Testimony of the National Association of Clean Air Agencies

before the U.S. Environmental Protection Agency

and the National Highway Traffic Safety Administration

on the Proposed Greenhouse Gas and Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and Vehicles – Phase 2

Docket ID No. EPA-HQ-OAR-2014-0827

August 6, 2015 Chicago, Illinois

The National Association of Clean Air Agencies (NACA A) appreciates this opportunity to provide testimony on the U.S. Enviro nmental Protection Agency’s (EPA) and the U.S. Department of Transportation National H ighway Traffic Safety Administration’s (NHTSA) Proposed Phase 2 Greenhouse Gas and Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and Ve hicles, as published in the Federal Register

on July 13, 2015 (80 Fed. Reg. 40,137). NACAA is a national, nonpartisan, non-profit association of air pollution c ontrol agencies in 41 states, the District of Columbia, four territories and 116 metropolitan are as. The air quality professionals in our member agencies have vast experience dedicated to i mproving air quality in the U.S. This testimony is based upon that experience. The vi ews expressed in this testimony do not represent the positions of every state and loca l air pollution control agency in the country.

According to EPA, although heavy-duty trucks accoun t for less than 5 percent of vehicles on U.S. roads, they are responsible for ab out 20 percent of the U.S. transportation sector’s energy use and GHG emission s and are the second largest source of GHG emissions in the transportation secto r after passenger cars and light

trucks. These vehicles consume about 2.5 million ba rrels of oil a day and produce almost a half billion tons of carbon a year.

NACAA supported EPA’s and NHTSA’s efforts to adopt t he first phase of GHG and fuel efficiency standards for heavy-duty vehicl es and engines, which took effect with Model Year (MY) 2014 and is being phased in through MY 2018. Now, we are pleased to support your agencies’ efforts to advance this p rogram by establishing Phase 2 standards. We believe your proposal holds great pr omise for achieving further GHG reductions and better fuel efficiency from heavy-du ty combination tractors, trailers, vocational vehicles and heavy-duty pickups and vans . Fulfilling that promise, however, will require some key improvements to the proposal.But before addressing those, NACAA would like to co mmend EPA and NHTSA on several of the

various aspects of the proposed rule that our assoc iation strongly supports. First, we fully endorse t he continued inclusion of separate but complementary s tandards for engines and full vehicles – this is a fundamental aspect of the rule. Second, the inclus ion of standards for trailers, particularly box tra ilers, is critical given their significant contribution to fu el consumption by long-haul trucks. Third, we are v ery much in favor of EPA’s proposal to close the existing lo ophole for glider kits, under which used pre-2013 e ngines – with no limit on age – may be installed into new glider kits without meeting applicable standards. We agree with EPA that its regulations should be revis ed to require that only engines that have been cert ified to meet the prevailing standards be eligible for insta llation into new glider kits.

Now NACAA would like to highlight aspects of the ru le our association believes should be improved.

In a March 18, 2015 letter to your respective agen cies, 1 NACAA provided our recommendations for essential components of a Phase 2 rule. In those r ecommendations, we urged for a rule that would redu ce GHG emissions and fuel consumption across the entir e fleet by at least 40 percent, on average, compare d to 2010. Unfortunately, we find the overall effect iveness of the Phase 2 proposal to fall short of ou r recommendation and, more importantly, significantly short of what can and should be achieved. Accordingly, we believe the overall stringency of t he proposal should be enhanced to take advantage of missed opportunities that, if incorporated into the final rule, would drive technology and ensure that maximum benefits are gained.

Toward this end, we believe the proposed engine stan dard must be strengthened. Others – including the California Air Resources Board (CARB)

, 2 engine makers 3 and independent non-governmental organizations 4 – have suggested engine efficiency can be improved by 15 percent or more, compared to the 4.2 percent proposed by EPA. Further, their an alyses, as well as those of EPA, indicate that technologies to achieve this degree of improvement are currently available and highly cost effective. We believe it is imperative that EPA strengthen the en gine standard in the final rule to reflect this.

