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7-1

Chapter 7: Vehicle-Related Costs, Fuel Savings & 

Maintenance Costs

In this chapter, the agencies present our estimates of the vehicle -related costs associated 

with the proposed standards along with corresponding fuel savings and maintenance costs. For 

this rule, the agencies conducted coordinated and complementary analyses using two analytical 

methods for the heavy-duty pick up and van segment by employing both DOT’s CAFE model 

and EPA’s MOVES model. The agencies used EPA’s MOVES model to estimate fuel 

consumption and emissions impacts for tractor-trailers (including the engine that powers the 

tractor), and vocational vehicles (including the engine that powers the vehicle). Additional 

calculations were performed to determine corresponding monetized program costs and benefits. 

For heavy-duty pickups and vans, the agencies performed complementary analyses, which we 

refer to as “Method A” and “Method B”. In Method A, the CAFE model was used to project a 

pathway the industry could use to comply with each regulatory alternative and the estimated 

effects on fuel consumption, emissions, benefits and costs. In Method B, the CAFE model was 

used to project a pathway the industry could use to comply with each regulatory alternative, 

along with resultant impacts on per vehicle costs, and the MOVES model was used to calculate 

corresponding changes in total fuel consumption and annual emissions. Additional calculations 

were performed to determine corresponding monetized program costs and benefits. NHTSA 

considered Method A as its central analysis and Method B as a supplemental analysis. EPA 

considered the results of both methods. The agencies concluded that both methods led the 

agencies to the same conclusions and the same selection of the proposed standards. Throughout

this Chapter and in later chapters presenting program-related costs and benefits, engine costs are 

included along with vehicle-related costs.

7.1 Vehicle Costs, Fuel Savings and Maintenance Costs vs. the Dynamic 

Baseline and Using Method A

The agencies joint analysis of the potential costs of the proposed standards combines 

DOT CAFE model calculations of HD pickup and van costs with EPA MOVES modeling of 

vocational vehicle, tractor and trailer fuel consumption along with EPA analysis of vocational 

vehicle, tractor and trailer costs. The analysis includes costs for fuel-saving technology that 

manufacturers could add in response to the proposed standards, EPA estimates of the additional 

compliance and R&D costs for vocational vehicles and combination tractor trailers, and some 

additional maintenance costs. 

7.1.1 Vehicle Program Costs

In this section, the agencies present our estimate of the vehicle- -related costs associated 

with the proposed program versus Alternative 1b using the CAFE model analysis of HD pickups 

and vans. The presentation here summarizes the costs associated with new technology the 

agencies estimate manufacturers could add to meet the proposed GHG and fuel consumption 

standards. The analysis summarized here provides our estimate of incremental costs on a per 

vehicle basis and on a MY lifetime basis. In Chapter 7.2, where the agencies present the Method 

B analysis, the analogous information is presented along with costs on an annual, or calendar 
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7-2

year, basis for all segments. For details behind the cost estimates associated with individual 

technologies, the reader is directed to Sections III through VI of the proposed preamble and to 

Chapter 2 of the draft RIA.

Note that all discounted costs presented in this chapter, whether in the Calendar Year (or 

annual) analysis or the Model Year Lifetime analysis, are discounted back to 2015 at the 

discount rate shown in the table(s).

7.1.1.1 Technology Costs

For the HD pickup trucks and vans, the agencies have used a methodology consistent 

with that used for our recent 2017-2025 light-duty joint rulemaking since most of the 

technologies expected for HD pickup trucks and vans are consistent with those expected for the 

larger light-duty trucks. The cost estimates presented in the recent light-duty joint rulemaking 

were then scaled upward to account for the larger weight, towing capacity, and work demands of 

the trucks in these heavier classes. For details on that scaling process and the resultant costs for 

individual technologies, the reader is directed to Chapter 2.6 and 2.12 of this draft RIA. Note 

also that all cost estimates have been updated to 2012 dollars for this analysis while the 2017-

2025 light-duty joint rulemaking was presented in 2010 dollars.1 

For vocational vehicles, tractors and trailers, consistent with the Phase 1 rule, the 

agencies have estimated costs using a different methodology than that employed in the recent 

light-duty joint rulemaking establishing fuel economy and GHG standards. In the recent lightduty joint rulemaking, all fixed costs were included in the hardware costs via an indirect cost 

multiplier. As such, the hardware costs presented in that analysis included both the actual 

hardware and the associated fixed costs. For the vocational, tractor and trailer segments in this 

analysis, some of the fixed costs are estimated separately and are presented separately from the 

technology costs. As noted above, all costs are presented in 2012 dollars.

The estimates of vehicle costs are generated relative to two unique “no action” baselines. 

The first of these (alternative 1a, presented below in Chapter 7.2) representing generally flat fuel 

consumption improvements, or a fleet of vehicles meeting the Phase 1 heavy-duty requirements. 

The second of these (alternative 1b and presented here) representing dynamic fuel consumption 

improvements, or a fleet of vehicles with improving fuel consumption despite the lack of 

regulatory drivers. See Section X of the preamble and Chapter 11 of this draft RIA for more 

detail on these two baselines. As such, costs to comply with the Phase 1 standards are not 

included in the estimates here. In fact, in the methodology used for vocational vehicles, tractors 

and trailers, there are cases where Phase 1 technologies are being removed in favor of Phase 2 

technologies – that is, the technology basis for the Phase 2 proposed standards involves 

removing certain of the Phase 1 technologies. In those cases, savings are associated with the 

removal of the Phase 1 technology. The details of which technologies and where such savings 

occur are presented in Chapter 2.12 of the draft RIA. 
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7-3

For HD pickups and vans, as described in Chapter 2 of this draft RIA, the agencies used 

NHTSA’s CAFE model to estimate the cost per vehicle associated with the proposed (and 

possible alternative) standards.AThat model has the capability to look ahead at future standards 

when making determinations of how vehicles should be changed to comply. It does this because 

redesign cycles do not always line up well with regulatory implementation schedules, so a 

manufacturer may choose to redesign a vehicle in MY2018 in preparation for upcoming 

MY2021-2025 standards if that particular vehicle is not scheduled for another redesign until, say, 

MY2026. The result being new technology costs in years prior to implementation of the 

standards. The CAFE model’s output would show such costs occurring in years prior to 

MY2021. On the other hand, the CAFE model also estimates the potential that credits generated 

in earlier model years might be carried forward (i.e., “banked”) and then used in later model 

years, potentially reducing costs in some model years covered by the analysis.

Table 7-1 presents the average incremental technology costs per vehicle for the proposed

program relative to alternative 1b. These tables include both engine and vehicle technologies. 

For HD pickups and vans, costs begin with new standards in MY2018, as technology is utilized 

in vehicles with early redesign cycles. The costs jump in MY2021 as more complex 

technologies are utilized, then generally increase through the remainder of the analysis period. 

For vocational vehicles, the costs begin in MY2021, then decrease slightly through MY2023, 

with an increase in MY2024, decreasing slightly through MY2026, and followed by a large 

increase in costs from MY2027 until the end of the analysis period. For tractor/trailers, the costs 

begin in MY2018 as trailers begin adding new technology to meet the 2018 trailer standards. 

Costs then increase in MY2021 as the tractor standards begin through 2027. After 2027, costs 

begin to decrease due to learning effects. All costs shown in the table represent the weighted 

average cost of all vehicles within the category shown in the heading.

 

A The CAFE model also provides a full benefit-cost analysis associated with proposed standards, and the agencies 

have used this analysis as part of Method A to provide estimates of the costs and benefits of today’s proposed 

standards. The full benefit-cost analysis for Method A is presented in Chapters 9 and 10 of this draft RIA. The full 

benefit-cost analysis for Method B is presented in Chapter 8 of this draft RIA.
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7-4

Table 7-1 Estimated Technology Costs per Vehicle for the Preferred Alternative versus the Dynamic Baseline 

and using Method A (2012$)

a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS

2018 $98 $0 $639

2019 $92 $0 $548

2020 $95 $0 $478

2021 $493 $1,152 $7,445

2022 $485 $1,128 $7,273

2023 $766 $1,037 $6,790

2024 $896 $1,766 $10,690

2025 $1,149 $1,731 $10,476

2026 $1,248 $1,695 $10,206

2027 $1,366 $3,381 $12,487

2028 $1,356 $3,323 $12,292

2029 $1,357 $3,271 $12,178

2030 $1,348 $3,222 $12,070

2050 $1,348 $3,232 $11,981

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section 

I.D; for an explanation of the less dynamic baseline, 1a, and more dynamic 

baseline, 1b, please see Preamble Section X.A.1

As noted in the text, MYs 2018-2020 include costs for trailers only, and in MYs 

2021 and later the costs include both tractor and trailer costs. Detailed 

technology and package costs for all segments can be found in Chapter 2 of this 

draft RIA (notably, see Sections 2.12 and 2.13).

Table 7-2 presents the model year lifetime costs for new technology discounted at 3 

percent using Method A. And Table 7-3 presents the model year lifetime costs for new 

technology discounted at 7 percent using Method A.
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7-5

Table 7-2 Discounted MY Lifetime New Technology Costs of the Preferred Alternative

Vs. the Dynamic Baseline and using Method A

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $61 $0 $104 $165 

2019 $55 $0 $99 $154 

2020 $55 $0 $95 $150 

2021 $280 $488 $1,013 $1,781 

2022 $269 $468 $976 $1,713 

2023 $412 $421 $898 $1,731 

2024 $479 $719 $1,412 $2,610 

2025 $608 $705 $1,396 $2,709 

2026 $654 $689 $1,369 $2,712 

2027 $704 $1,363 $1,676 $3,743 

2028 $688 $1,321 $1,642 $3,651 

2029 $677 $1,279 $1,618 $3,574 

Sum $4,942 $7,452 $12,299 $24,693 

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an 

explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble 

Section X.A.1

Table 7-3 Discounted MY Lifetime New Technology Costs of the Preferred Alternative

Vs. the Dynamic Baseline and using Method A

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $54 $0 $91 $145 

2019 $47 $0 $84 $131 

2020 $46 $0 $77 $123 

2021 $223 $381 $791 $1,395 

2022 $206 $352 $734 $1,292 

2023 $304 $305 $650 $1,259 

2024 $340 $501 $984 $1,825 

2025 $415 $473 $936 $1,824 

2026 $430 $445 $884 $1,759 

2027 $446 $847 $1,041 $2,334 

2028 $419 $790 $982 $2,191 

2029 $397 $736 $932 $2,065 

Sum $3,327 $4,829 $8,186 $16,342 

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
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7-6

7.1.1.2 Compliance Costs

As noted above, some fixed costs were estimated separately from the hardware costs. As 

such, not all fixed costs are included in the tables presented in Section 7.1.1.1. The agencies 

have estimated additional and/or new compliance costs associated with the proposed standards. 

Normally, compliance program costs would be considered part of the indirect costs and, 

therefore, would be accounted for via the markup applied to direct manufacturing costs. 

However, since the agencies are proposing new compliance elements that were not present 

during development of the indirect cost markups used in this analysis, additional compliance 

program costs are being accounted for via a separate “line-item” here. Note that, for HD pickups 

and vans, compliance elements were present during development of the indirect cost markups 

used; as such, these costs are already included as part of the technology costs described above.

There are three elements to the compliance costs estimated in this analysis. The first is 

for construction of new, or upgrades to existing, test facilities for conducting powertrain testing. 

The second costs are for conducting the powertrain tests themselves. And the third is for 

reporting of compliance data to EPA and NHTSA. We estimated these latter costs in the Phase 1 

rule as $0.24 million, $0.9 million and $1.1 million for HD pickups and vans, vocational and 

tractors, respectively, for a total of $2.3 million per year (2009$).2 All of these are industrywide, annual costs. 

We have estimated new reporting costs in this Phase 2 proposal associated with new 

powertrain testing within the vocational vehicle program, the increased level of reporting in the 

tractor program and an all new compliance program where none has existed to date within the 

trailer program. We have estimated those costs at $95,000 and $240,000 for vocational and 

tractor programs, and at $1.2 million in the trailer program, all in 2012$. All of these are 

industry-wide, annual costs. 

For powertrain testing facility upgrades and construction, we have estimated that 6 

manufacturers would upgrade and 5 would construct new facilities at an upgrade cost of $1.2 

million and a new construction cost of $1.9 million, all in 2012$. The result being an industrywide (but vocational program only) cost of $16.6 million (2012$). This cost would occur once 

which we have attributed to CY2021, what would be the first year of the Phase 2 vocational 

standards.B

Lastly, the vocational program is also estimated to incur costs associated with conducting 

powertrain testing. We have estimated the cost of testing at $69,000 per test and expect three 

large manufacturers to conduct 20 tests/year for a total of $4.1 million/year.C

 

B Note that, in alternative 2, we expect no manufacturers would conduct powertrain testing so none would construct 

or upgrade facilities.

C Note that, in alternative 2, we expect no powertrain testing so no testing costs; in alternative 4, we expect 4 large 

manufacturers to conduct the testing for an annual cost of $5.5 million.
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7-7

Table 7-4 and Table 7-5 present the MY lifetime costs for new compliance program 

elements at 3 percent and 7 percent, respectively.

