### Federal Register / Vol. 74, No. 186 / Monday, September 28, 2009 / Proposed Rules 

### 49553

**BILLING CODE 4910–59–C**

First, note that the scale in Figure III.D.6–2 is much smaller by a factor of 3 than that in Figure III.D.6–1. In other words, accounting for differences in vehicle weight (at constant footprint) and performance dramatically reduces
the differences in various
manufacturers’ CO 2 emissions. Most of the manufacturers with high offsets in Figure III.D.6–1 now show low or negative offsets. For example, BMW’s and VW’s trucks show very low CO 2 emissions. Tata’s emissions are very close to the industry average. Daimler’s vehicles are no more than 10 g/mi above the average for the industry. This analysis indicates that the primary reasons for the differences in technology penetrations shown for the various
manufacturers in Table III.D.6–3 are weight and performance. EPA has not determined why some manufacturers’ vehicle weight is relatively high for its footprint value, or whether this weight provides additional utility for the
consumer. Performance is moreVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00102 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

### 49554 Federal Register / Vol. 74, No. 186 / Monday, September 28, 2009 / Proposed Rules

straightforward. Some consumers desire high performance and some
manufacturers orient their sales towards these consumers. However, the cost in
terms of CO 2 emissions is clear. Producing relatively heavy or high performance vehicles increases CO 2 emissions and will require greater levels of technology in order to meet the proposed CO 2 standards.

As can be seen from Table III.D.6–3 above, widespread use of several technologies is projected due to the proposed standards. The vast majority of engines are projected to be converted to direct injection, with some of these engines including cylinder deactivation or turbocharging and downsizing. More than 60 percent of all transmissions are projected to be either high speed
automatic transmissions or dual-clutch
automated manual transmissions. More than one third of the fleet is projected to be equipped with 42 volt start-stop capability. This technology was not utilized in 2008 vehicles, but as discussed above, promises significant fuel efficiency improvement at a
moderate cost.

EPA foresees no significant technical or engineering issues with the projected deployment of these technologies across the fleet, with their incorporation being folded into the vehicle redesign process. All of these technologies are commercially available now. The automotive industry has already begun to convert its port fuel-injected gasoline engines to direct injection. Cylinder deactivation and turbocharging technologies are already commercially
available. As indicated in Table III.D.6– 1, high speed transmissions are already widely used. However, while more common in Europe, automated manual transmissions are not currently used extensively in the U.S. Widespread use of this technology would require significant capital investment but does not present any significant technical or engineering issues. Start-stop systems also represent a significant challenge because of the complications involved in a changeover to a higher voltage electrical architecture. However, with appropriate capital investments (which are captured in the costs), these technology penetration rates are
achievable within the timeframe of this
rule. While most manufacturers have some plans for these systems, our projections indicate that their use may exceed 35 percent of sales, with some manufacturers requiring higher levels.

Most manufacturers would not have to hybridize any vehicles due to the proposed standards. The hybrids shown for Toyota are projected to be sold even in the absence of the proposed standards. However the relatively high hybrid penetrations (15%) projected for BMW, Daimler, Porsche, Tata and Volkswagen deserve further discussion. These manufacturers are all projected by
the OMEGA model to utilize the maximum application of full hybrids allowed by our model in this time frame, which is 15 percent.

As discussed in the EPA DRIA, a 2016 technology penetration rate of 85% is projected for the vast majority of available technologies, however, for full hybrid systems the projection shows that given the available lead-time full hybrids can only be applied to approximately 15% of a manufacturer’s fleet. This number of course can vary by
manufacturer.

While the hybridization levels of BMW, Daimler, Porsche, Tata and Volkswagen are relatively high, the sales
levels of these five manufacturers are relatively low. Thus, industry-wide, hybridization reaches only 8 percent, compared with 3 percent in the reference case. This 8 percent level is believed to be well within the capability of the hybrid component industry by 2016. Thus, the primary challenge for these five companies would be at the manufacturer level, redesigning a relatively large percentage of sales to include hybrid technology. The proposed TLAAS provisions will provide significant aid to these manufacturers in pre-2016 compliance, since all qualified companies are expected to be able to take advantage of these provisions. By 2016, it is likely
that these manufacturers would also be able to change vehicle characteristics which currently cause their vehicles to
emit much more CO 2 than similar sized vehicles produced by other manufacturers. These factors may include changes in model mix, further lightweighting, downpowering, electric and/or plug-in hybrid vehicles, or downsizing (our current baseline fleet assumes very little change in footprint from 2012–2016), as well as technologies that may not be included in our packages. Also, companies may have technology penetration rates of less costly technologies (listed in the above tables) greater than 85%, and they may also be able to apply hybrid technology to more than 15 percent of their fleet (as the 15% for hybrid technology is an industry average). For example, a switch to a low GWP alternative refrigerant in a large fraction of a fleet can replace many other much more costly technologies, but this option is not captured in the modeling. In addition,
these manufacturers can also take advantage of flexibilities, such as early credits for air conditioning and trading with other manufacturers. The EPA expects that there will be certain high
volume manufacturers that will earn a significant amount of early GHG credits starting in 2009 and 2010 that will expire 5 years later, by 2014 and 2015,
unused. The EPA believes that these manufacturers will be willing to sell these expiring credits to manufacturers
with whom there is no direct competition. Furthermore, some of these
manufacturers have also stated either publicly or in confidential discussions with EPA that they will be able to comply with 2016 standards. Because of
the confidential nature of this information sharing, EPA is unable to capture these packages specifically in our modeling. The following companies have all submitted letters in support of the national program, including the 2016 MY levels discussed above: BMW, Chrysler, Daimler, Ford, GM, Honda, Mazda, Toyota, and Volkswagen. This supports the view that the emissions
reductions needed to achieve the standards are technically and economically feasible for all these companies, and that EPA’s projection of non-compliance for four of the companies is based on an inability of our model to fully account for the full flexibilities of the EPA program as well as the potentially unique technology approaches or new product offerings which these manufactures are likely to employ.

In addition, manufacturers do not need to apply technology exactly according to our projections. Our projections simply indicate one path which would achieve compliance.
Those manufacturers whose vehicles are heavier and higher performing than average in particular have additional options to facilitate compliance and reduce their technological burden closer to the industry average. These options include decreasing the mass of the vehicles and/or decreasing the power output of the engines. Finally, EPA allows compliance to be shown through
the use of emission credits obtained from other manufacturers. Especially for
the lower volume sales of some
manufacturers that could be one component of an effective compliance strategy, reducing the technology that needs to be employed on their vehicles.

For the vast majority of light-duty cars and trucks, manufacturers have available to them a range of technologies that are currently commercially available and can feasibly be employed in their vehicles by MY 2016. Our modeling projects widespread use of these technologies as a technologically feasible approach to complying with the proposed standards.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00103 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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In sum, EPA believes that the approaches and compliance flexibilities associated with the proposed 2016 CO 2 emissions reductions called for by the not fully reflected in our modeling. emission standards. The latter costs are proposed standards are technologically incremental to those associated with the EPA also projected the cost associated feasible, based on projections of 2011 MY standards and also include with these projections of technology penetration. Table III.D.6–4 shows the widespread use of commercially $60 per vehicle, on average, for the cost cost of technology in order for available technology, as well as use by of projected use of improved air- manufacturers to comply with the 2011 some manufacturers of other technology conditioning systems. 163 MY CAFE standards, as well as those



### TABLE 

### III.D.6–4—C OST OF 

### T ECHNOLOGY PER 

### V EHICLE IN 

### 2016 ($2007)

2011 MY CAFE standards Proposed 2016 CO 2 standards

Cars Trucks All Cars Trucks All

BMW ................................................................................ $319 $479 $361 $1,701 $1,665 $1,691 Chrysler ............................................................................ 7 125 59 1,331 1,505 1,408
Daimler ............................................................................. 431 632 495 1,631 1,357 1,543
Ford .................................................................................. 28 211 109 1,435 1,485 1,457
General Motors ................................................................ 28 136 73 969 1,782 1,311
Honda

............................................................................... 0 0 0 606 695 633 Hyundai ............................................................................ 0 76 14 739 1,680 907
Kia

.................................................................................... 0 48 8 741 1,177 812
Mazda

.............................................................................. 0 0 0 946 1,030 958
Mitsubishi ......................................................................... 96 322 123 1,067 1,263 1,090
Nissan

.............................................................................. 0 19 6 1,013 1,194 1,064
Porsche ............................................................................ 535 1,074 706 1,549 666 1,268
Subaru .............................................................................. 64 100 77 903 1,329 1,057
Suzuki .............................................................................. 99 231 133 1,093 1,263 1,137
Tata .................................................................................. 691 1,574 1,161 1,270 674 952 Toyota .............................................................................. 0 0 0 600 436 546 Volkswagen ...................................................................... 269 758 354 1,626 949 1,509
Overall .............................................................................. 47 141 78 968 1,214 1,051

As can be seen, the industry average cost of complying with the 2011 MY CAFE standards is quite low, $78 per vehicle. The range of costs across manufacturers is quite large, however. Honda, Mazda and Toyota are projected to face no cost, while Daimler, Porsche and Tata face costs of at least $495 per vehicle. As described above, these last three manufacturers face such high costs
to meet even the 2011 MY CAFE
standards due to both their vehicles’ weight per unit footprint and performance. Also, these cost estimates apply to sales in the 2016 MY. These three manufacturers, as well as others like Volkswagen, may choose to pay CAFE fines prior to this or even in 2016.

As shown in the last row of Table III.D.6–4, the average cost of technology to meet the proposed 2016 standards for
cars and trucks combined relative to the 2011 MY CAFE standards is $1051 per vehicle. The projection shows that the average cost for cars would be slightly lower than that for trucks. Toyota and Honda show projected costs significantly below the average, while BMW, Porsche, Tata and Volkswagen show significantly higher costs. On average, the $1051 per vehicle cost is significant, representing roughly 5% of the total cost of a new vehicle. However, as discussed below, the fuel savings associated with the proposed standards exceeds this cost significantly.

While the CO 2 emission compliance modeling using the OMEGA model focused on the proposed 2016 MY standards, EPA believes that the proposed standards for 2012–2015
would also be feasible. As discussed above, EPA believes that manufacturers develop their vehicle designs with several model years in view. Generally, the technology estimated above for 2016 MY vehicles represents the technology
which would be added to those vehicles which are being redesigned in 2012– 2015. The proposed CO 2 standards for
2012–2016 reduce CO 2 emissions at a fairly steady rate. Thus, manufacturers which redesign their vehicles at a fairly steady rate will automatically comply with the interim standard as they plan for compliance in 2016.

Manufacturers which redesign much fewer than 20% of their sales in the early years of the proposed program would face a more difficult challenge, as simply implementing the ‘‘2016 MY’’ technology as vehicles are redesigned may not enable compliance in the early years. However, even in this case,
manufacturers would have several options to enable compliance. One, they could utilize the proposed debit carryforward provisions described above. This may be sufficient alone to enable compliance through the 2012–2016 MY time period, if their redesign schedule exceeds 20% per year prior to 2016. If not, at some point, the manufacturer might need to increase their use of technology beyond that projected above in order to generate the credits necessary to balance the accrued debits. For most manufacturers representing the vast majority of U.S. sales, this would simply mean extending the same technology to a greater percentage of
sales. The added cost of this in the later years of the program would be balanced by lower costs in the earlier years. Two, the manufacturer could buy credits from
another manufacturer. As indicated above, several manufacturers are projected to require less stringent technology than the average. These manufacturers would be in a position to provide credits at a reasonable technology cost. Thus, EPA believes the proposed standards for 2012–2016
would be feasible.

