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ADVANCED CLEAN CARS SUMMARY

1. Background

Despite significant progress in reducing smog-forming and particulate matter criteria 

emissions from the passenger vehicle fleet, California needs further reductions in order 

to meet health-based State and federal ambient air quality standards. In addition, 

climate change continues to pose a serious threat to the economic well-being, public 

health, natural resources, and the environment of California.

To address the challenge presented by climate change, vehicle greenhouse gas (GHG) 

emissions must be drastically reduced if we are to meet our goal of an 80 percent

reduction by 2050. This 40 year outlook is a far longer time horizon than those 

employed by the federal agencies under the Clean Air Act, or the requirements to 

develop the corporate average fuel economy (CAFE) standards. Policies developed 

under this longer policy timeframe also deliver a continuous policy message to both the 

manufacturers and consumers that California is committed to significant changes to 

clean up the cars and lights trucks we drive. We have to start now. There is no time to 

lose.

Over the past three years California has worked with federal agencies to ensure that the 

stringent greenhouse gas standards, if adopted, will achieve the dramatic reductions 

that meet California‟s needs. Together these standards will provide consumers with the 

next generation of vehicles, designed to reduce multiple pollutants, while preserving 

vehicle choice and saving money.

California’s Advanced Clean Cars Program

Continuing its leadership role in developing innovative and ground breaking emission 

control programs, Air Resources Board (ARB) staff has developed the Advanced Clean 

Cars program, a pioneering approach of a „package‟ of regulations, although separate in 

construction are related in terms of the synergy developed to address both ambient air 

quality needs and address climate change. 

The Advanced Clean Cars program combines the control of smog, soot causing 

pollutants and greenhouse gas emissions into a single coordinated package of 

requirements for model years 2015 through 2025. And assures the development of 

environmentally superior cars that will continue to deliver the performance, utility, and

safety vehicle owners have come to expect. 

The ZEV program will act as the focused technology of the Advanced Clean Cars 

program by requiring manufacturers to produce increasing numbers of ZEVs and plug-in 

hybrid electric vehicles in the 2018-2025 model years.

Consumer labeling patterned on California‟s revolutionary environmental performance 

label will provide important emissions information in a graphical, easy-to-read and 

understand format for comparing new vehicle emissions.
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In addition, the Advanced Clean Cars program includes amendments to the Clean Fuels 

Outlet regulation that will assure ultra-clean fuels such as hydrogen are available to 

meet vehicle demands brought on by these amendments to the ZEV program.

Driving Technology and Improving the Economy

California is a clear leader in innovation and venture capital investment, which will 

benefit from the Advanced Clean Cars package. California received over half of all 

clean-tech venture capital investments in the U.S. in the last quarter,[1] and is well 

poised to continue to serve as an economic hub for technology and job creation related 

to clean vehicles in the coming years.

These regulations, especially the zero emission vehicle rules, are creating the jobs of 

the twenty-first century now in California. Three innovative automakers have opened 

shop in California, and are pushing the market forward and creating jobs in the 

State. Tesla Motors has resurrected auto manufacturing in California, purchasing and 

retooling the former NUMMI plant in Fremont, California to produce its Model S 

sedan. Manufacturing at the Tesla facility is expected to create about 1,000 

manufacturing jobs, up to a quarter of those lost when the NUMMI facility closed.[2] Just 

last week, CODA Automotive opened its new global headquarters in Los Angeles, which 

will allow the company to grow significantly in coming years. The company also has an 

assembly plant in Benicia, California, where final assembly of its sedan occurs. 

Southern California is also home to the global headquarters of ZEV producer Fisker 

Automotive, as well as engineering and design facilities for many larger automakers and 

their clean cars programs.

In addition to the automakers, the job and economic center of the plug-in electric vehicle 

charging sector is in California. In the tradition of the State‟s innovation driven 

economy, these companies are helping to develop the early market for ZEVs with novel 

financing and charging options. Vehicle operating and total cost savings that will 

materialize as a result of the Advanced Clean Cars program will also increase 

consumer purchasing power. This effectively puts more cash in Californians‟ pockets, 

pumping money back into the local economy, with the resulting effect of increasing 

economic output and job creation in the State overall. As the standards ramp up, 

economic modeling suggests an increasing positive economic impact to the State; 

consumer savings on fuel and operating costs will lead to thousands of additional jobs 

in the State this decade, and tens of thousands in the next. 