Table 7-4 Discounted MY Lifetime Compliance Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0

2021 $13.7 $1.2 $14.9

2022 $3.4 $1.1 $4.5

2023 $3.3 $1.1 $4.4

2024 $3.2 $1.1 $4.3

2025 $3.1 $1.0 $4.1

2026 $3.0 $1.0 $4.0

2027 $2.9 $1.0 $3.9

2028 $2.8 $1.0 $3.8

2029 $2.8 $0.9 $3.7

Sum $38.3 $9.4 $47.7

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; 

for an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, 

please see Preamble Section X.A.1
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7-8

Table 7-5 Discounted MY Lifetime Compliance Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0

2021 $10.7 $0.9 $11.6

2022 $2.5 $0.9 $3.4

2023 $2.4 $0.8 $3.2

2024 $2.2 $0.7 $3.0

2025 $2.1 $0.7 $2.8

2026 $1.9 $0.7 $2.6

2027 $1.8 $0.6 $2.4

2028 $1.7 $0.6 $2.3

2029 $1.6 $0.5 $2.1

Sum $27.0 $6.4 $33.4

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; 

for an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, 

please see Preamble Section X.A.1

7.1.1.3 Research & Development Costs

Much like the compliance program costs described above, EPA has estimated additional 

engine, vocational vehicle and tractor R&D associated with the proposed standards that is not 

accounted for via the indirect cost markups used in this analysis for those segments. The 

necessary R&D for HD pickups and vans is covered by the indirect costs included as part of the 

technology costs described above. In the Phase 1 rule, the agencies estimated the engine R&D 

costs at $6.8 million (2009$) per engine class per manufacturer per year for five years. In this 

Phase 2 analysis, EPA has estimated this same level of R&D and has assumed 12 heavy-heavy

and 12 medium-heavy HD engine R&D programs would be conducted for a total of $214 

million/year (2012$). In this analysis, EPA has assumed those costs would occur annually for 4 

years, MYs 2021-2024. The total being $857 million (2012$) over 4 years (by comparison, the 

Phase 1 rule estimated a total of $852 million (2009$) over 5 years). To this, EPA has estimated 

an additional $6 million/year spent by vocational vehicle manufacturers and $20 million/year 

spent by tractor manufacturers. In the end, EPA is estimating a total of $961 million in R&D 

spending above and beyond the level included in the markups used to estimate indirect costs for 

these segments. Under alternative 4, due to the accelerated implementation of technology, EPA 

has estimated even more R&D—an additional $6.5 million per year or $26 million total spent by

vocational vehicle and tractor manufacturers. Importantly, EPA estimates that these costs would 

occur during normal R&D and vehicle design cycles for both alternatives 3 and 4. EPA has not 

included any additional R&D would be spent by trailer manufacturers since our cost estimates 
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7-9

include R&D conducted by trailer parts suppliers which are subsequently included in the prices 

charged by those suppliers to the trailer manufacturer. Additionally, the markups we have 

applied to cover indirect costs (see Chapter 2.12 of this draft RIA) include costs associated with 

R&D incurred by the trailer manufacturer.

Table 7-6 through Table 7-7 present the model year lifetime R&D costs discounted at 3 

percent and 7 percent, respectively.

Table 7-6 Discounted MY Lifetime R&D Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0

2021 $93.4 $104.9 $198.3

2022 $90.6 $101.9 $192.5

2023 $88.0 $98.9 $186.9

2024 $85.4 $96.0 $181.5

2025 $0.0 $0.0 $0.0

2026 $0.0 $0.0 $0.0

2027 $0.0 $0.0 $0.0

2028 $0.0 $0.0 $0.0

2029 $0.0 $0.0 $0.0

Sum $357.5 $401.7 $759.2

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; 

for an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, 

please see Preamble Section X.A.1
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7-10

Table 7-7 Discounted MY Lifetime R&D Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0

2021 $72.9 $81.9 $154.9

2022 $68.1 $76.6 $144.7

2023 $63.7 $71.6 $135.3

2024 $59.5 $66.9 $126.4

2025 $0.0 $0.0 $0.0

2026 $0.0 $0.0 $0.0

2027 $0.0 $0.0 $0.0

2028 $0.0 $0.0 $0.0

2029 $0.0 $0.0 $0.0

Sum $264.3 $297.0 $561.3

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; 

for an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, 

please see Preamble Section X.A.1

7.1.1.4 Summary of Vehicle-Related Costs of the Proposed Program using Method A

Table 7-8 presents the model year lifetime costs associated with the preferred alternative 

discounted at 3 percent relative to the dynamic baseline and using Method A. Table 7-9 presents 

the model year lifetime costs associated with the preferred alternative discounted at 7 percent 

relative to the dynamic baseline and using Method A.
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7-11

Table 7-8 Discounted MY Lifetime Vehicle-Related Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $61 $0 $104 $165 

2019 $55 $0 $99 $154 

2020 $55 $0 $95 $150 

2021 $280 $595 $1,119 $1,994 

2022 $269 $563 $1,079 $1,911 

2023 $412 $512 $998 $1,922 

2024 $479 $807 $1,509 $2,795 

2025 $608 $708 $1,397 $2,713 

2026 $654 $692 $1,370 $2,716 

2027 $704 $1,366 $1,677 $3,747 

2028 $688 $1,324 $1,643 $3,655 

2029 $677 $1,282 $1,619 $3,578 

Sum $4,942 $7,848 $12,710 $25,500 

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-9 Discounted MY Lifetime Vehicle-Related Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $54 $0 $91 $145 

2019 $47 $0 $84 $131 

2020 $46 $0 $77 $123 

2021 $223 $465 $874 $1,562 

2022 $206 $423 $811 $1,440 

2023 $304 $371 $722 $1,397 

2024 $340 $562 $1,051 $1,953 

2025 $415 $475 $937 $1,827 

2026 $430 $446 $885 $1,761 

2027 $446 $849 $1,042 $2,337 

2028 $419 $792 $983 $2,194 

2029 $397 $738 $932 $2,067 

Sum $3,327 $5,121 $8,489 $16,937 

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
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7-12

7.1.2 Changes in Fuel Consumption and Savings

7.1.2.1 Changes in Fuel Consumption

The proposed standards would result in significant improvements in the fuel efficiency of 

affected vehicles. Drivers of those vehicles would see corresponding savings associated with 

reduced fuel expenditures. The agencies have estimated the impacts on fuel consumption for the 

proposed standards. More detail behind these changes in fuel consumption is presented in 

Chapter 5 and Chapter 10 of this draft RIA. The expected impacts on fuel consumption are 

shown in Table 7-10 as reductions from the dynamic baseline reference case (i.e., positive values 

represent fewer gallons consumed) and using Method A. The gallons shown in this table include 

any increased consumption resulting from the rebound effect.

Table 7-10 MY Lifetime Fuel Consumption Reductions due to the Preferred Alternative 

Vs. The Dynamic Baseline and using Method A

(Million Gallons) a

GASOLINE REDUCTIONS b DIESEL REDUCTIONS

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

2018 44 0 0 44 25 0 934 959

2019 41 0 0 41 20 0 870 890

2020 42 0 0 42 20 0 840 860

2021 172 54 0 226 136 340 4,091 4567

2022 173 54 0 227 136 340 4,057 4533

2023 265 54 0 319 246 340 3,958 4544

2024 306 127 0 433 283 705 6,289 7277

2025 678 130 0 808 309 722 6,330 7361

2026 782 133 0 915 315 738 6,359 7412

2027 884 297 0 1181 323 1,193 7,350 8866

2028 894 300 0 1194 326 1,210 7,417 8953

2029 910 303 0 1213 330 1,222 7,563 9115

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the 

less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b Gasoline reductions include reductions in Ethanol85.

7.1.2.2 Changes in Fuel Expenditures

Using the fuel consumption reductions presented above, the agencies have calculated the fuel 

expenditure changes associated with the proposed standards, subcategory by subcategory. To do 

this, reduced fuel consumption is multiplied in each year by the corresponding estimated average 

fuel price in that year, using the reference case fuel prices from AEO 2014. For the Method A 

analysis, the AEO 2014 early release reference case was used for the vocational vehicles and 

tractor/trailers; the AEO 2014 final release reference case was used for HD pickups and vans. 

As the AEO fuel price projections go through 2040 and not beyond, fuel prices beyond 2040 

were set equal to the 2040 values for vocational vehicles and tractor/trailers. For the Method A 
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7-13

HD pickups and vans, the retail price of gasoline was projected to rise at 0.2 percent per year for 

gasoline and 0.7 percent for diesel. These estimates do not account for the significant 

uncertainty in future fuel prices; the monetized fuel savings would be understated if actual fuel 

prices are higher (or overstated if fuel prices are lower) than estimated. The Annual Energy

Outlook (AEO) is a standard reference used by NHTSA and EPA and many other government 

agencies to estimate the projected price of fuel. This has been done using both the pre-tax and 

post-tax fuel prices. Since the post-tax fuel prices are the prices paid at fuel pumps, the fuel 

expenditure changes calculated using these prices represent the changes fuel purchasers would 

see. The pre-tax fuel savings are those that society would see. Assuming no change in fuel tax 

rates, the difference between these two columns represents the reduction in fuel tax revenues that 

would be received by state and federal governments. The MY lifetime fuel savings for the 

preferred alternative relative to the dynamic baseline and using Method A are shown in Table 

7-11 using a 3 percent discount rate and in Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-12 using a 7 percent discount rate. Note that in Chapters 8 and 11 of this draft 

RIA, the overall benefits and costs of the rulemaking are presented and only the pre-tax fuel 

expenditure impacts are presented there. 

Table 7-11 Discounted MY Lifetime Reductions in Fuel Expenditures of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(3% Discount Rate, Millions of 2012$)

a

REDUCED FUEL EXPENDITURES –

RETAIL

REDUCED FUEL EXPENDITURES –

UNTAXED

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

2018 $181 $0 $2,744 $2,925 $161 $0 $2,435 $2,596 

2019 $157 $0 $2,515 $2,672 $140 $0 $2,238 $2,378 

2020 $160 $0 $2,386 $2,547 $143 $0 $2,130 $2,273 

2021 $794 $1,082 $11,422 $13,297 $711 $966 $10,222 $11,898 

2022 $782 $1,064 $11,139 $12,984 $701 $952 $9,991 $11,645 

2023 $1,281 $1,044 $10,675 $13,000 $1,151 $937 $9,596 $11,684 

2024 $1,446 $2,156 $16,663 $20,264 $1,303 $1,937 $15,008 $18,248 

2025 $2,294 $2,167 $16,460 $20,922 $2,066 $1,951 $14,855 $18,872 

2026 $2,494 $2,172 $16,217 $20,883 $2,247 $1,959 $14,663 $18,870 

2027 $2,686 $3,617 $18,381 $24,684 $2,423 $3,267 $16,650 $22,340 

2028 $2,664 $3,591 $18,164 $24,419 $2,407 $3,250 $16,482 $22,138 

2029 $2,654 $3,555 $18,144 $24,352 $2,402 $3,222 $16,491 $22,115 

Sum $17,592 $20,446 $144,911 $182,949 $15,854 $18,442 $130,760 $165,056 

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
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7-14

Table 7-12 Discounted MY Lifetime Reductions in Fuel Expenditures of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(7% Discount Rate, Millions of 2012$)

a

REDUCED FUEL EXPENDITURES –

RETAIL

REDUCED FUEL EXPENDITURES –

UNTAXED

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

2018 $130 $0 $1,954 $2,084 $116 $0 $1,729 $1,845

2019 $109 $0 $1,721 $1,830 $97 $0 $1,528 $1,625

2020 $107 $0 $1,566 $1,673 $95 $0 $1,395 $1,490

2021 $510 $689 $7,197 $8,395 $455 $614 $6,426 $7,495

2022 $483 $653 $6,766 $7,902 $433 $583 $6,056 $7,072

2023 $762 $617 $6,249 $7,628 $684 $553 $5,605 $6,842

2024 $828 $1,227 $9,401 $11,457 $745 $1,101 $8,451 $10,297

2025 $1,265 $1,188 $8,945 $11,399 $1,138 $1,068 $8,058 $10,264

2026 $1,324 $1,147 $8,487 $10,957 $1,191 $1,033 $7,661 $9,884

2027 $1,373 $1,840 $9,264 $12,476 $1,236 $1,660 $8,378 $11,274

2028 $1,311 $1,758 $8,810 $11,879 $1,183 $1,589 $7,982 $10,753

2029 $1,257 $1,676 $8,472 $11,406 $1,136 $1,517 $7,690 $10,343

Sum $9,459 $10,796 $78,832 $99,087 $8,508 $9,717 $70,958 $89,184

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

7.1.3 Maintenance Costs

The agencies have estimated increased maintenance costs associated with installation of 

lower rolling resistance tires. We expect that, when replaced, the lower rolling resistance tires 

would be replaced by equivalent performing tires throughout the vehicle lifetime. As such, the 

incremental increases in costs for lower rolling resistance tires would be incurred throughout the 

vehicle lifetime at intervals consistent with current tire replacement intervals. Those intervals 

are difficult to quantify given the variety of vehicles and operating modes within the HD 

industry. For HD pickups and vans, we have chosen a tire replacement interval of 40,000 miles. 

