Regulatory Announcement

EPA and NHTSA Set Standards to 

Reduce Greenhouse Gases and 

Improve Fuel Economy for Model 

Years 2017-2025 Cars and Light Trucks 

The U.S. Environmental Protection Agency (EPA) and the 

Department of Transportation’s National Highway Traffic Safety 

Administration (NHTSA) are issuing final rules extending the National 

Program to further reduce greenhouse gas (GHG) emissions and improve 

fuel economy for model years (MYs) 2017 through 2025 light-duty 

vehicles. EPA is establishing national GHG emissions standards 

under the Clean Air Act, and NHTSA is establishing Corporate 

Average Fuel Economy (CAFE) standards under the Energy Policy 

and Conservation Act, as amended by the Energy Independence and 

Security Act (EISA). 

EPA’s standards apply to passenger cars, light-duty trucks, and 

medium-duty passenger vehicles, in MYs 2017 through 2025. The 

final standards are projected to result in an average industry fleetwide 

level of 163 grams/mile of carbon dioxide (CO2) in model year 2025, 

which is equivalent to 54.5 miles per gallon (mpg) if achieved exclusively 

through fuel economy improvements. Light-duty vehicles are currently 

responsible for nearly 60 percent of U.S. transportation-related petroleum 

use and GHG emissions. 

This new phase in this broadly supported national program conserves 

billions of barrels of oil, cuts carbon pollution, protects consumer choice, 

and enables long-term planning for automakers. 

Office of Transportation and Air Quality 

EPA-420-F-12-051 

August 2012 
Regulatory Announcement

Building on Success 

This MYs 2017-2025 program builds on the success of the first phase of the National Program 

for MYs 2012-2016 vehicles, which is projected to result in an average light-duty vehicle tailpipe 

CO2 level of 250 grams per mile by MY 2016, equivalent to 35.5 mpg (if achieved exclusively 

through fuel economy). Vehicles meeting the MYs 2012 and 2013 standards are on the road 

today, already saving consumers money at the pump. 

Combined with the MYs 2012-2016 standards, today’s final program will result in MY 2025 

vehicles emitting one-half of the GHG emissions of a MY 2010 vehicle, representing the most 

significant federal action ever taken to reduce GHG emissions and improve fuel economy. 

As with the first phase of the National Program, this second phase of the program was built on 

strong support from a wide range of stakeholders, including the automobile manufacturers. After 

President Obama announced plans for the second phase National Program on July 29, 2011, 

thirteen auto manufacturers representing over 90 percent of U.S. vehicle sales announced support 

for the program, as well as the State of California. The United Auto Workers, consumer 

organizations, environmental organizations, veterans groups, state/local governments, and 

nearly 300,000 individuals have also expressed strong support for the program. 

Continuing the National Program ensures that auto manufacturers can build a single fleet of 

U.S. vehicles that satisfy requirements of both federal programs as well as California’s program, 

thus helping to reduce costs and regulatory complexity while providing significant energy security 

and environmental benefits to the nation as a whole. 

Benefits to Consumers 

These standards will provide significant savings for consumers at the pump. Higher costs for new 

vehicle technology are projected to add, on average, about $1,800 for consumers who buy a new 

vehicle in MY 2025. Those consumers who drive their MY 2025 vehicle for its entire lifetime 

will save, on average, $5,700 to $7,400 (7 and 3 percent discount rates, respectively) in fuel savings, for a net lifetime savings of $3,400 to $5,000 (when compard to a vehicle meeting the MY 

2016 standards). For those consumers who purchase their new MY 2025 vehicle outright, the 

discounted fuel savings will offset the higher vehicle cost in less than 3.5 years, and fuel savings 

will continue for as long as the consumer owns the vehicle. 

Those consumers who purchase a new MY 2025 vehicle with a standard 5-year loan will 

immediately benefit as the monthly fuel savings offset the higher monthly payment by about 

$12 or about $140 per year. These savings assume a gasoline price of $3.87 in 2025 with small 

future increases throughout the vehicle’s lifetime; if gas prices soar consumers would save even 

more money as a result of these more fuel-efficient vehicles. 

The final standards preserve consumer choice -- that is, the standards should not affect consumers’ 

opportunity to purchase the size of vehicle with the performance, utility and safety features that 

meet their needs. The standards have been designed in a way that does not create incentives to 

manufacture vehicles of any particular size (for example, there is no incentive to downsize. 

