollutant standards, 15 years for the one milligram PM 

22 standard, and the cost of compliance here is minimal, 
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1 under $100. 

2 (Screen.) 

3 With regard to the greenhouse gas program and 

4 standards, we've demonstrated the feasibility, in 

5 cooperation with you and the TAR, and this has been 

6 documented in separate ARB and EPA rulemakings. There 

7 really is no question regarding the feasibility of these 

8 standards. 

9 The cost is reasonable, certainly higher than 

10 for the LEV program, but the fuel savings payback far 

11 exceeds the costs, up-front costs, and is a net positive 

12 for the consumers who will be driving these vehicles. 

13 On the ZEV program, it's feasible because plug 

14 vehicles are being marketed today, both plug-in hybrid and 

15 battery electric vehicles, and a whole bunch more, as 

16 shown on the chart, coming. Fuel cell vehicles will be 

17 offered by five manufacturers in 2015 and another one in 

18 2016 as they introduce them in commercial, pre-commercial, 

19 or early commercial quantities in California. Overall, 

20 the ZEV program still provides reasonable costs, including 

21 the ZEV program when you put it all together. 

22 (Screen.) 
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1 So in conclusion, the waiver criteria apply to 

2 California's program as a whole. The California program 

3 meets the waiver test now for LEV, both criteria and GHG, 

4 and the ZEV program. The "deemed to comply" program that 

5 we are considering in November is a fulfillment of our 

6 commitment, but it's not needed nor a requirement of the 

7 waiver. The mid-term review we believe we believe is a 

8 very useful step, and if there's any kind of midcourse 

9 corrections needed, working together with federal 

10 agencies, we'll be able to make those. 

11 Because manufacturers are relying on some of the 

12 amendments to our regulations that apply in the 2014 model 

13 year, which is just around the corner -- it starts on 

14 January 1 -- we need EPA to act on this waiver this 

15 calendar year. 

16 That concludes our presentation, and if you have 

17 any questions or anything at this time that would be fine. 

18 PRESIDING OFFICER OGE: Thank you. Do you have 

19 any questions for the California team? 

20 MR. DICKINSON: I just wanted to make sure, to 

21 be clear for the record, that it was Tom Cackette, Aron 

22 Livingston, Paul Hughes, and Analisa Bevans, and then Tom 
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1 Cackette in closing. 

2 MR. CACKETTE: We can repeat it again if you 

3 like. 

4 MR. DICKINSON: No. 

5 Let me thank all of you again for coming up and 

6 traveling through adverse weather. I know that there are 

7 some people that might be returning soon, so let me give a 

8 tacit acknowledgment of that and all the hard work that's 

9 been performed here at EPA and at CARB. 

10 I did have one specific question on the 

11 compelling and extraordinary condition prong. I don't 

12 expect an answer today, but if you could in your written 

13 comments as follow-up clarify whether EPA should be going 

14 under its traditional approach of looking at the need for 

15 the whole motor vehicle program, as opposed to a need for 

16 each individual standard in front of us today. 

17 MR. LIVINGSTON: That's easy. The first. Yes, 

18 the whole program. 

19 MR. DICKINSON: Aron says the whole program, but 

20 I invite comment to that extent. Thank you. 

21 MR. CACKETTE: We'll do that. It's on our 

22 slides just so you know what our position is. But we'll 
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1 be glad to elaborate on that. 

2 Do you want to point out that we sent a whole 

3 team of people here, not just to reward them for all their 

4 hard work, and they have to get other rewards other than 

5 flying to Washington, D.C., in thunderstorms, but because 

6 we consider this to be so important a step here in our 

7 progress towards trying to meet the federal clean air 

8 standards and greenhouse gas standards that we set in 

9 place. 

10 So we appreciate your consideration and your 

11 timely response to our request by the end of the year. 

12 PRESIDING OFFICER OGE: Janet? 

13 MS. COHEN: No. 

14 PRESIDING OFFICER OGE: Tom, I have one 

15 clarification. You have asked EPA to react this year. 

16 Could you elaborate a little bit on what happens starting 

17 January 2013 and the need that CARB is placing on EPA's 

18 prompt reaction this year? 

19 MR. CACKETTE: Well, as we pointed out, several 

20 of the revisions in our regulation involved credits or 

21 incentives for early compliance. As the speakers 

22 indicated, some of the manufacturers have already 
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1 indicated a desire to do things, for example early 

2 compliance with PM standards. There's provisions in the 

3 ZEV program that allow for flexibilities that have been 

4 added into the existing rules, the ones that go through 

5 2017. And all of these need to be covered by a waiver, 

6 and if we don't have a waiver arguably some of these 

7 flexibilities would not be available for manufacturers. 

8 So we would like to see you do that as soon as 

9 possible. Our standards, the basic standards for the LEV 

10 program, the criteria part start in 2015, and of course 

11 that means that vehicles can be produced as of 2014, which 

12 means the manufacturers need to have assurance that they 

13 can go ahead and use these, and some of them want to start 

14 complying in 2013 as 2014 models. 

15 So this program is knitted together in a way to 

16 provide lots of flexibility, to provide lots of phase-in, 

17 to let manufacturers move smoothly from one program to the 

18 next, and having the waiver not occur until afterwards 

19 gets rid of some of that smoothness and creates a 

20 choppiness that takes away the advantages that 

21 manufacturers need to meet these challenging requirements. 

22 PRESIDING OFFICER OGE: Thank you, Tom. 
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1 Clearly, the comment period closes October 19, 

2 2012. We have heard extensive testimony from the state of 

3 California. If there are any additional comments, the 

4 docket stays open for a number of weeks, so we would 

5 invite those comments to be submitted. 

6 Thank you. 

7 MR. CACKETTE: Thank you very much. 

8 PRESIDING OFFICER OGE: Now we'll call -- 

9 continue with the statements and first we will call on our 

10 colleagues from NACAA, NESCAUM, and the Maryland 

11 Department of Environment. Please state your name, 

12 affiliation, and give your testimony. 

13 PRESENTATION OF NATIONAL ASSOCIATION 

14 OF CLEAN AIR AGENCIES 

15 MS. KRUGER: Good morning. 

16 PRESIDING OFFICER OGE: Good morning. 

17 MS. KRUGER: I'm Nancy Kruger, Deputy Director 

18 of NACAA, the National Association of Clean Air Agencies. 

19 I'm here today to offer NACAA's strong support for full 

20 and prompt approval of California's request for a waiver 

21 of federal preemption for its Advanced Clean Car program. 

22 California has traditionally led the national 
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1 effort to reduce air pollution, dating back to 1963 when 

2 it adopted the nation's first motor vehicle emissions 

3 standards. Congress has consistently recognized and 

4 supported California's leadership role in the design of 

5 the Clean Air Act, which specifically authorizes 

6 enforcement of California-developed motor vehicle 

7 standards in California and other states as well. This 

8 provision has benefited greatly not only California, but 

9 the entire nation, in allowing states to serve as 

10 laboratories of innovation. 

11 CARB has requested that EPA grant a waiver of 

12 federal preemption under Section 202(b) of the Clean Air 

13 Act to permit enforcement of the LEV III component of its 

14 Advanced Clean Car program, and also that the agency 

15 confirm that the ZEV program revisions are within the 

16 scope of a previous waiver issued by EPA or, in the 

17 alternative, to issue a waiver for the ZEV revisions. 

18 As established by Congress and interpreted by 

19 EPA over the past 35 years, EPA's role in granting a 

20 waiver to California on a particular motor vehicle 

21 emissions rule is narrow and deferential. The agency must 

22 grant CARB's waiver request unless it can demonstrate that 
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1 the conditions of 209(b) are not met. 

2 First, EPA must grant the waiver unless it can 

3 be shown that CARB acted in an arbitrary and capricious 

4 manner when it determined that the Advanced Clean Car 

5 program did not render CARB's motor vehicle program, 

6 considered as a whole, less protective than the federal 

7 program. Given the fullness of the public process 

8 employed by CARB and the strength of the administrative 

9 record of support for CARB's decision, we believe there is 

10 no basis for EPA to determine that CARB's program and 

11 decisions were arbitrary and capricious. 

12 Second, EPA must grant a waiver unless it 

13 determines that California no longer needs to maintain an 

14 independent motor vehicle emissions program. EPA has 

15 consistently determined, for example in 2003, '05, '06, 

16 '09, and as recently as 2011, that there are compelling 

17 and extraordinary conditions warranting a continuing 

18 California vehicle emissions program. 

19 We believe CARB has documented its continued 

20 struggles to reduce air pollution, particularly pollution 

21 attributed to motor vehicles. There is nothing to suggest 

22 any significant change in circumstance and certainly 
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1 nothing to support a determination that California no 

2 longer needs an independent motor vehicle program. 

3 Third, EPA must grant the waiver unless it 

4 determines that California's motor vehicle program is not 

5 consistent with the requirements of Section 202(a) of the 

6 Clean Air Act, which EPA has agreed concerns technological 

7 feasibility and lead time, with consideration of costs. 

8 Here again, CARB's feasibility analysis, based primarily 

9 upon studies conducted jointly with federal agencies, 

10 including EPA, are comprehensive and robust. 

11 NACAA believes the LEV III program meets all the 

12 statutory conditions for a waiver. Further, we agree with 

13 CARB that the ZEV program revisions fall within the scope 

14 of a previously granted waiver by EPA and that EPA should 

15 confirm this. In the event EPA disagrees that the ZEV 

16 revisions fall within the scope of a prior waiver, the ZEV 

17 revisions also clearly meet the statutory conditions and 

18 EPA should grant a waiver for them. 

19 In the Clean Air Act, Congress finds that the 

20 reduction of air pollution, including that which may have 

21 an effect on climate and weather, is the primary 

22 responsibility of states and local governments. Although 
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1 the Act establishes a federal program to set minimum 

2 requirements to serve as a floor for state regulation, it 

3 specifically authorizes more stringent state regulation. 

4 While consideration of the potential adverse impact on 

5 commerce of many different state standards led Congress to 

6 preempt states other than California from adopting motor 

7 vehicle emissions standards, Congress does in Section 177 

8 of the Act provide that each state can decide whether to 

9 enforce the federal emission standards or the California 

10 standards for new motor vehicles sold in-state. 

11 Over the years, numerous states have recognized 

12 the benefits of California's motor vehicle emissions 

13 standards, including the LEV, ZEV, and greenhouse gas 

14 emissions standards, and have adopted statutes or 

15 regulations that permit enforcement of California's 

16 regulations in their own states. These state programs and 

17 revisions to them cannot be enforced until and unless EPA 

18 grants CARB's request for a waiver. 

19 States that wish to continue to avail themselves 

20 of their statutory authority to approve CARB's -- I'm 

21 sorry -- to approve and adopt and enforce California's 

22 vehicle standards also look to CARB -- to EPA to approve 
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1 CARB's request in a timely fashion, thus ensuring their 

2 rights to protect the health and welfare of their 

3 citizens. 

4 While California has proposed a "deemed to 

5 comply" rule, where California would accept compliance 

6 with national program GHG standards, we believe CARB's 

7 request as submitted meets the conditions for a waiver and 

8 should serve as an important backstop in the event the 

9 national program is either unjustifiably weakened or 

10 terminated. 

11 So in conclusion, CARB's Advanced Clean Car 

12 program and its request for a waiver and a scope-of-the13 waiver determination are clearly in the public interest 

14 and fully consistent with the Clean Air Act, and NACAA 

15 urges EPA to approve CARB's request as quickly as 

16 possible. 

17 Finally, I'd like to say I don't know, Margo, if 

18 this is your last official public hearing or your near 

19 last, but it's truly an honor to be testifying today at 

20 one of your final official acts, and it's been NACAA's 

21 privilege over the past years to work closely with you, 

22 and we will greatly miss you, but you have left your 
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1 indelible mark on this nation's clean air. So thank you 

2 very much. 

3 PRESIDING OFFICER OGE: Thank you. Thank you, 

4 Nancy. 

5 Any questions? 

6 (No response.) 

7 MS. KRUGER: Thank you. 

8 PRESIDING OFFICER OGE: I understand that Matt 

9 Solomon from NESCAUM is here to testify. 

10 PRESENTATION OF NORTHEAST STATES FOR 

11 COORDINATED AIR USE MANAGEMENT 

12 MR. SOLOMON: Good morning. 

13 PRESIDING OFFICER OGE: Good morning. 

14 MR. SOLOMON: My name is Matt Solomon. I am the 

15 Transportation Program Manager for the Northeast states 

16 for Coordinated Air Use Management. NESCAUM is an 

17 association of the air pollution control agencies of 

18 Connecticut, Maine, Massachusetts, New Hampshire, New 

19 Jersey, New York, Rhode Island, and Vermont. 

20 I'm speaking today in support of the request by 

21 the California Air Resources Board for waiver of the 

22 federal preemption for California's Advanced Clean Car 
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1 program. CARB's May 2012 waiver support document provides 

2 a solid demonstration that the standards embodied in the 

3 Advanced Clean Car program meet relevant waiver criteria. 

4 NESCAUM supports California's efforts to move forward 

5 with its standards and we ask EPA to expeditiously approve 

6 California's waiver request. 

7 The criteria for granting or denying a waiver of 

8 federal preemption in accordance with Section 2 of the 

9 Clean Air Act are straightforward and CARB has done a 

10 systematic job of outlining and responding to those 

11 criteria in the current waiver request, as well as in 

12 numerous past requests. Rather than reiterate their 

13 arguments, I will briefly emphasize some of the ways in 

14 which the Advanced Clean Car program benefits 

15 manufacturers, consumers, and the environment while at the 

16 same time supporting the waiver criteria. 