7. What Other Fleet-Wide CO 2 Levels
Were Considered?

Two alternative sets of CO 2 standards
were considered. One set would reduce

163 Note that the actual cost of the A/C technology III.D.2–3. However, we expect only 85 percent of of the technology when spread across the entire is estimated at $78 per vehicle as shown in Table the fleet to add that technology. Therefore, the cost fleet is $66 per vehicle ($78 × 85%=$66).VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00104 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

### 49556 Federal Register / Vol. 74, No. 186 / Monday, September 28, 2009 / Proposed Rules

CO 2 emissions at a rate of 4 percent per above for the proposed standards. The control scenarios were discussed above. year. The second set would reduce CO 2 only difference was the level of CO 2 The resultant CO 2 standards in 2016 for emissions at a rate of 6 percent per year. emission standards. The footprint-based each manufacturer under these two The analysis of these standards followed standard coefficients of the car and alternative scenarios and under the the exact same process as described truck curves for these two alternative proposal are shown in Table III.D.7–1.



### TABLE 

### III.D.7–1—O VERALL 

### AVERAGE 

### CO 2 

### E MISSION 

### S TANDARDS BY 

### M ANUFACTURER IN 

### 2016

4% per

year Proposed 6% per
year

BMW ............................................................................................................................

........................................ 245 241 222 Chrysler .......................................................................................................................

......................................... 266 262 241
Daimler ........................................................................................................................

......................................... 257 253 233
Ford ...........................................................................................................................

........................................... 270 266 245
General Motors .................................................................................................................

................................... 272 268 247
Honda ..........................................................................................................................

........................................ 243 239 219 Hyundai ........................................................................................................................

........................................ 235 231 212
Kia ............................................................................................................................

............................................ 237 234 215
Mazda ..........................................................................................................................

........................................ 231 227 208
Mitsubishi .....................................................................................................................

........................................ 226 223 204
Nissan .........................................................................................................................

......................................... 251 247 227
Porsche ........................................................................................................................

........................................ 234 230 210
Subaru .........................................................................................................................

........................................ 237 233 213
Suzuki .........................................................................................................................

......................................... 227 223 203
Tata ...........................................................................................................................

........................................... 267 263 241 Toyota .........................................................................................................................

......................................... 247 243 223 Volkswagen .....................................................................................................................

..................................... 233 230 211
Overall ........................................................................................................................

.......................................... 254 250 230

Tables III.D.7–2 and III.D.7–3 show 4 percent per year and 6 percent per the technology penetration levels for the year standards in 2016.



### TABLE 

### III.D.7–2—T ECHNOLOGY 

### P ENETRATION

### —4% PER 

### Y EAR 

### CO 2 

### S TANDARDS IN 

### 2016: C ARS AND 

### T RUCKS 

### C OMBINED

GDI GDI+ deac GDI+ turbo 6 Speed
auto trans Dual clutch
trans Start-stop Hybrid Mass reduction (%)

BMW ................................ 4% 35% 47% 15% 71% 71% 14% 5 Chrysler

............................ 47 25 3 33 48 48 0 5
Daimler

............................. 3 44 39 11 73 72 13 5
Ford

.................................. 33 32 13 23 61 61 0 5 General Motors

................ 33 25 7 19 48 48 0 5
Honda

............................... 20 1 0 6 19 19 2 2 Hyundai

............................ 27 2 12 2 39 39 0 3
Kia

.................................... 31 0 4 1 34 34 0 2
Mazda .............................. 34 2 16 10 43 43 0 3
Mitsubishi

......................... 65 2 7 28 60 60 0 6
Nissan

.............................. 34 22 2 40 51 51 1 5
Porsche

............................ 7 36 49 10 70 70 15 4 Subaru

.............................. 46 4 14 10 54 46 0 3 Suzuki

.............................. 72 5 2 15 63 63 0 4
Tata

.................................. 4 81 0 14 70 70 15 6 Toyota

.............................. 25 2 0 30 33 5 13 1 Volkswagen

...................... 9 26 58 12 72 70 15 4 Overall

.............................. 28 17 9 20 45 40 4 4 Increase over 2011 CAFE 21 15 9

¥ 5 42 38 1 4



### TABLE 

### III.D.7–3—T ECHNOLOGY 

### P ENETRATION

### —6% PER 

### Y EAR 

### A LTERNATIVE 

### S TANDARDS IN 

### 2016: C ARS AND 

### T RUCKS 

### C OMBINED

GDI GDI+ deac GDI+ turbo 6 Speed
auto trans Dual clutch
trans Start-stop Hybrid Weight reduction (%)

BMW ................................ 4% 35% 47% 15% 71% 71% 14% 5 Chrysler

............................ 29 50 6 4 85 85 0 8
Daimler

............................. 3 44 39 11 73 72 13 5
Ford

.................................. 8 37 40 4 74 74 11 7 General Motors

................ 24 54 8 6 81 81 0 8
Honda

............................... 38 1 15 8 50 50 2 4 Hyundai

............................ 36 9 28 7 66 66 0 5
Kia

.................................... 48 0 25 18 55 55 0 4
Mazda

.............................. 65 2 16 4 81 76 0 6VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00105 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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TABLE 

### III.D.7–3—T ECHNOLOGY 

### P ENETRATION

### —6% PER 

### Y EAR 

### A LTERNATIVE 

### S TANDARDS IN 

### 2016: C ARS AND 

### T RUCKS 

### C OMBINED

### —Continued

GDI GDI+ deac GDI+ turbo 6 Speed
auto trans Dual clutch
trans Start-stop Hybrid Weight reduction (%)

Mitsubishi

......................... 59 7 19 7 80 80 5 8
Nissan

.............................. 34 17 35 9 76 76 10 7
Porsche

............................ 7 36 49 10 70 70 15 4
Subaru

.............................. 66 4 14 0 85 80 0 6
Suzuki .............................. 2 12 71 0 80 80 5 7
Tata

.................................. 4 81 0 14 70 70 15 6 Toyota

.............................. 40 7 11 25 50 50 13 3 Volkswagen

...................... 9 26 58 12 72 70 15 4
Overall

.............................. 28 24 23 11 67 67 7 6
Increase over 2011 CAFE 22 23 22

¥ 15 65 65 4 6

With respect to the 4 percent per year standards, the levels of requisite control technology decreased relative to those under the proposed standards, as would be expected. Industry-wide, the largest decrease was a 2 percent decrease in the application of start-stop technology. On a manufacturer specific basis, the most significant decreases were a 6 percent decrease in hybrid penetration for BMW and a 2 percent drop for Daimler. These are relatively small changes and are due to the fact that the 4 percent per year standards only require 4 g/mi CO 2 less control than the proposed standards in 2016. Porsche, Tata and Volkswagen continue to be unable to comply with
the CO 2 standards in 2016.

With respect to the 6 percent per year standards, the levels of requisite control technology increased relative to those under the proposed standards, as again would be expected. Industry-wide, the largest increase was an 8 percent increase in the application of start-stop technology. On a manufacturer specific basis, the most significant increases were a 42 percent increase in hybrid penetration for BMW and a 38 percent
increase for Daimler. These are more significant changes and are due to the fact that the 6 percent per year standards require 20 g/mi CO 2 more control than the proposed standards in 2016. Porsche, Tata and Volkswagen continue to be unable to comply with
the CO 2 standards in 2016. However, BMW joins this list, as well, though just by 1 g/mi. Most manufacturers experience the increase in start-stop technology application, with the increase ranging from 5 to 17 percent.

Table III.D.7–4 shows the projected
cost of the two alternative sets of
standards.



### TABLE 

### III.D.7–4—T ECHNOLOGY 

### C OST PER 

### V EHICLE IN 

### 2016—A LTERNATIVE 

### S TANDARDS 

### ($2007)

4 Percent per year standards 6 Percent per year standards

Cars Trucks All Cars Trucks All

BMW ................................................................................ $1,701 $1,665 $1,691 $1,701 $1,665 $1,691 Chrysler ............................................................................ 1,340 1,211 1,283 1,642 2,211 1,893
Daimler ............................................................................. 1,631 1,357 1,543 1,631 1,357 1,543
Ford .................................................................................. 1,429 1,305 1,374 2,175 2,396 2,273
General Motors ................................................................ 969 1,567 1,221 1,722 2,154 1,904
Honda ............................................................................... 633 402 564 777 1,580 1,016 Hyundai ............................................................................ 685 1,505 832 1,275 1,680 1,347
Kia .................................................................................... 741 738 741 1,104 1,772 1,213
Mazda .............................................................................. 851 914 860 1,369 1,030 1,320
Mitsubishi ......................................................................... 1,132 247 1,028 1,495 2,065 1,563
Nissan .............................................................................. 910 1,194 991 1,654 2,274 1,830
Porsche ............................................................................ 1,549 666 1,268 1,549 666 1,268
Subaru .............................................................................. 903 1,131 985 1,440 1,615 1,503
Suzuki .............................................................................. 1,093 1,026 1,076 1,718 2,219 1,846
Tata .................................................................................. 1,270 674 952 1,270 674 952 Toyota .............................................................................. 518 366 468 762 1,165 895 Volkswagen ...................................................................... 1,626 949 1,509 1,626 949 1,509
Overall .............................................................................. 940 1,054 978 1,385 1,859 1,544

As can be seen, the average cost of the 4 percent per year standards is only $73 per vehicle less than that for the proposed standards. In contrast, the average cost of the 6 percent per year standards is nearly $500 per vehicle more than that for the proposed standards. Compliance costs are entering the region of non-linearity. The $73 cost savings of the 4 percent per year standards relative to the proposal represents $18 per g/mi CO 2 increase. The $493 cost increase of the 6 percent per year standards relative to the proposal represents $25 per g/mi CO 2 increase.

EPA does not believe the 4% per year alternative is an appropriate standard
for the MY2012–2016 time frame. As discussed above, the 250 g/mi proposal is technologically feasible in this time frame at reasonable costs, and provides higher GHG emission reductions at a modest cost increase over the 4% per year alternative (less than $100 per vehicle). In addition, the 4% per year
alternative does not result in a harmonized National Program for the country. Based on California’s letter of May 18, 2009, the emission standards
under this alternative would not result in the State of California revising its regulations such that compliance withVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00106 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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EPA’s GHG standards would be deemed to be in compliance with California’s GHG standards for these model years. Thus, the consequence of promulgating a 4% per year standard would be to require manufacturers to produce two vehicle fleets: a fleet meeting the 4% per

year Federal standard, and a separate fleet meeting the more stringent
California standard for sale in California
and the section 177 States. This further increases the costs of the 4% per year
standard and could lead to additional difficulties for the already stressed automotive industry.