Greenhouse Gas Emissions

Recognizing the increasing threat of climate change to the well-being of California‟s 

citizens and the environment, in 2002 the Legislature adopted and the Governor signed 

AB 1493 (Chapter 200, Statutes 2002, Pavley). AB 1493 directed ARB to adopt the 

maximum feasible and cost-effective reductions in GHG emissions from light-duty 

 

[1] See: http://www.ey.com/US/en/Newsroom/News-releases/Large-Energy-Storagedeals-push-US-VC-investment-in-cleantech

[2] See: http://abclocal.go.com/kgo/story?section=news/business&id=7453388
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vehicles. Vehicle GHG emissions included carbon dioxide (CO2), methane (CH4), and 

nitrous oxide (N2O) that are emitted from the tailpipe, as well as emissions of HFC134a, 

the refrigerant then used in most vehicle air conditioning systems. 

As directed by AB 1493, ARB adopted what is commonly referred to as the Pavley 

regulations, the first in the nation to require significant reductions of GHGs from motor 

vehicles. These regulations, covering the 2009-2016 and later model years, call for a 

17 percent overall reduction in climate change emissions from the light-duty fleet by 

2020 and a 25 percent overall reduction by 2030. They also formed the foundation for 

the federal GHG and fuel economy programs for light-duty vehicles for 2012-2016 

model years.

After the Board adopted the Pavley regulations, the Legislature adopted and the 

Governor signed AB 32, the California Global Warming Solutions Act (Chapter 488, 

Statutes 2006, Nuñez/Pavley.) AB 32 charges ARB with the responsibility of monitoring 

and regulating GHG emissions in the State. AB 32 also directed ARB to prepare a 

scoping plan outlining the State‟s strategy to achieve the maximum feasible and 

cost-effective reductions in furtherance of reducing GHG emissions to 1990 levels by 

2020. Measure T1 of the scoping plan anticipates an additional 3.8 million metric tons

of carbon dioxide equivalent (MMTCO2e) reduction from the passenger vehicle fleet by 

2020 beyond the reductions from the 2009-2016 AB 1493 standards.

In addition, in 2005, in order to mitigate the long-term impacts of climate change, the 

Governor issued Executive Order S-3-05. Among other actions, the Executive Order 

called for reducing GHG emissions to 80 percent below 1990 levels by 2050. This 

ambitious yet achievable reduction path and goal are considered necessary to stabilize 

the long-term climate.

ZEV Program

Although originally part of the LEV program, ARB established the ZEV program as a 

stand-alone regulation in 1999, in recognition of the increasing maturity of zero emission 

technologies and the critical role they can play in achieving California‟s air quality goals. 

Since then, the program has been modified several times to address the pace of 

development of zero emission technologies.

At its March 2008 hearing, the Board directed staff to redesign the 2015 and later model 

year ZEV program by strengthening the requirement and focusing primarily on zero 

emission technologies – battery electric vehicles, hydrogen fuel cell vehicles, and 

plug-in hybrid electric vehicles – in order to ensure that these low GHG technology 

vehicles transition from the demonstration phase to full commercialization in a 

reasonable timeframe to meet long-term emission reduction goals. The proposed 

amendments to the ZEV program are presented in a separate package, also part of this 

passenger vehicle rulemaking, as discussed next.
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Preparing for the future; Moving beyond Advanced Clean Cars

Beyond 2025, the driving force for lowering emissions in California will be climate 

change. In order to meet our 2050 GHG goal, the new vehicle feet will need to be 

primarily composed of advanced technology vehicles such as electric and fuel cell 

vehicles by 2035 in order to have nearly an entire advanced technology fleet – that is, 

both new and used vehicles – by 2050. Accordingly, the Advanced Clean Cars program 

coordinates the goals of the LEV, ZEV, and Clean Fuels Outlet programs in order to lay 

the foundation for the commercialization and support of these ultra-clean vehicles.

Figure 1 shows the cumulative on-road passenger vehicle fleet mix for one scenario 

developed by staff that achieves California‟s 2050 GHG emission reduction goal. 

Importantly, ZEV sales must constitute nearly 100 percent of new vehicles in 2040 for 

ZEVs to constitute approximately 87 percent of the on-road fleet by 2050. 