17 The Advanced Clean Car program is more 

18 protective of public health and welfare than the 

19 applicable federal standards. As a result of the new 

20 requirements, criteria pollutant emissions will be reduced 

21 by 75 percent from 2010 levels. Moreover, the 

22 requirements for increased numbers of zero emission 
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1 vehicles will help to facilitate additional reductions 

2 both in criteria and greenhouse gas pollutants in future 

3 years, while putting states on a path towards energy 

4 independence. 

5 California needs separate standards in order to 

6 meet compelling and extraordinary conditions. 

7 California's unique geographical and climatic conditions 

8 demand a higher degree of protection from motor vehicle 

9 emissions. Numerous waivers have been previously granted 

10 on this basis. 

11 The Advanced Clean Car program incorporates long 

12 lead times in conjunction with flexibility mechanisms to 

13 facilitate manufacturer compliance. The amendments to the 

14 ZEV regulations provide manufacturers with a variety of 

15 compliance options. For example, credit requirements for 

16 intermediate volume manufacturers for model years 2015 

17 through 2017 have been reduced and limitations have been 

18 removed on the carrying of ZEV credits forward. The 

19 travel provision for battery electric vehicles has been 

20 extended through model year 2017 and manufacturers may now 

21 choose an optional compliance path that allows for pooling 

22 of credits earned from placement of plug-in hybrids from 
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1 2015 through 2021. 

2 California has also provided additional 

3 compliance flexibility to facilitate achieving SULEV 

4 emission levels across the light-duty fleet. The separate 

5 NMOG and NOx emission standards have been replaced with a 

6 combined standard for these pollutants, allowing 

7 manufacturers greater latitude while still ensuring 

8 reductions in smog-forming emissions. 

9 Implementation of the LEV III exhaust emission 

10 requirements for NMOG and NOx is phased in over an 11-year 

11 period and the accredited mechanism for meeting fleet 

12 average requirements is expanded to include a 5-year 

13 carryforward and a 3-year carryback mechanism. Small 

14 manufacturers are given even greater flexibility in terms 

15 of stringency of the standards and the phase-in period. 

16 Finally, with regards to the evaporative 

17 standards under LEV III, manufacturers are allowed to 

18 phase in separate percentages of their fleets beginning 

19 with 60 percent in 2018, and the 100 percent requirement 

20 extended out to model year 2022. 

21 Granting California the waiver -- excuse me. 

22 Granting the California waiver gives other states a 
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1 critical option for reducing emissions to meet air quality 

2 goals. As you know, Section 177 of the Clean Air Act 

3 allows states to opt in to California's new motor vehicle 

4 emissions program. This option creates an opportunity for 

5 states to achieve additional reductions in criteria and 

6 greenhouse gas emissions in furtherance of their 

7 individual air quality goals. Seven of the eight 

8 states in the NESCAUM region have exercised this option, 

9 as have other states. Granting the waiver means that 

10 states will continue to have these flexibilities in 

11 crafting their air quality plans. 

12 The Advanced Clean Car program will help 

13 facilitate deployment of advanced technology vehicles. 

14 This will expand consumer choice and provide attractive 

15 opportunities for citizens and businesses to send less of 

16 their money to overseas oil producers. Nearly every major 

17 automobile manufacturer has introduced or will be 

18 introducing production BEV and PHEV products within the 

19 next three years and consumers are responding. Year to 

20 date sales of the Chevy Volt have quadrupled from a year 

21 earlier, indicating a strong trend towards increasing 

22 consumer acceptance of advanced technology vehicles. 
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1 Moreover, the NESCAUM states have taken and continue 

2 to pursue measures to facilitate EV commercialization. 

3 The Advanced Clean Car program implemented in 

4 California and the Section 177 states, in conjunction with 

5 increasing consumer acceptance of these advanced 

6 technologies, will send positive market signals to the 

7 auto manufacturing industry, helping to mainstream these 

8 technologies. 

9 Customers in our region want to purchase 

10 advanced vehicles. A recent review by the Center for 

11 Climate and Energy Solutions found potential for strong 

12 growth in demand for plug-in vehicles nationwide and 

13 particularly in the Northeast region. Consumers in the 

14 region have been among the most receptive to advanced 

15 vehicle technologies. Total hybrid sales -- excuse me. 

16 Total hybrid vehicle sales in the Northeast region are 

17 comparable to those in California. Finally, a survey 

18 of consumer attitudes by the McKinsey Group found 

19 sufficient consumer demand for plug-in vehicles to 

20 comprise up to 16 percent of new vehicle sales in New York 

21 City by 2015. 

22 In conclusion, we request expeditious approval 
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1 of CARB's request so that the citizens and businesses of 

2 California and the Section 177 states can continue to 

3 realize the economic and environmental benefits of this 

4 important program. 

5 Thank you. 

6 PRESIDING OFFICER OGE: Thank you, Mr. Solomon. 

7 Any questions? 

8 (No response.) 

9 MR. DICKINSON: Thank you. 

10 PRESIDING OFFICER OGE: Thank you. 

11 Ms. Marcia Ways. Good morning. Give your name 

12 and affiliation, please. 

13 PRESENTATION OF MARYLAND DEPARTMENT OF ENVIRONMENT 

14 MS. WAYS: Good morning. My name is Marcia Ways 

15 and I am the Program Manager for the Mobile Systems 

16 Control Program at the Maryland Department of the 

17 Environment. On behalf of the state of Maryland, I would 

18 like to thank you for the opportunity to testify today on 

19 CARB's request for a Clean Air Act waiver for California's 

20 Advanced Clean Car program. 

21 The state of Maryland offers its strong support 

22 for full and prompt approval of California's request. 
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1 While we are here today to discuss the specific request 

2 made by the state of California under the Clean Air Act, 

3 this is really about a much broader underlying issue, 

4 whether or not we are willing to make the right choices 

5 and establish procedures that protect public health and 

6 the environment, promote sustainability, and enhance the 

7 quality of life, not only for us but for our children and 

8 grandchildren. 

9 Maryland is one of 13 states that have adopted 

10 the California motor vehicle emissions standards. These 

11 standards benefit Maryland in two important ways. They 

12 reduce emissions of the pollutants that not only cause our 

13 ozone nonattainment problems, but they also contribute 

14 significantly to nutrient pollution in the Chesapeake Bay. 

15 There is perhaps no better place to discuss this issue 

16 than here, in a major city located in the heart of the 

17 Chesapeake Bay watershed. The bay is certainly a national 

18 treasurer that is absolutely vital to the economic health 

19 and cultural identity of Maryland. 

20 EPA has been an important partner in the bay 

21 restoration effort. Through approval of California's 

22 waiver request, EPA can make a further significant 
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1 contribution to our joint federal-state restoration 

2 effort. 

3 The majority of Maryland citizens continue to 

4 live in ozone nonattainment areas. We are subject to some 

5 of the worst ozone east of the Mississippi River. 

6 Reducing emissions of nitrogen oxides, or NOx, is key to 

7 improving our air quality. Mobile sources are the leading 

8 contributor to NOx emissions in Maryland. They are twice 

9 the NOx emissions from power plants. An effective ozone 

10 reduction strategy that will assure attainment for the 

11 federal ambient air quality standard must address the 

12 number one source of NOx emissions, mobile sources. 

13 When fully implemented, the California standards 

14 will reduce the pollutants that form ground-level ozone by 

15 75 percent. Adoption of the California standard is a key 

16 component of Maryland's ozone attainment strategy. 

17 Reducing mobile source emissions of NOx is also vitally 

18 important to the Chesapeake Bay restoration effort. 

19 Atmospheric deposition of nitrogen is responsible for 

20 approximately one-third of today's nutrient pollution. 50 

21 percent of the atmospheric deposition of nitrogen is 

22 attributable to mobile source emissions. The new 
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1 California standards will reduce nitrogen deposition to 

2 the bay. 

3 Maryland will also benefit from the zero 

4 emission vehicle provisions of the California standards. 

5 As you recall, the ZEV provisions require that the 

6 automobile manufacturers provide for sale in each state a 

7 certain percentage of low emission and zero emission 

8 vehicles. This guarantees that these vehicles will be 

9 available for sale in California and the other Section 177 

10 states like Maryland. 

11 The ZEV provisions serve to advance the 

12 development of cleaner motor vehicle technologies. In 

13 2002 there were only three hybrid vehicles commercially 

14 available for sale in the United States. 10 years later, 

15 that number has grown to 38. In 2006 there were no plug16 in electric motor vehicles commercially for sale in the 

17 United States. Now, only 6 years later, there are at 

18 least 13 different models. 

19 These advancements illustrate the importance of 

20 the California ZEV requirements, which have spurred the 

21 development of these new low and zero emission vehicle 

22 technologies. The transition to these advanced vehicle 
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1 technologies will allow us to achieve our air quality 

2 goals and enhance our nation's energy seismic by reducing 

3 dependency on foreign oil. 

4 The increasing availability of electric vehicles 

5 has provided the impetus for much needed investment in 

6 electric vehicle infrastructure. Maryland and other East 

7 Coast states are working collaboratively to ensure the 

8 development of a charging station network along the I-95 

9 corridor. In the past two years alone, Maryland has 

10 funded installation of more than 150 public charging 

11 stations. Together with privately funded installations, 

12 Maryland has made a commitment to ensuring the development 

13 of adequate charging infrastructure. The California ZEV 

14 requirements will ensure that the automobile manufacturers 

15 deliver electric vehicles to our state and the region. 

16 Finally, I would just like to briefly touch upon 

17 the legal merits of the California waiver request. Under 

18 Section 202(b) of the Clean Air Act, EPA can deny a waiver 

19 request only if California acted in an arbitrary and 

20 capricious manner when it determined its Advanced Clean 

21 Car program did not render California's mobile source 

22 program, when considered as a whole, less protective than 
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1 the federal program, if EPA determines that California no 

2 longer needs to maintain an independent program, or EPA 

3 determines under Section 202(a) that the program is not 

4 technologically feasible and that the lead time is 

5 insufficient, in consideration of costs. 

6 California's Advanced Clean Car program is based 

7 primarily on studies conducted jointly with EPA and other 

8 federal agencies. In addition, throughout the regulatory 

9 process California worked cooperatively with the 

10 automobile manufacturers in developing the standards. 

11 When these standards were signed in January of this year, 

12 most of the major manufacturers expressed their support 

13 for them. 

14 The robust record supporting the adoption of 

15 these new standards leaves no doubt that they are 

16 consistent with the technical feasibility and lead time 

17 provisions of 202(a) of the Clean Air Act and would not 

18 render the California standards less protective than the 

19 federal standards. Furthermore, EPA has consistently 

20 determined, as recently as 2011, that there are compelling 

21 reasons warranting a separate California program. In 

22 order to deny this waiver request, EPA will have to 
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1 demonstrate there is compelling evidence a separate 

2 California program is no longer warranted. 

3 In closing, I would like to thank you for this 

4 opportunity to comment and reiterate that granting 

5 California's request for a waiver is clearly in the best 

6 interests of the public and states and is fully consistent 

7 with the relevant provisions of the Clean Air Act. 

8 And also, like Maryland, Margo, the state of 

9 Maryland would like to thank you for your many years of 

10 dedicated service. Your accomplishments are many and we 

11 wish you the best in all your future endeavors. 

12 PRESIDING OFFICER OGE: Thank you. Thank you 

13 very much. 

14 Any comments? 

15 MR. DICKINSON: I do. David Dickinson. I have 

16 a comment as much as a question, or perhaps even a 

17 reminder. There has been some discussion here today about 

18 the "deemed to comply" provision that CARB is in the 

19 process of adopting. Section 177 has an identicality 

20 requirement so that states that are adopting California's 

21 regulations be identical to the California regulations. 

22 So just as a reminder, I would assume -- I don't know if 
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1 anyone wants to go on the record, but I would assume that 

2 the states would be in the process of adopting that 

3 provision to the degree they have to actively adopt it. 

4 MS. WAYS: Yes. Maryland is and I believe the 

5 other 177 states are in the process also. 

6 MR. DICKINSON: Thank you. 

7 PRESIDING OFFICER OGE: Thank you. 

8 Now, I'm going to call the next panel. Doug 

9 Greenhaus. Good morning, if you can state your name and 

10 your affiliation. 