EPA also does not believe the 6% per year alternative is an appropriate
standard for the MY 2012–2016 time
frame. As shown in Tables III.D.7–3 and III.D.7–4, the 6% per year alternative represents a significant increase in both the technology required and the overall costs compared to the proposed standards. In absolute percent increases in the technology penetration, compared to the proposed standards the 6% per year alternative requires for the industry as a whole: an 18% increase in GDI fuelsystems, an 11% increase in turbodownsize systems, a 6% increase in
dual-clutch automated manual transmissions (DCT), and a 9% increase in start-stop systems. For a number of manufacturers the expected increase in technology is greater: for GM, a 15% increase in both DCTs and start-stop systems, for Nissan a 9% increase in full hybrid systems, for Ford an 11% increase in full hybrid systems, for Chrysler a 34% increase in both DCT and start-stop systems and for Hyundai a 23% increase in the overall penetration of DCT and start-stop systems. For the industry as a whole, the per-vehicle cost increase for the 6% per year alternative is nearly $500. On average this is a 50% increase in costs compared to the proposed standards. At the same time, CO 2 emissions would be reduced by about 8%, compared to the 250 g/mi target level.

These technology and cost increases are significant, given the amount of lead-time between now and model years
2012–2016. In order to achieve the levels of technology penetration for the proposed standards, the industry needs to invest significant capital and product development resources right away, in particular for the 2012 and 2013 model year, which is only 2–3 years from now. For the 2014–2016 time frame, significant product development and capital investments will need to occur over the next 2–3 year in order to be ready for launching these new products for those model years. Thus a major part of the required capital and resource
investment will need to occur in the next few years, under the proposed
standards. EPA believes that the proposal (a target of 250 gram/mile in 2016) already requires significant investment and product development costs for the industry, focused on the next few years.

It is important to note, and as discussed later in this preamble, as well as in the draft Joint Technical Support Document and the draft EPA Regulatory Impact Analysis document, the average model year 2016 per-vehicle cost increase of nearly $500 includes an estimate of both the increase in capital investments by the auto companies and the suppliers as well as the increase in product development costs. These costs can be significant, especially as they must occur over the next 2–3 years. Both the domestic and transplant auto firms, as well as the domestic and world-wide automotive supplier base, is experiencing one of the most difficult markets in the U.S. and internationally that has been seen in the past 30 years. One major impact of the global downturn in the automotive industry and certainly in the U.S. is the significant reductions in product development engineers and staffs, as well as a tightening of the credit markets which allow auto firms and suppliers to make the near-term capital investments necessary to bring new technology into production. EPA is concerned that the significantly increased pressure on capital and other resources from the 6% per year alternative may be too stringent for this time frame, given both the relatively limited amount of lead-time between now and model years 2012– 2016, the need for much of these resources over the next few years, as
well the current financial and related
circumstances of the automotive industry. EPA is not concluding that the 6% per year alternative standards are technologically infeasible, but EPA
believes such standards for this time frame would be overly stringent given the significant strain it would place on the resources of the industry under
current conditions. EPA believes this degree of stringency is not warranted at
this time. Therefore EPA does not believe the 6% per year alternative would be an appropriate balance of various relevant factors for model years

2012–1016.

These alternative standards represent two possibilities out of many. The EPA believes that the current proposed standards represent an appropriate
balance of the factors relevant under section 202(a). For further discussion of this issue, see Chapter 4 of the DRIA. E. Certification, Compliance, and Enforcement

1. Compliance Program Overview

This section of the preamble describes EPA’s proposal for a comprehensive program to ensure compliance with EPA’s proposed emission standards for carbon dioxide (CO 2), nitrous oxide (N 2O), and methane (CH4 ), as described in Section III.B. An effective compliance program is essential to achieving the environmental and public health benefits promised by these mobile source GHG standards. EPA’s proposal for a GHG compliance program is designed around two overarching priorities: (1) To address Clean Air Act (CAA) requirements and policy objectives; and (2) to streamline the compliance process for both manufacturers and EPA by building on existing practice wherever possible, and by structuring the program such that manufacturers can use a single data set to satisfy both the new GHG and Corporate Average Fuel Economy (CAFE) testing and reporting requirements. The program proposed by EPA and NHTSA recognizes, and replicates as closely as possible, the compliance protocols associated with the existing CAA Tier 2 vehicle emission standards, and with CAFE standards. The certification, testing, reporting, and associated compliance activities closely track current practices
and are thus familiar to manufacturers. EPA already oversees testing, collects and processes test data, and performs calculations to determine compliance
with both CAFE and CAA standards. Under this proposed coordinated approach, the compliance mechanisms for both programs are consistent and non-duplicative.

Vehicle emission standards established under the CAA apply throughout a vehicle’s full useful life. In this case EPA is proposing fleet average standards where compliance with the fleet average is determined based on the testing performed at time of production, as with the current CAFE fleet average. EPA is also proposing in-use standards that apply throughout a vehicle’s useful life, with the standard determined by adding a 10% adjustment factor to the
model-level emission results used to calculate the fleet average. Therefore, EPA’s proposed program must not only assess compliance with the fleet average standards described in Section III.B, but must also assess compliance with the in-use standards. As it does now, EPA would use a variety of compliance
mechanisms to conduct these assessments, including pre-production certification and post-production, in-useVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00107 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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monitoring once vehicles enter customer service. Specifically, EPA is proposing a compliance program for the fleet average that utilizes CAFE program protocols with respect to testing, a certification procedure that operates in conjunction with the existing CAA Tier 2 certification procedures, andassessment of compliance with the inuse standards concurrent with existing
EPA and manufacturer Tier 2 emission compliance testing programs. Under the proposed compliance program
manufacturers would also be afforded numerous flexibilities to help achieve compliance, both stemming from the program design itself in the form of a manufacturer-specific CO 2 fleet average standard, as well as in various credit banking and trading opportunities, as
described in Section III.C. EPA’s proposed compliance program is
outlined in further detail below. EPA requests comment on all aspects of the compliance program design including
comments about whether differences between the proposed compliance scheme for GHG and the existing compliance scheme for other regulated pollutants are appropriate.

2. Compliance With Fleet-Average CO 2 Standards

Fleet average emission levels can only be determined when a complete fleet profile becomes available at the close of the model year. Therefore, EPA is proposing to determine compliance with the fleet average CO 2 standards when the model year closes out, as is currently the protocol under EPA’s Tier 2 program as well as under the current CAFE program. The compliance
determination would be based on actual production figures for each model and
on model-level emissions data collected through testing over the course of the model year. Manufacturers would
submit this information to EPA in an end-of-year report which is discussed in
detail in Section III.E.5.h below.

Manufacturers currently conduct their CAFE testing over an entire model year to maximize efficient use of testing and engineering resources. Manufacturers
submit their CAFE test results to EPA and EPA conducts confirmatory fuel economy testing at its laboratory on a
subset of these vehicles under EPA’s Part 600 regulations. EPA is proposing that manufacturers continue to perform the model level testing currently required for CAFE fuel economy performance and measure and report the

CO 2 values for all tests conducted. Thus,
manufacturers will submit one data set
in satisfaction of both CAFE and GHG requirements such that EPA’s proposed program would not impose additional timing or testing requirements on manufacturers beyond that required by the CAFE program. For example, manufacturers currently submit fuel economy test results at the subconfiguration and configuration levels to satisfy CAFE requirements. Under this proposal manufacturers
would also submit CO 2 values for the
same vehicles. Section III.E.3 discusses how this will be implemented in the certification process.

a. Compliance Determinations

As described in Section III.B above, the fleet average standards would be determined on a manufacturer by manufacturer basis, separately for cars and trucks, using the proposed footprint attribute curves. Under this proposal, EPA would calculate the fleet average emission level using actual production figures and, for each model type, CO 2 emission test values generated at the time of a manufacturer’s CAFE testing. EPA would then compare the actual fleet average to the manufacturer’s footprint standard to determine compliance, taking into consideration use of averaging and/or other types of
credits.

Final determination of compliance with fleet average CO 2 standards may not occur until several years after the close of the model year due to theflexibilities of carry-forward and carryback credits and the remediation of deficits ( see Section III.C). A failure to meet the fleet average standard after credit opportunities have been exhausted could ultimately result in penalties and injunctive orders under
the CAA as described in Section III.E.6
below.

EPA periodically provides mobile source emissions and fuel economy information to the public, for example through the annual Compliance Report 164 and Fuel Economy Trends Report. 165 EPA plans to expand these reports to include GHG performance and compliance trends information,
such as annual status of credit balances or debits, use of various credit programs, attained versus projected fleet average emission levels, and final compliance status for a model year after
credit reconciliation occurs. We seek comment on all aspects of public

164 2007 Progress Report Vehicle and Engine Compliance Activities; EPA–420–R–08–011;
October 2008. This document is available electronically at http://www.epa.gov/otaq/about/ 420r08011.pdf

.

165 Light-Duty Automotive Technology and FuelEconomy Trends: 1975 Through 2008; EPA–420–S– 08–003; September 2008. This document is available electronically at http://www.epa.gov/otaq/ fetrends.htm

. dissemination of GHG compliance
information

b. Required Minimum Testing for Fleet Average CO 2

As noted, EPA is proposing that the same test data required for determining a manufacturer’s compliance with the
CAFE standard also be used to
determine the manufacturer’s compliance with the fleet average CO 2 emissions standard. CAFE requires
manufacturers to submit test data representing at least 90% of the manufacturer’s model year production, by configuration. 166 The CAFE testing covers the vast majority of models in a
manufacturer’s fleet. Manufacturers industry-wide currently test more than 1,000 vehicles each year to meet this requirement. EPA believes this minimum testing requirement is necessary and applicable for calculating

accurate CO 2 fleet average emissions. Manufacturers may test additional vehicles, at their option. As described above, EPA would use the emissions results from the model-level testing to calculate a manufacturer’s fleet average

CO 2 emissions and to determine compliance with the CO 2 standard.

EPA is proposing to continue to allow certain testing flexibilities that exist under the CAFE program. EPA has always permitted manufacturers some ability to reduce their test burden in tradeoff for lower fuel economy numbers. Specifically the practice of
‘‘data substitution’’ enables manufacturers to apply fuel economy
test values from a ‘‘worst case’’ configuration to other configurations in lieu of testing them. The substituted values may only be applied to configurations that would be expected to have better fuel economy and for
which no actual test data exist. Substituted data would only be accepted for the GHG program if it is also used for CAFE purposes.

EPA’s regulations for CAFE fuel economy testing permit the use of analytically derived fuel economy data in lieu of an actual fuel economy test in

certain situations. 167 Analytically derived data is generated mathematically using expressions determined by EPA and is allowed on
a limited basis when a manufacturer has not tested a specific vehicle configuration. This has been done as a means to reduce some of the testing
burden on manufacturers without sacrificing accuracy in fuel economy measurement. EPA has issued guidance that provides details on analytically

166 See 40 CFR 600.010–08(d).

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derived data and that specifies the conditions when analytically derived fuel economy may be used. EPA would also apply the same guidance to the GHG program and would allow any analytically derived data used for CAFE to also satisfy the GHG data reporting requirements. EPA would, however,
need to revise the terms in the current equations for analytically derived fuel economy to specify them in terms of

CO 2 . Analytically derived CO 2 data would not be permitted for the Emission Data Vehicle representing a test group for pre-production certification, only for
the determination of the model level test
results used to determine actual fleetaverage CO 2 levels.

EPA is retaining the definitions
needed to determine CO 2 levels of each model type (such as ‘‘subconfiguration,’’ ‘‘configuration,’’ ‘‘base level,’’ etc. ) as they are currently defined in EPA’s fuel economy regulations.