Figure 1. On Road Light-Duty Vehicle Scenario to Reach 2050 Goal

2. Low Emission Vehicle (LEV) Program

2.1 Criteria Emission Standards 

In order to achieve further criteria emission reductions from the passenger vehicle fleet, 

staff is proposing several amendments representing a significant strengthening of the 

LEV program. The major elements of the proposed LEV III program are:

 A reduction of fleet average emissions of new passenger cars (PCs), 

light-duty trucks (LDTs) and medium-duty passenger vehicles (MDPVs) to 

super ultra-low-emission vehicle (SULEV) levels by 2025.
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 The replacement of separate NMOG and oxides of nitrogen (NOx) standards 

with combined NMOG plus NOx standards. The combined ROG+NOx 

standard will decline from 0.100 for passenger cars and light-duty truck 1s 

and 0.119 for light-duty truck 2s and medium duty passenger vehicles in 

2015 to 0.030 for all vehicle categories by 2030.

 An increase of full useful life durability requirements from 120,000 miles to 

150,000 miles, which guarantees vehicles operate longer at these extremely 

low emission particulate levels.

 A backstop to assure continued production of super ultra-low-emission 

vehicles after PZEVs as a category are moved from the Zero-Emission 

Vehicle program to the LEV program in 2018.

 More stringent particulate matter (PM) standards for light- and medium-duty 

vehicles.

 Zero fuel evaporative emission standards for PCs and LDTs, and more 

stringent evaporative standards for medium-duty vehicles (MDVs).

2.2 Greenhouse Gas Emission Standards

For the 2017-2025 model year standards, ARB proposes to use the United States 

Environmental Protection Agency (USEPA) approach and adopt separate standards for 

CO2, CH4, and N2O. The proposed GHG emission standards would reduce new 

passenger vehicles carbon dioxide (CO2) emissions from their model year 2016 levels 

by approximately 34 percent by model year 2025, from about 251 to about 166 

gCO2/mile, based on the projected mix of vehicles sold in California. The basic 

structure of the standards includes two categories – passenger cars and light-duty 

trucks – that are consistent with federal categories for light-duty vehicles. The standard 

targets would reduce car CO2 emissions by about 36 percent and truck CO2 emissions 

by about 32 percent from model year 2016 through 2025. Figure 2 illustrates the basic 

target emission trends that are projected from the car and truck standards.
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Figure 2. Target Emission Reductions from GHG Standards

The CH4 and N2O standards will reflect the same stringency as the original GHG

standards. The net result is, like the current 2009-2016 California GHG standards, the 

proposed 2017-2025 standards account for all major sources of vehicle GHG 

emissions, including upstream emissions associated with vehicle fuels. In addition, 

California is proposing to align its vehicle air conditioning system requirements with 

federal requirements. 

2.3 Maximum Feasible and Cost-Effective Technologies

Vehicle manufacturers need sufficient lead time to implement new technologies across 

their vehicle lines both from a feasibility and cost-effectiveness standpoint. 

Manufacturers will be resource challenged over the next 15 years as they strive to 

develop and implement technologies ranging from advanced gasoline and diesel 

engines to electric and fuel cell vehicles, while at the same time lowering criteria 

emissions of their combustion engines. The phase-in of the Advanced Clean Cars 

program requirements recognizes this by providing manufacturers with significant lead 

time and considerable compliance flexibility.

Criteria Emissions

The technology for controlling vehicle emissions is well understood and manufacturers 

have a wide range of emission control technologies available to achieve 

“near-zero-at-the-tailpipe (SULEV) emissions. Many of these technologies are already 

being used today on vehicles meeting LEV II requirements, and staff anticipates that 

with ongoing improvements to the effectiveness of these technologies, particularly 

catalyst technology, manufacturers will be able to meet the proposed requirements for 

smog forming emissions under the LEVIII element of the Advanced Clean Cars 

package. For some vehicles, specifically the heavier vehicles with larger displacement 

engines, additional emission control componentry such as secondary air and 

hydrocarbon absorbers may be required to achieve the proposed emission levels. 

100

150

200

250

300

350

2010 2015 2020 2025

GHG emissions (gCO2e/mi)

Model year

Truck

Combined light duty

Car

Previous rule Proposed rulemaking
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Greenhouse Gas Emissions

The proposed GHG standards are also predicated on many existing and emerging 

technologies that increase engine and transmission efficiency, reduce vehicle energy 

loads, improve auxiliary and accessory efficiency, and recognize increasingly electrified 

vehicle subsystems with hybrid and electric drivetrains. Many technologies reduce both 

criteria emissions and GHGs, with this synergy enhancing technologies, cost 

effectiveness and demonstrating the importance of California analyzing the passenger 

vehicle fleet program as a whole. 