We have done the same for all vocational vehicles which is probably overly conservative as 

more frequent intervals results in higher maintenance costs. For tractors and trailers, we have 

used a maintenance interval of 200,000 miles. The presence of tire inflation management 

systems, and the increased use of those systems expected due to this proposed rule, should serve 

to improve tire maintenance intervals.

In evaluating maintenance costs associated with the proposal relative to the less dynamic 

baseline, EPA has used the maintenance intervals noted above, the MOVES policy case VMT, 

and the MOVES population of specific MY vehicles in future calendar years to estimate the 

increased maintenance costs associated with the proposal, again for each subcategory. Note that, 

in the context of the benefit-cost analysis, EPA has estimated maintenance costs using the policy

case VMT which, by definition, includes rebound VMT (see Section IX of the preamble and 
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7-15

Chapter 8 of this draft RIA for a discussion of rebound VMT). In evaluating maintenance costs 

associated with the proposal relative to Alternative 1b, NHTSA has used, for HD pickups and 

vans, the integrated analysis performed using the CAFE modeling system. For vocational 

vehicles, tractors and trailers, NHTSA has used the MOVES-based approach outlined above.

Table 7-13 shows the incremental increased costs associated with lower rolling resistance 

tires for HD pickups and vans, vocational vehicles, tractors, trailers and tractor/trailers relative to 

the dynamic baseline. 

Table 7-13 Increased Maintenance Costs at Maintenance Intervals Associated with the Preferred Alternative 

Vs. The Dynamic Baseline using Method A

(2012$/event) a,b

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR TRAILER TRACTOR/TRAILER

2018 $0.00 $0.00 $0.00 $79.92 $67.16

2019 $0.00 $0.00 $0.00 $77.77 $65.36

2020 $0.00 $0.00 $0.00 $75.69 $63.60

2021 $1.72 $6.99 $33.16 $78.81 $99.38

2022 $3.45 $6.91 $32.53 $75.98 $96.39

2023 $5.17 $8.12 $31.66 $71.17 $91.46

2024 $6.90 $17.66 $33.50 $73.97 $95.66

2025 $8.62 $17.47 $32.92 $72.02 $93.43

2026 $8.62 $13.50 $30.01 $70.72 $89.44

2027 $8.62 $21.34 $32.27 $69.44 $90.62

2028 $8.62 $20.26 $31.52 $68.18 $88.81

2029 & later $8.62 $15.99 $31.22 $66.27 $86.91

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b The maintenance category includes only the incremental expenditure required to assure that low rolling resistance, 

rather than conventional, tires are used throughout the useful life of the vehicle. The agencies request comment and 

information on other relevant maintenance costs

Table 7-14 presents the model year lifetime in-use maintenance costs—versus the 

dynamic baseline and using Method A— discounted at 3 percent. Table 7-15 presents the model 

year lifetime in-use maintenance costs—versus the dynamic baseline and using Method A—

discounted at 7 percent.
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7-16

Table 7-14 Discounted MY Lifetime Maintenance Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $51.2 $51.2

2019 $0.0 $0.0 $49.2 $49.2

2020 $0.0 $0.0 $47.5 $47.5

2021 $3.3 $14.1 $72.6 $90.0

2022 $6.5 $13.5 $69.0 $88.9

2023 $9.4 $15.4 $64.0 $88.8

2024 $12.3 $33.3 $66.6 $112.2

2025 $15.1 $32.7 $65.1 $112.9

2026 $15.0 $25.0 $62.1 $102.1

2027 $14.7 $38.9 $62.3 $115.9

2028 $14.4 $36.2 $60.2 $110.7

2029 $14.0 $27.9 $57.9 $99.8

Sum $104.6 $237.0 $727.6 $1,069.2

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-15 Discounted MY Lifetime Maintenance Costs of the Preferred Alternative

Vs. The Dynamic Baseline and using Method A

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $35.8 $35.8

2019 $0.0 $0.0 $33.2 $33.2

2020 $0.0 $0.0 $30.9 $30.9

2021 $2.1 $8.9 $45.5 $56.6

2022 $3.9 $8.3 $41.7 $53.9

2023 $5.5 $9.1 $37.3 $51.9

2024 $6.9 $18.9 $37.4 $63.2

2025 $8.3 $17.8 $35.2 $61.3

2026 $7.9 $13.1 $32.4 $53.4

2027 $7.4 $19.7 $31.3 $58.5

2028 $7.0 $17.7 $29.2 $53.9

2029 $6.6 $13.1 $27.1 $46.8

Sum $55.7 $126.6 $417.2 $599.5

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-17

7.1.4 Analysis of Payback Periods

An important metric to vehicle purchasers is the payback period that can be expected on 

any new purchase. In other words, there is greater willingness to pay for new technology if that 

new technology “pays back” within an acceptable period of time. We make no effort to define 

the acceptable period of time here, but seek to estimate the payback period for others to make the 

decision themselves. We define the payback period as the point at which reduced fuel 

expenditures outpace increased vehicle costs. For example, a new MY2027 HD pickup truck is 

estimated to cost roughly $1,400 more (on average, in 2012$, and relative to the reference case 

vehicle) due to the addition of new fuel consumption improving and GHG reducing technology. 

This new technology would result in lower fuel consumption and, therefore, reduced fuel 

expenditures. But how many months or years would pass before the reduced fuel expenditures 

would surpass the increased costs? 

To estimate the costs, we have considered not only the cost of the new technology, but 

also the taxes paid on the incrementally higher purchase expense, the slightly higher insurance 

expenses on the slightly higher value vehicle, the increased finance cost, and the increased 

maintenance costs associated with the new technology. Taxes and fees paid were estimated as 

5.46 percent of the final MSRP. Financing was estimated to be 15.32 percent of final MSRP, 

and for insurance costs, the model uses an estimate of 19.23 percent of the final MSRP of a 

vehicle as the cost of insurance. For maintenance costs, the results shown in Table 7-16 express 

the average incremental maintenance costs associated with new technology added to an average 

HD pickup or van which drives an average amount of miles each year. These calculations do not 

represent specific vehicle classes or specific use cases so should not be seen as being applicable 

to any particular individual’s situation. However, the payback periods do provide a general 

sense, on average, of what sort of payback periods are likely at a national, societal perspective.

Table 7-16 presents the discounted annual increased vehicle costs and fuel expenditure 

impacts associated with owning a new MY2027 HD pickup or van using both 3 percent and 7 

percent discount rates. The results in this table use Method A. As shown in the table, the 

payback for HD pickups and vans occurs late in the 3rd year of ownership (the year in which 

cumulative expenditures become negative) using a 3 percent discount rate and in the early part of 

the 4th year using a 7 percent discount rate. For other classes of vehicles, including vehicle 

types such as refuse trucks and transit buses, refer to the Method B analysis of payback periods 

presented in Chapter 0.
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7-18

Table 7-16 Discounted Owner Expenditures & Payback Period for MY2027 HD Pickups & Vans under the 

Preferred Alternative Vs. The Dynamic Baseline and using Method A 

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $1,855 $0 -$522 $1,333 $1,779 $0 -$501 $1,278

2 $0 $0 -$513 $820 $0 $0 -$471 $806

3 $0 $0 -$467 $353 $0 $0 -$411 $395

4 $0 $0 -$429 -$76 $0 $0 -$363 $32

5 $0 $0 -$408 -$484 $0 $0 -$330 -$298

6 $0 $0 -$369 -$852 $0 $0 -$286 -$584

7 $0 $0 -$325 -$1,177 $0 $0 -$242 -$826

8 $0 $0 -$282 -$1,459 $0 $0 -$201 -$1,027

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

7.2Vehicle Costs, Fuel Savings and Maintenance Costs vs. the Less 

Dynamic Baseline and using Method B

As noted in the introduction to Chapter 7.1, the agencies joint analysis of the potential 

costs of the proposed standards combines EPA MOVES modeling of vocational vehicle, tractor 

and trailer fuel consumption, EPA analysis of vocational vehicle, tractor and trailer costs, along 

with DOT CAFE model calculations of HD pickup and van costs per vehicle. The analysis 

includes costs for fuel-saving technology that manufacturers could add in response to the 

proposed standards, EPA estimates of the additional compliance and R&D costs for vocational 

vehicles and combination tractor trailers, and some additional maintenance costs.3

7.2.1 Vehicle Program Costs 

In this section, the agencies present our estimate of the vehicle-related costs associated 

with the preferred alternative (Alternative 3) versus the less dynamic baseline (Alternative 1a)

using the MOVES analysis of HD pickups and vans as well as vocational vehicle, tractors and 

trailers. The presentation here summarizes the costs associated with new technology the 

agencies estimate manufacturers could add to meet the proposed GHG and fuel consumption 

standards. The analysis summarized here provides our estimate of incremental costs on a per 

vehicle basis, on a MY lifetime basis and on an annual basis. For details behind the cost 

estimates associated with individual technologies, the reader is directed to Sections III through 

VI of the proposed preamble and to Chapter 2 of the draft RIA. The analysis here also includes a 

look at payback periods—the time at which cumulative fuel savings outweigh increased costs 

associated with new, more fuel efficient vehicles. And finally, the analysis here includes a look 

at the cost per ton of GHG emissions reduced by the addition of new technology.
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7-19

Note that all discounted costs presented in this chapter, whether in the Calendar Year (or 

annual) analysis or the Model Year Lifetime analysis, are discounted back to 2015 at the 

discount rate shown in the table(s). 

7.2.1.1 Technology Costs

For the HD pickups and vans, the agencies have used a methodology consistent with that 

used for our recent 2017-2025 light-duty joint rulemaking since most of the technologies 

expected for HD pickups and vans are consistent with those expected for the larger light-duty 

trucks. The cost estimates presented in the recent light-duty joint rulemaking were then scaled 

upward to account for the larger weight, towing capacity, and work demands of the trucks in 

these heavier classes. For details on that scaling process and the resultant costs for individual 

technologies, the reader is directed to Chapter 2.12 of this draft RIA. Note also that all cost 

estimates have been updated to 2012 dollars for this analysis while the 2017-2025 light-duty 

joint rulemaking was presented in 2010 dollars.4 

For vocational vehicles, tractors and trailers, consistent with the Phase 1 rule, the

agencies have estimated costs using a different methodology than that employed in the recent 

light-duty joint rulemaking establishing fuel economy and GHG standards. In the recent lightduty joint rulemaking, all fixed costs were included in the hardware costs via an indirect cost 

multiplier. As such, the hardware costs presented in that analysis included both the actual 

hardware and the associated fixed costs. For the vocational, tractor and trailer segments in this 

analysis, some of the fixed costs are estimated separately and are presented separately from the 

technology costs. As noted above, all costs are presented in 2012 dollars.

The estimates of vehicle costs are generated relative to two unique “no action” baselines. 

The first of these (alternative 1a, presented here) representing generally flat or less dynamic fuel 

consumption improvements, or a fleet of vehicles meeting the Phase 1 heavy-duty requirements. 

The second of these (alternative 1b and presented in detail in Chapter 7.1) representing dynamic 

fuel consumption improvements, or a fleet of vehicles with improving fuel consumption despite 

the lack of regulatory drivers. See Section X of the preamble and Chapter 11 of this draft RIA 

for more detail on these two baselines. As such, costs to comply with the Phase 1 standards are 

not included in the estimates here. In fact, in the methodology used for vocational vehicles, 

tractors and trailers, there are cases where Phase 1 technologies are being removed in favor of 

Phase 2 technologies – that is, the technology basis for the Phase 2 proposed standards involves 

removing certain of the Phase 1 technologies. In those cases, savings are associated with the 

removal of the Phase 1 technology. The details of which technologies and where such savings 

occur are presented in Chapter 2.12 of the draft RIA. 

For HD pickups and vans, as described in Chapter 2 of this draft RIA, the agencies used 

NHTSA’s CAFE model to estimate the cost per vehicle associated with the preferred and 
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7-20

possible alternative standards.DThat model has the capability to look ahead at future standards 

when making determinations of how vehicles should be changed to comply. It does this because 

redesign cycles do not always line up well with regulatory implementation schedules, so a 

manufacturer may choose to redesign a vehicle in MY2018 in preparation for upcoming 

MY2021-2025 standards if that particular vehicle is not scheduled for another redesign until, say, 

MY2026. The result being new technology costs in years prior to implementation of the 

standards. The CAFE model’s output would show such costs occurring in years prior to 

MY2021. On the other hand, the CAFE model also estimates the potential that credits generated 

in earlier model years might be carried forward (i.e., “banked”) and then used in later model 

years, potentially reducing costs in some model years covered by the analysis. In Table 7-17, 

EPA has taken those early costs and spread them over the years 2021 through 2026 so that those 

costs can be fully realized while showing them occurring during the expected years of 

implementation. 