With respect to timing, NACAA strongly supports EP A’s proposed Alternative 4, under which the standards would be fully implemented by 2024. This implementation deadline is entirely feasible and vi tally important to spur much-needed near-term emissions r eductions and technological innovation. NACAA urges EPA to finalize Alternative 4 rather than Alt ernative 3, which would unnecessarily extend full implementation by three years to 2027.

Our March 18, 2015 letter also included a recommend ation that EPA articulate in the proposal the need for significantly lower national heavy-duty ni trogen oxide (NO x ) standards beyond the current 2010 onroad heavy-duty NO x

exhaust emission standards and nonroad heavy-duty engine exhaust emission standards. We are very disappointed that EPA has n ot included such a discussion in this proposal.

1 NACAA Letter to EPA and NHTSA providing recommendat ions on a Phase 2 regulatory proposal (March 18, 20 15), http://www.4cleanair.org/sites/default/files/Docume nts/NACAA-Letter_to_EPA_DOT-Ph2_HD_Fuel_EffGHG_Stds -031815.pdf

. 2 California Air Resources Board, Draft Technology Assessment: Engine/Powerplant and Drivetrain Optimization and Vehicle Efficiency (June 2015), http://www.arb.ca.gov/msprog/tech/techreport/epdo_v e_tech_report.pdf

. 3 Cummins, Engine Technologies for GHG and Low NO x (April 2015), http://www.arb.ca.gov/msprog/onroad/caphase2ghg/pre sentations/2_7_wayne_e_cummins.pdf

. 4 International Council on Clean Transportation, Advanced Tractor-Trailer Efficiency Technology Pote ntial in the 2020-2030

Timeframe (April 2015), http://www.theicct.org/sites/default/files/publicat ions/ICCT_ATTEST_20150420.pdf

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Although there is the potential for ancillary NO x reductions from the Phase 2 rule, the achievement of these reductions is not certain (we note that predicted a ncillary benefits of Phase 1 did not occur). Moreo ver, even if ancillary NO x

benefits do accrue under the Phase 2 rule, they wi ll not be nearly sufficient given the challenges state and local agencies face in attaini ng and maintaining current and upcoming ozone and f ine particulate matter (PM) standards and protecting ag ainst visibility impairment and eutrophication of w ater bodies. We urge that EPA include in the final Phas e 2 rule a clear and comprehensive discussion of th e need for very substantial additional NO x reductions from heavy-duty vehicles and engines an d, even more critically, an explicit commitment to begin immedia tely a separate rulemaking initiative to capture th ose reductions.

Finally, EPA projects an increase in the use of auxi liary power units (APUs) in Phase 2 and an associated 10-percent increase in PM emissions. Th e agency seeks comment on this, but proposes nothing to address the unacceptable and unnecessary expected rise in PM pollution. NACAA recommends that EPA include in the final rule a requirement, s imilar to CARB’s, that APUs be equipped with diesel particulate filters to capture the PM.

In conclusion, NACAA believes EPA and NHTSA have a tremendous opportunity to finalize a rule that will effectively address heavy-duty vehicle an d engine GHG emissions and fuel consumption and set the stage for a separate rule to achieve meaningful additional NO x reductions. We urge you to make the most of this opportunity. Further, in doing so, we encourage that your agencies collaborate with exper ts at CARB, given California’s unique ability to regulate these same source categories, its decades of experience in doing so and the past success that ha s been achieved when EPA, and more recently NHTSA, have collaborated with CARB.

In the coming weeks, we will continue to study issu es related to the Phase 2 proposal and will offer additional comments in writing by the September 17, 2015 deadline. In the meantime, we appreciate the chance to provide the comments we have offered toda y and look forward to continuing to work with EPA a nd NHTSA on this important initiative.