Previous rulemakings (i.e., California‟s 2009-2016 and federal 2012-2016 standards) 

established an original technical basis for the proposed GHG standards. This 

rulemaking builds on this existing technical foundation with new technical data and the

understanding of evolving state-of-the-art engine, transmission, hybrid, and 

electric-drive technologies. As part of this effort, and without conceding any of 

California‟s separate authority, staff has been working with the USEPA and the National 

Highway Transportation Safety Administration (NHTSA) since early last year to develop 

a unified national GHG program for motor vehicles beyond 2016. Importantly, while 

California proposes accepting national program compliance at manufacturers‟ option, 

California is only doing so because it believes the proposed standards are stringent 

enough to meet State GHG emission reduction goals. 

2.4 Environmental Impacts

Criteria Emissions

Table 1 provides the emission benefits for calendar years 2023, 2025, 2035, and 2040 

for reactive organic gas (ROG), oxides of nitrogen (NOx), and particulate matter 

(PM2.5) respectively. Emission benefits are fully realized in the 2035-2040 timeframe 

when nearly all vehicles operating in the fleet are expected to be compliant with the 

proposed Advanced Clean Car standards. By 2035 ROG statewide emissions would be 

reduced by an additional 21 percent, NOx emissions by an additional 36 percent, and 

PM2.5 emissions by 11 percent. 
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Table 1. Statewide Emission Benefits of the Advanced Clean Car Program: Reactive 

Organic Gas (ROG), Oxides of Nitrogen (NOx) and Particulate Matter (PM 2.5)

Statewide ROG (tons/day)

Calendar

Year Adjusted Baseline Proposed 

Regulation Benefits Percent Reduction

2023 193.2 190.1 3.1 2%

2025 179.1 173.4 5.8 3%

2035 144.9 114.1 30.8 21%

Statewide NOX (tons/day)

Calendar

Year Adjusted Baseline Proposed 

Regulation Benefits Percent Reduction

2023 201.3 186.7 14.7 7%

2025 183.7 162.3 21.3 12%

2035 136.8 88.0 48.9 36%

Statewide PM2.5 (tons/day)

Calendar

Year Adjusted Baseline Proposed 

Regulation Benefits Percent Reduction

2023 28.2 27.4 0.8 3%

2025 28.6 27.5 1.1 4%

2035 30.5 27.2 3.3 11%

Greenhouse Gas Emissions

The Advanced Clean Cars program would provide major reductions in greenhouse gas 

emissions. Table 2 shows the greenhouse gas emission benefits in 2020, 2025, 2035, 

and 2050. By 2025, CO2 equivalent emissions would be reduced by 13 million metric 

tons (MMT) per year, which is 12 percent from baseline levels. The reduction increases 

in 2035 to 31 MMT/Year, a 27 percent reduction from baseline levels. By 2050, the 

proposed regulation will reduce emissions by more than 40 MMT/Year, the equivalent of 

taking 8 million cars off the road and a reduction of 33 percent from baseline levels. 

Viewed cumulatively over the life of the regulation (2017-2050), the proposed Advanced 

Clean Cars regulation would reduce emissions by more than 850 MMT CO2 Equivalent, 

roughly double the total greenhouse gas emissions of California in 1990. 

Table 2. CO2-Equivalent (CO2e) Emission Benefits from Advanced Clean Car Regulations

Statewide CO2e Emissions (Million Metric Tons / Year)

Calendar

Year

Adjusted 

Baseline with 

Rebound

Proposed 

Regulation with 

Rebound

Benefits Percent 

Reduction

2020 111.7 108.5 3.2 3%

2025 110.9 97.0 13.8 12%

2035 116.1 84.2 31.9 27%

2050 132.4 89.2 43.3 33%
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2.5 Cost Effectiveness

Criteria Emissions

Staff based its cost-effectiveness analysis on the projected increase in vehicle price 

assuming all new vehicles meet the SULEV emission standard in 2025. Table 3 lists 

the average incremental costs for light-duty LEV III vehicles in 2025.

Table 3. Average Incremental Costs for Light-Duty LEV III Vehicles in 2025

Category Initial MY2008 certification level

Engine size Average 

price

($/vehicle)

Average 

price 

($/vehicle)

Average 

price to 

consumer 

($/vehicle)

4-cyl 6-cyl 8-cyl

PC/LDT1

(up to 

8,500 lbs)

LEV $96 $160 $299 $148

$60

$86

ULEV $52 $90 $194 $74

SULEV $0 $1 $2 $0

LDT2

(8,500 to 

14,000 lbs)