Table 7-17 presents the average incremental technology costs per vehicle for the 

preferred alternative relative to the less dynamic baseline and using Method B (the MOVES 

analysis for all vehicle categories). These tables include both engine and vehicle technologies. 

For HD pickups and vans, costs begin with new standards in MY2021 then generally increase 

through MY2027 after which time they begin to decrease as vehicles continue to meet the 

MY2027 standards at ever decreasing cost due to learning effects. The trend is similar for 

vocational vehicles. For tractor/trailers, the costs begin in MY2018 as trailers begin adding new 

technology to meet the 2018 trailer standards. Costs then increase in MY2021 as the tractor 

standards begin through 2027. After 2027, costs begin to decrease due to learning effects. All 

costs shown in the table represent the weighted average cost of all vehicles within the category

shown in the heading. 

 

D The CAFE model also provides a full benefit-cost analysis associated with the HD pickup and van portion of the 

proposed and alternative standards, and the agencies have used this analysis as part of Method A to provide 

estimates of the costs and benefits of today’s proposed standards. The full benefit-cost analysis for Method A is 

presented in Chapters 9 and 10 of this draft RIA. The full benefit-cost analysis for Method B is presented in Chapter 

8 of this draft RIA.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-21

Table 7-17 Estimated Technology Costs per Vehicle for the Preferred Alternative versus the Less Dynamic 

Baseline and using Method B (2012$)

a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS

2018 $0 $0 $639

2019 $0 $0 $613

2020 $0 $0 $592

2021 $558 $1,152 $7,606

2022 $551 $1,128 $7,482

2023 $834 $1,037 $7,016

2024 $991 $1,766 $10,947

2025 $1,204 $1,731 $10,763

2026 $1,267 $1,695 $10,513

2027 $1,342 $3,381 $12,849

2028 $1,332 $3,323 $12,655

2029 $1,334 $3,271 $12,548

2030 $1,324 $3,222 $12,439

2050 $1,324 $3,232 $12,415

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section 

I.D; for an explanation of the less dynamic baseline, 1a, and more dynamic baseline,

1b, please see Preamble Section X.A.1

As noted in the text, MYs 2018-2020 include costs for trailers only, and in MYs 

2021 and later the costs include both tractor and trailer costs, inclusive of 

engine-related costs. Detailed technology and package costs for all segments can 

be found in Chapter 2 of this draft RIA (notably, see Sections 2.12 and 2.13).

Also, for HD pickups and vans, EPA has taken early costs and spread them over 

the years 2021 through 2026 so that those costs can be fully realized while 

showing them occurring during the expected years of implementation. 

Table 7-18 presents the annual costs—versus the less dynamic baseline and using Method 

B—for new engine- and vehicle-related technology along with net present values at 3 percent 

and 7 percent. Table 7-19 presents the model year lifetime costs—versus the less dynamic 

baseline and using Method B—for new technology discounted at 3 percent. Table 7-20 presents 

the model year lifetime costs—versus the less dynamic baseline and using Method B—for new 

technology discounted at 7 percent.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-22

Table 7-18 Annual Technology Costs and Net Present Values Associated with the Preferred Alternative vs.

the Less Dynamic Baseline and using Method B

($Millions of 2012$) a

CALENDAR

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $116 $116

2019 $0 $0 $113 $113

2020 $0 $0 $112 $112

2021 $328 $591 $1,254 $2,173

2022 $324 $585 $1,252 $2,161

2023 $491 $541 $1,192 $2,224

2024 $590 $951 $1,913 $3,455

2025 $731 $961 $1,955 $3,647

2026 $788 $967 $1,980 $3,736

2027 $844 $1,972 $2,493 $5,309

2028 $847 $1,969 $2,519 $5,334

2029 $854 $1,963 $2,559 $5,376

2030 $855 $1,956 $2,589 $5,399

2035 $892 $2,076 $2,888 $5,856

2040 $935 $2,204 $3,177 $6,316

2050 $1,024 $2,414 $3,548 $6,987

NPV, 3% $13,475 $29,183 $43,268 $85,926

NPV, 7% $6,461 $13,502 $20,553 $40,516

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-23

Table 7-19 Discounted MY Lifetime New Technology Costs of the Preferred Alternative

Vs. the Less Dynamic Baseline and using Method B

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $104 $104

2019 $0 $0 $99 $99

2020 $0 $0 $95 $95

2021 $271 $488 $1,035 $1,794

2022 $260 $468 $1,003 $1,731

2023 $382 $421 $927 $1,730

2024 $446 $719 $1,445 $2,610

2025 $536 $705 $1,434 $2,674

2026 $561 $689 $1,410 $2,660

2027 $583 $1,363 $1,723 $3,670

2028 $568 $1,321 $1,690 $3,580

2029 $556 $1,279 $1,667 $3,502

Sum $4,164 $7,452 $12,632 $24,248

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-20 Discounted MY Lifetime New Technology Costs of the Preferred Alternative

Vs. the Less Dynamic Baseline and using Method B

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $91 $91

2019 $0 $0 $84 $84

2020 $0 $0 $77 $77

2021 $212 $381 $808 $1,401

2022 $195 $352 $754 $1,302

2023 $276 $305 $671 $1,252

2024 $311 $501 $1,007 $1,818

2025 $360 $473 $961 $1,793

2026 $362 $445 $910 $1,717

2027 $363 $847 $1,071 $2,280

2028 $340 $790 $1,011 $2,141

2029 $320 $736 $960 $2,017

Sum $2,738 $4,829 $8,405 $15,973

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-24

7.2.1.2 Compliance Costs

As noted above, some fixed costs were estimated separately from the hardware costs. As 

such, not all fixed costs are included in the tables presented in Section 7.2.1.1. The agencies 

have estimated additional and/or new compliance costs associated with the proposed standards.

Normally, compliance program costs would be considered part of the indirect costs and, 

therefore, would be accounted for via the markup applied to direct manufacturing costs. 

However, since the agencies are proposing new compliance elements that were not present 

during development of the indirect cost markups used in this analysis, additional compliance 

program costs are being accounted for via a separate “line-item” here. Note that, for HD pickups 

and vans, compliance elements were present during development of the indirect cost markups 

used; as such, these costs are already included as part of the technology costs described above.

There are three elements to the compliance costs estimated in this analysis. The first is 

for construction of new, or upgrades to existing, test facilities for conducting powertrain testing. 

The second costs are for conducting the powertrain tests themselves. And the third is for 

reporting of compliance data to EPA and NHTSA. We estimated these latter costs in the Phase 1 

rule as $0.24 million, $0.9 million and $1.1 million for HD pickups and vans, vocational and 

tractors, respectively, for a total of $2.3 million per year (2009$).

5 All of these are industrywide, annual costs. 

We have estimated new reporting costs in this Phase 2 proposal associated with new 

powertrain testing within the vocational vehicle program, the increased level of reporting in the 

tractor program and an all new compliance program where none has existed to date within the 

trailer program. We have estimated those costs at $95,000 and $240,000 for vocational and 

tractor programs, and at $1.2 million in the trailer program, all in 2012$. All of these are 

industry-wide, annual costs. 

For powertrain testing facility upgrades and construction, we have estimated that 6

manufacturers would upgrade and 5 would construct new facilities at an upgrade cost of $1.2 

million and a new construction cost of $1.9 million, all in 2012$. The result being an industrywide (but vocational program only) cost of $16.6 million (2012$). This cost would occur once 

which we have attributed to CY2021, what would be the first year of the Phase 2 vocational 

standards.E

Lastly, the vocational program is also estimated to incur costs associated with conducting 

powertrain testing. We have estimated the cost of testing at $69,000 per test and expect three 

large manufacturers to conduct 20 tests/year for a total of $4.1 million/year.F

 

E Note that, in alternative 2, we expect no manufacturers would conduct powertrain testing so none would construct 

or upgrade facilities.

F Note that, in alternative 2, we expect no powertrain testing so no testing costs; in alternative 4, we expect 4 large

manufacturers to conduct the testing for an annual cost of $5.5 million.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-25

Table 7-21 through Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-23 present the annual costs for new compliance program elements along with net 

present values at 3 percent and 7 percent, and the model year lifetime compliance costs 

discounted at 3 percent and 7 percent, respectively.

Table 7-21 Annual Compliance Costs and Net Present Values Associated with the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

($Millions of 2012$) a

CALENDAR

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $16.6 $1.4 $18.1

2022 $0.0 $4.2 $1.4 $5.7

2023 $0.0 $4.2 $1.4 $5.7

2024 $0.0 $4.2 $1.4 $5.7

2025 $0.0 $4.2 $1.4 $5.7

2026 $0.0 $4.2 $1.4 $5.7

2027 $0.0 $4.2 $1.4 $5.7

2028 $0.0 $4.2 $1.4 $5.7

2029 $0.0 $4.2 $1.4 $5.7

2030 $0.0 $4.2 $1.4 $5.7

2035 $0.0 $4.2 $1.4 $5.7

2040 $0.0 $4.2 $1.4 $5.7

2050 $0.0 $4.2 $1.4 $5.7

NPV, 3% $0.0 $80.8 $23.7 $104.4

NPV, 7% $0.0 $44.2 $12.1 $56.4

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-26

Table 7-22 Discounted MY Lifetime Compliance Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $13.7 $1.2 $14.9

2022 $0.0 $3.4 $1.1 $4.5

2023 $0.0 $3.3 $1.1 $4.4

2024 $0.0 $3.2 $1.1 $4.3

2025 $0.0 $3.1 $1.0 $4.1

2026 $0.0 $3.0 $1.0 $4.0

2027 $0.0 $2.9 $1.0 $3.9

2028 $0.0 $2.8 $1.0 $3.8

2029 $0.0 $2.8 $0.9 $3.7

Sum $0.0 $38.3 $9.4 $47.7

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-23 Discounted MY Lifetime Compliance Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(7% Discount Rate, $Millions of 2012$)

a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $10.7 $0.9 $11.6

2022 $0.0 $2.5 $0.9 $3.4

2023 $0.0 $2.4 $0.8 $3.2

2024 $0.0 $2.2 $0.7 $3.0

2025 $0.0 $2.1 $0.7 $2.8

2026 $0.0 $1.9 $0.7 $2.6

2027 $0.0 $1.8 $0.6 $2.4

2028 $0.0 $1.7 $0.6 $2.3

2029 $0.0 $1.6 $0.5 $2.1

Sum $0.0 $27.0 $6.4 $33.4

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-27

7.2.1.3 Research & Development Costs

Much like the compliance program costs described above, EPA has estimated additional 

engine, vocational vehicle and tractor R&D associated with the proposed standards that is not 

accounted for via the indirect cost markups used in this analysis for those segments. The 

necessary R&D for HD pickups and vans is covered by the indirect costs included as part of the 

technology costs described above. In the Phase 1 rule, the agencies estimated the engine R&D 

costs at $6.8 million (2009$) per engine class per manufacturer per year for five years. In this 

Phase 2 analysis, EPA has estimated this same level of R&D and has assumed 12 heavy-heavy

and 12 medium-heavy HD engine R&D programs would be conducted for a total of $214 

million/year (2012$). In this analysis, EPA has assumed those costs would occur annually for 4 

years, MYs 2021-2024. The total being $857 million (2012$) over 4 years (by comparison, the 

Phase 1 rule estimated a total of $852 million (2009$) over 5 years). To this, EPA has estimated 

an additional $6 million/year spent by vocational vehicle manufacturers and $20 million/year

spent by tractor manufacturers. In the end, EPA is estimating a total of $961 million in R&D 

spending above and beyond the level included in the markups used to estimate indirect costs for 

these segments. Under alternative 4, due to the accelerated implementation of technology, EPA 

has estimated even more R&D—an additional $6.5 million per year or $26 million total spent by

vocational vehicle and tractor manufacturers. Importantly, EPA estimates that these costs would 

occur during normal R&D and vehicle design cycles for both alternatives 3 and 4. EPA has not 

included any additional R&D would be spent by trailer manufacturers since our cost estimates 

include R&D conducted by trailer parts suppliers which are subsequently included in the prices 

charged by those suppliers to the trailer manufacturer. Additionally, the markups we have 

applied to cover indirect costs (see Chapter 2.12 of this draft RIA) include costs associated with 

R&D incurred by the trailer manufacturer.