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Regulatory Announcement

Benefits from Greenhouse Gas Reductions and Less Oil Dependency 

Over the lifetimes of the vehicles sold in MYs 2017-2025 standards, this program is projected to 

save approximately 4 billion barrels of oil and reduce GHG emissions by 2 billion metric tons, 

with net benefits to society in the range of $326 billion to $451 billion (7 and 3 percent discount 

rates, respectively). These savings come on top of savings that would already be achieved through 

the continuation of the MY 2016 standards. 

The combined National Program for MYs 2012-2016 and MYs 2017-2025 is projected to save 

families more than $1.7 trillion in fuel costs and reduce America’s dependence on oil by more 

than 2 million barrels per day in 2025, which is equivalent to one-half of the oil that we currently import from OPEC countries each day. In addition, the combined program will cut 6 

billion metric tons of greenhouse gases over the lifetimes of the vehicles sold in MYs 2012-2025 

– more than the total amount of carbon dioxide emitted by the United States in 2010. 

Consumers who purchase a new MY 2025 vehicle will save more than $8,000 in fuel costs 

over that vehicle’s lifetime (when compared to a vehicle meeting the MY 2011 CAFE 

standards). 

EPA’s Greenhouse Gas Standards 

EPA is finalizing a set of fleet-wide average carbon dioxide (CO2) emission standards for cars 

and light trucks. These standards are based on CO2 emissions-footprint curves, where each 

vehicle has a different CO2 emissions compliance target depending on its footprint value 

(related to the size of the vehicle). Generally, the larger the vehicle footprint, the higher the 

corresponding vehicle CO2 emissions target. As a result, the burden of compliance is distributed 

across all vehicles and all manufacturers. Manufacturers are not compelled to build vehicles of 

any particular size or type (nor does the rule create an incentive to do so), and no single vehicle 

is required to meet its individual target. Each manufacturer will have its own fleet-wide standard 

that reflects the vehicles it chooses to produce, and the GHG program provides a wide range of 

credit programs and flexibilities for manufacturers to meet the standards. 

Table 1 shows the projected fleet-wide CO2 emission targets under this footprint-based approach. The car CO2 emission levels are projected to increase in stringency from 212 to 143 

grams per mile (g/mi) between MY s 2017 and 2025. Similarly, fleet-wide CO2 emission levels 

for trucks are projected to increase in stringency from 295 in MY 2017 to 203 g/mi in MY 2025. 

EPA projects that the average light vehicle (combined car and truck) tailpipe CO2 compliance 

level in MY 2017 will be 243 g/mi, phasing down by MY 2025 to 163 g/mi, corresponding to 

54.5 mpg in MY 2025 if all reductions were made through fuel economy improvements. 

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Regulatory Announcement

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Table 1 - Projected Fleet-Wide Emissions Compliance Targets under the Footprint-Based 

CO2 Standards (g/mi) and Corresponding Fuel Economy (mpg) 

2016 

base 2017 2018 2019 2020 2021 2022 2023 2024 2025 

Passenger Cars (g/mi) 225 212 202 191 182 172 164 157 150 143 

Light Trucks (g/mi) 298 295 285 277 269 249 237 225 214 203 

Combined Cars & 

Trucks (g/mi) 250 243 232 222 213 199 190 180 171 163 

Combined Cars & 

Trucks (mpg) 35.5 36.6 38.3 40.0 41.7 44.7 46.8 49.4 52.0 54.5 

Figures 1 and 2 show the actual footprint curves for cars and trucks, respectively. For passenger 

cars, the CO2 compliance values associated with the footprint curves would be reduced on average 

by 5 percent per year from the MY 2016 projected passenger car industry-wide compliance level 

through MY 2025. To address the challenges facing light-duty trucks, as we transition from the 

MY 2016 standards to MY 2017 and later, while preserving the utility (e.g., towing and payload 

capabilities) of those vehicles, EPA’s standards provide a lower annual rate of improvement for 

light-duty trucks in the early years of the program. The average annual rate of CO2 emissions 

reduction in MYs 2017 through 2021 is 3.5 percent per year and 5 percent per year for MYs 

2022 through 2025. 
Regulatory Announcement

Figure 1 CO2 (g/mile) Car Standards Curves
 

Figure 2 CO2 (g/mile) Truck Standard Curves
 

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Regulatory Announcement

Example footprint targets for popular vehicle models are shown in Table 2, illustrating the fact 

that different vehicle sizes will have varying CO2 emissions and fuel economy targets under 

the footprint-based standards. Vehicle CO2 emissions will be measured over the EPA city and 

highway tests. 

Table 2 Model Year 2025 CO2 and Fuel Economy Targets for Representative MY 2012 Vehicles 

Vehicle Type Example 

Models 

Example Model 

Footprint (sq. ft.) 