LEV $96 $160 $299 $183

ULEV $52 $90 $194 $128 $135

SULEV $0 $1 $2 $0

The analysis concluded that the average cost-effectiveness of light-duty vehicles 

meeting the LEV III program exhaust requirements relative to the 2008 fleet is 

approximately $5.00 per pound of Non-Methane Organic Gases (NMOG) and Oxides of 

Nitrogen (NOx) reduced. Staff also concluded that, since the proposed particulate 

matter (PM), that is, fine soot and other particle standards would be met by engine 

modifications during the normal course of engine development, no incremental increase 

in vehicle price would occur as a result. This cost estimate is likely conservative 

because the baseline 2008 fleet emissions are higher than the 2010 fleet emissions 

when LEV II is fully phased-in. In addition, the 2025 fleet is projected to include a 

greater portion of down sized four and six cylinder engines that incur the lower costs to 

meet SULEV emissions. Stationary source controls can range up to $10 per pound of 

emissions reduced.

Greenhouse Gas Emissions

Many of the technologies that reduce climate change emissions will also reduce the 

operating costs of light-duty vehicles. Estimates of the average reduction in operating 

costs of the new vehicles range from about 4 percent for model year (MY) 2017 

vehicles, to over 25 percent for MY2025 vehicles. For every dollar spent, the regulation 

could save consumers about $3. These savings include the expenditures on electricity 

and hydrogen associated with operating the greater volume of ZEVs being proposed; in 

the absence of those amendments the savings would be greater. Overall, purchasers 

of new vehicles in 2017 and beyond would experience a significant reduction in their 

operating cost as a result of the proposed regulation. 

2.6 Economic Impacts

The greenhouse gas element of the Advanced Clean Cars program may impact several 

sectors of the economy. The steps that manufacturers will need to take to comply with 

the Advanced Clean Cars program are expected to result in price increases for new 
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vehicles, while leading to reduced operating costs. However, the operating cost savings 

from the use of more efficient vehicles will positively impact consumers and most 

businesses. Based on staff‟s analysis, the net effect of the program on the economy is 

expected to be small but positive. 

ARB has made the achievement of environmental justice an integral part of its activities. 

Accordingly, staff evaluated the economic effects of the Advanced Clean Cars program 

on low-income households. For those households who purchase new vehicles, the 

economic effects of the regulations would be no different than on any other consumer. 

However, because residents in low-income communities tend to purchase used vehicles 

at a higher rate than residents in middle and high income communities, staff evaluated 

the effects of the program on the used vehicle market and, more specifically, on low

income households that purchase used vehicles.

Staff concluded that, while the Advanced Clean Cars program will cause vehicle prices 

to increase, as with other consumers, low income consumers will see a significant 

reduction in vehicle operating costs. The fuel savings from more efficient used vehicles 

far outweigh the annualized cost of purchasing the vehicle (price increase spread over 

the years of ownership.) Therefore, while purchase prices for used cars will increase by 

a small percentage, any increase in price will be offset by the operating cost savings. 

Table 5 below shows that whether purchasing new or used vehicles, the consumer will 

experience a net monthly savings from the program.

Table 5. Potential Impact on Monthly Loan Payment and Operating Cost Savings for New 

2025 MY Vehicles and 10 Year Old Used Vehicles (2009 dollars)

New 2025 MY Vehicles

Description Advanced Clean 

Cars Program

Average Increase in New Vehicle Price $1,900

Increase in Monthly Loan Payment $35

Net Lifetime Savings $4,000

Monthly Operating Savings $48

Net Monthly Savings $12

Payback Period (Years) 2.9

10 Year Old Used Vehicles

Description Advanced Clean 

Cars Program

Increase in Used 2025 MY Vehicle Price $440

Increase in Monthly Loan Payment $14

Net Lifetime Savings $2,000

Monthly Operating Cost Savings $36

Net Monthly Savings $22

Payback Period (years) 0.9
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3. Zero Emission Vehicle Regulation

Many gasoline engines now emit at near zero emission levels of smog forming 

emissions. Conventional hybrid electric vehicles have been commercialized, and the 

number of models offered for sale is quickly expanding. Recently, battery electric 

vehicles (BEV) and plug-in hybrid electric vehicles (PHEV) have been introduced for 

sale, and fuel cell electric vehicles (FCV) are expected to be sold beginning in 2015. 

This movement towards commercialization of advanced clean cars has occurred 

because of the ZEV regulation. Table 6 below summarizes the vehicle placements due 

to the ZEV regulation to date.