Table 7-24 through Table 7-26 present the annual costs for R&D spending along with net 

present values at 3 percent and 7 percent, and the model year lifetime R&D costs discounted at 3 

percent and 7 percent, respectively.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-28

Table 7-24 Annual R&D Costs and Net Present Values Associated with the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

($Millions of 2012$) a

CALENDAR

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $113.1 $127.1 $240.3

2022 $0.0 $113.1 $127.1 $240.3

2023 $0.0 $113.1 $127.1 $240.3

2024 $0.0 $113.1 $127.1 $240.3

2025 $0.0 $0.0 $0.0 $0.0

2026 $0.0 $0.0 $0.0 $0.0

2027 $0.0 $0.0 $0.0 $0.0

2028 $0.0 $0.0 $0.0 $0.0

2029 $0.0 $0.0 $0.0 $0.0

2030 $0.0 $0.0 $0.0 $0.0

2035 $0.0 $0.0 $0.0 $0.0

2040 $0.0 $0.0 $0.0 $0.0

2050 $0.0 $0.0 $0.0 $0.0

NPV, 3% $0.0 $357.5 $401.7 $759.2

NPV, 7% $0.0 $264.3 $297.0 $561.3

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-29

Table 7-25 Discounted MY Lifetime R&D Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $93.4 $104.9 $198.3

2022 $0.0 $90.6 $101.9 $192.5

2023 $0.0 $88.0 $98.9 $186.9

2024 $0.0 $85.4 $96.0 $181.5

2025 $0.0 $0.0 $0.0 $0.0

2026 $0.0 $0.0 $0.0 $0.0

2027 $0.0 $0.0 $0.0 $0.0

2028 $0.0 $0.0 $0.0 $0.0

2029 $0.0 $0.0 $0.0 $0.0

Sum $0.0 $357.5 $401.7 $759.2

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-26 Discounted MY Lifetime R&D Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $0.0 $0.0

2019 $0.0 $0.0 $0.0 $0.0

2020 $0.0 $0.0 $0.0 $0.0

2021 $0.0 $72.9 $81.9 $154.9

2022 $0.0 $68.1 $76.6 $144.7

2023 $0.0 $63.7 $71.6 $135.3

2024 $0.0 $59.5 $66.9 $126.4

2025 $0.0 $0.0 $0.0 $0.0

2026 $0.0 $0.0 $0.0 $0.0

2027 $0.0 $0.0 $0.0 $0.0

2028 $0.0 $0.0 $0.0 $0.0

2029 $0.0 $0.0 $0.0 $0.0

Sum $0.0 $264.3 $297.0 $561.3

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-30

7.2.1.4 Summary of Vehicle-Related Costs of the Program using Method B

Table 7-27 presents the annual new vehicle costs (including engine-related costs) 

associated with the preferred alternative for HD pickups and vans, vocational vehicles, and 

tractor and trailer programs along with net present values at 3 percent and 7 percent. This table 

presents costs relative to the less dynamic baseline and using the MOVES analysis of all vehicle 

categories (Method B). Table 7-28 presents the model year lifetime costs associated with the 

preferred alternative discounted at 3 percent relative to the less dynamic baseline and using 

Method B. Table 7-29 presents the model year lifetime costs associated with the preferred 

alternative discounted at 7 percent relative to the less dynamic baseline and using Method B.

Table 7-27 Annual Vehicle-Related Costs and Net Present Values Associated with the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

($Millions of 2012$) a

CALENDAR

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $116 $116

2019 $0 $0 $113 $113

2020 $0 $0 $112 $112

2021 $328 $721 $1,382 $2,432

2022 $324 $702 $1,381 $2,407

2023 $491 $659 $1,320 $2,470

2024 $590 $1,069 $2,042 $3,701

2025 $731 $965 $1,956 $3,653

2026 $788 $972 $1,982 $3,742

2027 $844 $1,976 $2,495 $5,315

2028 $847 $1,973 $2,520 $5,340

2029 $854 $1,967 $2,560 $5,381

2030 $855 $1,960 $2,591 $5,405

2035 $892 $2,080 $2,890 $5,862

2040 $935 $2,209 $3,179 $6,322

2050 $1,024 $2,418 $3,550 $6,992

NPV, 3% $13,475 $29,621 $43,693 $86,789

NPV, 7% $6,461 $13,810 $20,862 $41,133

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-31

Table 7-28 Discounted MY Lifetime Vehicle-Related Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $104 $104

2019 $0 $0 $99 $99

2020 $0 $0 $95 $95

2021 $271 $595 $1,141 $2,007

2022 $260 $563 $1,106 $1,928

2023 $382 $512 $1,027 $1,921

2024 $446 $807 $1,542 $2,795

2025 $536 $708 $1,435 $2,678

2026 $561 $692 $1,411 $2,664

2027 $583 $1,366 $1,724 $3,673

2028 $568 $1,324 $1,691 $3,583

2029 $556 $1,282 $1,668 $3,506

Sum $4,164 $7,848 $13,044 $25,055

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-29 Discounted MY Lifetime Vehicle-Related Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0 $0 $91 $91

2019 $0 $0 $84 $84

2020 $0 $0 $77 $77

2021 $212 $465 $891 $1,567

2022 $195 $423 $832 $1,450

2023 $276 $371 $743 $1,390

2024 $311 $562 $1,074 $1,947

2025 $360 $475 $962 $1,796

2026 $362 $446 $911 $1,719

2027 $363 $849 $1,072 $2,283

2028 $340 $792 $1,012 $2,143

2029 $320 $738 $960 $2,019

Sum $2,738 $5,121 $8,709 $16,568

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-32

7.2.2 Changes in Fuel Consumption and Savings

7.2.2.1 Changes in Fuel Consumption

The proposed standards would result in significant improvements in the fuel efficiency of 

affected vehicles. Drivers of those vehicles would see corresponding savings associated with 

reduced fuel expenditures. The agencies have estimated the impacts on fuel consumption for the 

proposed standards. More detail behind these changes in fuel consumption is presented in 

Chapter 5 of this draft RIA. The expected impacts on fuel consumption are shown in Table 7-30

as reductions from the less dynamic baseline reference case (i.e., positive values represent fewer 

gallons consumed) and using the MOVES analysis of all vehicle categories (Method B). The 

gallons shown in this table include any increased consumption resulting from the rebound effect.

Table 7-30 Annual Fuel Consumption Reductions due to the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(Million Gallons) a

GASOLINE REDUCTIONS DIESEL REDUCTIONS

CALENDAR

YEAR

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

2018 0 0 0 0 0 0 74 74

2019 0 0 0 0 0 0 150 150

2020 0 0 0 0 0 0 227 227

2021 5 5 0 10 5 29 489 523

2022 19 10 0 29 20 58 817 894

2023 42 15 0 57 43 86 1,147 1,276

2024 73 26 0 99 76 146 1,674 1,895

2025 113 37 0 151 117 205 2,202 2,523

2026 161 48 0 210 167 263 2,722 3,152

2027 217 74 0 291 224 357 3,308 3,890

2028 270 99 0 369 280 449 3,871 4,600

2029 321 123 0 445 333 538 4,407 5,278

2030 370 147 0 516 383 622 4,918 5,924

2035 561 240 0 801 579 962 6,975 8,517

2040 674 294 0 968 690 1,169 8,349 10,209

2050 783 343 0 1,127 803 1,390 10,117 12,310

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-33

Table 7-31 MY Lifetime Fuel Consumption Reductions due to the Preferred Alternative 

Vs. The Less Dynamic Baseline and using Method B

(Million Gallons) a

GASOLINE REDUCTIONS DIESEL REDUCTIONS

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

2018 0 0 0 0 0 0 754 754

2019 0 0 0 0 0 0 745 745

2020 0 0 0 0 0 0 738 738

2021 58 54 0 113 59 340 4,025 4,424

2022 162 54 0 216 164 340 4,064 4,568

2023 263 54 0 317 267 340 4,096 4,703

2024 366 127 0 493 373 705 6,551 7,628

2025 472 130 0 602 481 722 6,763 7,967

2026 582 133 0 714 593 738 6,958 8,289

2027 685 297 0 982 699 1,193 8,092 9,984

2028 692 300 0 992 707 1,210 8,265 10,181

2029 696 303 0 999 712 1,222 8,427 10,360

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

7.2.2.2 Changes in Fuel Expenditures

Using the fuel consumption reductions presented above, the agencies have calculated the fuel 

expenditure changes associated with the proposed standards, subcategory by subcategory. To do 

this, reduced fuel consumption is multiplied in each year by the corresponding estimated average 

fuel price in that year, using the reference case fuel prices from AEO 2014. As the AEO fuel 

price projections go through 2040 and not beyond, fuel prices beyond 2040 were set equal to the 

2040 values. These estimates do not account for the significant uncertainty in future fuel prices; 

the monetized fuel savings would be understated if actual fuel prices are higher (or overstated if 

fuel prices are lower) than estimated. The Annual Energy Outlook (AEO) is a standard reference 

used by NHTSA and EPA and many other government agencies to estimate the projected price 

of fuel. This has been done using both the pre-tax and post-tax fuel prices. Since the post-tax 

fuel prices are the prices paid at fuel pumps, the fuel expenditure changes calculated using these 

prices represent the changes fuel purchasers would see. The pre-tax fuel savings are those that 

society would see. Assuming no change in fuel tax rates, the difference between these two 

columns represents the reduction in fuel tax revenues that would be received by state and federal 

governments, or about $240 million in 2021 and $5.2 billion by 2050 as shown in Table 7-32. 

Table 7-33 presents the model year lifetime fuel savings—versus the less dynamic baseline and 

using Method B—discounted at 3 percent. Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-34

Table 7-34 presents the model year lifetime costs fuel savings—versus the less dynamic baseline 

and using Method B—discounted at 7 percent. Note that in Chapters 8 and 11 of this draft RIA, 

the overall benefits and costs of the rulemaking are presented and only the pre-tax fuel 

expenditure impacts are presented there. 

Table 7-32 Annual Reductions in Fuel Expenditures and Net Present Values due to the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(Millions of 2012$)

a

REDUCED FUEL EXPENDITURES –

RETAIL

REDUCED FUEL EXPENDITURES –

UNTAXED

CALENDAR

YEAR

HD 

PICKUPS

& VANS

VOC TRACTOR/

TRAILERS SUM

HD 

PICKUPS 

& VANS

VOC TRACTOR/

TRAILERS SUM

2018 $0 $0 $261 $261 $0 $0 $227 $227

2019 $0 $0 $540 $540 $0 $0 $472 $472

2020 $0 $0 $834 $834 $0 $0 $731 $731

2021 $36 $124 $1,830 $1,989 $31 $109 $1,610 $1,750

2022 $137 $251 $3,117 $3,505 $120 $222 $2,753 $3,095

2023 $303 $381 $4,435 $5,119 $267 $337 $3,928 $4,532

2024 $536 $656 $6,558 $7,750 $474 $581 $5,824 $6,879

2025 $838 $937 $8,756 $10,531 $742 $833 $7,797 $9,372

2026 $1,206 $1,218 $10,953 $13,378 $1,071 $1,085 $9,777 $11,934

2027 $1,643 $1,708 $13,508 $16,859 $1,462 $1,525 $12,089 $15,076

2028 $2,062 $2,182 $15,937 $20,181 $1,837 $1,952 $14,289 $18,079

2029 $2,478 $2,658 $18,349 $23,485 $2,213 $2,383 $16,487 $21,083

2030 $2,877 $3,120 $20,677 $26,675 $2,574 $2,803 $18,616 $23,993

2035 $4,633 $5,175 $31,160 $40,968 $4,190 $4,698 $28,354 $37,242

2040 $5,896 $6,681 $39,501 $52,078 $5,385 $6,122 $36,276 $47,783

2050 $6,859 $7,917 $47,862 $62,638 $6,264 $7,255 $43,955 $57,474

NPV, 3% $59,038 $66,542 $418,711 $544,290 $53,537 $60,566 $381,492 $495,595

NPV, 7% $24,187 $27,169 $176,228 $227,584 $21,881 $24,670 $160,096 $206,646

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-35

Table 7-33 Discounted MY Lifetime Reductions in Fuel Expenditures of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(3% Discount Rate, Millions of 2012$)

a

REDUCED FUEL EXPENDITURES –

RETAIL

REDUCED FUEL EXPENDITURES –

UNTAXED

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

2018 $0 $0 $2,183 $2,183 $0 $0 $1,937 $1,937

2019 $0 $0 $2,123 $2,123 $0 $0 $1,890 $1,890

2020 $0 $0 $2,066 $2,066 $0 $0 $1,844 $1,844

2021 $296 $1,066 $11,074 $12,436 $263 $952 $9,911 $11,126

2022 $813 $1,048 $10,995 $12,856 $724 $938 $9,862 $11,525

2023 $1,296 $1,029 $10,888 $13,212 $1,157 $923 $9,787 $11,867

2024 $1,774 $2,124 $17,103 $21,001 $1,587 $1,909 $15,405 $18,901

2025 $2,246 $2,136 $17,330 $21,712 $2,013 $1,923 $15,640 $19,577

2026 $2,712 $2,140 $17,490 $22,342 $2,436 $1,931 $15,814 $20,180

2027 $3,135 $3,564 $19,944 $26,643 $2,821 $3,220 $18,065 $24,106

2028 $3,104 $3,539 $19,949 $26,592 $2,798 $3,202 $18,101 $24,101

2029 $3,064 $3,503 $19,925 $26,493 $2,767 $3,175 $18,109 $24,052

Sum $18,440 $20,149 $151,070 $189,659 $16,567 $18,173 $136,364 $171,105

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-34 Discounted MY Lifetime Reductions in Fuel Expenditures of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(7% Discount Rate, Millions of 2012$)

a

REDUCED FUEL EXPENDITURES –

RETAIL

REDUCED FUEL EXPENDITURES –

UNTAXED

MODEL

YEAR

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

HD 

PICKUPS 

& VANS

VOC

TRACTO

R/

TRAILER

S

SUM

2018 $0 $0 $1,529 $1,529 $0 $0 $1,352 $1,352

2019 $0 $0 $1,428 $1,428 $0 $0 $1,267 $1,267

2020 $0 $0 $1,331 $1,331 $0 $0 $1,185 $1,185

2021 $186 $666 $6,848 $7,701 $165 $594 $6,115 $6,874

2022 $492 $631 $6,555 $7,678 $437 $564 $5,867 $6,869

2023 $755 $597 $6,255 $7,607 $673 $535 $5,611 $6,819

2024 $995 $1,187 $9,472 $11,654 $889 $1,065 $8,515 $10,469

2025 $1,213 $1,149 $9,244 $11,607 $1,086 $1,033 $8,328 $10,447

2026 $1,410 $1,109 $8,986 $11,505 $1,265 $999 $8,111 $10,374

2027 $1,570 $1,780 $9,868 $13,218 $1,411 $1,605 $8,924 $11,940

2028 $1,496 $1,701 $9,500 $12,697 $1,347 $1,537 $8,607 $11,490

2029 $1,423 $1,621 $9,135 $12,179 $1,283 $1,468 $8,291 $11,041

Sum $9,540 $10,442 $80,151 $100,134 $8,555 $9,399 $72,174 $90,128

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-36

7.2.3 Maintenance Costs

The agencies have estimated increased maintenance costs associated with installation of 

lower rolling resistance tires. We expect that, when replaced, the lower rolling resistance tires 

would be replaced by equivalent performing tires throughout the vehicle lifetime. As such, the 

incremental increases in costs for lower rolling resistance tires would be incurred throughout the 

vehicle lifetime at intervals consistent with current tire replacement intervals. Those intervals 

are difficult to quantify given the variety of vehicles and operating modes within the HD 

industry. For HD pickups and vans, we have chosen a tire replacement interval of 40,000 miles. 