11 Unfortunately, we cannot have all of you sitting 

12 here like a typical public hearing. So it's one at a 

13 time. 

14 PRESENTATION OF NATIONAL 

15 AUTOMOBILE DEALERS ASSOCIATION 

16 MR. GREENHAUS: I'll try to have a little better 

17 luck with the microphone. We'll see what happens. 

18 My name is Douglas Greenhaus. I'm the Chief 

19 Regulatory Counsel for Environment, Health, and Safety of 

20 the National Automobile Dealers Association. Good 

21 morning, everyone. I'm going to present a little 

22 different take on California's waiver application than 
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1 maybe we've heard so far today. 

2 I am pleased to present testimony in today's 

3 hearing. It's an important hearing. Let me just say by 

4 way of background that NADA represents the 19,000 

5 franchise automobile and truck dealerships who sell new 

6 motor vehicles across the country in virtually every 

7 state. We employ about a million people nationwide. 

8 Now, we're going to file by October 19th a full 

9 set of formal comments addressing both legal and practical 

10 issues raised by CARB's fuel economy and ZEV rules, 

11 including CARB's insufficient justification for the 

12 preemption waiver. That CARB has tended to bury its fuel 

13 economy rules within the Advanced Clean Car package is 

14 curious. However, for purposes of this preemption waiver 

15 process it is incumbent upon EPA to review those rules 

16 separately from CARB's so-called LEV III rules, just as it 

17 did last time. 

18 I'm here today because it's dealers, not 

19 manufacturers, who sell new vehicles to consumers and it 

20 is dealers and their employees, those one million plus 

21 employees, whose livelihood is at stake should CARB be 

22 granted preemption waiver for its fuel economy and ZEV 
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1 rules. 

2 Let me just make two points this morning: The 

3 law and good public policy require a national fuel economy 

4 program, and I'll talk about that in a second; and 

5 secondly, the CARB fuel economy and ZEV rules are 

6 inherently flawed and offer no environmental benefits over 

7 and above the national program. 

8 Let's start off with the national, the need for 

9 a national consistent program. Only a single, well 

10 designed national standard can enhance new vehicle fuel 

11 economy performance. NADA has significant reservations, 

12 as I think some of you know, with respect to the 

13 structure, timing, and stringency of the 2017 to '25 

14 program that was issued late last month in its EPA 

15 program. Yet we remain committed to it, as we have for 

16 over 30 years, to a national program designed to promote 

17 continuous fuel economy improvements that are both 

18 technologically feasible and economically practical. So 

19 the national nature of that program is very important. 

20 By way of contrast, a state by state approach to 

21 fuel economy regulation raises the real prospect of CARB 

22 state dealerships faced with unsold new vehicles 
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1 languishing on their lots. CARB's patchwork approach will 

2 require manufacturers to deliver to dealers separate and 

3 unique fleets in each CARB state. A patchwork will result 

4 because consumers buy different vehicles in different 

5 quantities in each state. Simply, CARB's rules will force 

6 manufacturers to deliver vehicles to dealers that their 

7 customers may not want, while rationing the vehicles they 

8 desire. 

9 Ironically, while dealer inventories will be 

10 constrained under CARB's approach, consumer choice may not 

11 be since compliance with CARB's rules are measured by what 

12 manufacturers deliver for sale to the dealers, not by what 

13 retail customers actually buy and lease. Consumers unable 

14 to obtain new vehicles of choice from inventory15 constrained CARB-state dealers will be free to purchase 

16 and are free to purchase vehicles from out-of-state 

17 dealers. 

18 The bottom line is -- so in effect, it's a 

19 program just full of holes. Bottom line, in-state dealers 

20 will lose sales without any environmental benefit for the 

21 CARB states or elsewhere. 

22 Alternatively, consumers facing a CARB-
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1 constrained mix at their local dealers may elect to buy a 

2 CARB-exempted brand, to purchase a late model used 

3 vehicle, including out-of-state federal vehicles with more 

4 than 7500 miles, or to defer vehicle purchases altogether. 

5 Again, to the extent that consumers choose one of these 

6 options no new regulatory benefits will be achieved. 

7 The new NHTSA-EPA fuel economy program's high 

8 average per-vehicle compliance costs render it far from 

9 perfect. But, unlike what the fuel economy and ZEV rules 

10 CARB has submitted for Clean Air Act preemption waiver, 

11 the national program largely avoids the perverse 

12 interstate sales distortions of the CARB patchwork. 

13 All right, let's talk about the fact that these 

14 programs are inherently flawed. The CARB approach to 

15 regulating new motor vehicle fuel economy and advanced 

16 technological is rife with flaws. Fundamentally, the CARB 

17 patchwork will result in numerous sets of state by state, 

18 manufacturer by manufacturer mandates. CARB has failed to 

19 analyze, let alone consider, the dramatic economic impacts 

20 these mandates will have on dealerships in California and 

21 in other CARB states. 

22 In 2009, NADA testified on the EPA proposal to 
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1 reverse its 2008 denial of CARB's last fuel economy rule 

2 waiver request. At that time the country, including 

3 California, perhaps more so than any other state, was in 

4 the depths of an economic recession that was having 

5 dramatic impacts on the companies that build new motor 

6 vehicles and on the dealers who sell them to consumers. 

7 For example, in 2009 NADA had some 19,000 members, but 

8 directly due to the recession there are some 2,000 fewer 

9 dealerships that exist today. Also, in 2009 new vehicle 

10 sales plunged from a high of 16 million to a low of less 

11 than 10. 

12 Thankfully for the industry, but more 

13 importantly for the nation as a whole, pent-up consumer 

14 demand and increased consumer creditworthiness have caused 

15 new vehicle sales to increase to today's annualized rate 

16 of, last time I checked, more than 14 million. However, 

17 the economic recovery, as we all know, remains shaky and 

18 the recession's dramatic impacts still linger. This is 

19 perhaps nowhere more pronounced than in California, a 

20 state that saw hundreds of dealerships shutter their 

21 doors. 

22 It is almost surreal to once again see CARB 
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1 seeking a waiver for yet another modification to its long2 suffering ZEV program. When will CARB learn that public 

3 policies must recognize and leverage consumer demand, not 

4 fight it. As was stated before, this is a technology5 forcing program that has been amended numerous times 

6 because numerous times it has not worked. 

7 After many years and numerous iterations, CARB 

8 continues to fail to see that a "build it and they will 

9 come" approach does not work for vehicles that offer 

10 compromised performance attributes at above-market prices. 

11 Instead, CARB seems determined to continue to ignore 

12 customer needs and purchasing behaviors, unable to 

13 recognize, as dealers do, that new vehicle sales depend on 

14 consumer affordability and acceptability. Policies that 

15 attempt to force the manufacture and sale of vehicles 

16 shunned by consumers offer nothing but economic harm, not 

17 only for California but for all CARB states. 

18 Let me just say one of the things I didn't see 

19 in CARB's presentation which has worked really well is the 

20 HOV lane incentives, which I think some studies have shown 

21 have been a major contributor to the purchase of some of 

22 these new technology vehicles. So I would add that to the 
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1 list. 

2 But thank you very much. 

3 PRESIDING OFFICER OGE: Thank you. 

4 Let me ask a couple of questions. Do you 

5 consider greenhouse gas emissions as air pollutants? 

6 MR. GREENHAUS: Well, we recognize that there 

7 was a Supreme Court ruling that says it's an air 

8 pollutant, and that's about as far as I'll go. 

9 PRESIDING OFFICER OGE: So today we're hearing 

10 testimony under the Clean Air Act provision of 209, am I 

11 right? 

12 MR. GREENHAUS: Right. 

13 PRESIDING OFFICER OGE: And there is waiver 

14 preemption language for California's air pollution 

15 standards -- 

16 MR. GREENHAUS: Right. 

17 PRESIDING OFFICER OGE: -- for mobile sources; 

18 am I right? 

19 MR. GREENHAUS: That's correct. 

20 PRESIDING OFFICER OGE: Okay. So I heard two 

21 major points that you're making. One was fuel efficiency. 

22 I just want to remind you and the rest of the participants 
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1 that what we're hearing today from California is a request 

2 for a waiver. They would be preempted, in other words, if 

3 we didn't give them the waiver, to establish under the 

4 Clean Air Act a clean car program based on air pollution 

5 needs. 

6 So I'm confused, and I understand the 

7 similarities between fuel economy and greenhouse gas 

8 emissions, but half of your testimony is about fuel 

9 economy, and I would tend to as Presiding Officer here, to 

10 take out both your oral and written reference to fuel 

11 economy standards because that's not the purpose of this 

12 hearing. 

13 MR. GREENHAUS: Well, I agree with you, Margo, 

14 we use "fuel economy" as a euphemism, if you will, for 

15 greenhouse gases. Besides the air conditioning, which is 

16 a major area we can control, but beyond controlling fuel 

17 economy, it's primarily a focus on managing fuel economy 

18 that manufacturers have to do for their fleet average. 

19 So yes, I could have written it "fuel 

20 economy/greenhouse gases" and I'll make a point of doing 

21 it that way in my written comments. And we clearly do not 

22 believe that CARB has satisfied the statutory criteria for 
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1 justifying, as we said during the last waiver proceeding, 

2 its statutory burdens on greenhouse gas emissions. 

3 PRESIDING OFFICER OGE: One more. Since you 

4 were talking about fuel economy, I just got a quote from -

5 - and this is for the record. This is a quote from an 

6 interview that Mr. Mulally, the CEO of Ford, did 

7 yesterday. This is the quote: "Most people agree that 

8 they'll pay more for fuel going forward, so fuel 

9 efficiency is the number one reason to buy." So that's 

10 the CEO of Ford quoted yesterday. 

11 Your testimony is clearly consistent with the 

12 testimony that you gave to EPA when we were having our 

13 public hearing on the greenhouse gas emissions with our 

14 colleagues from NHTSA on fuel economy standards on the 

15 comprehensive program that the two agencies working with 

16 California established. And your testimony at that point 

17 and your testimony today consistently suggests that the 

18 consumer will not buy those vehicles that will be cleaner 

19 and more efficient, where the CEO of Ford as early as 

20 yesterday believes that that's not the case, and we have 

21 13 OEMs in this country, car companies that represent 90 

22 percent of sales in this country, that have supported this 
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1 program. 

2 I will ask you, just to be consistent, the same 

3 question I asked your colleagues when you were testifying 

4 for EPA and NHTSA's national program: What do the dealers 

5 know that the OEMs don't know? Because both of you are in 

6 the same market. You want to sell more cars. Please go 

7 ahead. 

8 MR. GREENHAUS: What we have shown in our prior 

9 submissions during both the national program development 

10 as well as during prior waiver proceedings is that 

11 consumers care about fuel economy absolutely, especially 

12 when fuel prices are high, and that's why we have always 

13 supported efforts to improve fuel economy or, as you said, 

14 greenhouse gas emission improvements. 

15 However, they have to be affordable and they 

16 have to be coming into the market without any significant 

17 compromises to at least important, or if not more 

18 important, vehicle attributes that people look at when 

19 they buy an automobile. And for certain vehicles that 

20 just is not the case. And we can, and I'll be happy to 

21 for the record, give you examples of that. I can also 

22 give you a new report from Ford Motor Company that came 
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1 out about a month ago that said unless it can pay off in 

2 four years it ain't going to make it. 

3 So there's -- they have to be affordable, they 

4 have to be affordable for the public at large. They can't 

5 just be niche vehicles, and that's sort of where the ZEV 

6 program in particular is focused. 

7 We believe fuel economy is an important 

8 attribute, as we've said in our testimony time and time 

9 again. It's truly a matter of affordability and 

10 acceptability to the public that we're concerned about. 

11 PRESIDING OFFICER OGE: I guess for the record, 

12 Mr. Cackette and his colleagues, the programs that they 

13 have proposed to EPA and to the Board have maintained 

14 every attribute of the vehicle, from safety to power to 

15 size. So again, if NADA has data such that these proposed 

16 standards from CARB, that again for the greenhouse gas 

17 emissions for the most part are consistent with the 

18 federal program, do not respect all the other attributes 

19 of vehicles, I would invite NADA to provide that data for 

20 the record. 

21 MR. GREENHAUS: Thank you. We'll take advantage 

22 of that. 
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1 PRESIDING OFFICER OGE: Thank you. 

2 MR. GREENHAUS: I appreciate that. 

3 PRESIDING OFFICER OGE: Now we'd like to invite 

4 Mr. Gillis, Jack Gillis. 

5 Good morning. If you can give us your name and 

6 affiliation for the record. 

7 PRESENTATION OF THE CONSUMER FEDERATION OF AMERICA 

8 MR. GILLIS: My name is Jack Gillis. I'm 

9 Director of Public Affairs for the Consumer Federation of 

10 America and author of "The Car Book," and I'm also here 

11 today with Dr. Mark Cooper, our Research Director. CFA is 

12 an association of over 280 consumer groups which is 

13 designed to advance the consumer interest in education and 

14 advocacy. We appreciate this opportunity. 

