Regulatory Announcement
 

EPA and NHTSA Propose Historic 

National Program to Reduce 

Greenhouse Gases and Improve Fuel 

Economy for Cars and Trucks 

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

Department of Transportation’s National Highway Traffic Safety 

Administration (NHTSA) are issuing a joint proposal to establish a 

national program consisting of new standards for model year 2012 

through 2016 light-duty vehicles that will reduce greenhouse gas 

emissions and improve fuel economy. EPA is proposing the first-ever 

national greenhouse gas (GHG) emissions standards under the Clean 

Air Act, and NHTSA is proposing Corporate Average Fuel Economy 

(CAFE) standards under the Energy Policy and Conservation Act. 

The standards proposed would apply to passenger cars, light-duty trucks, and mediumduty passenger vehicles, covering model years 2012 through 2016. They require 

these vehicles to meet an estimated combined average emissions level of 250 grams 

of carbon dioxide (CO2

) per mile in model year 2016, equivalent to 35.5 miles per 

gallon (mpg) if the automotive industry were to meet this CO2 level all through fuel 

economy improvements. 

These proposed rules were developed in response to President Obama’s call for a 

strong and coordinated federal greenhouse gas and fuel economy program for passenger cars, light-duty trucks, and medium-duty passenger vehicles.1

 At the same time, 

the proposed national program allows automobile manufacturers to build a single 

light-duty national fleet that satisfies all requirements under both Federal programs 

and the standards of California and other states. The national program therefore provides critical environmental and energy benefits while ensuring that consumers have 

a full range of vehicle choices. 

Office of Transportation and Air Quality 

EPA-420-F-09-047 

September 2009 
 

 

 

 

 

 

Regulatory Announcement
 

Need to Reduce Greenhouse Gas (GHG) Emissions and Improve Fuel 

Economy from Passenger Cars and Light Trucks 

The proposed rules will simultaneously increase energy security, reduce air pollution, increase 

fuel savings, offer clarity and predictability for manufacturers, and reduce greenhouse gas emissions. 

Climate change is one of the most significant long-term threats to the global environment and 

is caused by greenhouse gases in the atmosphere which effectively trap some of the Earth’s heat 

that would otherwise escape into space. Greenhouse gases are both naturally occurring and 

anthropogenic. The primary greenhouse gases of concern are directly emitted by human activities 

and include carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and 

sulfur hexafluoride. 

The key effects of climate change observed to date and projected to occur in the future include, 

but are not limited to, more frequent and intense heat waves, more severe wildfires, degraded 

air quality, heavier and more frequent downpours and flooding, increased drought, greater sea 

level rise, more intense storms, harm to water resources, continued ocean acidification, harm to 

agriculture, and harm to wildlife and ecosystems. 

Improving energy security by reducing our dependence on oil has been a national objective 

since the first oil price shocks in the 1970s. Tight global oil markets led to prices over $100 per 

barrel in 2008, with gasoline reaching as high as $4 per gallon in many parts of the U.S., causing 

financial hardship for many families. The light-duty vehicles subject to this proposed national 

program account for about 40 percent of all U.S. oil consumption. 

Likewise, transportation sources represent a large and growing share of the U.S. greenhouse 

gases, and in 2006 they emitted 28 percent of all U.S. greenhouse gases and were the fastestgrowing source of these gases in the U.S., accounting for 47 percent of the net increase in total 

U.S. greenhouse gas emissions from 1990-2006. 

Today’s proposed greenhouse gas standards are aimed at the largest sources of transportation 

greenhouse gases—light-duty vehicles, light-duty trucks, and medium-duty passenger vehicles 

(known as light-duty vehicles). These vehicle categories, which include cars, sport utility vehicles, 

minivans, pickup trucks used for personal transportation and passenger vans, are responsible for 

almost 60 percent of all U.S. transportation related greenhouse gases. 