Table 6: Cumulative Vehicle Placements

(1996 – 2010)

ZEV Technology Type Quantity of 

Vehicles

Fuel Cell 180

Battery Electric 5,200

Neighborhood Electric 28,800

Hybrid or Compressed Natural Gas 380,000

Conventional Gas 1,750,000

The ZEV regulation, which affects passenger cars and light-duty trucks, remains 

critically important to California‟s efforts to meet health based air quality goals. More 

recently, the program‟s goals have evolved to include paving the way for achieving 

California‟s long term climate change emission reduction goals. For these reasons, 

California remains committed to the commercialization of ZEV technologies.

At its last review of the program, the Board directed staff to strengthen the requirement 

over the current program and focus primarily on the zero emission drive, that is BEV, 

hydrogen FCV, and PHEV technologies. The goal of the Board direction was to ensure 

California remains the central location for moving advanced, low greenhouse gas 

(GHG) technology vehicles from the demonstration phase to commercialization. 

This rulemaking is an opportunity for the Board to commit to the transformation of 

California‟s light-duty vehicle fleet. As the technology forcing piece of the 

Advanced Clean Car (ACC) package, the ZEV regulation along with new LEV III 

smog-forming pollutant and GHG standards can be the catalyst to that transformative 

process. Proposed amendments to the regulation therefore focus on technologies that 

help meet long term emission reduction goals, simplify the program where needed, and 

increase requirements for 2018 and subsequent model years.

3.1 Proposed Amendments to the ZEV Regulations

2009 through 2017 Model Year Amendments

Staff‟s goal for amendments affecting the current ZEV regulation through the 2017 

model year is to make minor mid-course corrections and clarifications, and enable 
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manufacturers to successfully meet 2018 and subsequent model year requirements. 

The amendments include:

A. Provide Compliance Flexibility: 

 Credit Expiration: Remove limitations on the use of credits (expiration dates). 

 Intermediate Volume Manufacturer requirements: Slightly reduce the 2015 

through 2017 credit requirement for intermediate volume manufacturers (IVMs, 

less than 60,000 vehicles produced each year), to allow them to prepare for 

requirements in 2018. 

 “Travel provision”: Extend the provision that allows ZEVs placed in any state 

that has adopted the California ZEV regulation to count towards the ZEV 

requirement through 2017 (i.e. extending the “travel provision” for BEVs 

through 2017). 

B. Adjust Credits and Allowances: Increase credits for Type V (300 mile FCV) ZEV 

to appropriately incentivize this longer term technology. Add a Type H advanced 

technology partial zero emission vehicle (PZEV) allowance to give appropriate 

credit for BEV-like plug-in hybrid electric vehicles (PHEV), a car that is designed 

to run primarily on its batteries. 

2018 and Subsequent Model Year Amendments

Staff‟s goal for the proposed amendments for 2018 and subsequent model years is to 

achieve ZEV and transitional zero emission vehicle (TZEV; most commonly a plug-in 

hybrid electric vehicle) commercialization through simplifying the regulation and pushing 

technology to higher volume production in order to achieve cost reductions. The 

amendments include:

A. Increase Requirement for 2018 and Subsequent Model Years. Increase 

requirements which push ZEVs and plug-in hybrids to about 15.4 percent of new 

sales by 2025. This will ensure production volumes are at a level sufficient to 

bring battery and fuel cell technology down the cost curve and reduce 

incremental ZEV prices. 

B. Focus Regulation on ZEVs and Plug-in Hybrids: Remove PZEV (near-zero 

emitting conventional technologies) and advanced technology partial zero 

emission vehicles (AT PZEV, typically non-plug-in hybrids) credits as compliance 

options for manufacturers because these technologies are now commercialized.

C. Amend Manufacturer Size Definitions and Ownership Requirements. Amend 

Intermediate and Large Volume Manufacturer (LVM) size definitions to bring all 

but the smallest manufacturers under the full ZEV requirements by model year 

2018; and change the percentage of ownership for combining manufacturers. 

These changes result in applying the ZEV regulation to manufacturers that 

represent 97 percent of the light duty vehicle market. Table 7 below shows the 

manufactures that will be subject to the existing and new requirements.
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Table 7: Current Manufacturer Size Status

(2008 – 2010 MY Sales Averages, Rounded)

Existing Large Volume 

Manufacturers

New Large Volume Manufacturers

Chrysler BMW

Ford Daimler

GM Hyundai

Honda Kia

Nissan Mazda

Toyota Volkswagen

D. Modify Travel Provision: The so-called travel provision allows ZEVs placed in 

any state that has adopted the California ZEV regulation to count towards the 

ZEV requirement in California. The staff proposes to end the travel provision for 

BEVs after model year 2017. Extend the travel provision for fuel cell vehicles 

(FCVs) until sufficient complementary polices are in place in states that have 

adopted the California ZEV regulation. This will allow FCV technology to continue 

to mature, and provide time for states that have adopted California‟s ZEV 

regulation to build infrastructure and put in place incentives to foster FCVs.