15 We strongly urge the EPA to approve California's 

16 request for a waiver under the Clean Air Act to implement 

17 its Advanced Clean Car program. Tailpipe emission 

18 standards encourage the development of cars that go both 

19 farther on a gallon of gas and use alternative fuels. The 

20 result is cleaner, more efficient cars that reduce 

21 America's vulnerability to oil and gas price shocks. 

22 Consumers understand the benefits and have 
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1 consistently voiced support for California's leadership on 

2 clean car standards. In fact, in CFA's most recent poll 

3 we found that more than 70 percent of Americans support 

4 states being allowed to continue setting tailpipe 

5 standards that also increase motor vehicle efficiency. 

6 In a few moments I think you'll hear from 

7 Shannon Baker-Branstetter of Consumers Union, but I wanted 

8 to add that Consumer Reports also supported the survey 

9 research that we found, and that is 81 percent of 

10 Californians agree that the state should require 

11 automakers to significantly reduce the emissions of 

12 greenhouse gases. 

13 One of the things that I'd like to remind you in 

14 response especially to the recent comments from NADA is 

15 that a recent Deloitte study, an independent research 

16 study, found that 59 percent of 20 to 32-year-olds 

17 preferred alternative powered vehicles. This tells us 

18 that clean cars will likely be the choice of the majority 

19 of future consumers. By providing a waiver for 

20 California, EPA will be taking an important step in 

21 ensuring that this demand will be met. 

22 Simply put, stronger emissions standards mean 
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1 greater fuel economy. In spite of what Margo said, we 

2 want to separate the two issues, they are linked. And one 

3 of the great benefits of cleaner cars is lower gas prices. 

4 Last year gas prices set a record high and this pushed 

5 household gas expenditures to a record $2850. Shockingly, 

6 gas eats up over 8 percent of the family's household 

7 income. 

8 California has played a critical role in 

9 stimulating the innovation in the auto market by striking 

10 the right balance between reducing pollution and setting 

11 achievable targets that push the automakers to employ new 

12 technologies. Many of those new technologies are already 

13 appearing in showrooms today. 

14 14 states and D.C. have adopted the previous 

15 round of updates to California's clean car standards and 

16 are poised to do so again, which would dramatically 

17 increase the benefits of this waiver. In fact, the 15 

18 percent requirement for zero emission vehicles in the CARB 

19 proposal will play a central role in assuring that 

20 automakers reach the proposed national fuel economy 

21 standard of 54.5. 

22 In order to achieve our nation's goals, electric 
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1 vehicles will have to become a steadily increasing part of 

2 the vehicle fleet. The California Advanced Clean Car 

3 program will spur steady progress in both technology and 

4 consumer acceptance. With these efforts, electric 

5 vehicles will become as common as smart phones and 

6 tablets. 

7 A decade ago when California first adopted the 

8 innovative LEV-ZEV standards that would require hybrid and 

9 electric vehicles, the automakers insisted that it 

10 couldn't be done. But California stood its ground and 

11 today, as you've heard earlier, there are 30 models 

12 available from all the major automakers and the Prius has 

13 become a best-selling and profitable vehicle. 

14 Consumers are counting on California to lead 

15 America to a cleaner, more sustainable, more affordable 

16 future. Consumers across America join me in encouraging 

17 the EPA to grant the California Air Resources Board 

18 request for a waiver and begin implementing its Advanced 

19 Clean Car program. It's good for the environment, it's 

20 good for consumer pocketbooks, it's good for the auto 

21 industry, and it's good for our nation's independence. 

22 Now I'd like to introduce my colleague, Dr. Mark 
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1 Cooper. 

2 DR. COOPER: I appreciate the opportunity to 

3 appear today. You've heard about the consumer benefits, 

4 you've heard about the public support -- 

5 PRESIDING OFFICER OGE: Would you please give us 

6 your name? 

7 DR. COOPER: Oh, Mark Cooper, Director of 

8 Research, Consumer Federation of America. I thought Jack 

9 had taken care of that. 

10 So I want to emphasize something different. I 

11 won't repeat what Jack said or what others have said. For 

12 us, the clean cars program led by California has helped to 

13 set us on a path that will improve the performance of 

14 light-duty vehicles, cars and trucks by a greater amount, 

15 in a shorter time period, than ever accomplished in U.S. 

16 history. CFA believes that the direction set by 

17 California and the clean car states is a wonderful example 

18 of American federalism at its best, and this is in part a 

19 response to the NADA claim about having to have only 

20 national standards. 

21 The clean cars program enjoys widespread support 

22 from consumers, automakers and suppliers, business groups, 
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1 autoworkers, national defense experts, public health 

2 advocates, and environmentalists, and there are good 

3 economic reasons and environmental reasons and pocketbook 

4 reasons that it enjoys that support. But I want to stress 

5 the fact that there was a process here that is bipartisan, 

6 consensual, and I think the public really is yearning for 

7 that kind of policy process in America. 

8 Now, I emphasize the plural, "clean car states," 

9 for a simple reason. It is certainly true that the 

10 statutory language of the Clean Air Act gives California 

11 the lead role in developing a state-based alternative to 

12 federal standards. But we believe the adoption of 13 

13 additional states and jurisdictions is what really gave 

14 California clean cars program its clout. Combined, the 

15 clean car states represent the fifth or sixth largest auto 

16 market in the world. The collective wisdom of so many 

17 states gave the California standard a great deal of 

18 credibility and the size of the market gave it economic 

19 clout, and those two things have propelled the program 

20 forward. 

21 So one of the great benefits of American 

22 federalism is to allow the individual states to act as 
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1 laboratories, to discover better ways of accomplishing 

2 shared goals. The more eyballs looking at a problem, the 

3 more likely it is that a good solution will be found. 

4 By allowing the largest economy in the nation to develop a 

5 set of standards independently of the federal standards 

6 and allowing other states to adopt either the federal 

7 standard or the California standard, the Clean Air Act 

8 prevents fragmentation of 50 standards, but preserves the 

9 dynamic state-based process of innovation and 

10 experimentation, and that is what American federalism is 

11 about. 

12 I do find it ironic that the dealers insist that 

13 we have a national standard for emissions and fuel 

14 economy, but when it comes to sales they insist on state15 based laws, which prevent cross-state sales of 

16 automobiles. I would love to join with them in supporting 

17 a national approach to selling automobiles instead of 

18 state-based franchise laws. We've actually spent about 

19 ten years working on that. 

20 But this program went farther than the 

21 traditional federalism approach and that is important. By 

22 adding a layer of cooperation between the federal and the 
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1 state agencies, an executive order of the Obama 

2 administration smoothed the process and increased the 

3 benefits of federalism dramatically. This was a 

4 coordinated effort of federal agencies recognizing federal 

5 law and state agencies tapping into grassroots public 

6 support. It has advanced federalism significantly. 

7 So that cooperation has produced this remarkable 

8 outcome, the first long-term set of standards, both 

9 pollution and fuel economy, that the nation has ever had, 

10 to double the fuel economy of vehicle fleets in a little 

11 over a decade, a decade and a half, which has 

12 environmental, economic, national security, public health 

13 benefits. 

14 So this is the outcome of a process that is 

15 really important. California took a leadership role, and 

16 you've heard about the market for hybrids, which would not 

17 have existed but for the clean car states. The current 

18 proposal nudges that market farther along. 

19 The automakers recognize the standards are good 

20 for them. In fact, virtually every stakeholder in the 

21 automotive market except the dealers recognizes that these 

22 standards are good for the industry. 
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1 We urge that you approve the waiver and continue 

2 this remarkable example of consensus, bipartisanship, and 

3 federalism. It's good for the country. 

4 Thank you. 

5 PRESIDING OFFICER OGE: Thank you, Mark. 

6 Any questions for Jack and Mark? 

7 (No response.) 

8 PRESIDING OFFICER OGE: Thank you. 

9 MR. GILLIS: Thank you. 

10 PRESIDING OFFICER OGE: Now I'd like to call 

11 Shannon Baker-Branstetter. 

12 PRESENTATION OF CONSUMERS UNION 

13 MS. BAKER-BRANSTETTER: Good morning. 

14 PRESIDING OFFICER OGE: Can you give your full 

15 name and organization to the reporter. 

16 MS. BAKER-BRANSTETTER: Good morning. I'm 

17 Shannon Baker-Branstetter and I'm Policy Counsel for 

18 Consumers Union, the policy advocacy division of Consumer 

19 Reports. I appreciate the opportunity to convey Consumer 

20 Reports' support for California's waiver request for its 

21 Advanced Clean Car program. I would like to make three 

22 points: First, Californians support this program; second, 
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1 the standards are technologically feasible; and third, 

2 Californians needs these clean car standards. 

3 Consumer Reports conducts comprehensive tests of 

4 approximately 80 new vehicles every year, which we buy 

5 anonymously at retail. We provide consumers with 

6 objective comparative ratings about performance, safety, 

7 and reliability of these vehicles. We do not accept 

8 outside advertising and we have more than eight million 

9 subscribers. 

10 First, Californians do support these standards. 

11 Last year Consumer Reports surveyed California residents 

12 to find out their views on key elements of the California 

13 clean cars program and we found overwhelming support. 81 

14 percent of Californians agree that the state should 

15 require all automakers to reduce significantly the 

16 emissions of greenhouse gases from new vehicles. 75 

17 percent agreed that California should require automakers 

18 to build fleets that include increasing numbers of zero 

19 emission vehicles. 

20 Second, the standards are technologically 

21 feasible. Manufacturers are already offering plug-in 

22 hybrids and battery electric cars, with new models 
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1 appearing all the time. California is committed to 

2 solving the chicken and egg problem by coordinating 

3 vehicle delivery and the alt-fuel infrastructure needed to 

4 support these vehicles. Automakers have also announced 

5 aggressive plans to mass produce plug-in hybrids, battery 

6 electric, and fuel cell vehicles to meet the ZEV 

7 requirement. 

8 Importantly, consumers seem very pleased with 

9 these new options. In our own satisfaction survey, lower 

10 emission in alt-fuel vehicles dominated the list. Chevy 

11 Volt topped the list with 93 percent of buyers saying 

12 they'd definitely buy the car again. The Toyota Prius, 

13 Ford Fusion hybrid, and Volkswagen Golf TDI and Jetta TDI 

14 all rank at the top or near the top of class for customer 

15 satisfaction. 

16 Third, California needs the Advanced Clean Car 

17 program to protect the health and welfare of its citizens. 

18 The Clean Air Act expressly recognizes California's right 

19 to set vehicle emission standards that are stronger than 

20 the federal standards and the right of other states to 

21 adopt the California standards. 

22 Thanks to the Clean Air Act, California and the 
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1 nation have been able to improve air quality and reduce 

2 pollution over the last several decades. However, due to 

3 geography, population, and many millions of vehicles, 

4 California still has some of the worst air pollution in 

5 the country. California's prior iterations of the clean 

6 cars program have helped reduce emissions, but air is 

7 still unsafe in several regions of the state and people's 

8 lives depend on making the air cleaner. 

9 By 2025, California's LEV standards will reduce 

10 the average emissions of new light-duty vehicles by 

11 approximately 75 percent from 2010 levels. The new LEV 

12 rules will decrease greenhouse gas, particulate, and smog13 forming emissions, which will reduce pollution-related 

14 illness and improve public health and the quality of life 

15 for California. 

16 California's ZEV standards are expected to 

17 deliver 1.4 million zero emission vehicles to the state. 

18 Because these vehicles do not require gasoline, the ZEV 

19 standards will reduce California's oil demand and need for 

20 refineries, reducing upstream emissions and delivering 

21 terrific consumer pocketbook savings. 

22 In summary, California's Advanced Clean Car 
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1 program is a practical and popular approach that is 

2 necessary to reduce some of the worst air pollution in the 

3 country. Allowing the program to go forward is in the 

4 state's best interest and the nation's. 

5 Thank you for your time and considering our 

6 views. 

7 PRESIDING OFFICER OGE: Thank you. 

8 Any questions? 

9 MR. DICKINSON: Thank you. 

10 MS. COHEN: I have two questions about the 

11 survey you alluded to. Are the results publicly 

12 available? 

13 MS. BAKER-BRANSTETTER: They are. 

14 PRESIDING OFFICER OGE: I want to make sure it's 

15 loud for the reporter. 

16 MS. BAKER-BRANSTETTER: Yes, they are. The 

17 customer satisfaction survey? 

18 MS. COHEN: Yes. 

19 MS. BAKER-BRANSTETTER: Yes, they are. They're 

20 available on our web site. 

21 MS. COHEN: And did the survey ask about 

22 purchase behavior on the part of consumers who supported 
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1 more intense requirements for manufacturers for low 

2 emission vehicles? 

3 MS. BAKER-BRANSTETTER: I'm sorry. There are 

4 two separate surveys. There is the owner satisfaction 

5 survey about people being happy with their vehicles. 