Benefits and Costs of the Proposed National Program 

The national program proposed by EPA and NHTSA would address the urgent and closely 

intertwined challenges of global warming and energy independence and security through a 

strong and coordinated federal greenhouse gas and fuel economy program, for light-duty vehicles. 

At the same time it would ensure that automobile manufactures can build a single-national fleet 

and U.S. consumers will still have a full range of vehicle choices. 

Over the lifetime of the vehicles sold during 2012-2016, this proposed national program is projected to reduce U.S. CO2

 emissions by 950 million metric tons and save 1.8 billion barrels of 

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Regulatory Announcement
 

oil. In total, the combined EPA and NHTSA 2012-2016 standards would reduce CO2 emissions 

form the U.S. light-duty fleet by approximately 21 percent by 2030 over the level that would 

occur in the abscence of the national program. 

EPA estimates that 2012-2016 model year lifetime costs of the national program are less than 

$60 billion, well below the expected benefits, which are expected to exceed $250 billion. There 

are also many potential benefits of the rule which are not quantified including reductions in 

emissions of toxic air pollutants and ambient ozone exposures. The benefits which are calculated 

into dollar amounts include fuel savings, greenhouse gas (GHG) reductions, particulate matter 

(PM) benefits, and energy security. The two agencies’ standards together comprise the national 

program, and this discussion of costs and benefits of EPA’s GHG standards does not change the 

fact that both the CAFE and greenhouse gas standards, jointly, are the source of the majority of 

the benefits and costs of the national program. 

Benefits to Consumers 

Together, EPA and NHTSA estimate that the average cost increase for a model year 2016 vehicle due to the proposed national program is less than $1,100. U.S. consumers who pay for their 

vehicle in cash would save enough in lower fuel costs over the first three years to offset these 

higher vehicle costs. However, most US consumers purchase a new vehicle using credit rather 

than paying cash. Consumers using an average 5-year, 60-month loan would see immediate savings 

due to their vehicle’s lower fuel consumption in the form of reduced annual costs of $130-$160 a 

year throughout the duration of the loan (that is, the fuel savings outweigh the increase in loan 

payments by $130-$160 per year). 

Whether a consumer takes out a loan or pays for their vehicle in cash, the consumer would save 

more than $3,000 due to fuel savings over the lifetime of a model year 2016 vehicle. 

EPA’s Proposed Standards 

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

and 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 light vehicles of 

any particular size or type, and each manufacturer will have its own standard which reflects the 

vehicles it chooses it produce. 

Table 1 shows the projected fleet-wide CO2 emission level requirements for cars under the proposed footprint-based approach. These requirements are projected to increase in stringency from 

261 to 224 grams per mile between model year 2012 and model year 2016. Similarly, fleet-wide 

CO2

 equivalent emission level requirements for trucks are projected to increase in stringency 

from 352 to 302 grams per mile. The EPA projects that the average light vehicle tailpipe CO2 

level in model year 2012 will be 295 grams per mile while the average vehicle tailpipe CO2 

emissions compliance level for the proposed model year 2016 standard is projected to be 250 


 
  

   

   

       

 

 

grams per mile, corresponding to 35.5 mpg in model year 2016, if all reductions were made 

through fuel economy improvements. 

Regulatory Announcement
 

Table 1 - Projected Fleet-Wide Emissions Compliance Levels under the Proposed 

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

2012 2013 2014 2015 2016 

Passenger Cars (g/mi) 261 253 246 235 224 

Light Trucks (g/mi) 352 341 332 317 302 

Combined Cars & Trucks (g/mi) 295 286 276 263 250 

Figures 1 and 2 show the actual footprint curves for cars and trucks. It is important to note that 

for the car standard curves shown in Figure 1 most model year 2012 - model year 2016 vehicle 

footprints are between 40-55 square feet. For the truck standard curves in Figure 2 most model 

2012 - model year 2016 truck footprints are between 45-65 square feet. 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 proposed footprint 

300 CO2 (grams per mile) 

2012 

2016 

` 

CO2 (grams per mile)

curve CO2 standards. Vehicle CO2 emissions would be measured over the EPA city and highway 

tests. 