3. Vehicle Certification

CAA section 203(a)(1) prohibits manufacturers from introducing a new
motor vehicle into commerce unless the vehicle is covered by an EPA-issued certificate of conformity. Section 206(a)(1) of the CAA describes the requirements for EPA issuance of a certificate of conformity, based on a demonstration of compliance with the emission standards established by EPA
under section 202 of the Act. The certification demonstration requires emission testing, and must be done for each model year. 168

Under Tier 2 and other EPA emission standard programs, vehicle manufacturers certify a group of vehicles called a test group. A test group typically includes multiple vehicle car lines and model types that share critical
emissions-related features. 169 The manufacturer generally selects and tests one vehicle to represent the entire test group for certification purposes. The test vehicle is the one expected to be the
worst case for the emission standard at
issue. Emission results from the test vehicle are used to assign the test group to one of several specified bins of emissions levels, identified in the Tier 2 rule, and this bin level becomes the
in-use emissions standard for that test

group. 170

168 CAA section 206(a)(1).

169 The specific test group criteria are described in 40 CFR 86.1827–01, car lines and model types have the meaning given in 40 CFR 86.1803–01.

170 Initially in-use standards were different from
the bin level determined at certification as the useful life level. The current in-use standards, however, are the same as the bin levels. In all cases, the bin level, reflecting useful life levels, has been used for determining compliance with the fleet

average. Since compliance with the Tier 2 fleet average depends on actual test group sales volumes and bin levels, it is not possible to determine compliance at the time the manufacturer applies for and receives a certificate of conformity for a test group. Instead, EPA requires the manufacturer to make a good faith
demonstration in the certification application that vehicles in the test group will both (1) comply throughout
their useful life with the emissions bin assigned, and (2) contribute to fleetwide compliance with the Tier 2 average when the year is over. EPA issues a
certificate for the vehicles included in the test group based on this demonstration, and includes a condition
in the certificate that if the manufacturer does not comply with the fleet average, then production vehicles from that test group will be treated as not covered by
the certificate to the extent needed to bring the manufacturer’s fleet average into compliance with Tier 2.

The certification process often occurs several months prior to production and manufacturer testing may occur months
before the certificate is issued. The certification process for the Tier 2 program is an efficient way for
manufacturers to conduct the needed testing well in advance of certification,
and to receive the needed certificates in
a time frame which allows for the orderly production of vehicles. The use
of a condition on the certificate has been an effective way to ensure compliance with the Tier 2 fleet average.

EPA is proposing to similarly condition each certificate of conformity for the GHG program upon a manufacturer’s good faith demonstration of compliance with the manufacturer’s fleetwide average CO 2 standard. The following discussion explains how EPA proposes to integrate the proposed vehicle certification program into the existing certification

program.

a. Compliance Plans

EPA is proposing that manufacturers submit a compliance plan to EPA prior to the beginning of the model year and prior to the certification of any test group. This plan would include themanufacturer’s estimate of its footprintbased standard (Section III.B), along with a demonstration of compliance with the standard based on projected
model-level CO 2 emissions, and production estimates. Manufacturers
would submit the same information to NHTSA in the pre-model year report required for CAFE compliance. However, the GHG compliance plan
could also include additional information relevant only to the EPA program. For example, manufacturers seeking to take advantage of air conditioning or other credit flexibilities (Section III.C) would include these in their compliance demonstration. Similarly, the compliance
demonstration would need to include a credible plan for addressing deficits accrued in prior model years. EPA would review the compliance plan for technical viability and conduct a certification preview discussion with
the manufacturer. EPA would view the compliance plan as part of the manufacturer’s good faith demonstration, but understands that initial projections can vary considerably from the reality of final production and emission results. EPA requests comment on the proposal to evaluate manufacturer compliance plans prior to the beginning of model year certification. EPA also requests comment on what criteria the agency should use to evaluate the sufficiency of the plan and on what steps EPA should take if it determines that a plan is unlikely to offset a deficit.

b. Certification Test Groups and Test
Vehicle Selection

Manufacturers currently divide their fleet into ‘‘test groups’’ for certification purposes. The test group is EPA’s unit of certification; one certificate is issued per test group. These groupings cover
vehicles with similar emission control system designs expected to have similar emissions performance. 171 The factors considered for determining test groups include combustion cycle, engine type, engine displacement, number of cylinders and cylinder arrangement, fuel type, fuel metering system, catalyst construction and precious metal composition, among others. Vehicles having these features in common are generally placed in the same test

group. 172 Cars and trucks may be included in the same test group as long as they have similar emissions performance (manufacturers frequently produce cars and trucks that have identical engine designs and emission controls).

EPA is proposing to retain the current Tier 2 test group structure for cars and light trucks in the certification requirements for CO 2 . At the time of certification, manufacturers would use
the CO 2 emission level from the Tier 2 Emission Data Vehicle as a surrogate to represent all of the models in the test group. However, following certification

171 40 CFR 86.1827–01.

172 EPA provides for other groupings in certain circumstances, and can establish its own test groups in cases where the criteria do not apply. 40 CFR 86.1827–01(b), (c) and (d).VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00109 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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further testing would generally be required for compliance with the fleet average CO 2 standard as described
below. EPA’s issuance of a certificate would be conditioned upon the manufacturer’s subsequent model level testing and attainment of the actual fleet average. Further discussion of these requirements is presented in Section

III.E.6.

EPA recognizes that the Tier 2 test group criteria do not necessarily relate

to CO 2 emission levels. For instance, while some of the criteria, such as combustion cycle, engine type and displacement, and fuel metering, may have a relationship to CO 2 emissions, others, such as those pertaining to the catalyst, may not. In fact, there are many vehicle design factors that impact CO 2 generation and emission but are not included in EPA’s test group criteria. 173 Most important among these may be vehicle weight, horsepower, aerodynamics, vehicle size, and performance features.

EPA considered, but is not proposing, a requirement for separate CO 2 test groups established around criteria more directly related to CO 2 emissions. Although CO 2 -specific test groups might more consistently predict CO 2 emissions of all vehicles in the test group, the
addition of a CO 2 test group requirementwould greatly increase the preproduction certification burden for both manufacturers and EPA. For example, a current Tier 2 test group would need to be split into two groups if automatic and
manual transmissions models had been included in the same group. Two- and
four-wheel drive vehicles in a current test group would similarly require separation, as would weight differences among vehicles. This would at least triple the number of test groups. EPA
believes that the added burden of creating separate CO 2 test groups is not warranted or necessary to maintain an appropriately rigorous certification program because the test group data are later replaced by model specific data
which are used as the basis for determining compliance with a manufacturer’s fleet average standard.

EPA believes that the current test group concept is appropriate for N 2 O and CH4 because the technologies that would be employed to control N 2O and

CH4 emissions would generally be the
same as those used to control the criteria pollutants.

As just discussed, the ‘‘worst case’’
vehicle a manufacturer selects as the

173 EPA noted this potential lack of connection between fuel economy testing and testing for emissions standard purposes when it first adopted fuel economy test procedures. See 41 FR at 38677 (Sept. 10, 1976). Emissions Data Vehicle to represent a test group under Tier 2 (40 CFR 86.1828–01) may not have the highest
levels of CO 2 in that group. For instance, there may be a heavier, more powerful configuration that would have higher

CO 2 , but may, due to the way the catalytic converter has been matched to the engine, actually have lower NO X , CO, PM or HC.

Therefore, in lieu of a separate CO 2- specific test group, EPA considered requiring manufacturers to select a CO 2 test vehicle from within the Tier 2 test group that would be expected, based on good engineering judgment, to have the highest CO 2 emissions within that test group. The CO 2 emissions results from
this vehicle would be used to establish

an in-use CO 2 emission standard for the test group. The requirement for a separate, worst case CO 2 vehicle would provide EPA with some assurance that all vehicles within the test group would
have CO 2 emission levels at or below those of the selected vehicle, even if
there is some variation in the CO 2 control strategies within the test group (such as different transmission types). Under this approach, the test vehicle might or might not be the same one that
would be selected as worst case for criteria pollutants. Thus, manufacturers might be required to test two vehicles in each test group, rather than a single vehicle. This would represent an added timing burden to manufacturers because they might need to build additional test
vehicles at the time of certification that previously weren’t required to be tested.

Instead, EPA is proposing to require a single Emission Data Vehicle that would represent the test group for both Tier 2
and CO 2 certification. The manufacturer would be allowed to initially apply the
Emission Data Vehicle’s CO 2 emissions value to all models in the test group, even if other models in the test group are expected to have higher CO 2 emissions. However, as a condition of the certificate, this surrogate CO 2 emissions value would generally be replaced with actual, model-level CO 2 values based on results from CAFE testing that occurs later in the model year. This model level data would
become the official certification test results (as per the conditioned certificate) and would be used to determine compliance with the fleet average. Only if the test vehicle is in fact
the worst case CO 2 vehicle for the test group could the manufacturer elect to apply the Emission Data Vehicle
emission levels to all models in the test group for purposes of calculating fleet average emissions. Manufacturers would be unlikely to make this choice, because doing so would ignore the emissions performance of vehicle
models in their fleet with lower CO 2 emissions and would unnecessarily
inflate their CO 2 fleet average. Testing at the model level already occurs and data are already being submitted to EPA for CAFE and labeling purposes, so it
would be an unusual situation that would cause a manufacturer to ignore these data and choose to accept a higher

CO 2 fleet average.

EPA requests comment regarding whether the Tier 2 test group can adequately represent CO 2 emissions for certification purposes, and whether the
Emission Data Vehicle’s CO 2 emission level is an appropriate surrogate for all vehicles in a test group at the time of certification, given that the certificate would be conditioned upon additional model level testing occurring during the year ( see Section III.E.6) and that the surrogate CO 2 emission values would be replaced with model-level emissions
data from those tests. Comments should
also address EPA’s desire to minimize the up-front pre-production testing burden and whether the proposed efficiencies would be balanced by the requirement to test all model types in the fleet by the conclusion of the model year in order to establish the fleet average CO 2 levels.

There are two standards that the manufacturer would be subject to, the fleet average standard and the in-use
standard for the useful life of the vehicle. Compliance with the fleet average standard is based on production-weighted averaging of the test data that applies for each model. For each model, the in-use standard is set at 10% higher than the level used for that model in calculating the fleet average. The certificate would cover both of these standards, and the
manufacturer would have to demonstrate compliance with both of these standards for purposes of receiving a certificate of conformity. The certification process for the in-use
standard is discussed below in Section

III.E.4.

c. Certification Testing Protocols and
Procedures

To be consistent with CAFE, EPA proposes to combine the CO 2 emissions results from the FTP and HFET tests using the same calculation method used to determine fuel economy for CAFE purposes. This approach is appropriate
for CO 2 because CO 2 and fuel economy are so closely related. Other than the fact that fuel economy is calculated using a harmonic average and CO 2 emissions can be calculated using a conventional average, the calculation methods are very similar. The FTP CO 2VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00110 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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data will be weighted at 55%, and the highway CO 2 data at 45%, and then averaged to determine the combined
number. See Section III.B.1 for more
detailed information on CO 2 test procedures, Section III.C.1 on Air Conditioning Emissions, and Section

III.B.6for N 2 O and CH4 test procedures.