6 That's available on Consumer Reports, etcetera. But if 

7 you're asking about the survey of Californians about 

8 support for green cars -- 

9 MS. COHEN: Yes. 

10 MS. BAKER-BRANSTETTER: -- that is part of the 

11 CARB comment period as part of their public record. 

12 MR. DICKINSON: If you could submit both of 

13 those, if you'd like to, for the record, that would be 

14 helpful. 

15 MS. BAKER-BRANSTETTER: Sure. 

16 PRESIDING OFFICER OGE: Thank you. 

17 Ms. Ellen Kennedy. 

18 PRESENTATION OF CALVERT INVESTMENTS 

19 MS. KENNEDY: Good morning. 

20 PRESIDING OFFICER OGE: Would you state your 

21 name and your affiliation. 

22 MS. KENNEDY: My name is Ellen Kennedy and I am 
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1 the Manager of Environment and Climate Change Analysis for 

2 Calvert Investments. We manage approximately $12.3 

3 billion in a wide range of domestic and international 

4 offerings and we closely track regulatory developments 

5 that will affect our holdings. 

6 California's Advanced Clean Car program is one 

7 such development that will drive innovation, investment, 

8 and job creation, ensuring that the domestic auto industry 

9 retains global leadership in the years ahead. Thus, we 

10 strongly support the granting of California's request for 

11 a waiver of preemption under Section 209(b) of the Clean 

12 Air Act for the ACCP, both the LEV III program and the ZEV 

13 program. 

14 We do so because worldwide the trend is clear. 

15 Customers want and in an increasing number of countries 

16 require cleaner cars and trucks, to go further on every 

17 gallon of gas, while cutting back on greenhouse gas 

18 emissions that contribute to climate change. Companies 

19 that fail to embrace relevant new technologies, from 

20 improving mileage for conventional internal combustion 

21 engines to developing hybrid, electric, and fuel cell 

22 vehicles, are putting themselves at risk. In contrast, 
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1 the ACCP promotes investment in new technology. 

2 The government Air Resource Board's LEV III 

3 program, which provides for smog reductions as well as 

4 carbon dioxide reductions that harmonize with the recently 

5 announced federal regulations, will have significant 

6 economic and environmental benefits. Further, granting 

7 the waiver request will promote development and deployment 

8 of ZEVs not only in California, but in Section 177 states 

9 that adopt the standards as well and pave the way for 

10 wider deployment. Promoting the deployment of ZEVs will 

11 advance the development of innovative technologies and 

12 reduce our dependence on oil, thereby protecting consumers 

13 and businesses from volatile oil price spikes. 

14 The ACCP will provide the regulatory certainty 

15 needed to spur further investment in innovative 

16 technologies. There are already many examples of such 

17 investments based on current regulations. First, a report 

18 from the nonprofit, nonpartisan research group Next 10 

19 found that California attracted 69 percent of worldwide 

20 venture capital dedicated to electronic vehicle 

21 development in the first half of 2011. That's about $467 

22 million. 
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1 Continental, a supplier of fuel-efficient 

2 turbochargers to Ford's 2014 Focus vehicle, is steadily 

3 pursuing electrification technologies and sees them as 

4 long-term investments. Ford is accelerating development 

5 of its hybrid and electric vehicles by bringing the design 

6 and production of key emissions-reducing components in 

7 house, a $135 million investment. The ACCP will 

8 serve to accelerate this trend. 

9 In sum, as investors we believe that the ACCP 

10 will benefit California and our nation as a whole by 

11 strengthening the nation's market for clean cars and clean 

12 car technologies. The ACCP will act as a tide that lifts 

13 all boats. It is good for investors, automakers, and the 

14 American economy. 

15 Thank you very much. 

16 PRESIDING OFFICER OGE: Thank you. 

17 I have a question. You mentioned a couple of 

18 reports. I believe one of the reports that you mentioned 

19 is Next To 10? 

20 MS. KENNEDY: It's from Next 10. 

21 PRESIDING OFFICER OGE: Next 10. 

22 MS. KENNEDY: I can arrange to get that to you. 
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1 PRESIDING OFFICER OGE: If there is any record 

2 of those statements that you made, we would ask you to 

3 submit it for the record. 

4 MS. KENNEDY: Yes. 

5 PRESIDING OFFICER OGE: Thank you. 

6 Any other questions? 

7 (No response.) 

8 PRESIDING OFFICER OGE: Thank you very much. 

9 Unfortunately, I have another meeting that you 

10 need to attend. So I'm going to ask my colleague Janet 

11 Cohen to take over. 

12 Some of you mentioned, this is indeed my last 

13 public hearing. It was 33 years. Now you all know my 

14 age. I started here when I was a baby. But I want to 

15 express my honor and privilege at working with all of you, 

16 the states -- and we have them here today -- both the 

17 NACAA and specific states, local governments, car 

18 companies, suppliers, dealers, environmental, and consumer 

19 groups. Thank you very much. Continue your efforts for 

20 clean air. 

21 (Applause.) 

22 PRESIDING OFFICER OGE: And we apologize for our 
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1 microphone, but it's behaving now. 

2 MS. COHEN (presiding): Thank you, everyone who 

3 has testified so far. 

4 Our next panel will be environmental and health 

5 organizations. I'd like to ask Mr. Paul Billings from the 

6 American Lung Association. Would you please state your 

7 affiliation for the record? Thank you. 

8 PRESENTATION OF THE AMERICAN LUNG ASSOCIATION 

9 MR. BILLINGS: Sure. Hi. I'm Paul Billings. I 

10 am Senior Vice President for Advocacy and Education for 

11 the American Lung Association. 

12 Margo, before you go, I just want to say thank 

13 you very much on behalf of my daughters and 300 million 

14 other Americans who breathe clean air because of your 

15 efforts. We thank you for your service and we wish you 

16 well in your future endeavors, but we will miss you 

17 greatly. 

18 PRESIDING OFFICER OGE: Thank you, Paul. 

19 MR. BILLINGS: The American Lung Association 

20 advocates for clean and healthy air for all Americans. 

21 For decades we have advocated for the cleanup of pollution 

22 from motor vehicles. Despite much progress in California 
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1 and communities across the country, air pollution remains 

2 a major public health threat. Motor vehicle tailpipes 

3 continue to be a major source of air pollution. 

4 The American Lung Association and our California 

5 charter association fully support the state of 

6 California's waiver request to implement its low emission 

7 vehicle and zero emission vehicle programs through 2025. 

8 Together they are known as the Advanced Clean Car 

9 programs. 

10 Motor vehicle emissions remain the leading 

11 source of harmful air pollution in California that can 

12 lead to hospitalization, emergency room visits, asthma 

13 attacks and other lung illness, heart attacks, strokes, 

14 and premature deaths. Californians continue to suffer 

15 from some of the most polluted air in the United States. 

16 According to our 2012 State of the Air report, nine of the 

17 ten most polluted metropolitan areas in the country are in 

18 California for ozone. 

19 Los Angeles tops the list, as it has for 12 out 

20 of the 13 years we've published the report. In the L.A. 

21 metro area, there are more than one million adults with 

22 asthma and over 300,000 children with asthma who are 
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1 routinely exposed to unhealthy levels of air pollution. 

2 In addition, California cities occupy the top five 

3 positions on both our annual and 24-hour particulate 

4 matter most-polluted lists. 

5 For decades, California's air pollution problem 

6 has placed an enormous health burden on its residents. 

7 Thanks to the leadership shown by California, air 

8 pollution levels in most of its cities continue to 

9 improve. However, getting better does not mean the air is 

10 safe to breathe. Pollution in California still kills. 

11 Progress must continue and the Advanced Clean Cars program 

12 is critical to continuing this success. 

13 In 2025, new cars in California will emit 75 

14 percent less smog-forming pollution than the average new 

15 car sold today. The Air Resources Board estimates that by 

16 2035, when nearly the entire fleet will be compliant with 

17 the new standards, the critical components of ozone smog, 

18 reactive organic gases and nitrogen oxides, will be cut by 

19 21 percent and 36 percent respectively. PM 2.5 emissions 

20 will be cut by 11 percent. California needs these 

21 reductions to help attain and maintain compliance with 

22 national ambient air quality standards. 
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1 Under the Clean Air Act, California clearly has 

2 the right to sell these vehicles and to -- sorry -- to set 

3 these emission standards. EPA should approve the waiver. 

4 The state clearly needs the Advanced Clean Car program to 

5 protect the health and welfare of its citizens. 

6 California has the unique authority because of 

7 its compelling and extraordinary history of fighting air 

8 pollution. The state has consistently demonstrated its 

9 commitment to act and to exercise a fundamental right to 

10 protect its citizens from air pollution. 

11 The decision before the EPA is clear. We 

12 request that you promptly approve the California waiver 

13 request. 

14 Thank you very much. 

15 MS. COHEN: Thanks. 

16 I'd like to invite Megan Higgins from the Union 

17 of Concerned Scientists. 

18 PRESENTATION OF THE UNION OF CONCERNED SCIENTISTS 

19 MS. HIGGINS: Thank you for the opportunity to 

20 testify today. My name is Megan Higgins and I am the 

21 Senior Washington Representative for the Clean Vehicles 

22 Program of the Union of Concerned Scientists. UCS is the 
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1 nation's leading science-based nonprofit, working for a 

2 healthy environment and a safer world. 

3 On behalf of UCS's more than 400,000 supporters 

4 and network of more than 18,000 scientists, we strongly 

5 urge the EPA to approve California's waiver request so 

6 that they can move forward with their amended low emission 

7 vehicle and zero emission vehicle standards. 

8 California continues to have the nation's worst 

9 air quality and vehicles are a significant source of this 

10 pollution. The Advanced Clean Cars regulatory package, of 

11 which LEV and ZEV are a part, is necessary for the state 

12 to meet its air pollution goals. Addressing both smog13 forming and greenhouse gas emissions, the Advanced Clean 

14 Car program will clean the air, protect public health, and 

15 save the consumers money, approximately $22 billion 

16 through 2025 according to an analysis by the California 

17 Air Resources Board. 

18 The technology to achieve these standards is 

19 here today. It is already being used on cars throughout 

20 the fleet. These include not only electric and hybrid 

21 vehicles like the Chevy Volt, the Nissan Leaf, and the 

22 Toyota Prius, but also conventional models like the Honda 
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1 Accord, the Chevy Cruze, the Ford F-150, the Honda 

2 Odyssey, and the Toyota Siena, just to name a few. The 

3 Advanced Clean Cars regulatory package would ensure that 

4 cleaner technologies reach even more models of all vehicle 

5 types in the coming years. 

6 The Clean Air Act explicitly grants California 

7 the authority to set its own emission standards for most 

8 mobile sources if those standards are at least as 

9 protective as the federal standard and permits other 

10 states to opt into these standards. It is essential that 

11 California and any states that adopt California's 

12 regulation be able to retain this authority. This 

13 authority has driven innovation in the automotive sector 

14 and has resulted in dramatic reductions of emissions and 

15 healthier air, not just in California but throughout the 

16 entire nation. 

17 Earlier this year, 161 scientists and engineers 

18 in California signed an open letter in support of the 

19 state's efforts to continue to reduce the impact of motor 

20 vehicle emissions. The reasons for their support were 

21 many, from the fact that the longer we wait to bring down 

22 emissions the harder and more costly it will be, to the 
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1 fact that we already have the solutions and technology to 

2 significantly reduce emissions; and finally, because the 

3 science on the causes and risks are clear. 

4 In 2009, when California requested a waiver to 

5 enforce its greenhouse gas emission standards for motor 

6 vehicles covering model years 2012 to 2016, Administrator 

7 Jackson stated in granting the waiver that EPA, quote, 

8 "put the law and science first." The request submitted 

9 by the state of California and under consideration today 

10 clearly meets all the legal and technical requirements of 

11 a waiver. Therefore we are urging you to once again put 

12 the law and science first and grant this waiver without 

13 delay. 

14 On behalf of UCS and all of our members and 

15 supporters, we thank you for all the good work you are 

16 doing to ensure a healthy environment and a safer world. 

17 MS. COHEN: Thank you. 

18 Any questions? 

19 MR. DICKINSON: Thank you. 

20 MS. COHEN: Could I invite Ann Mesnikoff of the 

21 Sierra Club. 

22 PRESENTATION OF THE SIERRA CLUB 
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1 MS. MESNIKOFF: Let's see if I can make this 

2 work well. 

3 My name is Ann Mesnikoff. I direct the Sierra 

4 Club's Green Transportation Campaign. Thanks for the 

5 opportunity to testify this morning. On behalf of our 1.4 

6 million members and supporters, including our 170,000 

7 members and supporters of Sierra Club California, I 

8 strongly urge EPA to grant California's request for a 

9 waiver to implement its Advanced Clean Car program. This 

10 program includes new standards for smog-forming and other 

11 air pollutants, an updated zero emission vehicle program, 

12 and standards that continue to ratchet down greenhouse gas 

13 pollution. These new standards tackle critical issues for 

14 California and also have significant impacts beyond its 

15 borders. 