Figure 1 - CO2 (g/mi) Car Standard Curves Figure 2 - CO2 (g/mi) Truck Standard Curves 

400 400 

350 350 

300 

2012 

250 2016 250 

200 200 

30 35 40 45 50 55 60 65 70 30 35 40 45 50 55 60 65 70 Footprint (sq feet) Footprint (sq feet) 

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Table 2- Model Year 2016 CO2 and Fuel Economy Targets for Various MY 2008 Vehicle Types 

Regulatory Announcement
 

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 40 214 41.4 

Midsize car Ford Fusion 46 237 37.3 

Full-size car Chrysler 300 53 270 32.8 

Example Light-duty Trucks 

Small SUV 4WD Ford Escape 44 269 32.8 

Midsize 

crossover 

Nissan Murano 49 289 30.6 

Minivan Toyota Sienna 55 313 28.2 

Large pickup 

truck Chevy Silverado 67 358 24.7 

EPA is proposing to provide auto manufacturers with the opportunity to earn credits toward the 

fleet-wide average CO2 standards for improvements to air conditioning systems, including both 

hydrofluorocarbon (HFC) refrigerant losses (i.e. system leakage) and indirect CO2 emissions 

related to the increased load on the engine. Earning credits for these types of greenhouse gas 

reductions is conditioned on demonstrated improvements in vehicle air conditioner systems, 

including both efficiency and refrigerant leakage improvement. Other program flexibilities, such 

as flex-fuel vehicle credits, temporary lead-time allowance and advanced technology credits 

would also be available to qualified auto manufacturers and are explained more fully below. 

EPA’s and NHTSA’s technology assessment indicates there is a wide range of technologies 

available for manufacturers to consider in upgrading vehicles to reduce greenhouse gas emissions 

and improve fuel economy. These include engine improvements, such as use of gasoline direct 

injection and downsized engines that use turbochargers to provide performance similar to that 

of larger engines, the use of advanced transmissions, increased use of start-stop technology, 

improvements in tire performance, reductions in vehicle weight, increased use of hybrid and 

other advanced technologies, and the initial commercialization of electric vehicles and plug-in 

hybrids. EPA is also projecting improvements in vehicle air conditioners including more efficient 

as well as low leak systems. All of these technologies are already available today, and EPA’s 

and NHTSA’s assessment is that manufacturers would be able to meet the proposed standards 

through more widespread use of these technologies across their fleet. 

EPA is also proposing standards that will cap tailpipe nitrous oxide (N2O) and methane (CH4) 

emissions at 0.010 and 0.030 grams per mile, respectively. Even after adjusting for the higher 

relative global warming potencies of these two compounds, nitrous oxide and methane emissions 

represent less than one percent of overall vehicle greenhouse gas emissions from new vehicles. 


 
 

 

 

 

Regulatory Announcement
 

EPA’s Program Flexibilities 

EPA’s and NHTSA’s proposed programs provide compliance flexibility to manufacturers, especially 

in the early years of the national program. This flexibility is expected to provide sufficient lead 

time for manufacturers to make necessary technological improvements and reduce the overall 

cost of the program, without compromising overall environmental and fuel economy objectives. 

EPA is proposing to establish a system of averaging, banking, and trading of credits integral to 

the fleet averaging approach, based on a manufacturer’s fleet average CO2 performance. This 

approach would allow for trading of credits among all vehicles a manufacturer produces, both 

cars and light trucks. Trading of credits between companies would also be permitted. This 

program is similar to averaging, banking, and trading (ABT) programs EPA has established in 

other programs for motor vehicles. EPA is also proposing to include credits for improved air 

conditioning performance (both reduced leakage of refrigerant and improved air conditioner 

efficiency) as an aspect of the standards, as mentioned above. 