EPA CO2 

Emissions Target 

(g/mi)* 

NHTSA Fuel 

Economy 

Target (mpg) 

*/ ** 

Example Passenger Cars 

Compact car Honda Fit 40 131 61.1 

Mid-size car Ford Fusion 46 147 54.9 

Full-size car Chrysler 300 53 170 48.0 

Example Light-duty Trucks 

Small SUV 4WD Ford 

Escape 

43 170 47.5 

Midsize crossover Nissan Murano 49 188 43.4 

Minivan Toyota Sienna 56 209 39.2 

Large pickup truck Chevy Silverado 

(extended 

cab,6.5 foot 

base) 

67 252 33.0 

* Real-world CO2 is typically 25 percent higher and real-world fuel economy is typically 20 percent lower than the 

CO2 and CAFE values discussed here. 

** The fuel economy mpg targets shown in the last column would be higher if using the MPG-equivalent values 

corresponding to the CO2 emissions targets, i.e., if all CO2 reductions were achieved exclusively with higher fuel 

economy technologies. 

Vehicle Technologies to Reduce GHGs and Improve Fuel Economy 

EPA projects that manufacturers will comply with the MYs 2017-2025 standards by using a wide 

range of technologies, including continual advances in gasoline engines and transmissions, vehicle 

weight reduction, lower tire rolling resistance, vehicle aerodynamics, diesel engines, and more 

efficient vehicle accessories. EPA expects that the majority of improvements will come from 

advancements in internal combustion engines, although we also expect to see some increased 

electrification of the fleet through the expanded production of stop/start, hybrid vehicles, plugin hybrid electric vehicles, and electric vehicles. EPA also expects that vehicle air conditioning 

systems will continue to become more efficient, reduce leakage, and use alternative refrigerants 

with lower hydrofluorocarbon emissions. 

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Regulatory Announcement

Mid-Term Evaluation 

Given the long time frame at issue in setting standards for MYs 2022-2025, and given NHTSA‘s 

obligation to conduct a separate rulemaking in order to establish final standards for vehicles for 

those model years, EPA and NHTSA will conduct a comprehensive mid-term evaluation and 

agency decision-making process. As part of this undertaking, EPA and NHTSA will develop and 

compile up-to-date information for the evaluation, through a collaborative, robust and transparent 

process, including public notice and comment. EPA and NHTSA fully expect to conduct this 

mid-term evaluation in coordination with the California Air Resources Board (CARB), given 

our interest in maintaining a National Program to address GHG emissions and fuel economy. 

The comprehensive evaluation process will lead to final agency action by both agencies. 

EPA’s Program Flexibilities 

EPA’s final program includes provisions that offer compliance flexibility to auto manufacturers. Together these flexibilities are expected to provide sufficient lead time for manufacturers 

to make necessary technological improvements and to reduce the overall cost of the program, 

without compromising overall environmental objectives. The flexibilities also provide incentives 

to facilitate market penetration of the most advanced vehicle technologies. 

Credit Banking and Trading - EPA will continue the same comprehensive program for averaging, banking, and trading of credits established in the MYs 2012-2016 program. Together, these 

provisions help manufacturers in planning and implementing the orderly phase-in of GHGreducing technology in their production, consistent with typical redesign schedules. Credits may 

be carried forward, or banked, for five years, or carried back three years to cover a deficit in a 

previous year. A manufacturer may transfer credits across all vehicles it produces, both cars and 

light trucks. Trading of credits between companies is also permitted. To facilitate the transition 

to the increasingly more stringent MYs 2017-2025 standards, EPA is finalizing under its Clean 

Air Act authority a one-time CO2 credit carry-forward provision beyond 5 years, allowing credits 

generated from MYs 2010 through 2016 to be used through MY 2021. 

Air Conditioning Improvement Credits - As with the MYs 2012-2016 program, manufacturers 

will be able to generate CO2-equivalent credits to use in complying with the CO2 standards for 

(1) improvements in air conditioning (A/C) systems that reduce tailpipe CO2 through efficiency 

improvements, and (2) for reduced refrigerant leakage--through better components and/or use of 

alternative refrigerants with lower global warming potential. Currently A/C systems use 

refrigerants containing hydrofluorocarbons (HFC) which are highly potent greenhouse gases, 

and EPA’s A/C credits will give manufacturers an incentive to accelerate the use of refrigerants 

with much lower HFC emissions. 