For the purposes of compliance with the fleet average and in-use standards,
the emissions measured from each test vehicle will include hydrocarbons (HC) and carbon monoxide (CO), in addition

to CO 2 . All three of these exhaust constituents are currently measured and
used to determine the amount of fuel burned over a given test cycle using a ‘‘carbon balance equation’’ defined in the regulations, and thus measurement of these is an integral part of current fuel economy testing. As explained in Section III.C, it is important to account for the total carbon content of the fuel.
Therefore the carbon-related combustion products HC and CO must be included in the calculations along
with CO 2 . CO emissions are adjusted by
a coefficient that reflects the carbon weight fraction (CWF) of the CO molecule, and HC emissions are adjusted by a coefficient that reflects the CWF of the fuel being burned (the molecular weight approach doesn’t work since there are many different hydrocarbons being accounted for).Thus, EPA is proposing that the carbonrelated exhaust emissions of each test vehicle be calculated according to the following formula, where HC, CO, and

CO 2 are in units of grams per mile:

Carbon-related exhaust emissions (grams/mile) = CWF*HC +

1.571*CO + CO 2 As part of the current CAFE and Tier 2 compliance programs, EPA selects a subset of vehicles for confirmatory testing at its National Vehicle and Fuel Emissions Laboratory. The purpose of confirmatory testing is to validate the
manufacturer’s emissions and/or fuel economy data. Under this proposal, EPA
would add CO 2 , N 2O, and CH4 to the
emissions measured in the course of Tier 2 and CAFE confirmatory testing.
The emission values measured at the EPA laboratory would continue to stand as official, as under existing regulatory

programs.

As is the current practice with fuel economy testing, if during EPA’s confirmatory testing the EPA CO 2 value differs from the manufacturer’s value by more than 3%, manufacturers could request a re-test. Also as with current practice, the results of the re-test would stand as official, even if they differ from the manufacturer value by more than 3%. EPA is proposing to allow a re-test request based on a 3% or greater disparity since a manufacturer’s fleet average emissions level would be
established on the basis of model level testing only (unlike Tier 2 for which a fixed bin standard structure provides the opportunity for a compliance buffer). EPA requests comment on whether the 3% value currently used during CAFE confirmatory testing is appropriate and should be retained under the proposed GHG program.

4. Useful Life Compliance

Section 202(a)(1) of the CAA requires emission standards to apply to vehicles throughout their statutory useful life, as
further described in Section III.A. For emission programs that have fleet average standards, such as Tier 2 and the proposed CO 2 standards, the useful life requirement applies to individual vehicles rather than to the fleet average standard. For example, in Tier 2 the useful life requirements apply to the
individual emission standard levels or ‘‘bins’’ that the vehicles are certified to, not the fleet average standard. For Tier 2, the useful life requirement is 10 years or 120,000 miles with an optional 15 year or 150,000 mile provision. For each model, the proposed CO 2 standards inuse are the model specific levels used in calculating the fleet average, adjusted to be 10% higher. EPA is proposing the 10% adjustment factor to provide some margin for production and test-to-test variability that could result in
differences between initial model-level emission results used in calculating the fleet average and any subsequent in-use testing. EPA requests comment on whether a separate in-use standard is an appropriate means of addressing issues of variability and whether 10% is an appropriate adjustment.

This in-use standard would apply for the same useful life period as in Tier 2. Section 202(i)(3)(D) of the CAA allows EPA to adopt useful life periods for light-duty vehicles and light-duty trucks
which differ from those in section 202(d). Similar to Tier 2, the useful life requirements would be applicable to the
model-level CO 2 certification values (similar to the Tier 2 bins), not to the fleet average standard.

EPA believes that the useful life period established for criteria pollutants under Tier 2 is also appropriate for CO 2
. Data from EPA’s current in-use compliance test program indicate that

CO 2 emissions from current technology vehicles increase very little with age and in some cases may actually improve slightly. The stable CO 2 levels are expected because unlike criteria pollutants, CO 2 emissions in current technology vehicles are not controlled by after treatment systems that may fail with age. Rather, vehicle CO 2 emission levels depend primarily on fundamental vehicle design characteristics that do not change over time. Therefore, vehicles designed for a given CO 2 emissions level would be expected to sustain the same emissions profile over
their full useful life.

The CAA requires emission standards to be applicable for the vehicle’s full
useful life. Under Tier 2 and other vehicle emission standard programs, EPA requires manufacturers to
demonstrate at the time of certification that the new vehicles being certified
will continue to meet emission standards throughout their useful life.
EPA allows manufacturers several options for predicting in-use deterioration, including full vehicle testing, bench-aging specific components, and application of a
deterioration factor based on data and/ or engineering judgment.

In the specific case of CO 2 , EPA does not currently anticipate notable deterioration and is therefore proposing that an assigned deterioration factor be applied at the time of certification. EPA is further proposing an additive assigned deterioration factor of zero, or a multiplicative factor of one. EPA anticipates that the deterioration factor would be updated from time to time, as new data regarding emissions
deterioration for CO 2 are obtained and analyzed. Additionally, EPA may consider technology-specific deterioration factors, should data
indicate that certain CO 2 control technologies deteriorate differently than
others.

During compliance plan discussions prior to the beginning of the certification process, EPA would explore with each manufacturer any new technologies that could warrant use
of a different deterioration factor.
Manufacturers would not be allowed to use the assigned deterioration factor but rather would be required to establish an appropriate factor for any vehicle model determined likely to experience

increases in CO 2 emissions over the
vehicle’s useful life. If such an instance were to occur, EPA is also proposing to
allow manufacturers to use the wholevehicle mileage accumulation method currently offered in EPA’s regulations.

EPA requests comments on the proposal to allow manufacturers to use an EPA-assigned deterioration factor for

CO 2 useful life compliance, and to set that factor at zero (additive) or one (multiplicative). Particularly helpful
would be data from in-use vehicles that demonstrate the rate of change in CO 2 emissions over a vehicle’s useful life,VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00111 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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separated according to vehicle technology.

N 2 O and CH4 emissions are directly affected by vehicle emission control systems. Any of the durability options offered under EPA’s current compliance program can be used to determine how
emissions of N 2 O and CH4 change over

time.

a. Ensuring Useful Life Compliance

The CAA requires a vehicle to comply
with emission standards over its regulatory useful life and affords EPA broad authority for the implementation of this requirement. As such, EPA has authority to require a manufacturer to remedy any noncompliance issues. The remedy can range from the voluntary or mandatory recall of any noncompliant
vehicles to the recalculation of a manufacturers fleet average emissions level. This provides manufacturers with a strong incentive to design and build complying vehicles.

Currently, EPA regulations require manufacturers to conduct in-use testing
as a condition of certification. Specifically, manufacturers must commit to later procure and test privately-owned vehicles that have been normally used and maintained. The
vehicles are tested to determine the inuse levels of criteria pollutants when they are in their first and third years of service. This testing is referred to as the In-Use Verification Program (IUVP) testing, which was first implemented as part of EPA’s CAP 2000 certification

program. 174 The emissions data
collected from IUVP serves several purposes. It provides EPA with annual real-world in-use data representing the majority of certified vehicles. EPA uses IUVP data to identify in-use problems, validate the accuracy of the certification program, verify the manufacturer’s durability processes, and support emission modeling efforts. Manufacturers are required to test low mileage and high mileage vehicles over the FTP and US06 test cycles. They are also required to provide evaporative emissions and on-board diagnostics (OBD) data.

Manufacturers are required to provide data for all regulated criteria pollutants. Some manufacturers voluntarily submit

CO 2 data as part of IUVP. EPA is proposing that for IUVP testing, all manufacturers will provide emission
data for CO 2 and also for N 2 O and CH4
. EPA is also proposing that manufacturers perform the highway test cycle as part of IUVP. Since the proposed CO 2 standard reflects a combined value of FTP and highway

174 64 FR 23906, May 4, 1999. results, it is necessary to include the highway emission test in IUVP to enable EPA to compare an in-use CO 2 level
with a vehicle’s in-use standard. EPA requests comments on adding the highway test cycle as part of the IUVP requirements.

Another component of the CAP 2000 certification program is the In-Use Confirmatory Program (IUCP). This is a manufacturer-conducted recall quality in-use test program that can be used as
the basis for EPA to order an emission recall. In order to qualify for IUCP, there
is a threshold of 1.30 times the
certification emission standard and an additional requirement that at least 50% of the test vehicles for the test group fail for the same pollutant. EPA is proposing
to exclude IUVP data for CO 2 , N 2O, and

CH4 emissions from the IUCP thresholds. At this time, EPA does not
have sufficient data to determine if the existing thresholds are appropriate or even applicable to those emissions. Once EPA can gather more data from the IUVP program and from EPA’s internal surveillance program described below,
EPA will reassess the need to exclude IUCP thresholds, and if warranted, propose a separate rulemaking establishing IUCP threshold criteria which may include CO 2 , N 2O, and CH4 emissions. EPA requests comment on the proposal to exclude CO 2 , N 2O, and

CH4 from the IUCP threshold.

EPA has also administered its own inuse testing program for light-duty vehicles under authority of section 207(c) of the CAA for more than 30 years. In this program, EPA procures and tests representative privately owned vehicles to determine whether they are complying with emission standards. When testing indicates noncompliance,
EPA works with the manufacturer to determine the cause of the problem and to conduct appropriate additional testing to determine its extent or the
effectiveness of identified remedies. This program operates in conjunction with the IUVP program and other sources of information to provide a comprehensive picture of the compliance profile for the entire fleet and address compliance problems that are identified. EPA proposes to add CO 2 , N 2O, and CH4 to the emissions measurements it collects during surveillance testing.

b. In-Use Compliance Standard

For Tier 2, the in-use standard and the
certification standard are the same. Inuse compliance for an individual vehicle is determined by comparing the
vehicle’s in-use emission results with
the emission standard levels or ‘‘bin’’ to
which the vehicle is certified rather than to the Tier 2 fleet average standard
for the manufacturer. This is because as part of a fleet average standard,
individual vehicles can be certified to various emission standard levels, which could be higher or lower than the fleet average standard. Thus, comparing an individual vehicle to the fleet average,
where that vehicle was certified to an
emission level that could be different than the fleet average level, would be inappropriate.

This would also be true for the proposed CO 2 fleet average standard. Therefore, to ensure that an individual vehicle complies with the proposed CO 2 standards in-use, it is necessary to compare the vehicle’s in-use CO 2 emission result with the appropriate
model-level certification CO 2 level used in determining the manufacturer’s fleet average result.

There is a fundamental difference between the proposed CO 2 standards and Tier 2 standards. For Tier 2, the certification standard is one of eight different emission levels, or ‘‘bins,’’ whereas for the proposed CO 2 fleet average standard, the certification
standard is the model-level certification

CO 2 result. The Tier 2 fleet average standard is calculated using the ‘‘bin’’ emission level or standard, not the
actual certification emission level of the
certification test vehicle. So no matter
how low a manufacturer’s actual certification emission results are, the fleet average is still calculated based on
the ‘‘bin’’ level rather than the lower certification result. In contrast, EPA is proposing that the CO 2 fleet average standard would be calculated using the
actual vehicle model-level CO 2 values
from the certification test vehicles. With
a known certification emission standard, such as the Tier 2 ‘‘bins,’’manufacturers typically attempt to overcomply with the standard to give themselves some cushion for potentially higher in-use testing results due to emissions performance deterioration and/or variability that could result in higher emission levels during subsequent in-use testing. For our proposed CO 2 standards, the
certification standard is the actual certification vehicle test result, thus manufacturers cannot over comply since
the certification test vehicle result will always be the value used in determining
the CO 2 fleet average. If the manufacturer attempted to design the
vehicle to achieve a lower CO 2 value, similar to Tier 2 for in-use purposes, the
new lower CO 2 value would simply
become the new certification standard.