EPA is also proposing several additional credit provisions would apply only in the initial model 

years of the program. These include credits based on the use of advanced technologies, and 

generation of credits for superior greenhouse gas emission reduction performance prior to model 

year 2012. These credit programs would provide flexibility to manufacturers, which may be 

especially important during the early transition years of the program. In addition, both NHTSA 

and EPA are continuing to offer credits for vehicles designed to operate on alternative fuels, 

although these credits would be phased out after model year 2015 under the EPA greenhouse gas 

program. 

•	 Flex-fuel and Alternative Fuel Vehicle Credits - EPA is proposing to allow Flex Fuel 

Vehicle or FFV credits in line with limits established under the Energy Independence 

and Security Act of 2007 during model years 2012 to 2015. After model year 2015, EPA 

proposes to allow FFV credits only based on a manufacturer’s demonstration that the 

alternative fuel is actually being used in the vehicles and actual greenhouse gas emissions 

performance for the vehicle run on that alternative fuel. FFVs are vehicles that can run 

both on an alternative fuel and conventional fuel. Most FFVs are E-85 capable vehicles, 

which can run on either gasoline or a mixture of up to 85 percent ethanol and 15 percent gasoline. Dedicated alternative fuel vehicles are vehicles that run exclusively on an 

alternative fuel. 

•	 Optional Temporary Lead-time Allowance Alternative Standards (TLAAS) - Manufacturers with limited product lines may be especially challenged technologically in the 

early years of the program. Manufacturers that have traditionally paid fines to NHTSA 

in lieu of meeting Corporate Average Fuel Economy (CAFE) standards may be especially 

challenged in bringing their fleets into compliance with the greenhouse gas emission 

standards. Under the Clean Air Act, manufacturers of light duty motor vehicles cannot 

pay fines in lieu of complying with motor vehicle emissions standards. EPA is proposing 

an optional, temporary alternative standard, which is only slightly less stringent, and 

limited to the first four model years (2012-2015) of the national program, so that these 

manufacturers can have sufficient lead time to meet the tougher model year 2016 greenhouse gas standards, while preserving consumer choice of vehicles during this time. 


 
 

Regulatory Announcement
 

In model year 2016, the TLAAS option ends, and all manufacturers, regardless of size, must 

comply with the same CO2

 standards, while under the CAFE program companies would continue to be allowed to pay civil penalties in lieu of complying with the CAFE standards. However, because companies must meet both the CAFE standards and the EPA CO2

 standards, the 

national program in effect mean that companies will not have the civil penalty option, thereby 

resulting in more fuel savings and CO2

 reductions than would be the case under the CAFE program alone. 

Specifically, this temporary standard would apply to manufacturers who sold less than 400,000 

model year 2009 vehicles in the U.S. and would allow them to establish a separate averaging 

fleet comprising on average 25,000 vehicles per year (and no more than 100,000 total vehicles 

during this four year period). This limited vehicle fleet would be subject to a slightly less stringent greenhouse gas standard of 125 percent of the vehicle’s otherwise applicable foot-print 

target level. The alternative fleet could not generate credits for use by the remainder of the 

manufacturer’s fleet. 

•	 Advanced Technology Credits - EPA is proposing additional credit opportunities to 

encourage the commercialization of advanced greenhouse gas/fuel economy control technologies, such as electric vehicles, plug-in hybrid electric vehicles, and fuel cell vehicles. 

These proposed advanced technology credits are in the form of a multiplier that would 

be applied to the number of vehicles sold, such that each eligible vehicle counts as more 

than one vehicle in the manufacturer’s fleet average. EPA is also proposing to allow early 

advanced technology credits to be generated beginning in model years 2009 through 

2011. 

•	 Off-Cycle Innovative Technology Credits - EPA is proposing a credit opportunity intended to apply to new and innovative technologies that reduce vehicle CO2 emissions, 

but for which the CO2 reduction benefits are not captured over the 2-cycle test procedure 

used to determine compliance with the fleet average standards (i.e., “off-cycle”). Eligible 

innovative technologies would be those that are relatively newly introduced in one or 

more vehicle models, but that are not yet implemented in widespread use in the lightduty fleet. Further, any credits for these off-cycle technologies must be based on realworld greenhouse gas emission reductions not captured on the current 2-cycle tests and 

verifiable test methods, and represent average U.S. driving conditions. 