Off-Cycle Credits - Off-cycle technologies achieve CO2 reductions that are not reflected in current 

test procedures. Such off-cycle technologies might include solar panels on hybrids, engine startstop or active aerodynamics. EPA is expanding and streamlining the MYs 2012-2016 off-cycle 

credit provisions for demonstrating and obtaining these credits. For MYs 2014 and later, EPA 

is finalizing a pre-approved list of technologies and credit values. Further, manufacturers will be 

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Regulatory Announcement

able to apply for off-cycle technology credits beyond those listed (or for different credit values 

for the listed technologies) if they present sufficient data to EPA. 

Incentives for Electric Vehicles, Plug-in Hybrid Electric Vehicles, Fuel Cell Vehicles, and 

Compressed Natural Gas Vehicles - To facilitate market penetration of the most advanced vehicle 

technologies as rapidly as possible, EPA is finalizing an incentive multiplier for compliance 

purposes for all electric vehicles (EVs), plug-in hybrid electric vehicles (PHEVs), fuel cell vehicles 

(FCV) and compressed natural gas (CNG) vehicles sold in MYs 2017 through 2021. This 

multiplier approach means that each EV/PHEV/FCV/CNGV would count as more than one 

vehicle in the manufacturer’s compliance calculation. EVs and FCVs will start with a multiplier 

value of 2.0 in MY 2017, phasing down to a value of 1.5 in MY 2021. PHEVs and CNG vehicles 

will start at a multiplier value of 1.6 in MY 2017 and phase down to a value of 1.3 in MY 2021. 

There are no multipliers for MYs 2022-2025. 

For EVs, PHEVs and FCVs, EPA is setting 0 g/mi as the tailpipe compliance value for EVs, 

PHEVs (electricity usage) and FCVs for MYs 2017-2021, with no limit on the quantity of vehicles 

eligible for 0 g/mi tailpipe emissions accounting. For MYs 2022-2025, 0 g/mi will only be allowed 

up to a per-company cumulative sales cap: 

1) 600,000 vehicles for companies that sell 300,000 EV/PHEV/FCVs in MYs 2019-2021; 

2) 200,000 vehicles for all other manufacturers. 

For sales above these thresholds, manufacturers will be required to account for the net upstream 

GHG emissions for the electric portion of operation, using accounting methodologies set out in 

the rule. 

Incentives for Advanced Technologies Including Hybridization for Full-Size Pickup 

Trucks - EPA is finalizing an additional CO2 per vehicle credit, for mild and strong hybrid 

electric (HEV) full-size pickup trucks, if this advanced technology is utilized across a designated 

percentage of a manufacturers’ full-size pickup trucks. This incentive further encourages 

manufacturers to begin to transform the most challenged category of vehicles in terms of the 

penetration of advanced technologies. 

Eligibility for this credit is conditioned on a minimum penetration of the technology in a manufacturer’s full size pickup truck fleet. Mild HEVs pickup trucks will be eligible for a per vehicle 

credit of 10 g/mi during MYs 2017-2021 if the technology is used with at least 20% of a company’s 

MY 2017 full-size pickup production and ramping up to at least 80% in MY 2021. Strong HEV 

pickup trucks will be eligible for 20 g/mi per vehicle credit during MYs 2017-2025 if the 

technology is used on at least 10% of the company’s full size pickups. 

In addition to the specific hybridization credits, because there are other technologies besides 

mild and strong hybrids which can significantly reduce GHG emissions and fuel consumption 

in pickup trucks, EPA is also finalizing a performance-based incentive CO2 emissions credit 

for full-size pickup trucks that achieve a significant CO2 reduction below the applicable target. 

To avoid double-counting, the same vehicle will not receive credit under both the HEV and 

performance based approaches. 

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Regulatory Announcement

Treatment of Compressed Natural Gas (CNG), Plug-in Hybrid Electric Vehicles (PHEVs), 

and Flexible Fuel Vehicles (FFVs) - EPA is finalizing a methodology for determining CO2 

levels for plug-in hybrid electric vehicles (PHEVs) and dual fuel compressed natural gas (CNG) 

vehicles. This methodology assumes how much of the time these vehicles will operate using the 

alternative fuel, and how much on gasoline. This methodology (called a “utility factor”) assumes 

that owners of these vehicles will use the cheaper non-gasoline fuel most of the time, since that 

was a main reason for purchasing the vehicle. 

As proposed, EPA is not establishing a utility factor for flexible fueled vehicles (FFVs) using 

E-85 and gasoline, since there is not a significant cost differential between an FFV and a 

conventional gasoline vehicle and historically consumers have only fueled these vehicles with 

E85 a very small percentage of the time. FFVs continue to be treated as they are treated in MY 

2016 where emissions are weighted based on actual alternative fuel usage. 