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representative of the point of production, and while there is expected to be limited if any deterioration in effectiveness for any vehicle during the useful life, the fleet average standard
does not take into account the test to test variability or production variability that can affect in-use levels. Therefore, EPA believes that unlike Tier 2, it is necessary to have a different in-use
standard for CO 2 to account for these variabilities. EPA is proposing to set the in-use standard at 10% higher than the appropriate model-level certification

CO 2 level used in determining the manufacturer’s fleet average result.

As described above, manufacturers typically design their vehicles to emit at emission levels considerably below the
standards. This intentional difference
between the actual emission level and
the emission standard is referred to as ‘‘certification margin,’’ since it is typically the difference between the
certification emission level and the
emission standard. The certification margin can provide manufacturers with some protection from exceedingemission standards in-use, since the inuse standards are typically the same as the certification standards. For Tier 2, the certification margin is the delta between the specific emission standard level, or ‘‘bin,’’ to which the vehicle is certified, and the vehicle’s certification
emission level.

Since the level of the fleet average
standard does not reflect this kind of variability, EPA believes it is appropriate to set an in-use standardthat provides manufacturers with an inuse compliance factor of 10% that will act as a surrogate for a certification margin. The factor would only be applicable to CO 2 emissions, and would be applied to the model-level test results
that are used to establish the modellevel in-use standard.

If the in-use emission result for the
vehicle exceeds the model-level CO 2certification result multiplied by the inuse compliance factor of 10%, then the
vehicle would have exceeded the in-use
emission standard. The in-usecompliance factor would apply to all inuse compliance testing including IUVP, selective enforcement audits, and EPA’s internal test program.

The intent of the separate in-use standard, based on a 10% compliance factor adjustment, is to provide a reasonable margin such that vehicles are not automatically deemed as exceeding standards simply because of normal variability in test results. EPA has some
concerns however that this in-use compliance factor could be perceived as providing manufacturers with the ability to design their fleets to generate CO 2 emissions up to 10% higher than the actual values they use to certify and to calculate the year end fleet average value that determines compliance with the fleet average standard. This concern provides additional rationale for requiring FTP and HFET IUVP data for

CO 2 emissions to ensure that in-use values are not regularly 10% higher than the values used in the fleet average calculation. If in the course of reviewing
a manufacturer’s IUVP data it becomes apparent that a manufacturer’s CO 2 results are consistently higher than the values used for certification, EPA would
discuss the matter with the manufacturer and consider possible resolutions such as changes to ensure
that the emissions test data more accurately reflects the emissions level of vehicles at the time of production, increased EPA confirmatory testing, and
other similar measures.

EPA selected a value of 10% for the
in-use standard based on a review of EPA’s fuel economy labeling and CAFE confirmatory test results for the past several vehicle model years. The EPA
data indicate that it is common for test variability to range between three to six percent and only on rare occasions to exceed 10%. EPA believes that a value of 10% should be sufficient to account for testing variability and any production variability that a manufacturer may encounter. EPA considered both higher and lower values. The Tier 2 fleet as a whole, for example, has a certification margin approaching 50%. 175 However, there are
some fundamental differences between

CO 2 emissions and other criteria pollutants in the magnitude of the pollutants. Tier 2 NMOG and NO X emission standards are hundredths of a gram per mile ( e.g., 0.07 g/mi NO X &

0.09g/mi NMOG), whereas the CO 2 standards are four orders of magnitude greater ( e.g., 250 g/mi). Thus EPA does not believe it is appropriate to consider a value on the order of 50 percent. In addition, little deterioration in emissions control is expected in-use. The adjustment factor addresses only one element of what is usually built into a compliance margin.

EPA requests comments regarding a proposed in-use standard that uses an in-use compliance factor. Specifically, is a factor the best way to address thetechnical and other feasibility of the inuse standard; is 10% the appropriate factor; can EPA expect variability to decrease as manufacturing experience

175 See pages 39–41 of EPA’s Vehicle and Engine Compliance Activities 2007 Progress Report (EPA– 420–R–08–011) published in October 2008. This document is available electronically at http:// epa.gov/otaq/about/420r08011.pdf. increases, in which case would it be appropriate for the in-use compliance factor of 10% to decrease over time? EPA especially requests any data to support such comments.

5. Credit Program Implementation

As described in Section III.E.2 above, for each manufacturer’s model year production, EPA is proposing that the manufacturer would average the CO 2 emissions within each of the two averaging sets (passenger cars and trucks) and compare that with its respective fleet average CO 2 standards (which in turn would have been determined from the appropriate footprint curve applicable to that modelyear). In addition to this withincompany averaging, EPA is proposing that when a manufacturer’s fleet average

CO 2 emissions of vehicles produced in an averaging set over-complies compared to the applicable fleet average standard, the manufacturer could generate credits that it could save for later use (banking) or could transfer to another manufacturer (trading). Section

III.Cdiscusses opportunities that EPA is proposing for manufacturers to earn additional credits, beyond those simply calculated by ‘‘over-achieving’’ their applicable standard. Implementation of the credit program generally involves two steps: calculation of the credit amount and reporting the amount and
the associated data and calculations to

EPA.

Of the various credit programs being proposed by EPA, there are two broad types. One type of credit directly lowers a manufacturer’s actual fleet average by virtue of being applied to the methodology for calculating the fleet average emissions. Examples of this type of credit include the credits
available for alternative fuel vehicles and for advanced technology vehicles. The second type of credit is independent of the calculation of a manufacturer’s fleet average. Rather than giving credit by lowering a manufacturer’s fleet average via a credit mechanism, these credits (in megagrams) are calculated separately and are simply added to the
manufacturer’s overall ‘‘bank’’ of credits (or debits). Using a fictional example, the remainder of this section will step through the different types of credits and show where and how they are calculated and how they impact a
manufacturer’s available credits.

a. Basic Credits for a Fleet With Average

CO 2 Emissions Below the Standard

Basic credits are earned by doing better than the applicable standard.
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(separate standards are calculated forcars and trucks) using the footprintbased equations described in Section

III.B. A manufacturer’s actual end-ofyear fleet average CO 2 is calculated similarly to the way in which CAFE values are currently calculated; in fact, the regulations are essentially identical.
The current CAFE calculation methods

are in 40 CFR Part 600. EPA is proposing to amend key subparts and sections of Part 600 to require that fleet average CO 2 be calculated in a manner parallel to the way CAFE values are
calculated. First manufacturers would
determine a CO 2-equivalent value for each model type. The CO 2 -equivalent
value is a summation of the carboncontaining constituents of the exhaust emissions, with each weighted by a
coefficient that reflects the carbon weight fraction of that constituent. For gasoline and diesel vehicles this simply
involves measurement of total hydrocarbons and carbon monoxide in
addition to CO 2 , but becomes somewhat more complex for alternative fuel
vehicles due to the different nature of their exhaust emissions. For example, for ethanol-fueled vehicles, the emission tests must measure ethanol, methanol, formaldehyde, and acetaldehyde in
addition to CO 2 . However, all these measurements are necessary to determine fuel economy and thus no new testing or data collection would be required. Second, manufacturers would calculate a fleet average by weighting
the CO 2-equivalent value for each model type by the production of that model type, as they currently do for the CAFE program. Again, this would be done separately for cars and trucks. Finally, the manufacturer would compare the calculated standard with the average that is actually achieved to determine the credits (or debits). Both the determination of the applicable standard and the actual fleet average would be done after the model year is complete and using final model year production data. Consider a basic example where
Manufacturer ‘‘A’’ has calculated a car standard of 300 grams/mile and a fleet average of 290 grams/mile (Figure III.E.5–1). Further assume that the manufacturer produced 500,000 cars. The credit is calculated by taking the
difference between the standard and the fleet average (300–290=10) and multiplying it by the production of 500,000. This result is then multiplied by the lifetime vehicle miles travelled (for cars this is 190,971 miles), then finally divided by 1,000,000 to convert from grams to total megagrams. The
result is the number of CO 2 megagrams of credit (or deficit, if the manufacturer was not able to comply with the fleet average standard) generated by the
manufacturer’s car fleet. In this example, the result is 954,855

megagrams.

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b. Advanced Technology Credits

Advanced technology credits directly impact a manufacturer’s fleet average, thus increasing the amount of credits they earn (or reducing the amount of debits that would otherwise accrue). To earn these credits, manufacturers that produce electric vehicles, plug-in hybrid electric vehicles, or fuel cell
electric vehicles would include these vehicles in the fleet average calculation with their model type emission values (0 g/m for electric vehicles and fuel cell electric vehicles, and a measured CO 2 value for plug-in hybrid electric vehicles), but would apply the proposed multiplier of 2.0 to the production
volume of each of these vehicles. This approach would thus enhance the impact that each of these low-CO 2 advanced technology vehicles has on the manufacturer’s fleet average. EPA is proposing to limit availability of advanced technology credits to the technologies noted above, with the
additional limitation that the vehicles
must be certified to Tier 2 Bin 5 emission standards or cleaner (this obviously applies primarily to plug-in hybrid electric vehicles). EPA is proposing to use the following
definitions to determine which vehiclesVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00115 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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are eligible for the advanced technology
credits:

• Electric vehicle means a motor vehicle that is powered solely by an electric motor drawing current from a rechargeable energy storage system, such as from storage batteries or other portable electrical energy storage devices, including hydrogen fuel cells, provided that:

Æ (1) Recharge energy must be drawn from a source off the vehicle, such as residential electric service; and

Æ (2) The vehicle must be certified to
the emission standards of Bin #1 of Table S04–1 in paragraph (c)(6) of § 86.1811. • Fuel cell electric vehicle means a motor vehicle propelled solely by an electric motor where energy for the motor is supplied by a fuel cell.

• Fuel cell means an electrochemical cell that produces electricity via the
reaction of a consumable fuel on the
anode with an oxidant on the cathode in the presence of an electrolyte.

• Plug-in hybrid electric vehicle (PHEV) means a hybrid electric vehicle that: (1) Has the capability to charge the battery from an off-vehicle electric source, such that the off-vehicle source
cannot be connected to the vehicle while the vehicle is in motion, and (2) has an equivalent all-electric range of no
less than 10 miles. With some simplifying assumptions, assume that 25,000 of Manufacturer A’s fleet are now plug-in hybrid electric
vehicles with CO 2 emissions of 100 g/mi, and the remaining 475,000 are conventional technology vehicles with average CO 2 emissions of 290 grams/ mile. By applying the factor of 2.0 to the electric vehicle production numbers in the appropriate places in the fleet average calculation formula
Manufacturer A now has more than 2.6 million credits (Figure III.E.5–2). Without the use of the multiplier Manufacturer A’s fleet average would be 281 instead of 272, which would generate about 1.8 million credits.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00116 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2EP28SE09.017</GPH>mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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c. Flexible-Fuel Vehicle Credits

As noted in Section III.C, treatment of flexible-fuel vehicle (FFV) credits differs
between 2012 to 2015 and 2016 and later. For the 2012 through 2015 model years the FFV credits will be calculated as they are in the CAFE program for the same model years, except that formulae in the regulations would be modified as
needed to do the calculations in terms of grams per mile of CO 2 rather than miles per gallon. Like the advanced technology vehicle credits, these credits are integral to the fleet average calculation, but rather than crediting the vehicles with an artificially inflated quantity as in the advanced technology credit program described above, the FFV credit program allows the vehicles to be represented by artificially reduced emissions. To use this credit program,
the CO 2 emissions of FFVs will be represented by the average of two things: the CO 2 emissions while operating on gasoline, and the CO 2 emissions operating on the alternative fuel multiplied by 0.15.