We have done the same for all vocational vehicles which is probably overly conservative as 

more frequent intervals results in higher maintenance costs. For tractors and trailers, we have 

used a maintenance interval of 200,000 miles. The presence of tire inflation management 

systems, and the increased use of those systems expected due to this proposed rule, should serve 

to improve tire maintenance intervals.

In evaluating maintenance costs associated with the proposal relative to the less dynamic 

baseline, EPA has used the maintenance intervals noted above, the MOVES policy case VMT, 

and the MOVES population of specific MY vehicles in future calendar years to estimate the 

increased maintenance costs associated with the proposal, again for each subcategory. Note that, 

in the context of the benefit-cost analysis, EPA has estimated maintenance costs using the policy

case VMT which, by definition, includes rebound VMT (see Section IX of the preamble and 

Chapter 8 of this draft RIA for a discussion of rebound VMT). In contrast, in the context of the 

payback analysis discussed below, EPA estimates maintenance costs using the reference case 

VMT which, by definition, excludes rebound VMT. EPA does this for reasons explained in the 

payback discussion presented in Chapter 0 of this draft RIA.

Table 7-35 shows the incremental increased costs associated with lower rolling resistance 

tires for HD pickups and vans, vocational vehicles, tractors, trailers and tractor/trailers relative to 

the less dynamic baseline and using Method B. Table 7-36 shows the lifetime maintenance 

intervals for MY2018 through MY2029.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-37

Table 7-35 Increased Maintenance Costs at Maintenance Intervals Associated with the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(2012$/event) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR TRAILER TRACTOR/TRAILER

2018 $0.00 $0.00 $0.00 $79.92 $67.16

2019 $0.00 $0.00 $0.00 $77.77 $65.36

2020 $0.00 $0.00 $0.00 $75.69 $63.60

2021 $1.72 $6.99 $33.16 $78.81 $99.38

2022 $3.45 $6.91 $32.53 $76.74 $97.02

2023 $5.17 $8.12 $31.66 $71.17 $91.46

2024 $6.90 $17.66 $33.50 $73.97 $95.66

2025 $8.62 $17.47 $32.92 $72.02 $93.43

2026 $8.62 $13.50 $30.01 $70.72 $89.44

2027 $8.62 $21.34 $32.27 $69.44 $90.62

2028 $8.62 $20.26 $31.52 $68.85 $89.37

2029 & later $8.62 $15.99 $31.22 $68.27 $88.59

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-36 Lifetime Maintenance Intervals for the Indicated Model Years

Vs. The Less Dynamic Baseline and using Method Ba, b

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILER

2018 7.19 7.89 7.74

2019 7.18 7.85 7.74

2020 7.16 7.82 7.73

2021 7.24 7.93 7.74

2022 7.23 7.90 7.74

2023 7.23 7.88 7.74

2024 7.23 7.87 7.75

2025 7.23 7.86 7.77

2026 7.25 7.87 7.80

2027 7.28 7.88 7.85

2028 7.32 7.90 7.90

2029 & later 7.37 7.93 7.97

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section 

I.D; for an explanation of the less dynamic baseline, 1a, and more dynamic 

baseline, 1b, please see Preamble Section X.A.1

b

Includes rebound vehicle miles traveled (VMT).
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-38

Table 7-37 presents the annual in-use maintenance costs associated with the preferred 

alternative along with net present values at 3 percent and 7 percent. This table presents costs 

relative to the less dynamic baseline and using the MOVES analysis for all vehicle categories

(Method B). Table 7-38 presents the model year lifetime in-use maintenance costs—versus the 

less dynamic baseline and using Method B— discounted at 3 percent. Table 7-39 presents the 

model year lifetime in-use maintenance costs—versus the less dynamic baseline and using 

Method B—discounted at 7 percent.

Table 7-37 Annual Increased Maintenance Costs and Net Present Values Associated with the Preferred 

Alternative Vs. The Less Dynamic Baseline and using Method B

($Millions of 2012$) a

CALENDAR

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $5.5 $5.5

2019 $0.0 $0.0 $11.0 $11.0

2020 $0.0 $0.0 $16.5 $16.5

2021 $0.4 $1.8 $25.4 $27.6

2022 $1.3 $3.5 $33.8 $38.6

2023 $2.5 $5.6 $41.5 $49.6

2024 $4.2 $10.2 $49.3 $63.8

2025 $6.3 $14.7 $56.8 $77.8

2026 $8.4 $18.1 $63.4 $90.0

2027 $10.4 $23.6 $69.8 $103.7

2028 $12.3 $28.5 $75.5 $116.3

2029 $14.1 $32.0 $80.7 $126.8

2030 $14.1 $32.0 $80.7 $126.8

2035 $14.1 $32.0 $80.7 $126.8

2040 $14.1 $32.0 $80.7 $126.8

2050 $14.1 $32.0 $80.7 $126.8

NPV, 3% $183.5 $417.8 $1,194.7 $1,796.0

NPV, 7% $83.7 $191.1 $585.4 $860.2

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-39

Table 7-38 Discounted MY Lifetime Maintenance Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(3% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $51.2 $51.2

2019 $0.0 $0.0 $49.2 $49.2

2020 $0.0 $0.0 $47.5 $47.5

2021 $3.3 $14.1 $72.6 $90.0

2022 $6.5 $13.5 $69.4 $89.4

2023 $9.4 $15.4 $64.0 $88.8

2024 $12.3 $33.3 $66.6 $112.2

2025 $15.1 $32.7 $65.1 $112.9

2026 $15.0 $25.0 $62.1 $102.1

2027 $14.7 $38.9 $62.3 $115.9

2028 $14.4 $36.2 $60.6 $111.1

2029 $14.0 $27.9 $59.1 $101.0

Sum $104.6 $237.0 $729.5 $1,071.2

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-39 Discounted MY Lifetime Maintenance Costs of the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

(7% Discount Rate, $Millions of 2012$) a

MODEL

YEAR

HD PICKUPS 

& VANS VOCATIONAL TRACTOR/TRAILERS SUM

2018 $0.0 $0.0 $35.8 $35.8

2019 $0.0 $0.0 $33.2 $33.2

2020 $0.0 $0.0 $30.9 $30.9

2021 $2.1 $8.9 $45.5 $56.6

2022 $3.9 $8.3 $42.0 $54.2

2023 $5.5 $9.1 $37.3 $51.9

2024 $6.9 $18.9 $37.4 $63.2

2025 $8.3 $17.8 $35.2 $61.3

2026 $7.9 $13.1 $32.4 $53.4

2027 $7.4 $19.7 $31.3 $58.5

2028 $7.0 $17.7 $29.4 $54.0

2029 $6.6 $13.1 $27.6 $47.3

Sum $55.7 $126.6 $418.2 $600.5

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation 

of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-40

7.2.4 Analysis of Payback Periods

An important metric to vehicle purchasers is the payback period that can be expected on 

any new purchase. In other words, there is greater willingness to pay for new technology if that 

new technology “pays back” within an acceptable period of time. We make no effort to define 

the acceptable period of time here, but seek to estimate the payback period for others to make the 

decision themselves. We define the payback period as the point at which reduced fuel 

expenditures outpace increased vehicle costs. For example, a new MY2027 tractor with trailer is 

estimated to cost roughly $12,850 more (on average, including an “average” trailer, in 2012$, 

and relative to the reference case vehicle) due to the addition of new GHG reducing/fuel 

consumption improving technology. This new technology would result in lower fuel 

consumption and, therefore, reduced fuel expenditures. But how many months or years would 

pass before the reduced fuel expenditures would surpass the increased costs? 

To estimate the costs, we have considered not only the cost of the new technology, but 

also the taxes paid on the incrementally higher purchase expense, the slightly higher insurance 

expenses on the slightly higher value vehicle, and the increased maintenance costs associated 

with the new technology. Taxes paid were estimated as 6 percent sales tax in all regulated 

sectors and a 12 percent excise tax applicable in the tractor/trailer and vocational sectors. As 

such, the vehicle costs presented here are slightly higher than those presented elsewhere in this 

draft RIA. For insurance costs, we have estimated the collision insurance to be 2 percent of the 

purchase price of a vehicle consistent with the approach taken in our 2017-2025 light-duty

GHG/CAFE rule.6Therefore, increased insurance costs would equal 2 percent of the increased 

technology costs, and would be incurred every year going forward. But, since collision 

insurance is tied to vehicle value, we have also included a depreciation rate consisting of 

straight-line depreciation of 3 percent each year through the 25th year of ownership at which time 

we have flat-lined the depreciation and held vehicle value constant (see Table 7-59 in Chapter 

7.3, below). For maintenance costs, we have used the same method described above (see 

Chapter 0 of this draft RIA) except that we have used reference case VMT for the calculation 

rather than policy case VMT (i.e., we exclude rebound miles here) because typical payback 

considerations generally do not account for possible increased miles driven. Also, here we use 

retail fuel prices since those are the prices paid by owners of these vehicles.

We have conducted this payback analysis for HD pickups and vans, vocational vehicles 

and for tractor/trailers (including the engines used in each of these subcategories). All 

calculations are for the average vehicle, or average tractor/trailer combination, that drives the 

average number of miles each year. The calculations do not represent specific vehicle classes or 

specific use cases so should not be seen as being applicable to any particular individual’s 

situation. However, the payback periods do provide a general sense, on average, of what sort of 

payback periods are likely at a national, societal perspective.

Table 7-40 presents the discounted annual increased vehicle costs and fuel expenditure 

impacts associated with owning a new MY2027 HD pickup or van using both 3 percent and 7 

percent discount rates. The results in this table use Method B. As shown in the table, the 

payback for HD pickups and vans occurs late in the 3

rd year of ownership (the year in which 

cumulative expenditures become negative) using a 3 percent discount rate and in the early part of 

the 3rd year using a 7 percent discount rate.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-41

Table 7-40 Discounted Owner Expenditures & Payback Period for MY2027 HD Pickups & Vans under the 

Preferred Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $1,587 $4 -$759 $832 $1,558 $3 -$745 $817

2 $25 $3 -$734 $126 $23 $3 -$694 $150

3 $23 $3 -$714 -$561 $21 $3 -$649 -$476

4 $22 $3 -$693 -$1,229 $19 $3 -$606 -$1,060

5 $20 $3 -$651 -$1,857 $17 $2 -$549 -$1,590

6 $19 $3 -$611 -$2,446 $15 $2 -$496 -$2,067

7 $18 $2 -$571 -$2,997 $14 $2 -$446 -$2,497

8 $16 $2 -$536 -$3,514 $12 $2 -$403 -$2,886

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

Table 7-41 and Table 7-42 show the same information for a MY2027 vocational vehicle 

and a tractor/trailer, respectively. As shown, payback for vocational vehicles occurs in the 5

th

year of ownership (using 3 percent discounting and in the 6th year using 7 percent discounting) 

while payback for tractor/trailers occurs early in the 2nd year of ownership.