E. Add GHG-ZEV Over-Compliance Credits: Allow manufacturers who 

systematically over-comply with the proposed greenhouse gas fleet standard to 

offset a portion of their ZEV requirement in 2018 through 2021 model years only. 

3.2 Effect of Proposed Amendments

Zero Emission Vehicle Volumes

As a result of staff‟s proposal, over 1.4 million ZEVs and TZEVs are expected to be 

produced cumulatively in California by 2025, with 500,000 of those vehicles being pure 

ZEVs (BEVs and FCVs). Figure 3 illustrates an expected compliance scenario which 

results in 15.4 percent of new car sales subject to the ZEV regulation.
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Figure 3 Expected ZEV Regulation Compliance for 2018 through 2025 Model 

Years

Recently, a number of manufacturers have announced aggressive production plans for 

PHEVs and BEVs for the next three model years. Table 8 provides a summary of 

manufacturers‟ current program commitments, by technology category, as publicly 

stated. 

 -

 50,000

 100,000

 150,000

 200,000

 250,000

 300,000

2018 2019 2020 2021 2022 2023 2024 2025

Annual California Sales

Model Year

17%

14%

11%

9%

6%

3%

% of 2025 Sales

15.4% of 2025

New Sales

FCVs

BEVs

PlugHybrids
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Table 8. Future ZEVs and PHEVs Announced by Manufacturers

Manufacturer Model Type Timeframe Reference

BMW 

ActiveE BEV 2011 BMW, 2011a

i3 BEV

2013

BMW, 2011b

i3 Rex PHEV BMW, 2011c

i8 PHEV 2014 BMW, 2011b

BYD e6 BEV 2012 BYD, 2010

CODA (unknown) BEV 2011 Popular Mechanics, 2011

Chrysler Fiat 500 EV BEV 2012 Chrysler, 2010

Fisker Karma PHEV 2011 Fisker, 2011

Ford

C-MAX Energi PHEV 2012 Ford, 2011a

Focus Electric BEV 2011 Ford, 2011b

Transit Connect Electric BEV in production n/a

GM

Cadillac ELR PHEV (unknown) GM, 2011a

Spark BEV 2012 GM, 2011b

Volt PHEV in production n/a

(unknown) FCV 2015 USA TODAY, 2010

Honda

Fit EV BEV 2012

Honda, 2011

(unknown) PHEV 2012

Clarity FCX FCV in production n/a

Hyundai Tucson IX FCV 2015 Bloomberg, 2010

Mercedes 

Benz

(unknown) BEV 2012 Mercedes, 2011

F-Cell FCV in production Mercedes, 2010

Mitsubishi

i BEV in production n/a

Outlander PHEV 2013 Motor Trend, 2011

Nissan LEAF BEV in production n/a

Smart fortwo ED BEV in production n/a

Tesla Model S BEV 2012 Tesla, 2011

Think City BEV in production n/a

Toyota

Prius Plug-In PHEV 2012 Toyota, 2011b

RAV-4 EV BEV 2012 Toyota, 2011c Scion iQ-EV BEV 2012

(unknown) FCV 2015 Toyota, 2011d

Volkswagen e-up! BEV 2013 Volkswagen, 2011

Wheego Whip LiFe BEV in production n/a
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3.3 Environmental Benefits

The proposed amendments will also result in an emissions benefit due mostly to 

increased electricity and hydrogen use, and the resulting decrease in the production 

and use of gasoline. Figures 6 and 7 compare well to wheel grams per mile emissions 

of conventional vehicle technologies and ZEV program technologies. The „fuel cycle‟ 

refers to the emissions related to the extraction, transportation, refining, and

manufacture or generation of a specific fuel. 