For example, Manufacturer A now makes 30,000 FFVs with CO 2 emissions of 280 g/mi using gasoline and 260 g/mi using ethanol. The CO 2 emissions that would represent the FFVs in the fleet average calculation would be
calculated as follows:
FFV emissions = (280 + 260 × 0.15) ÷ 2 = 160 g/miVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00117 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2EP28SE09.018</GPH>mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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Including these FFVs with the III.E.5–3, further reduces the fleet the manufacturer’s credits to about 4.2 applicable credit in Manufacturer A’s average to 256 grams/mile and increases million megagrams. fleet average, as shown below in Figure

In the 2016 and later model years the based upon the actual use of the used negligibly, and the CO 2 value that
calculation of FFV emissions would be alternative fuel and on actual CO 2 would apply to an FFV by default much the same except that the emissions while operating on that fuel. would be the value determined for
determination of the CO 2 value to EPA’s default assumption in the operation on conventional fuel. represent an FFV model type would be regulations is that the alternative fuel is However, if the manufacturer believesVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00118 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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that the alternative fuel is used in realworld driving and that accounting for this use could improve the fleet average,
the manufacturer would have two options. First, the regulations would allow a manufacturer to request that EPA determine an appropriate weighting value for an alternative fuel to reflect the degree of use of that fuel in
FFVs relative to real-world use of the
conventional fuel. Section III.C describes how EPA might make this determination. Any value determined by EPA would be published via guidance letter to manufacturers, and that weighting value would be available
for all manufacturers to use for that fuel. A second option proposed in the regulations would allow a manufacturer to determine the degree of alternative fuel use for their own vehicle(s), using a variety of potential methods. Both the
method and the use of the final results would have to be approved by EPA
before their use would be allowed. In either case, whether EPA supplies the weighting factors or the manufacturer determines them, the CO 2 emissions of
an FFV in 2016 and later would be as follows (assuming non-zero use of the alternative fuel): (W1 ×CO 2 conv)+(W2 ×CO 2alt),

Where, W1 and W2 are the proportion of miles driven using conventional fuel and alternative fuel, respectively, CO 2 conv is the

CO 2 value while using conventional fuel, and

CO 2alt is the CO 2 value while using the
alternative fuel.

d. Dedicated Alternative Fuel Vehicle
Credits

Like the FFV credit program described above, these credits would be treated differently in the first years of the program than in the 2016 and later model years. In fact, these credits are essentially identical to the FFV credits except for two things: (1) There is no need to average CO 2 values for gasoline and alternative fuel, and (2) in 2016 and
later there is no demonstration needed to get a benefit from the alternative fuel.
The CO 2 values are essentially determined the same way they are for FFVs operating on the alternative fuel. For the 2012 through 2015 model years
the CO 2 test results are multiplied by the credit adjustment factor of 0.15, and the result is production-weighted in the fleet average calculation. For example,
assume that Manufacturer A now produces 20,000 dedicated CNG
vehicles with CO 2 emissions of 220 grams/mile, in addition to the FFVs and PHEVs already included in their fleet (Figure III.E.5–4). Prior to the 2016 model year the CO 2 emissions representing these CNG vehicles would be 33 grams/mile (220 × 0.15).VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00119 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2EP28SE09.019</GPH>mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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**BILLING CODE 4910–59–C**

The calculation for 2016 and later would be exactly the same except the

0.15 credit adjustment factor would be removed from the equation, and the CNG vehicles would simply be production-weighted in the equation using their actual emissions value of 220 grams/mile instead of the ‘‘credited’’ value of 33 grams/mile. e. Air Conditioning Leakage Credits
Unlike the credit programs described above, air conditioning-related credits
do not affect the overall calculation of the fleet average. Whether a manufacturer generates zero air conditioning credits or many, the calculated fleet average remains the same. Air conditioning credits are calculated and added to any credits (or deficit) that results from the fleet average calculation. Thus, these credits
can increase a manufacturer’s credit balance or offset a deficit, but their
calculation is external to the fleet average calculation. As noted in Section III.C, manufacturers could generate credits for reducing the leakage of refrigerant from their air conditioning systems. To do this the manufacturer would identify an air conditioning system improvement, indicate that theyVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00120 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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intend to use the improvement to generate credits, and then calculate an annual leakage rate (grams/year) for that system based on the method defined by the proposed regulations. Air conditioning credits would be determined separately for cars and trucks using the car and truck-specific equations described in Section III.C.

In order to put these credits on the
same basis as the basic and other credits describe above, the air conditioning leakage credits would need to be calculated separately for cars and trucks. Thus, the resulting grams per
mile credit determined from the appropriate car or truck equation would be multiplied by the lifetime VMT (190,971 for cars; 221,199 for trucks), and then divided by 1,000,000 to get the total megagrams of CO 2 credits generated by the improved air conditioning system. Although the calculations are done separately for cars and trucks, the total megagrams would
be summed and then added to the overall credit balance maintained by the
manufacturer.

For example, assume that Manufacturer A has improved an air conditioning system that is installed in 250,000 cars and that the calculated leakage rate is 12 grams/year. Assume
that the manufacturer has also implemented a new refrigerant with a Global Warming Potential of 850. In this case the credit per air conditioning unit, rounded to the nearest gram per mile
would be:
[13.8 × [1—(12/16.6 × 850/1430)] = 7.9 g/mi. Total megagrams of credits would
then be:
[7.9 × 250,000 × 190971 ] ÷ 1,000,000 = 377,168 Mg. These credits would be added directly to a manufacturer’s total balance; thus in this example Manufacturer A would now have, after consideration of all the above credits, a total of 5,437,900 Megagrams of credits.

f. Air Conditioning Efficiency Credits

As noted in Section III.C.1.b,
manufacturers could earn credits for improvements in air conditioning efficiency that reduce the impact of the air conditioning system on fuel consumption. These credits are similar to the air conditioning leakage credits described above, in that these credits are determined independently from the manufacturer’s fleet average calculation, and the resulting credits are added to
the manufacturer’s overall balance for the respective model year. Like the air conditioning leakage credits, these
credits can increase a manufacturer’s credit balance or offset a deficit, but
their calculation is external to the fleet average calculation.

In order to put these credits on the
same basis as the basic and other credits describe above, the air conditioning leakage credits would need to be calculated separately for cars and trucks. Thus, the resulting grams per
mile credit determined in the above equation would be multiplied by the lifetime VMT (190,971 for cars; 221,199 for trucks), and then divided by 1,000,000 to get the total megagrams of

CO 2 credits generated by the improved air conditioning system. Although the calculations are done separately for cars and trucks, the total megagrams can be
summed and then added to the overall credit balance maintained by the
manufacturer.

As described in Section III.C,
manufacturers would determine their
credit based on selections from a menu of technologies, each of which provides a gram per mile credit amount. The
credits would be summed for all the technologies implemented by the manufacturer, but could not exceed 5.7 grams per mile. Once this is done, the calculation is a straightforward translation of a gram per mile credit to total car or truck megagrams, using the same methodology described above. For example, if Manufacturer A implements enough technologies to get the maximum 5.7 grams per mile for an air conditioning system that sells 250,000 units in cars, the calculation of total
credits would be as follows:
[5.7 × 250,000 × 190971] ÷ 1,000,000 = 272,134 Mg. These credits would be added directly to a manufacturer’s total balance; thus in this example Manufacturer A would now have, after consideration of all the above credits, a total of 5,710,034 Megagrams of credits.

g. Off-Cycle Technology Credits

As described in Section III.C, these
credits would be available for certain technologies that achieve real-world

CO 2 reductions that aren’t adequately captured on the city or highway test cycles used to determine compliance with the fleet average standards. Like the air conditioning credits, these credits are independent of the fleet average calculation. Section III.C.4 describes two options for generating these credits: either using EPA’s 5-cycle fuel economy labeling methodology, or if that method fails to capture the CO 2- reducing impact of the technology, the manufacturer could propose and use, with EPA approval, a different analytical approach to determining the credit amount. Like the air conditioning credits above, these credits would have to be determined separately for cars and trucks because of the differing lifetime mileage assumptions between cars and
trucks.

Using the 5-cycle approach would be relatively straightforward, and because the 5-cycle formulae account for nationwide variations in driving conditions, no additional adjustments to the test results would be necessary. The manufacturer would simply calculate a 5-cycle CO 2 value with the technology installed and operating and compare it with a 5-cycle CO 2 value determined without the technology installed and/or operating. Existing regulations describe how to calculate 5-cycle fuel economy values, and the proposed regulations contain provisions that describe how to calculate 5-cycle CO 2 values. The manufacturer would have to design a test program that accounts for vehicle differences if the technology is installed in different vehicle types, and enough
data would have to be collected to address data uncertainty issues. A description of such a test program and
the results would be submitted to EPA for approval.

As noted in Section III.C.4, a manufacturer-developed testing, data collection and analysis program would require some additional EPA approval and oversight. Once the demonstration
of the CO 2 reduction of an off-cycle technology is complete, however, and the resulting value accounts for variations in driving, climate and other conditions across the country, the two approaches are treated fundamentally the same way and in a way that parallels the approach for determining the air conditioning credits described above. Once a gram per mile value is approved by the EPA, the manufacturer would determine the total credit value by multiplying the gram per mile per vehicle credit by the volume of vehicles with that technology and approved for
use of the credit. This would then be multiplied by the lifetime vehicle miles for cars or trucks, whichever applies, and divided by 1,000,000 to obtain total Megagrams of CO 2 credits. These credits
would then be added to the
manufacturer’s total balance for the given model year. Just like the above air conditioning case, an off-cycle technology that is demonstrated to achieve an average CO 2 reduction of 4 grams/mile and that is installed in 175,000 cars would generate credits as
follows:

[4 × 175,000 × 190971] ÷ 1,000,000 = 133,680 Mg.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00121 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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h. End-of-Year Reporting

In general, implementation of the averaging, banking, and trading (ABT) program, including the calculation of credits and deficits, would be accomplished via existing reporting mechanisms. EPA’s existing regulations
define how manufacturers calculate fleet average miles per gallon for CAFE compliance purposes, and EPA is proposing to modify these regulations to also require the parallel calculation of fleet average CO 2 levels for car and light truck compliance categories. Theseregulations already require an end-ofyear report for each model year, submitted to EPA, which details the test
results and calculations that determine
each manufacturer’s CAFE levels. EPA is proposing to require that this report also include fleet average CO 2 levels. In addition to requiring reporting of theactual fleet average achieved, this endof-year report would also contain the calculations and data determining the manufacturer’s applicable fleet average standard for that model year. As under the existing Tier 2 program, the report would be required to contain the fleet average standard, all values required to calculate the fleet average standard, the actual fleet average CO 2 that was achieved, all values required to calculate the actual fleet average, the number of credits generated or debits incurred, all the values required to calculate the credits or debits, and the resulting balance of credits or debits.

Because of the multitude of creditprograms that are available, the end-ofyear report will be required to have
more data and a more defined and specific structure than the CAFE end– of-year report does today. Although requiring ‘‘all the data required’’ to calculate a given value should be inclusive, the proposed report would contain some requirements specific to certain types of credits.