Table 7-41 Discounted Owner Expenditures & Payback Period for MY2027Vocational Vehicles under the 

Preferred Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $3,998 $10 -$965 $3,043 $3,924 $10 -$947 $2,987

2 $63 $9 -$937 $2,178 $59 $9 -$885 $2,169

3 $59 $9 -$914 $1,331 $53 $8 -$832 $1,399

4 $55 $9 -$891 $504 $48 $8 -$780 $675

5 $51 $8 -$829 -$265 $43 $7 -$699 $27

6 $48 $7 -$771 -$981 $39 $6 -$625 -$554

7 $45 $7 -$716 -$1,645 $35 $5 -$559 -$1,073

8 $42 $6 -$667 -$2,264 $31 $5 -$501 -$1,538

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-42

Table 7-42 Discounted Owner Expenditures & Payback Period for MY2027Tractor/Trailers under the 

Preferred Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insuranceb

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $15,194 $48 -$14,649 $593 $14,914 $47 -$14,379 $582

2 $238 $46 -$14,204 -$13,327 $225 $43 -$13,421 -$12,571

3 $223 $44 -$13,809 -$26,869 $203 $40 -$12,561 -$24,889

4 $209 $42 -$13,416 -$40,034 $183 $37 -$11,746 -$36,415

5 $195 $39 -$12,391 -$52,191 $164 $33 -$10,443 -$46,661

6 $182 $35 -$11,411 -$63,385 $148 $29 -$9,258 -$55,743

7 $170 $32 -$10,511 -$73,694 $133 $25 -$8,209 -$63,794

8 $158 $29 -$9,704 -$83,211 $119 $22 -$7,295 -$70,949

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

The fuel expenditure column uses retail fuel prices specific to gasoline and diesel fuel as 

projected in AEO2014 Early Release. This payback analysis does not include other private 

impacts, such as reduced refueling events, or other societal impacts, such as the potential 

rebound miles driven or the value of driving those rebound miles, or noise, congestion and 

accidents. It also does not include societal impacts such as co-pollutant environmental benefits 

or benefits associated with reduced GHG emissions. We use retail fuel prices and exclude these 

other private and social impacts because the focus is meant to be on those factors that buyers 

think about most while considering a new vehicle purchase and those factors that result in more 

or fewer dollars in their pockets.

In an effort to provide further information on payback, we have also looked at the 

payback periods for more specific vehicle subcategories. For example, while the tractor/trailer 

payback shown in Table 7-42 occurs early in the 2nd year, the payback for a Class 8 sleeper cab 

would occur within the first year of ownership as shown in Table 7-43.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-43

Table 7-43 Discounted Owner Expenditures & Payback Period for MY2027 Sleeper Cab with Trailer under 

the Preferred Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost, taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost, taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $16,541 $60 -$20,087 -$3,486 $16,236 $59 -$19,717 -$3,422

2 $259 $58 -$19,477 -$22,646 $244 $55 -$18,403 -$21,526

3 $243 $56 -$18,936 -$41,285 $221 $50 -$17,224 -$38,479

4 $227 $53 -$18,396 -$59,401 $199 $47 -$16,107 -$54,341

5 $212 $49 -$17,053 -$76,193 $179 $41 -$14,373 -$68,494

6 $198 $45 -$15,768 -$91,718 $161 $36 -$12,793 -$81,090

7 $185 $41 -$14,591 -$106,083 $144 $32 -$11,395 -$92,309

8 $172 $37 -$13,538 -$119,412 $129 $28 -$10,178 -$102,330

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

Given the variety in the vocational market, the subcategory analysis becomes more 

interesting. For example, Table 7-44 shows the payback for an intercity bus. Table 7-45 shows 

the same information for a transit bus, while Table 7-46 shows this information for a school bus.

These tables highlight how much the payback period can vary depending on the level of 

technology cost and fuel consumption improvement versus the number of miles driven. The 

high VMT intercity bus (~80,000 miles/year) and transit bus (~60,000 miles/year) payback in the 

1

st and 3rd year, respectively, despite first year costs exceeding $4,000 and $8,000, respectively. 

By contrast, the lower VMT school bus (~13,000 miles/year) pays back in the 11th year (or 14th

year with 7 percent discounting) despite first year costs under $6,000.

Table 7-44 Discounted Owner Expenditures & Payback Period for MY2027 Intercity Bus under the 

Preferred Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost, taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures c

Cumulative

expenditures

Technology 

cost, taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures c

Cumulative

expenditures

1 $4,863 $57 -$8,388 -$3,469 $4,773 $56 -$8,234 -$3,405

2 $76 $55 -$8,203 -$11,541 $72 $52 -$7,751 -$11,032

3 $71 $53 -$8,046 -$19,462 $65 $48 -$7,318 -$18,237

4 $67 $52 -$7,881 -$27,225 $58 $45 -$6,901 -$25,034

5 $62 $50 -$7,734 -$34,846 $53 $42 -$6,518 -$31,457

6 $58 $49 -$7,593 -$42,332 $47 $39 -$6,160 -$37,530

7 $54 $47 -$7,459 -$49,689 $42 $37 -$5,826 -$43,277

8 $51 $46 -$7,357 -$56,950 $38 $34 -$5,531 -$48,735

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-44

Table 7-45 Discounted Owner Expenditures & Payback Period for MY2027Transit Bus under the Preferred 

Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $8,718 $45 -$4,328 $4,435 $8,558 $44 -$4,248 $4,353

2 $136 $42 -$4,098 $516 $129 $40 -$3,872 $650

3 $128 $40 -$3,892 -$3,209 $116 $36 -$3,540 -$2,738

4 $120 $37 -$3,689 -$6,741 $105 $33 -$3,230 -$5,830

5 $112 $35 -$3,503 -$10,097 $94 $29 -$2,953 -$8,659

6 $104 $33 -$3,330 -$13,290 $85 $27 -$2,702 -$11,249

7 $97 $31 -$3,170 -$16,332 $76 $24 -$2,476 -$13,625

8 $91 $29 -$3,026 -$19,238 $68 $22 -$2,275 -$15,810

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

Table 7-46 Discounted Owner Expenditures & Payback Period for MY2027School Bus under the Preferred 

Alternative Vs. The Less Dynamic Baseline and using Method B

3% and 7% Discount Rates (2012$) a

Age

3% Discount Rate 7% Discount Rate

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

Technology 

cost,

taxes, 

insurance b

Maintenance 

expenditures

Fuel

expenditures 

c

Cumulative

expenditures

1 $5,687 $7 -$675 $5,019 $5,582 $7 -$662 $4,926

2 $89 $7 -$660 $4,455 $84 $6 -$623 $4,393

3 $83 $6 -$647 $3,897 $76 $6 -$589 $3,886

4 $78 $6 -$634 $3,348 $68 $6 -$555 $3,405

5 $73 $6 -$622 $2,805 $62 $5 -$524 $2,948

6 $68 $6 -$611 $2,268 $55 $5 -$495 $2,512

7 $63 $6 -$600 $1,737 $50 $4 -$469 $2,098

8 $59 $6 -$592 $1,210 $44 $4 -$445 $1,701

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the less 

dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

b

6% sales tax and 12% excise tax; insurance estimates are described in text.

c

Fuel expenditures calculated using retail fuel prices according to AEO2014 early release, reference case estimates.

We could present tables for each MOVES subcategory, but since all are calculated using 

the same methodology, the detailed tables seem unnecessary. Instead, we provide Table 7-47

which summarizes the payback period for each MOVES subcategory at both 3 percent and 7 

percent discount rates and for each fuel type.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-45

Table 7-47 Payback Periods Associated with the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

for MY2027 Vehicle Subcategories at 3% and 7% Discount Rates

Payback occurs in Year Shown a

Subcategory 3% Discount Rate 7% Discount Rate

Gasoline Diesel All Gasoline Diesel All

HD Pickups & Vans (MY2027) 3 2 3 3 2 3

Vocational (MY2027 for each)

Intercity bus N/A 1 1 N/A 1 1

Transit bus 3 3 3 3 3 3

School bus 13 11 11 18 13 14

Refuse truck N/A 4 4 N/A 4 4

Single unit short haul 4 5 5 4 5 5

Single unit long haul N/A 3 3 N/A 3 3

Motor home >23 >23 >23 >23 >23 >23

All 5 5 5 5 6 6

Tractor/Trailer (MY2027 for each)

Combination short haul N/A 2 2 N/A 2 2

Combination long haul N/A 1 1 N/A 1 1

All N/A 2 2 N/A 2 2

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

N/A denotes no such vehicles in this segment.

7.2.5 Cost per Ton of CO2 Equivalent Reduced vs. the Less Dynamic Baseline

and using Method B

The agencies have calculated the cost per ton of GHG (CO2-equivalent, or CO2eq) 

reductions associated with this rulemaking using the costs presented in Chapter 7.2.1 and 

7.2.2, and the GHG emissions reductions described in Chapter 5 of this draft RIA. These 

costs per ton-reduction values are presented in Table 7-48 through Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for 

an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see 

Preamble Section X.A.1 GHG reductions include CO2 and CO2 equivalents of CH4, N2O 

and HFCs.

Table 7-51 for HD pickups & vans, vocational vehicles, tractor/trailers and all segments, 

respectively. The cost per metric ton of GHG emissions reductions in 2050 represents the longterm cost per ton of the emissions reduced. The agencies have also calculated the cost per metric 

ton of GHG emission reductions including the savings associated with reduced fuel 

consumption. 

The calculations presented here include all engine-related costs but do not include 

benefits associated with the preferred alternative such as those associated with criteria pollutant 

reductions or energy security benefits (discussed in Chapter 8 of this draft RIA). By including 
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-46

the fuel savings, the cost per ton-reduction is less than $0 since the estimated value of fuel 

savings outweighs the program costs.

Table 7-48 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

HD Pickups and Vans only (dollar values are 2012$) a

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2021 $0.3 $0.0 0 $2,600 $2,400

2024 $0.6 $0.5 2 $330 $67

2027 $0.9 $1.5 5 $160 -$110

2030 $0.9 $2.6 9 $95 -$190

2035 $0.9 $4.2 14 $65 -$240

2040 $0.9 $5.4 17 $57 -$270

2050 $1.0 $6.3 19 $54 -$270

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for 

an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see 

Preamble Section X.A.1 GHG reductions include CO2 and CO2 equivalents of CH4, N2O 

and HFCs.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-47

Table 7-49 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

Vocational Vehicles only (dollar values are 2012$) a

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2021 $0.7 $0.1 0 $1,500 $1,300

2024 $1.1 $0.6 2 $460 $210

2027 $2.0 $1.5 6 $340 $81

2030 $2.0 $2.8 10 $190 -$78

2035 $2.1 $4.7 16 $130 -$160

2040 $2.2 $6.1 20 $110 -$200

2050 $2.5 $7.3 23 $110 -$210

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for 

an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see 

Preamble Section X.A.1 GHG reductions include CO2 and CO2 equivalents of CH4, N2O 

and HFCs.

Table 7-50 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

Tractor/Trailers only (dollar values are 2012$) a

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2021 $1.4 $1.6 7 $210 -$30

2024 $2.1 $5.8 23 $90 -$160

2027 $2.6 $12.1 46 $56 -$210

2030 $2.7 $18.6 69 $39 -$230

2035 $3.0 $28.4 97 $31 -$260

2040 $3.3 $36.3 116 $28 -$280

2050 $3.6 $44.0 141 $26 -$290

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for 

an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see 

Preamble Section X.A.1 GHG reductions include CO2 and CO2 equivalents of CH4, N2O 

and HFCs.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-48

Table 7-51 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the Preferred Alternative

Vs. The Less Dynamic Baseline and using Method B

All Vehicle Segments (dollar values are 2012$) a

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2021 $2.5 $1.7 7 $330 $96

2024 $3.8 $6.9 28 $140 -$110

2027 $5.4 $15.1 57 $94 -$170

2030 $5.5 $24.0 88 $63 -$210

2035 $6.0 $37.2 127 $47 -$250

2040 $6.4 $47.8 152 $42 -$270

2050 $7.1 $57.5 183 $39 -$270

Notes:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for 

an explanation of the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see 

Preamble Section X.A.1 GHG reductions include CO2 and CO2 equivalents of CH4, N2O 

and HFCs.