Provisions for Intermediate and Small Volume Manufacturers - In the MYs 2012-2016 rule, 

EPA provided less stringent CO2 standards through MY 2016 to manufacturers with U.S. sales 

of less than 50,000 vehicles under the Temporary Lead time Allowance Alternative Standards 

(TLAAS) program. For MYs 2017-2025 standards, EPA is providing additional lead time flexibility 

to these intermediate volume manufacturers to help ease their transition to the primary program 

standards. The lead time flexibility is available through MY 2020 and intermediate volume 

manufacturers are required to meet the primary standards starting in MY 2021. 

EPA is allowing small volume manufacturers (SVMs) with U.S. sales of less than 5,000 vehicles 

to petition EPA for alternative CO2 standards, which will be established for eligible SVMs on 

a case-by-case basis. These SVMs are exempt under the MYs 2012-2016 CO2 standards. EPA 

is also allowing manufacturers that are able to demonstrate that they are operationally independent 

from their parent company and have U.S. sales of less than 5,000 vehicles to be eligible for 

SVM GHG provisions. 

In addition, EPA is continuing to exempt small businesses (companies with less than 1,000 

employees, as defined by the Small Business Administration) from all GHG standards and 

program requirements. 

Public Participation 

EPA developed this final rule after consideration of extensive public input. EPA and NHTSA 

heard from nearly 400 testifiers at three public hearings held in Detroit, Philadelphia and San 

Francisco during January 2012. The agencies received written comments from nearly 300,000 

individuals and more than 140 organizations, including auto manufacturers and suppliers, state 

and local governments and their associations, consumer groups, labor unions, fuels and energy 

providers, auto dealers, academics, national security experts and veterans, environmental and 

other non-governmental organizations. 

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Regulatory Announcement

Background on the MYs 2017-2025 National Program 

Following the successful adoption of a National Program for GHG and fuel economy standards 

for MYs 2012-2016 vehicles, President Obama requested the agencies to continue their efforts 

to develop a second phase of the National Program, with standards for MYs 2017-2025 lightduty vehicles. In a May 21, 2010, Presidential Memorandum, the President requested that EPA 

and NHTSA work together to develop a national program that would “...produce a new generation of clean vehicles.” The President specifically requested that the agencies develop “...a coordinated national program under the CAA [Clean Air Act] and the EISA [Energy Independence 

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

passenger cars and light-duty trucks of model years 2017-2025.” The President recognized our 

country could take a leadership role in addressing the global challenges of improving energy security 

and reducing greenhouse gas pollution, stating that “America has the opportunity to lead the 

world in the development of a new generation of clean cars and trucks through innovative technologies 

and manufacturing that will spur economic growth and create high-quality domestic jobs, enhance our energy security, and improve our environment.” 

The agencies worked with the State of California to address all elements requested in the May 

21, 2010 Presidential Memorandum and completed an initial assessment of the technologies, 

strategies and underlying analyses that would be considered in setting standards for MYs 2017­

2025, in consultation with a wide range of stakeholders. EPA and NHTSA issued an Interim 

Joint Technical Assessment Report (TAR) and a Notice of Intent (NOI) to conduct a joint 

rulemaking on September 30, 2010.1

 Following an opportunity for public comment, the agencies published a Supplemental NOI (SNOI)2

 in December 2010 highlighting many of the key 

comments received in response to the September NOI and the TAR and outlining plans for key 

technical analyses that would be undertaken in developing the proposed rulemaking. 

On July 29, 2011, President Obama announced plans for the MYs 2017-2025 national program 

and EPA and NHTSA issued another SNOI3, outlining plans for the MYs 2017-2025 proposed 

program. The State of California and thirteen auto manufacturers representing over 90 percent 

of U.S. vehicle sales provided letters of support for the program concurrent with the SNOI. 

The joint proposal to extend the National Program to MYs 2017-2025 light-duty vehicles was 

issued on November 16, 2011 and published in the Federal Register on December 1, 2011.4 

For More Information 

You can access the final rule, regulations and related documents on EPA’s Office of Transportation and Air Quality (OTAQ) Web site at: 

www.epa.gov/otaq/climate/regulations.htm 

For more information on this rule, please contact the U.S. Environmental Protection Agency, 

Office of Transportation and Air Quality at: 

E-mail: OTAQPUBLICWEB@epa.gov 

1 75 FR 62739, October 13, 2010. 

2 75 FR 76337, December 8, 2010. 

3 76 FR 48758, August 9, 2011 

4 76 FR 74854, December 1, 2011. 

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