•	 Early Credits - EPA is also proposing early credits in model years 2009-2011 through 

over-compliance with a baseline standard. The baseline standard would be set to be 

equivalent, on a national level, to the California standard. Potentially, credits could be 

generated by over-compliance with this baseline in one of two ways: over-compliance by 

the fleet of vehicles sold in California and the CAA section 177 states (i.e. those states 

adopting the California program), or over-compliance with the fleet of vehicles sold in 

the 50 states. EPA is also proposing early credits based on over-compliance with CAFE, 

but only for vehicles sold in states outside of California and the CAA section 177 states. 

With the goal of promoting informed choices by consumers, EPA is also asking for public comments on how to improve fuel economy labels. 

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Regulatory Announcement
 

Background of EPA’s Proposal 

The EPA’s proposal represents the second-phase of its response to the Supreme Court’s 2007 

decision in Massachusetts v. EPA which held that greenhouse gases were air pollutants for 

purposes of the Clean Air Act (CAA). The Court held that the Administrator must determine 

whether or not emissions of greenhouse gases from new motor vehicles and new motor vehicle 

engines cause or contribute to air pollution which may reasonably be anticipated to endanger 

public health or welfare, or whether the science is too uncertain for EPA to make a reasoned 

decision. The Court remanded the case back to the Agency for reconsideration in light of its 

holding. 

The Administrator responded to the Court’s remand by issuing two proposed findings under 

section 202(a) on April 24, 2009. First, the Administrator proposed to find that the science supports a positive endangerment finding that a mix of certain greenhouse gases in the atmosphere 

endangers the public health and welfare of current and future generations. This is referred to 

as the endangerment finding. Second, the Administrator proposed to find that the emissions of 

four of these gases--carbon dioxide, methane, nitrous oxide, and hydrofluorocarbons -- from new 

motor vehicles and new motor vehicle engines contribute to the atmospheric concentrations of 

these key greenhouse gases and hence to the threat of climate change. This is referred to as the 

cause or contribute finding. Finalizing today’s proposed light vehicle regulations is contingent 

upon EPA finalizing both the endangerment finding and the cause or contribute finding. 

Public Participation Opportunities 

We welcome your comments on this rule. Comments will be accepted for 60 days beginning 

when this proposal is published in the Federal Register. All comments should be identified by 

Docket ID No. EPA-HQ-OAR-2009-0472 and submitted by one of the following methods: 

Internet: www.regulations.gov 

E-mail: A-and-R-Docket@epa.gov 

Mail: 

Environmental Protection Agency 

Air and Radiation Docket and Information Center (6102T) 

1200 Pennsylvania Avenue NW 

Washington, DC 20460 

Hand Delivery: 

EPA West building 

EPA Docket Center (Room 3340) 

1301 Constitution Avenue NW 

Washington, DC 

You should consult the Federal Register notice for this proposal for more information about how 

to submit comments, when the comment period will close, and about where and when public 

hearings will be held. A copy of Federal Register notice can be found on our website listed below. 


 
For More Information 

You can access the rule 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 Tad Wysor at: 

U.S. Environmental Protection Agency 


Office of Transportation and Air Quality 


2000 Traverwood Drive 


Ann Arbor, MI 48105 


(734) 214-4332 


E-mail: wysor.tad@epa.gov
 

footnote:
 

1 President Obama Announces National Fuel Efficiency Policy, The White House, May 19, 2009. Available at: www.whitehouse.
 

gov/the_press_office/President-Obama-Announces-National-Fuel-Efficiency-Policy/. Remarks by the President on National Fuel 


Efficiency Standards, The White House, May 19, 2009. Available at: www.whitehouse.gov/the_press_office/Remarks-by-thePresident-on-national-fuel-efficiency-standards/.


Regulatory Announcement
 

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