16 We'll submit more detailed comments for the 

17 record. 

18 Under the Clean Air Act, California can set air 

19 quality standards that are more stringent than federal 

20 standards so long as they address a compelling and 

21 extraordinary need, are stricter than federal regulations, 

22 and are technically and economically feasible. Over the 
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1 past four decades, the EPA has granted waivers to 

2 California more than 50 times. CARB's June 27th request 

3 for a waiver to adopt the Advanced Clean Car program, 

4 including the ZEV program, clearly meets the legal and 

5 technical requirements of the Clean Air Act. Failure to 

6 grant the waiver would be arbitrary and capricious. 

7 I was pleased to testify on behalf of California 

8 in 2009 in support of EPA's reconsideration of 

9 California's waiver request for its historic greenhouse 

10 gas emissions standards. In that testimony, I detailed 

11 the compelling legal case for granting California's 

12 waiver, including the specific climate impacts California 

13 was experiencing then and the significant greenhouse gas 

14 impact of motor vehicles in the state. 

15 From drought to wildfires, California is on the 

16 front line of climate change and remains on the front line 

17 for air pollution. In 2009, we shared the more than 1,000 

18 photos submitted as part of our photo petition conveying a 

19 clear message to EPA: "EPA holds the keys to clean cars." 

20 That was true then with respect to the greenhouse gas 

21 standards under consideration in 2009 and continues to be 

22 true today as EPA considers the waiver for this full suite 
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1 of standards. 

2 Air pollution from vehicles is a critical health 

3 issue in California, but also a significant economic issue 

4 as well. My colleague from Sierra Club California shared 

5 information regarding a study done a few years ago that 

6 the costs of not meeting federal air pollution standards 

7 in the San Joaquin Valley costs the region about $6 

8 billion annually and the South Coast Air Basin region 

9 about $22 billion. These costs include direct health 

10 costs -- emergency room visits, hospitalizations -- as 

11 well as costs associated with lost days at work and school 

12 and premature death. These air basins are the only two in 

13 the region that are ranked as in extreme nonattainment, in 

14 part due to the large number of vehicles and their 

15 tailpipe pollution. 

16 A draft vision developed earlier this year by 

17 these air districts and others shows that moving toward 

18 zero and near-zero emission vehicles is essential to meet 

19 clean air standards wile also achieving substantial 

20 greenhouse gas reductions. The Advanced Clean Car program 

21 advances these goals. 

22 California has also led the nation with its ZEV 
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1 program. From moving the Prius to market or growing the 

2 number of electric -- or the growing number of electric 

3 vehicles today, the ZEV program continues to be central to 

4 meeting the state's long-term health-based air pollution 

5 and climate change goals. 

6 The updated program, developed with input from a 

7 range of stakeholders including the states that have 

8 adopted this program, will continue to push innovation. 

9 Further, by displacing oil, the program has upstream air 

10 quality benefits as refinery emissions are reduced. 

11 As CARB has documented, the revised program is 

12 technically feasible and there is ample lead time and 

13 flexibilities for the automakers to meet the requirements 

14 of the program in California as well as in the states from 

15 the Northeast to the Northwest that follow it. 

16 This Sunday, September 23rd, is the second 

17 National Plug In Day. Sierra Club is joining with other 

18 groups to hold events in California, with more than 60 

19 events nationwide. Today's electric vehicle owners, 

20 automakers, dealers, and others will have a chance to show 

21 off the best of today's technology. The ZEV program will 

22 help put technology on the road and sets a clear path for 
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1 automakers, but also for states, as they plan for and 

2 prepare for these vehicles. 

3 According to the American Lung Association, more 

4 than four out of ten Americans live in areas that have 

5 received an F for unhealthy levels of ozone and 

6 particulate pollution. The Advanced Clean Car program 

7 will deliver benefits directly to those areas of 

8 California that received an F or a low grade in ALA's 

9 assessment, but also have benefits well beyond California. 

10 Approximately 96,627,673 Americans live in 

11 states that have adopted California's vehicle emissions 

12 program. Granting the waiver will enable these states to 

13 adopt and implement strong standards and continue, with 

14 California, to be leaders. 

15 There's no question that California's Advanced 

16 Clean Car program offers greater air pollution reductions 

17 than the federal program. It is critical that EPA follow 

18 the guidance of the Clean Air Act in terms of granting the 

19 waiver California has requested. Sierra Club also urges 

20 EPA to move forward quickly with Tier 3 low sulfur fuel 

21 standards. 

22 All Americans, whether they reside in the state 
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1 of California or those that follow its emissions program, 

2 deserve to breathe clean air. Tier 3 standards for 

3 vehicles will help ensure that they have that opportunity 

4 while also enabling the technologies that can help meet 

5 the national fuel efficiency and greenhouse gas standards. 

6 Further, a low sulfur fuel standard will slash sulfur 

7 levels -- that slashes sulfur levels in fuel sold 

8 nationally will have a tremendous impact on reducing ozone 

9 pollution from all vehicles on the road, even as vehicles 

10 with the latest emission control equipment phase into the 

11 fleet. 

12 Given the important benefits to California, the 

13 177 states and the nation, Sierra Club urges EPA to grant 

14 the waiver California has requested while also pursuing 

15 strong standards for the nation. EPA indeed holds the 

16 keys to clean cars, clean air, and climate protection. 

17 Thank you very much. 

18 MS. COHEN: I would just encourage you, as we 

19 have with others who testified and mentioned studies or 

20 reports that they cited, you talked about a California 

21 Sierra Club study that looked into the costs of failing to 

22 meet standards. If you are able to, I would encourage you 
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1 to send it in. 

2 MS. MESNIKOFF: Yes. I'll just clarify. It was 

3 a study done by one of the state universities, but one 

4 that my colleague director of the California Sierra Club 

5 referenced to me yesterday. 

6 MS. COHEN: If you could include that with your 

7 comments, we'd appreciate it. 

8 MS. MESNIKOFF: Yes, right. Thank you. 

9 MS. COHEN: I invite Tomas Carbonell, 

10 Environmental Defense Fund, at this time. 

11 PRESENTATION OF THE ENVIRONMENTAL DEFENSE FUND 

12 MR. CARBONELL: Good morning. My name is Tomas 

13 Carbonell. I'm an attorney in the Climate and Air Program 

14 of the Environmental Defense Fund. I appreciate the 

15 opportunity to testify. 

16 On behalf of Environmental Defense Fund, our 

17 more than 700,000 members nationwide, and our tens of 

18 thousands of members in California, I sincerely thank you 

19 for the opportunity to testify today on California's 

20 landmark Advanced Clean Cars program and request for 

21 waiver. The California program will help curb helpful 

22 smog-forming and particulate pollution and address the 
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1 extensive climate-disrupting pollution from passenger 

2 vehicles. 

3 California's decades-long bipartisan leadership 

4 on cleaner cars has provided vital protection for public 

5 health and the environment for millions of Californians. 

6 California's motor vehicle control program is urgently 

7 needed to address compelling and extraordinary conditions, 

8 including the country's largest state population, its 

9 largest motor vehicle fleet, climate-sensitive resources 

10 ranging from imperiled water supplies that rely on Sierra 

11 snow pack, to the nation's largest agricultural base, to 

12 its 500-mile shoreline, and severe air quality problems 

13 that will be exacerbated by temperature increases that are 

14 caused by climate change, and it would be arbitrary for 

15 EPA to find otherwise. EDF urges EPA to approve the 

16 waiver without delay. 

17 California has a legacy of adopting clean car 

18 standards that protect human health and the environment, 

19 advance low-pollution technologies, and are highly cost 

20 effective. California's leadership is rooted in a firm 

21 bipartisanship. Over 40 years ago, during the development 

22 of the Clean Air Act in 1967, it was Republican Senator 
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1 George Murphy of California who sponsored the pivotal 

2 legislative language guaranteeing California's continued 

3 leadership in establishing clean car standards. Senator 

4 Murphy won sweeping bipartisan support for California to 

5 maintain its authority to protect human health and the 

6 environment from automobile emissions, pointing to 

7 California's serious air pollution challenges. 

8 The Senator said at the time: "I am 

9 particularly grateful for the recognition that the 

10 committee has given to the state of California by 

11 accepting an amendment offered by me which recognizes the 

12 state's unique problems and pioneering efforts by granting 

13 a waiver from the federal preemption for the state of 

14 California and thus ensuring that the state will be able 

15 to continue its already excellent program for the benefit 

16 of the people of that state." 

17 California has continued to demonstrate 

18 bipartisan leadership in providing clean air protection 

19 for the state and our nation. The National Academy of 

20 Sciences examined California's time-tested leadership, 

21 finding that the Golden State has long been considered a 

22 laboratory for emission control innovation. California 
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1 also collaborated with the Environmental Protection 

2 Agency, the Department of Transportation, auto companies, 

3 the United Auto Workers, and numerous other states to 

4 forge a landmark national program reducing climate 

5 pollution from cars nationwide. The success of that 

6 collaboration is reflected in the broad support for the 

7 national program. 

8 We applaud California for its steadfast 

9 leadership in securing clean air, a healthier environment, 

10 and a stronger clean energy economy for millions of 

11 Californians. 

12 EPA's review of California's waiver request is 

13 constrained by the narrowly circumscribed criteria set 

14 forth in Section 209(b) of the Act. The legislative 

15 history of Section 209, EPA's prior decisions on waiver 

16 requests, and court review of these decisions clearly 

17 establish that EPA's review must be highly deferential to 

18 California and that grounds for denial are very tightly 

19 constrained by the statutory factors. 

20 As the D.C. Circuit Court has noted: "Congress 

21 has decided to grant California the broadest possible 

22 discretion in adopting and enforcing standards for the 
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1 control of emissions from new motor vehicles." 

2 California's emissions standards are presumed to 

3 satisfy the waiver requirements and EPA may not disregard 

4 California's determination absent clear and compelling 

5 evidence to the contrary. 

6 The California's Advanced Clean Car program will 

7 reduce climate pollution from California fleet of cars by 

8 2 million tons, or 34 percent, in 2025. These reductions 

9 will provide a savings of $5 billion in operating costs in 

10 2025 for California drivers, which will rise to $10 

11 billion in 2030 when even more advanced cars are on the 

12 road. 

13 The emission reductions under this program are a 

14 critical part of the state's efforts to ward off the worst 

15 consequences of climate change, including the clear and 

16 present danger of rising sea levels. The grim impacts of 

17 climate change in California and the Southwest include 

18 that water supplies will become increasingly scarce, 

19 calling for tradeoffs among competing uses and potentially 

20 leading to conflict. Increasing temperature and drought, 

21 wildfire, and invasive species will accelerate the 

22 transformation of the landscape; and increased frequency 
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1 and altered timing of flooding will increase risks to 

2 people, ecosystems, and infrastructure. 

3 Climate change is also likely to harm 

4 California's economy by reducing the types of natural, 

5 non-irrigated vegetation available for livestock forage 

6 and the ability of forest ecosystems to store carbon 

7 dioxide. 

8 These impacts and many others associated with 

9 climate change impose a heavy price in California's public 

10 health, environment, and its prosperity. 

11 While California's ingenuity and technology has 

12 brought significant progress in reducing harmful ozone13 forming and particulate emissions from passenger cars and 

14 trucks, California continues to experience some of the 

15 worst air quality in the nation and needs additional 

16 reductions to protect public health and meet health-based 

17 air quality standards. 

18 The Advanced Clean Car program will help meet 

19 these needs by reducing statewide VOC emissions by 21 

20 percent, NOx emissions by 36 percent, and fine PM 

21 emissions by 11 percent in 2035. These estimated 

22 reductions are expected to avoid up to 530 premature 
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1 deaths by 2025 and will help ensure healthier, longer 

2 lives in target areas like the San Joaquin Valley and the 

3 South Coast Air Basin. 

4 Further, the accompanying reductions of carbon 

5 pollution are essential to help secure these health 

6 quality benefits and ameliorate the serious risk of more 

7 dangerous high pollution days in California, that are 

8 exacerbated by a warming climate. 

9 We also respectfully urge EPA to build from the 

10 foundation forged by California's leadership and 

11 immediately propose national Tier 3 emissions and gasoline 

12 fuel standards for passenger vehicles. Such a rigorous 

13 program would have immediate and far-reaching health and 

14 environmental benefits for our entire country, reducing a 

15 cascade of harmful airborne contaminants, ensuring longer 

16 and healthier lives, and helping states and communities 

17 across our country restore healthy air. 

18 These critical health protections will be 

19 achieved through improvements in fuel quality standards 

20 that cost less than a penny a gallon, and timely 

21 finalization of these clean air standards would allow 

22 manufacturers to efficiently align their technology 
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1 upgrades for nitrogen oxides and other pollutants with the 

2 recently finalized fuel efficiency and greenhouse gas 

3 emission standards, securing the suite of human health and 

4 environmental protections that are available from both 

5 standards through smart, optimized clean air investments 

6 for our children, our communities, and the nation. 