Figure 6. Well to Wheel Smog Forming Emissions (ROG + NOx) Comparison

Figure 7. Well to Wheel Greenhouse Gas Emissions Comparison

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

NOx + ROG emissions (g/mi)

Fuel cycle

Vehicle use (evap)

Vehicle use (exhaust)

0	

100	

200	

300	

400	

500	

600	

Gasoline	(2010)	Gasoline	(2020)	Gasoline	(2025)	

Plug-in	hybrid	(PHEV20)	

Electric	vehicle	

Fuel	cel 	vehicle	

GHG	emissions	(g/mi)	

Fuel-cycle	

Other	vehicle	(HFC,	N2O,	CH4)	

Vehicle	use	(exhaust)	
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4. Clean Fuels Outlet Regulation

The CFO regulation requires the construction of alternative fuel outlets for a particular 

fuel when there are 20,000 alternative fuel vehicles (AFVs) using that fuel. Coordinating 

the development of alternative fuel infrastructure with AFV deployment is critically 

important to the successful commercialization of both. This is especially true for ZEVs, 

specifically hydrogen fuel cell vehicles, where customers rely solely on publically 

available fuel to use their vehicles. 

The Board is proposing changes to this program now in order to address the pending 

commercialization of zero emission hydrogen fuel cell vehicles. As a zero emission 

vehicle fuel, hydrogen has many benefits beyond propelling a zero emission vehicle. It 

can be produced from renewable resources and used in a fuel cell vehicle; a kilogram of 

hydrogen drives a car twice as far as a gallon of gasoline in a conventional car. As 

shown in Table 9 below, manufacturers are projecting early commercial volumes of fuel 

cell vehicles in the 2015 to 2017 timeframe. However, a successful launch of these 

volumes of vehicles will require fueling stations.

Table 9: Summary of ARB/CEC Auto Manufacturer Survey Results (2010)

2010 Survey 2012 2013 2014 2015-17

Cumulative FCVs 

Statewide

312 430 1,389 53,000

FCVs in South Coast Air 

Basin

240 347 1,161 34,230

4.1 Proposed Amendments to the CFO Regulation

The proposed changes to the CFO regulation include:

 Streamlining the compliance requirements. The proposed amendments include 

modifying the compliance requirements to be less prescriptive and more like 

performance standards, giving the regulated party the flexibility to determine how 

best to meet the minimum requirements. Hydrogen infrastructure can be placed 

at an existing gasoline station or at a freestanding site.

 Adding a lower regional activation trigger. Staff is proposing to add a 10,000 

vehicle activation trigger that would apply to an air basin before the statewide 

trigger of 20,000 is reached. The lower trigger complements auto manufacturers‟ 

early commercialization plans to marketing FCVs in regional clusters.

 Applying to zero emission vehicles (ZEVs) and ZEV fuels only. Staff is proposing 

to change the types of alternative fuel vehicles captured under the regulation 

from all alternative fuel vehicles (including vehicles using compressed natural
18

gas and ethanol) certified as low emission vehicles to only those certified as 

ZEVs when operating on a designated clean fuel.

 Adding a regulatory review for plug-in electric vehicles. Electricity is currently 

excluded from the definition of designated clean fuel in the regulation. The 

proposed changes, applying to fuels used in ZEVs would include electricity, 

however, since most plug-in vehicles are expected to charge at home and public 

and workplace charging is under development, Staff is proposing to add 

regulatory language that requires ARB to evaluate the development and usage of 

workplace and public charging infrastructure, and make recommendations for 

further actions in two years. 

 Changing the regulated party to be the major producer/importers of gasoline. 

California‟s seven major petroleum companies supply 93 percent of the gasoline 

consumed in California, while owning only 13 percent of the retail gasoline 

outlets. Changing the regulated party from owner/lessors of retail gasoline 

outlets to “major refiner/importers of gasoline,” evenly spreads the requirement to 

build CFOs among the parties that continue to benefit financially from California‟s 

use of gasoline.

 Lowering the regulation sunset provision. Staff is proposing to lower the 

requirement to build CFOs when the number of hydrogen stations equals five

percent of the total number of retail gasoline outlets. 

4.2 Impacts of Proposed Clean Amendments

Projected environmental impacts associated with this regulation are expected to be 

minimal as activities will occur primarily in urban developed areas. The State will 

benefit from overall reductions in both greenhouse gas and criteria pollutant emissions 

due to the increased use of hydrogen fuel in fuel cell vehicles. 

The anticipated economic impacts of the regulation will mainly be felt during the onset, 

when hydrogen stations are expected to be less than fully utilized. As station utilization 

improves due to increased consumer acceptance of FCV technology and confidence in 

fuel availability, the cost to produce hydrogen will decrease. Staff projects that, with 

high station utilization, fuel providers will be able to sell hydrogen at an affordable price 

and realize a return on their investment within three to four years. Offering hydrogen 

fuel in convenient commercial settings is critical to the successful launch of zero 

emission vehicles, which will be the cornerstone of long term health based criteria 

pollutant and climate change emission reduction goals.