For comparison, Table 7-52 through Table 7-55 show the same information as it was 

presented in Chapter 7 of the final RIA for the Phase 1 HD rule.7

Table 7-52 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the HD Phase 1 Final Rule 

HD Pickups and Vans only (dollar values are 2009$)

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2020 $0,8 $0.9 3 $240 -$30

2030 $0.9 $3.0 10 $90 -$200

2040 $1.0 $4.3 14 $70 -$240

2050 $1.2 $5.5 16 $80 -$270

Table 7-53 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the HD Phase 1 Final Rule

Vocational Vehicles only (dollar values are 2009$)

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2020 $0.2 $1.1 4 $50 -$210

2030 $0.2 $2.4 9 $20 -$250

2040 $0.3 $3.5 12 $30 -$270

2050 $0.4 $4.7 14 $30 -$310
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-49

Table 7-54 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the HD Phase 1 Final Rule

Tractor/Trailers only (dollar values are 2009$)

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2020 $1.0 $7.7 32 $30 -$210

2030 $1.1 $15.3 57 $20 -$250

2040 $1.4 $20.2 68 $20 -$280

2050 $1.8 $26.4 78 $20 -$320

Table 7-55 Annual Cost per Metric Ton of CO2eq Emissions Reduced in the HD Phase 1 Final Rule

All Vehicle Segments (dollar values are 2009$)

Calendar 

Year

Vehicle & 

Maintenance 

Costs

($Billions)

Fuel 

Savings

($Billions)

GHG 

Reduced

(MMT)

$/metric 

ton w/o 

fuel

$/metric 

ton w/ fuel

2020 $2.0 $9.6 39 $50 -$190

2030 $2.2 $20.6 76 $30 -$240

2040 $2.7 $28.0 94 $30 -$270

2050 $3.3 $36.5 108 $30 -$310

7.3Key Parameters Used in the Estimation of Costs and Fuel Savings

This section presents some of the parameters used in generating expenditure impacts

associated with the program. Table 7-56 presents estimated sales of complying vehicles by

calendar year. Table 7-57 presents AEO 2014 early release reference case fuel prices. Note that 

AEO projects fuel prices out to 2040. Table 7-58 presents AEO 2014 final reference case fuel 

prices which are used in Method A for analysis of HD pickups and vans. For that analysis, the 

retail (post-tax) prices are increased for each year after 2040 by 0.2 percent for gasoline and 0.7

percent for diesel. For years beyond 2040, EPA has kept fuel prices at the 2040 level rather than 

growing those fuel prices at a rate consistent with years prior to 2040. Table 7-59 shows the 

depreciation rates used in the payback period analysis presented in Chapter 0. Table 7-60

through Table 7-62 show the policy and reference case VMT values used in MOVES modeling.
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-50

Table 7-56 Estimated Calendar Year Sales by Vehicle Type using Method B a, b

Calendar Year HD Pickup & 

Vans

Vocational 

Vehicles Tractors Semi-trailers

2018 601,428 508,986 152,323 181,264 

2019 592,824 508,189 155,452 184,988 

2020 588,718 511,308 159,221 189,473 

2021 588,166 513,187 161,198 191,826 

2022 588,277 518,192 163,719 194,826 

2023 588,468 522,188 166,094 197,652 

2024 595,880 538,609 171,770 204,406 

2025 607,607 555,144 178,532 212,453 

2026 622,297 570,707 185,102 220,271 

2027 629,008 583,170 190,777 227,025 

2028 635,564 592,507 195,631 232,801 

2029 640,235 600,238 200,434 238,516 

2030 645,344 606,945 204,610 243,486 

2031 650,635 613,681 208,775 248,442 

2032 656,130 620,670 213,612 254,198 

2033 660,463 625,768 217,695 259,057 

2034 665,671 633,244 222,677 264,986 

2035 673,795 643,148 228,335 271,719 

2036 680,860 651,588 233,285 277,609 

2037 688,683 660,629 238,296 283,572 

2038 697,131 670,643 243,855 290,187 

2039 702,434 676,957 247,759 294,833 

2040 706,025 682,097 251,554 299,349 

2041 711,730 682,945 247,952 295,063 

2042 718,283 689,604 251,409 299,177 

2043 724,911 696,394 254,917 303,351 

2044 731,657 703,351 258,472 307,582 

2045 738,470 710,389 262,079 311,874 

2046 745,352 717,507 265,734 316,223 

2047 752,303 724,711 269,440 320,634 

2048 759,313 731,984 273,199 325,107 

2049 766,385 739,323 277,009 329,641 

2050 773,523 746,732 280,872 334,238 

Notes:

a

Sales are estimated using population data contained in MOVES. See Chapter 5 of this draft RIA for a 

description of the MOVES modeling done in support of this proposal.

b

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of the 

less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-51

Table 7-57 AEO 2014 Early Release Reference Case Fuel Prices (2012$/gallon)

Pre-Tax Post-Tax

Calendar

Year Gasoline Diesel Gasoline Diesel

2018 $2.61 $3.07 $3.02 $3.53

2019 $2.62 $3.15 $3.03 $3.61

2020 $2.67 $3.22 $3.08 $3.67

2021 $2.71 $3.29 $3.12 $3.74

2022 $2.77 $3.37 $3.17 $3.82

2023 $2.82 $3.43 $3.22 $3.87

2024 $2.86 $3.48 $3.26 $3.92

2025 $2.89 $3.54 $3.29 $3.98

2026 $2.92 $3.59 $3.32 $4.02

2027 $2.96 $3.65 $3.36 $4.08

2028 $2.98 $3.69 $3.37 $4.12

2029 $3.01 $3.74 $3.40 $4.16

2030 $3.04 $3.79 $3.43 $4.20

2031 $3.08 $3.84 $3.46 $4.25

2032 $3.12 $3.89 $3.50 $4.30

2033 $3.16 $3.95 $3.54 $4.36

2034 $3.24 $4.02 $3.61 $4.43

2035 $3.27 $4.06 $3.65 $4.47

2036 $3.32 $4.11 $3.69 $4.51

2037 $3.36 $4.15 $3.73 $4.54

2038 $3.40 $4.19 $3.77 $4.58

2039 $3.47 $4.26 $3.83 $4.65

2040 $3.54 $4.34 $3.90 $4.73

2041 $3.54 $4.34 $3.90 $4.73

2042 $3.54 $4.34 $3.90 $4.73

2043 $3.54 $4.34 $3.90 $4.73

2044 $3.54 $4.34 $3.90 $4.73

2045 $3.54 $4.34 $3.90 $4.73

2046 $3.54 $4.34 $3.90 $4.73

2047 $3.54 $4.34 $3.90 $4.73

2048 $3.54 $4.34 $3.90 $4.73

2049 $3.54 $4.34 $3.90 $4.73

2050 $3.54 $4.34 $3.90 $4.73
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-52

Table 7-58 AEO 2014 Final Reference Case Fuel Prices Used in Method A Analysis for HD Pickups and 

Vans (2012$/gallon)

Pre-Tax Post-Tax

Calendar

Year Gasoline Diesel Gasoline Diesel

2018 $2.63 $3.10 $3.02 $3.53 

2019 $2.64 $3.19 $3.03 $3.61 

2020 $2.69 $3.25 $3.08 $3.67 

2021 $2.74 $3.32 $3.12 $3.74 

2022 $2.79 $3.41 $3.17 $3.82 

2023 $2.84 $3.46 $3.22 $3.87 

2024 $2.88 $3.51 $3.26 $3.92 

2025 $2.92 $3.58 $3.29 $3.98 

2026 $2.95 $3.62 $3.32 $4.02 

2027 $2.99 $3.68 $3.36 $4.08 

2028 $3.00 $3.73 $3.37 $4.12 

2029 $3.03 $3.77 $3.40 $4.16 

2030 $3.07 $3.81 $3.43 $4.20 

2031 $3.10 $3.87 $3.46 $4.25 

2032 $3.14 $3.92 $3.50 $4.30 

2033 $3.18 $3.98 $3.54 $4.36 

2034 $3.27 $4.06 $3.62 $4.43 

2035 $3.30 $4.10 $3.65 $4.47 

2036 $3.34 $4.14 $3.69 $4.51 

2037 $3.38 $4.18 $3.73 $4.54 

2038 $3.43 $4.22 $3.77 $4.58 

2039 $3.49 $4.29 $3.83 $4.65 

2040 $3.56 $4.38 $3.90 $4.73 

2041 $3.57 $4.41 $3.91 $4.76 

2042 $3.58 $4.44 $3.92 $4.80 

2043 $3.59 $4.48 $3.93 $4.83 

2044 $3.59 $4.51 $3.93 $4.86 

2045 $3.60 $4.54 $3.94 $4.90 

2046 $3.61 $4.58 $3.95 $4.93 

2047 $3.62 $4.61 $3.96 $4.97 

2048 $3.63 $4.65 $3.97 $5.00 

2049 $3.63 $4.68 $3.97 $5.04 

2050 $3.64 $4.72 $3.98 $5.07 
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-53

Table 7-59 Depreciation Schedule used in Payback Analysis for Method B a

Age Depreciation

0 0%

1 3%

2 7%

3 10%

4 13%

5 17%

6 20%

7 23%

8 27%

9 30%

10 33%

11 37%

12 40%

13 43%

14 47%

15 50%

16 53%

17 57%

18 60%

19 63%

20 67%

21 70%

22 73%

23 77%

24 80%

25 83%

26 83%

27 83%

28 83%

29 83%

30 83%

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-54

Table 7-60 Reference Case and Policy Case Vehicle Miles Traveled (VMT)

For the Preferred Alternative relative to the Less Dynamic Baseline using Method B

Gasoline & Diesel Fueled

HD Pickups and Vans a

Model Year Reference case Policy Case Rebound VMT

2018 115,829,944,373 115,829,944,373 0

2019 113,678,239,954 113,678,239,954 0

2020 112,489,612,844 112,489,612,844 0

2021 111,945,040,889 113,266,026,805 1,320,985,916

2022 111,677,755,878 112,995,512,359 1,317,756,481

2023 111,450,161,386 112,765,269,187 1,315,107,801

2024 112,709,425,730 114,039,351,705 1,329,925,975

2025 114,748,238,188 116,102,258,642 1,354,020,454

2026 117,275,813,888 118,659,694,470 1,383,880,582

2027 118,386,726,732 119,783,672,794 1,396,946,063

2028 119,534,232,399 120,944,733,432 1,410,501,033

2029 120,302,585,242 121,722,263,013 1,419,677,771

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1

Table 7-61 Reference Case and Policy Case Vehicle Miles Traveled (VMT)

For the Preferred Alternative relative to the Less Dynamic Baseline using Method B 

Gasoline & Diesel Fueled

Vocational Vehicles a

Model Year Reference case Policy Case Rebound VMT

2018 118,450,357,579 118,450,357,579 0

2019 116,749,449,396 116,749,449,396 0

2020 116,127,003,082 116,127,003,082 0

2021 115,248,392,233 117,357,427,520 2,109,035,287

2022 115,272,965,194 117,382,447,329 2,109,482,135

2023 115,175,262,339 117,282,914,481 2,107,652,142

2024 117,884,442,538 120,041,702,114 2,157,259,576

2025 120,740,410,310 122,949,989,775 2,209,579,465

2026 123,305,465,962 125,561,901,338 2,256,435,376

2027 125,295,415,305 127,588,325,885 2,292,910,580

2028 126,961,637,088 129,285,065,704 2,323,428,616

2029 128,161,021,270 130,506,385,592 2,345,364,323

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-55

Table 7-62 Reference Case and Policy Case Vehicle Miles Traveled (VMT)

For the Preferred Alternative relative to the Less Dynamic Baseline using Method B 

Gasoline & Diesel Fueled

Tractor/Trailer a

Model Year Reference case Policy Case Rebound VMT

2018 205,633,186,090 206,868,892,110 1,235,706,020

2019 208,901,077,400 210,286,134,790 1,385,057,390

2020 212,879,741,190 214,425,143,290 1,545,402,100

2021 214,192,002,054 215,883,987,009 1,691,984,954

2022 216,140,641,720 217,848,264,966 1,707,623,246

2023 217,755,803,295 219,476,052,250 1,720,248,954

2024 223,503,856,041 225,269,560,066 1,765,704,025

2025 230,652,945,572 232,475,299,910 1,822,354,338

2026 237,271,789,952 239,146,338,666 1,874,548,714

2027 242,810,503,298 244,728,847,129 1,918,343,832

2028 247,759,768,627 249,716,945,459 1,957,176,832

2029 252,434,280,992 254,428,339,577 1,994,058,585

Note:

a

For an explanation of analytical Methods A and B, please see Preamble Section I.D; for an explanation of 

the less dynamic baseline, 1a, and more dynamic baseline, 1b, please see Preamble Section X.A.1
*** E.O. 12866 Review – REVISED – Do Not Cite, Quote, or Release During Review ***

7-56

References

1 Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards; Final 

Rulemaking 75 Fed. Reg. 25323 (May 7, 2010).

2

Final Rulemaking to Establish Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for Mediumand Heavy-Duty Engines and Vehicles, Regulatory Impact Analysis, EPA-420-R-11-901, August 2011.

3 All of EPA’s calculations of costs and benefits (monetized) along with paybacks can be found in the docket as 

“GHGHD2 NPRM Package Costs.xlsb,” “GHGHD2 NPRM BCA.xlsb,” and “GHGHD2 NPRM Payback.xlsb.”

4 Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average Fuel Economy Standards; Final 

Rulemaking 75 Fed. Reg. 25323 (May 7, 2010).

5

Final Rulemaking to Establish Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for Mediumand Heavy-Duty Engines and Vehicles, Regulatory Impact Analysis, EPA-420-R-11-901, August 2011.

6

Final Rulemaking for 2017-2025 Light-Duty Vehicle Greenhouse Gas Emission Standards and Corporate Average 

Fuel Economy Standards, Regulatory Impact Analysis, EPA-420-R-12-016, August 2012.

7

Final Rulemaking to Establish Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for Mediumand Heavy-Duty Engines and Vehicles, Regulatory Impact Analysis, EPA-420-R-11-901, August 2011.