7 In conclusion, EDF urges EPA to approve 

8 California's waiver without delay to secure vital clean 

9 air protections. 

10 Thanks. I will be submitting a copy of these 

11 remarks for the record. 

12 MS. COHEN: Thank you. 

13 MR. CARBONELL: Sorry, but we don't have enough 

14 copies with us. 

15 MS. COHEN: Any questions? 

16 MR. DICKINSON: Thank you. 

17 MS. COHEN: Mr. Nathan Wilcox, Environment 

18 America. Good morning. 

19 PRESENTATION OF ENVIRONMENT AMERICA 

20 MR. WILCOX: Hello and thanks for the 

21 opportunity to testify today on this important topic. My 

22 name is Nathan Wilcox and I'm the Federal Global Warming 
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1 Program Director for Environment America. Environment 

2 America is the federation of 29 state-based, citizen3 funded environmental advocacy organizations working for a 

4 cleaner, greener, and a healthier future. 

5 Environment America and our state groups were 

6 actively involved in the push in California and 13 other 

7 states to see California's original clean cars program 

8 adopted and we wholeheartedly support California's waiver 

9 request to implement its low emission vehicle and zero 

10 emission vehicle programs through 2025. 

11 Getting cleaner cars and trucks on the roads is 

12 absolutely critical to our effort to tackle global warming 

13 as only power plants produce more global warming pollution 

14 nationwide than do cars and light trucks. The past 12 

15 months alone have offered numerous examples of why 

16 tackling global warming is essential to protecting our 

17 environment, our health, and our safety. From deadly heat 

18 waves and wildfires to devastating floods, recent extreme 

19 weather events offer even more proof that our climate is 

20 changing in dangerous ways and emphasize the need to cut 

21 emissions of the carbon pollution that is fueling the 

22 problem. 
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1 The LEV and ZEV programs are two of the best 

2 tools available to cut carbon pollution within the 

3 transportation sector. In fact, the California Air 

4 Resources Board estimates that by 2025 the LEV and ZEV 

5 programs would cut carbon dioxide emissions by almost 14 

6 million metric tons per year. The LEV program is also 

7 critical to cutting emissions of criteria pollutants that 

8 lead to smog and other dangerous air pollution problems. 

9 California's LEV and ZEV programs by tightening 

10 emissions for our cars and light trucks have also helped 

11 build a vehicle fleet that consumes less oil. From the 

12 rivers and coastlines that are devastated by oil spills, 

13 to the carbon pollution created by the burning of oil, to 

14 the pain that consumers feel at the gas pump because of 

15 our dependence on this finite resource, there are many 

16 important reasons why getting off oil is in our country's 

17 best interests. These standards help to push automakers 

18 to create cars that are part of the solution instead of 

19 exacerbating the problem. 

20 These clean car programs are important not just 

21 for California, but for the nation as a whole. For the 

22 past four decades, California and its standards have 
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1 served as a laboratory for advancing cleaner car 

2 technologies, and because of the adoption of these 

3 standards by other states and the support their adoption 

4 helped provide for the national clean cars program, the 

5 rest of the country has less pollution and cleaner air as 

6 well. 

7 Finally, the Clean Air Act expressly recognizes 

8 California's right to set vehicle emissions standards that 

9 are stronger than the federal standards and the right of 

10 other states to adopt California standards. 

11 California has clearly met all of the legal and 

12 technical requirements for its waiver request and EPA 

13 should therefore grant the state's request without delay. 

14 Denying the request would be inconsistent with EPA's past 

15 actions, to say nothing of the threat it would pose to the 

16 ability of these standards to continue reaping benefits 

17 for California and the nation as a whole. 

18 Thanks again for the opportunity to testify. 

19 MS. COHEN: Thank you. 

20 Is there someone here from the Maryland Sierra 

21 Club wanting to testify? Yes? 

22 Would you please provide your name and 
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1 affiliation for the record? Thank you. 

2 PRESENTATION OF THE MARYLAND SIERRA CLUB 

3 MR. TULKIN: Hello. I am someone from the 

4 Maryland Sierra Club. My name is Josh Tulkin. I am the 

5 Director of the Maryland Chapter of the Sierra Club. 

6 Thanks to the many qualified comments earlier, I 

7 can keep my comments fairly brief. I'm also speaking as a 

8 displaced Californian. I had the privilege of going to 

9 school in the smog belt of Los Angeles. But I will be 

10 speaking specifically about Maryland's interest in 

11 granting this waiver. 

12 The Maryland Chapter of the Sierra Club has over 

13 30,000 supporters and we were strong advocates of 

14 Maryland's adoption of California's clean car standard, 

15 back I believe in 2007. There are specific benefits which 

16 come to Maryland from this program. About one-third of 

17 Maryland's emissions, particularly greenhouse gas 

18 emissions, come from automobiles, as someone mentioned, 

19 just second to our coal-fired power plants in the state, 

20 and the greenhouse gas reductions in this plan are part of 

21 Maryland's plan to meet its GGRA, its Greenhouse Gas 

22 Reduction Act goals. This is Maryland's goal to make 
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1 significant reductions, 20 or 25 percent, by the year 

2 2025. Second to power plants, clean cars makes one of the 

3 most significant reductions in greenhouse gases. 

4 This year Maryland saw 26 code orange days. We 

5 currently have 11 states -- sorry -- 11 counties in 

6 nonattainment for particulate matter. So there are 

7 clearly clean air -- there are clearly air pollution 

8 problems that Maryland has, and one of its approaches was 

9 the adoption of the California clean car standard. This 

10 waiver would not only benefit California, as noted 

11 earlier, but would have benefits to Maryland in state, 

12 would have benefits to Maryland's impact on five 

13 surrounding states, which have been noted to have air 

14 pollution transfer from Maryland, and for the other states 

15 upwind of us would definitely bring a downwind benefit. 

16 I think, given everything else, I'll just leave 

17 it at that. 

18 MS. COHEN: Thank you very much. 

19 MR. TULKIN: Thank you. 

20 MS. COHEN: Our next panelists represent 

21 industry. I'd like to ask Mr. Antonio Santos from MECA to 

22 testify. 
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1 PRESENTATION OF THE MANUFACTURERS OF 

2 EMISSION CONTROLS ASSOCIATION 

3 MR. SANTOS: Good morning. Hi. My name is 

4 Antonio Santos, Director of Special Projects at the 

5 Manufacturers of Emission Controls Association here in 

6 Washington, D.C. MECA and its member companies today 

7 would like to thank the U.S. EPA for allowing us to speak 

8 at this hearing. 

9 We, along with the Emissions Control Technology 

10 Association, ECTA, and the Advanced Engine Systems 

11 Institute, AESI, which you'll be hearing from later today, 

12 are pleased to provide comments in support of the 

13 California Air Resources Board's request that EPA grant a 

14 waiver for ARB's Advanced Clean Car program. This 

15 comprehensive program that includes future criteria 

16 exhaust and evaporative emission standards for light-duty 

17 and medium-duty vehicles, post-2016 light-duty greenhouse 

18 gas emission standards, and revisions to ARB's zero 

19 emission vehicle requirements, will reset the bar for 

20 state of the art exhaust and evaporative emission controls 

21 for light-duty vehicles through 2025. 

22 MECA is a nonprofit association of the world's 
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1 leading manufacturers of emission control technology for 

2 mobile sources. Our members have over 40 years of 

3 experience and a proven track record in developing and 

4 manufacturing emission control technology for a wide 

5 variety of on-road and off-road vehicles and equipment, 

6 including extensive experience in developing exhaust and 

7 evaporative emission controls for gasoline and diesel 

8 light-duty vehicles in all world markets. Our industry 

9 has played an important role in the emission control 

10 success story associated with light-duty vehicles in 

11 California and has continually supported efforts to 

12 develop innovative technology-forcing emission control 

13 programs to deal with California's unique air quality 

14 problems. 

15 The experience of our industry over the last 40 

16 years clearly demonstrates the connection between vehicle 

17 emission regulation and economic development. Prior to 

18 1970, our industry did not exist. But with the enactment 

19 of the Clean Air Act in 1970, our industry has flourished, 

20 developing successive generations of technology to meet 

21 ever-tightening regulatory standards. 

22 Since the introduction of the catalytic 
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1 converter in 1975, more than 500 million light-duty 

2 vehicles have been sold in the U.S. equipped with exhaust 

3 and evaporative emission control technologies developed by 

4 our industry. This generated an estimated $250 to $300 

5 billion in economic activity since 1975. In 2010 alone, 

6 our industry generated $12 billion of economic activity 

7 and accounted for 65,000 jobs, mostly in manufacturing. 

8 ARB's Advanced Clean Car program will provide additional 

9 support for the continued development of a thriving U.S. 

10 industry focused on a wide range of technologies that can 

11 reduce vehicle criteria pollutant and greenhouse gas 

12 emissions. 

13 MECA provided detailed written comments to ARB 

14 in January of this year as part of their proposed 

15 rulemaking for the Advanced Clean Car program, which was 

16 officially approved by the ARB Board on January 27, 2012. 

17 In those comments, MECA agreed with ARB staff's 

18 assessment that achieving the proposed LEV III exhaust and 

19 evaporative emission standards and associated emission 

20 reductions are both technically feasible and cost21 effective. 

22 This fact is clearly demonstrated by the more 
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1 than two million SULEV and PZEV-compliant light-duty 

2 vehicles that have been sold in the California market 

3 since these near-zero emission gasoline vehicles were 

4 first introduced more than ten years ago. The technology 

5 base of advanced three-way catalysts, exhaust hydrocarbon 

6 adsorber materials, high cell density substrates, emission 

7 system thermal management strategies, secondary air 

8 injection systems, advanced carbon canisters, advanced low 

9 fuel permeation materials, and air intake hydrocarbon 

10 adsorber materials that have already been commercialized 

11 for PZEV gasoline vehicle applications can be extended to 

12 and further optimized to allow all light, medium, and 

13 heavy-duty gasoline vehicles to achieve the exhaust and 

14 evaporative emission standards needed by vehicle 

15 manufacturers to comply with the LEV III emission limits. 

16 In addition, advanced diesel emission control 

17 technologies, including diesel particulate filters, lean 

18 NOx adsorber catalysts, and selective catalytic reduction 

19 catalysts, will be combined with future advanced diesel 

20 engines to allow light-duty diesel vehicles to achieve the 

21 LEV III emission limits. 

22 MECA also urged ARB in our previous testimony to 
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1 include a mid-term formal review on their proposed one 

2 milligram per mile light-duty vehicle PM standard to 

3 ensure that future gasoline vehicles that are introduced 

4 into the California market include the best available 

5 technologies for minimizing particulate emissions from 

6 these vehicles. MECA also supported ARB's changes to 

7 their light-duty vehicle on-board diagnostic requirements, 

8 noting that it is important for ARB to continue to 

9 encourage the development of commercial opportunities for 

10 particulate sensors for both light-duty and heavy-duty 

11 vehicle OBD applications. 

12 MECA also fully supported ARB's post-2016 

13 greenhouse gas emission standards for light-duty vehicles. 

14 Implicit in federal and state greenhouse gas emission 

15 analyses is the ability of these advanced powertrain 

16 options to meet the applicable criteria pollutant emission 

17 standards, such as for carbon monoxide, oxides of 

18 nitrogen, and non-methane organic gases. 

19 All of these advanced light-duty powertrain 

20 options combined with the appropriately designed and 

21 optimized emission control technologies can meet all 

22 current and future federal and state criteria emission 
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1 requirements. In this manner, advanced emission controls 

2 for criteria pollutants enable advanced powertrains to 

3 also be viable options for reducing greenhouse gas 

4 emissions. 

5 A range of powertrain technologies, including 

6 engine turbochargers, exhaust gas recirculation systems, 

7 advanced fuel systems, variable valve actuation 

8 technology, advanced transmissions, hybrid powertrain 

9 components, and powertrain control modules, that could be 

10 applied to both light-duty gasoline and diesel powertrains 

11 to help improve overall vehicle efficiencies, also help 

12 reduce fuel consumption, both of which can result in lower 

13 CO2 exhaust emissions. 

14 In many cases, the application and optimization 

15 of advanced emission control technologies on advanced 

16 powertrains can be achieved with minimal impacts on 

17 overall fuel consumption. Auto manufacturers will also 

18 take advantage of synergies between advanced emission 

19 control technologies and advanced powertrains to assist in 

20 their efforts to optimize their performance with respect 

21 to both criteria pollutant and greenhouse gas emissions. 

22 In summary, there are significant opportunities 
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1 to reduce both criteria pollutant and greenhouse gas 

2 emissions from the transportation sector through the 

3 design of fuel efficient powertrains that include advanced 

4 emission controls for meeting even the most stringent 

5 criteria pollutant standards that are included in ARB's 

6 Advanced Clean Car program. 

7 MECA believes the advanced emission control 

8 systems have a critically important role in current and 

9 future policies that aim to reduce mobile source criteria 

10 pollutant and greenhouse gas emissions. These advanced 

11 exhaust and evaporative emission control technologies will 

12 allow all current and future high-efficiency powertrain 

13 options to comply with ARB's LEV III criteria pollutant 

14 standards, thus enabling these powertrains to be viable 

15 options for complying with existing and proposed ARB and 

16 EPA greenhouse gas pollutant standards. 

17 MECA, ECTA, and AESI commend ARB for taking 

18 important steps through its Advanced Clean Car program to 

19 reduce criteria pollutant and greenhouse gas emissions and 

20 to improve fuel economy from light-duty vehicles in 

21 California. We ask EPA to grant ARB a waiver for this 

22 innovative regulatory program. We also urge EPA to bring 
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1 forward their Tier 3 light-duty proposal, using ARB's LEV 

2 III program as a template, that will establish a national 

3 set of exhaust and evaporative standards for light-duty 

4 vehicles. 

5 Our industry is prepared to do its part to 

6 deliver cost-effective advanced emission control 

7 technologies to the market. MECA will provide written 

8 comments on this waiver request before the close of the 

9 comment period. 

10 Thank you. 

11 MS. COHEN: Thank you very much. 

12 MR. DICKINSON: Thank you. 

13 MS. COHEN: Chris Hessler, Advanced Engine 

14 Systems Institute. 

15 Good morning. 

16 PRESENTATION OF THE ADVANCED ENGINE SYSTEMS INSTITUTE 

17 MR. HESSLER: Good morning. My name is Chris 

18 Hessler. I'm here today on behalf of the Advanced Engine 

19 Systems Institute. AESI was established to represent the 

20 companies that design, engineer and manufacture components 

21 that enable engines to operate more cleanly and 

22 efficiently. I'm going to pile on a little bit in favor 
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1 of approval of the waiver petition, but also talk a bit 

2 about what we think is an important way to think about 

3 costs and technologies. 

4 AESI strongly supports EPA approval of the 

5 waiver sought by the California Air Resources Board. 

6 ARB's waiver request is consistent with past approvals of 

7 California waivers. California is seeking permission to 

8 implement the third major version of its LEV program, 

9 which has been a vital component of California's strategy 

10 to manage some of the most difficult air pollution 

11 challenges in the nation. 

12 There has been a lot of talk already about the 

13 three tests in Section 209 of the Clean Air Act, so I 

14 won't repeat them, but will address our views regarding 

15 how the petition meets -- how the standard meets those 

16 tests. 

17 Regarding consistency, California's air remains 

18 stubbornly in nonattainment with the ozone and PM NAAQS. 

19 Nearly 80 percent of the state's ozone-forming NOx 

20 emissions and a third of its PM 2.5 emissions are from 

21 mobile sources. So absent further tightening of the LEV 

22 emission standards, Californians have little hope that the 
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1 air they breathe will ever meet federal standards. 

2 Regarding arbitrary and capricious, the proposed 

3 revisions are entirely consistent with past standards 

4 crafted by the ARB and approved by EPA. Moreover, the ARB 

5 has fully documented its process for developing the 

6 standards, including the steps it's taken to ensure the 

7 standards are practical and achievable. 

8 Regarding stringency, clearly its more stringent 

9 than the federal standard. It represents a meaningful 

10 tightening of the current standards and it will drive the 

11 use of some of the latest technologies. 

12 Given that the standard meet the three tests set 

13 forth in the law, the Administrator must grant the 

14 petition. 

15 Unfortunately, the federal government has fallen 

16 behind California in regard to vehicle emission standards. 

17 And, worse, it has done so without explanation of any 

18 kind. Years have been spent developing a federal proposal 

19 that would, we are told, put the rest of the nation on par 

20 with California's LEV III standard, but the proposal 

21 appears to have been shelved. 

22 Some have boldly asserted that a federal Tier 3 
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1 standard would pose unbearable costs on our already 

2 weakened economy. My question would be, by what 

3 techniques has anyone managed to analyze the micro and 

4 macro economic outcomes of a proposal that none of us in 

5 the public has yet seen? Perhaps we should see such 

6 assertions for the nonsense that they are, based at best 

7 on guesswork as to what is contained in the proposal. The 

8 federal government has no cause to conceal its work and 

9 its thinking on Tier 3 from the public. Let it be seen 

10 and let its merits and demerits be debated. 

11 Whether we're talking about LEV III or Tier 3, 

12 casual assertions that reducing vehicle emissions is 

13 somehow inconsistent with economic growth flies in the 

14 face of four decades of evidence to the contrary. In 

15 1967, the city of Los Angeles made the cover of Time 

16 Magazine under a banner headline, "The Polluted Air." 

17 Many other cities were faced with choking smog that would 

18 shock and amaze those of us who have become accustomed to 

19 today's far better air quality standards. 

20 What has happened since that time provides us 

21 with incontrovertible evidence that emissions controls do 

22 not hamper economic development. They have enhanced and 
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1 enabled growth and the mobility that is powered by ever2 cleaner engines. Since that article appeared in Time, the 

3 miles driven by cars and trucks in this country have 

4 tripled, as has GDP. The volume of freight shipped around 

5 the country has quadrupled, and yet total emissions from 

6 mobile sources have shrunk to a quarter of what they were. 

7 Automakers have produced cars that are more 

8 powerful, last longer, are driven more, and yet pollute 

9 far less. They have done that using the technologies 

10 developed and manufactured in this country by AESI members 

11 and their colleagues in other companies throughout the 

12 industry. 

13 If we had not controlled emissions from all the 

14 engines used to keep this country moving, much of the air 

15 in this nation would be poisonous and unbreathable. Of 

16 course, it's somewhat silly to think about that because 

17 Americans would never have tolerated such a wasteful 

18 destruction of the resource of clean air, and that's why 

19 Congress passed and repeatedly improved the Clean Air Act. 

20 That's why under the leadership of individuals like Margo 

21 Oge, whose tremendous public service is nearing its end, 

22 EPA has repeatedly adopted tighter emission standards, as 
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1 has California, that have reflected the advances made by 

2 technologies. 

3 Are there costs associated with using emission 

4 control equipment? Absolutely. But the average emission 

5 control system costs less than a modern car audio system. 

6 Innovation is constantly driving costs down. Just this 

7 month, a major automaker it will introduce on 2013 

8 vehicles a new catalytic converter that uses 22 percent 

9 less precious metals and costs 37 percent less than the 

10 converter it is replacing, while still complying with 

11 emission standards. 

12 The technologies used to control emissions have 

13 proven highly cost-effective, while allowing us to reap 

14 the economic and social rewords of our mobility. Despite 

15 this tremendous progress, a third of the nation still 

16 lives in nonattainment areas still contribute 60 percent 

17 of the NOx emissions and a third of the PM 2.5 emissions 

18 in most of those places, and more in some. So unless 

19 folks are going to start driving less, we'd better 

20 continue making our cars and trucks cleaner. 

21 Our industry continues its long and successful 

22 tradition of innovative and cost-effective technologies -- 
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1 of producing innovative and cost-effective technologies to 

2 meet automakers' needs. All we ask is that EPA approve 

3 California's petition to implement its LEV III standard 

4 and that EPA release its own proposal for Tier 3 standards 

5 for public comment and discussion. 

6 Thank you for your time. 

7 MS. COHEN: Questions? 

8 MR. DICKINSON: I have a question for you, 

9 Chris, and for Mr. Santos as well. Do either of you have 

10 anything you'd like to comment on in the LEV context? 

11 MR. HESSLER: We are going to submit some more 

12 detailed written comments and I think in those we'll talk 

13 a bit more about ZEV technologies as well as greenhouse 

14 gas. But it will be in the context of what lessons we can 

15 draw from the emission control success and what that 

16 suggests about the market. 

17 MR. DICKINSON: Thank you, Chris. 

18 Mr. Santos? 

19 MR. SANTOS: MECA back in January did not 

20 comment directly on ARB's previous rulemaking in January 

21 on the ZEV rulemaking directly addressing this criteria. 

22 But I'm sure we can probably come up with something 
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1 appropriate. 

2 MR. DICKINSON: Okay, at your pleasure. Thank 

3 you. 

4 MS. COHEN: Thank you. 

5 It is our practice at these waiver hearings to 

6 offer California the last chance to testify. But before 

7 we close, is there anyone else here who would like to 

8 present testimony today? 

9 (No response.) 

10 MS. COHEN: Would California like to present 

11 further testimony? 

12 CLOSING PRESENTATION OF THE CALIFORNIA 

13 AIR RESOURCES BOARD 

14 MR. CACKETTE: First of all, I'd like to thank 

15 all of the testifiers who were so incredibly supportive of 

16 the program. We really appreciate their response, and I 

17 think the diversity of them is quite impressive -- 

18 environmental groups, consumer groups, investors, states, 

19 and other local governments. So again, thank you very 

20 much for that. 

21 I'll leave my one comment to the one testifier 

22 who was not supportive, which was NADA. There's four 
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1 points they made that I want to respond to. The first one 

2 is California's fuel economy program. I guess NADA is 

3 following the current political handbook, which says that 

4 if you say something and it's not true enough times people 

5 will believe it's true. 

6 The fact that we have a fuel economy program in 

7 California is not true. It's disingenuous for people to 

8 continue to say that. We only have emission standards. 

9 We're not allowed to have a fuel economy program. We 

10 don't want to have a fuel economy program and don't have 

11 one. So I hope the record will reflect that and perhaps 

12 Ms. Oge's comments that things that aren't true should be 

13 stricken from the record would be an appropriate response. 

14 Regarding the patchwork and border sales issues, 

15 these are largely old information, something that's been 

16 again promoted by NADA and other people for a long time. 

17 We tried to respond to these and we have responded to 

18 them. We have pooling now so that in the LEV program 

19 there's pooling, in greenhouse gas there's pooling. That 

20 means that manufacturers do not have to have sales that 

21 match the requirements in every single state, but they can 

22 pool stuff together. Even in the ZEV program, there are 
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1 provisions to try to get at the same issue. 

2 As regards to the there's no benefit above the 

3 federal program comment made by NADA, it's simply not 

4 supported or true. We can point to our whole program, 

5 which is in general more stringent than the federal 

6 program. We can point to the LEV III part for criteria 

7 pollutants, which is more stringent than the federal 

8 program. We can point to the greenhouse gas program with 

9 California's unique and separate regulation which is more 

10 stringent than the federal program, despite the fact that 

11 we're willing to accept the federal program for compliance 

12 in the case of greenhouse gases. And we can point to the 

13 ZEV program, which there is no counterpart at the federal 

14 level, and it's clearly more restrictive than the federal 

15 program. So again, a statement that I think is not true. 

16 Finally, on the fourth point, NADA made the 

17 comment that the ZEV program was amended a lot of times 

18 because it doesn't work. Let me give you the contrary 

19 assessment of that. I find the fact that it's been 

20 modified a lot of times to be a positive attribute, not a 

21 flaw. It shows that it's flexible and it's responsive as 

22 needed for when you have a true technology-forcing 
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1 requirement such as this. I note that there was OEM, car 

2 manufacturer, opposition to it for decades, and in the 

3 last amendments there was none. The manufacturers clearly 

4 recognize this is where technologies need to go and that's 

5 where they're going, and as a result they did not oppose 

6 the ZEV amendments, which, as I showed you, were a 

7 substantial strengthening of the program, moving out of 

8 kind of a niche program, again that NADA referred to, into 

9 an early commercialization stage. 

10 I'll also finally point to the fact that the ZEV 

11 program has a number of complementary policies and we 

12 wouldn't be putting these in place if it was a failing 

13 program and one that didn't work. We're investing money 

14 for incentives for people who buy ZEV vehicles. We're 

15 investing over $100 million in infrastructure improvements 

16 for providing a hydrogen fueling network. We're going to 

17 have about 18,000 electric chargers, public electric 

18 chargers, in California within the next four years to 

19 support expanded use of battery electric vehicles and 

20 plug-in hybrid electric vehicles. 

21 These clearly would not be taken by our 

22 legislature and our governor if we were supporting a 
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1 program that was limited to just niche with no future and 

2 one that didn't work. 

3 So those are the comments that I would offer. 

4 Thank you very much for the opportunity. 

5 MS. COHEN: Thank you. 

6 Do we have any questions? 

7 (No response.) 

8 MS. COHEN: If no other party wishes to bring 

9 testimony to this hearing panel, if there are no other 

10 comments -- 

11 (No response.) 

12 MS. COHEN: -- then we'll proceed to close this 

13 meeting, this hearing. As noted at the outset, the public 

14 comment period will remain open until October 19th and the 

15 full docket is also open for your review. We encourage 

16 you to submit comments, and I thank you all for your 

17 participation. 

18 This hearing is hereby closed. 

19 (Whereupon, at 11:43 a.m., the hearing was 

20 adjourned.) 

21

22