For advanced technology credits that apply to vehicles like electric vehicles and plug-in hybrid electric vehicles, manufacturers would be required to identify the number and type of these
vehicles and the effect of these credits on their fleet average. The same would
be true for credits due to flexible-fuel and alternative-fuel vehicles, although
for 2016 and later flexible-fuel credits
manufacturers would also have to provide a demonstration of the actual
use of the alternative fuel in-use and the resulting calculations of CO 2 values for such vehicles. For air conditioning leakage credits manufacturers would have to include a summary of their use
of such credits that would include which air conditioning systems were subject to such credits, information regarding the vehicle models which were equipped with credit-earning air conditioning systems, the production volume of these air conditioning systems, the leakage score of each air conditioning system generating credits, and the resulting calculation of leakage credits. Air conditioning efficiency reporting will be somewhat more complicated given the phase-in of the efficiency test, and reporting would have to detail compliance with the phase-in as well as the test results and the resulting efficiency credits generated. Similar reporting requirements would also apply to the variety of possible off-cycle credit options, where manufacturers would have to report the applicable technology, the amount of credit per unit, the production volume of the technology, and the total credits from that technology.

Although it is the final end-of-year report, when final production numbers are known, that will determine the degree of compliance and the actual values of any credits being generated by manufacturers, EPA is also proposing that manufacturers be prepared to discuss their compliance approach and their potential use of the variety of credit options in pre-certification meetings that EPA routinely has with manufacturers. In addition, and in conjunction with a pre-model year report required under the CAFE program, the manufacturer would be required to submit projections of all of
the elements described above.

Finally, to the extent that there are any credit transactions, the
manufacturer would have to detail in the end-of-year report documentation on
all credit transactions that the manufacturer has engaged in.
Information for each transaction would
include: The name of the credit provider, the name of the credit recipient, the date the transfer occurred, the quantity of credits transferred, and the model year in which the credits were earned. Failure by the
manufacturer to submit the annual report in the specified time period
would be considered to be a violation of section 203(a)(1) of the Clean Air Act.

6. Enforcement

As discussed above in Section III.E.5 under the proposed program, manufacturers would report to EPA their fleet average standard for a given model year (reporting separately for each of the car and truck averaging sets), the credits or deficits generated in the current year, the balance of credit balances or deficits (taking into account banked credits, deficit carry-forward,

etc. see Section III.E.5), and whether they were in compliance with the fleet average standard under the terms of the regulations. EPA would review the annual reports, figures, and calculations submitted by the manufacturer to determine any nonconformance. EPA requests comments on the above approach for monitoring and enforcement of the fleet average
standard.

Each certificate, required prior to introduction into commerce, would be conditioned upon the manufacturer attaining the CO 2 fleet average standard.
If a manufacturer failed to meet this condition and had not generated or purchased enough credits to cover the fleet average exceedance following the three year deficit carry-forward (Section III.B.4, then EPA would review the
manufacturer’s sales for the most recent model year and designate which vehicles caused the fleet average
standard to be exceeded. EPA would designate as nonconforming those vehicles with the highest emission values first, continuing until a number of vehicles equal to the calculated number of non-complying vehicles as
determined above is reached and those
vehicles would be considered to be not covered by the certificates of conformity covering those model types. In a test group where only a portion of vehicles would be deemed nonconforming, EPA
would determine the actual nonconforming vehicles by counting
backwards from the last vehicle sold in that model type. A manufacturer would be subject to penalties and injunctive
orders on an individual vehicle basis for sale of vehicles not covered by a certificate. This is the same general
mechanism used for the National LEV and Tier 2 corporate average standards, except that these programs operateslightly differently in that the noncompliant vehicles would be designated not in the most recent model year, but in the model year in which the deficit originated. EPA requests comment on which approach is most appropriate; the Tier 2 approach of penalizing vehicles from the year in which the deficit was generated, or the proposed approach that would penalize vehicles from the year in which the manufacturer failed to make up the deficit as required.

Section 205 of the CAA authorizes EPA to assess penalties of up to $37,500 per vehicle for violations of the requirements or prohibitions of this proposed rule. 176 This section of the

176 42 U.S.C. 7524(a), Civil Monetary Penalty Inflation Adjustment, 69 FR 7121 (Feb. 13, 2004)

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CAA provides that the agency shall take the following penalty factors into consideration in determining the appropriate penalty for any specific case: The gravity of the violation, the economic benefit or savings (if any) resulting from the violation, the size of the violator’s business, the violator’s history of compliance with this title, action taken to remedy the violation, the effect of the penalty on the violator’s ability to continue in business, and such other matters as justice may require.

EPA recognizes that it may be appropriate, should a manufacturer fail to comply with the NHTSA fuel economy standards as well as the CO 2 standard proposed today in a case arising out of the same facts and circumstances, to take into account the civil penalties that NHTSA has assessed
for violations of the CAFE standards when determining the appropriate penalty amount for violations of the CO 2 emissions standards. This approach is
consistent with EPA’s broad discretion
to consider ‘‘such other matters as justice may require,’’ and will allow EPA to exercise its discretion to prevent injustice and ensure that penalties for
violations of the CO 2 rule are assessed
in a fair and reasonable manner.

The statutory penalty factor that
allows EPA to consider ‘‘such other matters as justice may require’’ vests EPA with broad discretion to reduce the penalty when other adjustment factors prove insufficient or inappropriate to achieve justice. 177 The underlying principle of this penalty factor is to operate as a safety mechanism when necessary to prevent injustice. 178

In other environmental statutes, Congress has specifically required EPA to consider penalties assessed by other government agencies where violations
arise from the same set of facts. For instance, section 311(b)(8) of the Clean Water Act, 33 U.S.C. 1321(b)(8) authorizes EPA to consider any other penalty for the same incident when determining the appropriate Clean Water Act penalty. Likewise, section 113(e) of the CAA authorizes EPA to consider ‘‘payment by the violator of penalties previously assessed for the same violation’’ when assessing penalties for certain violations of Title
I of the Act.

7. Prohibited Acts in the CAA

Section 203 of the Clean Air Act describes acts that are prohibited by

and Civil Monetary Penalty Inflation Adjustment Rule, 73 FR 75340 (Dec. 11, 2008).

177 In re Spang & Co., 6 E.A.D. 226, 249 (EAB 1995).

178 B.J. Carney Industries, 7 E.A.D. 171, 232, n. 82 (EAB 1997). law. This section and associated regulations apply equally to the greenhouse standards proposed today as to any other regulated pollutant.

8. Other Certification Issues

a. Carryover/Carry Across Certification

Test Data

EPA’s certification program for vehicles allows manufacturers to carry
certification test data over and across certification testing from one model year to the next, when no significant changes to models are made. EPA expects that this policy could also apply to CO 2 , N 2O and CH4 certification test data. A manufacturer may also be eligible to use carryover and carry across data to
demonstrate CO 2 fleet average compliance if they had done so for CAFE purposes.

b. Compliance Fees

The CAA allows EPA to collect fees to cover the costs of issuing certificates of conformity for the classes of vehicles and engines covered by this proposal. On May 11, 2004, EPA updated its fees regulation based on a study of the costs
associated with its motor vehicle and engine compliance program (69 FR 51402). At the time that cost study was conducted the current rulemaking was
not considered.

At this time the extent of any added costs to EPA as a result of this proposal
is not known. EPA will assess its compliance testing and other activities associated with the proposed rule and may amend its fees regulations in the future to include any warranted new

costs.

c. Small Entity Deferment

EPA is proposing to defer CO 2 standards for certain small entities, and these entities (necessarily) would not be subject to the certification requirements of this proposal.

As discussed in Section III.B.7, businesses meeting the Small Business Administration (SBA) criterion of a
small business as described in 13 CFR

121.201 would not be subject to the proposed GHG requirements, pending future regulatory action. EPA is proposing that such entities submit a declaration to EPA containing a detailed written description of how that manufacturer qualifies as a small entity under the provisions of 13 CFR 121.201
in order to ensure EPA is aware of the deferred companies. This declaration would have to be signed by a chief officer of the company, and would have to be made at least 30 days prior to the introduction into commerce of any vehicles for each model year for which the small entity status is requested, but not later than December of the calendar year prior to the model year for which deferral is requested. For example, if a manufacturer will be introducing model year 2012 vehicles in October of 2011, then the small entity declaration would be due in September of 2011. If 2012 model year vehicles are not planned for introduction until March of 2012, then
the declaration would have to be
submitted in December of 2011. Such entities are not automatically exemptedfrom other EPA regulations for lightduty vehicles and light-duty trucks; therefore, absent this annual declaration EPA would assume that each entity was not deferred from compliance with the proposed greenhouse gas standards.

d. Onboard Diagnostics (OBD) and CO 2 Regulations

The light-duty on-board diagnostics (OBD) regulations require manufacturers to detect and identify malfunctions in
all monitored emission-related powertrain systems or components. 179 Specifically, the OBD system is required to monitor catalysts, oxygen sensors, engine misfire, evaporative system leaks, and any other emission control systems directly intended to control emissions, such as exhaust gas recirculation (EGR), secondary air, and fuel control systems. The monitoring threshold for all of these systems or components is 1.5 times the applicable standards, which typically include NMHC, CO, NO X , and PM. EPA isconfident that many of the emissionrelated systems and components currently monitored would effectively catch any malfunctions related to CO 2 emissions. For example, malfunctions resulting from engine misfire, oxygen sensors, the EGR system, the secondary air system, and the fuel control system would all have an impact on CO 2 emissions. Thus, repairs made to any of these systems or components should also result in an improvement in CO 2 emissions. In addition, EPA does not have data on the feasibility or effectiveness of monitoring various emission systems and components for

CO 2 emissions and does not believe it would be prudent to include CO 2 emissions without such information. Therefore, at this time, EPA does not plan to require CO 2 emissions as one of the applicable standards required for the OBD monitoring threshold. EPA plans to evaluate OBD monitoring technology, with regard to monitoring CO 2 emissions-related systems and components, and may choose to propose
to include CO 2 emissions as part of the OBD requirements in a future regulatory

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action. EPA requests comment as to whether this is appropriate at this time, and specifically requests any data that would support the need for CO 2-related components that could or should be monitored via an OBD system.

e. Applicability of Current High
Altitude Provisions to Greenhouse

Gases

EPA is proposing that vehicles covered by this proposal meet the CO 2 , N 2 O and CH4 standard at altitude. The CAA requires emission standards under section 202 to apply at all altitudes. 180 EPA does not expect vehicle CO 2 , CH4 , or N 2O emissions to be significantly different at high altitudes based on vehicle calibrations commonly used at all altitudes. Therefore, EPA is proposing to retain its current high altitude regulations so manufacturers would not normally be required to
submit vehicle CO 2 test data for high altitude. Instead, they would submit an engineering evaluation indicating that common calibration approaches will be utilized at high altitude. Any deviation in emission control practices employed only at altitude would need to be included in the auxiliary emission control device (AECD) descriptions submitted by manufacturers at certification. In addition, any AECD specific to high altitude would be required to include emissions data to allow EPA evaluate and quantify any emission impact and validity of the AECD. EPA requests comment on this approach, and specifically requests data on impact of altitude on FTP and HFET

CO 2 emissions.

f. Applicability of Standards to
Aftermarket Conversions

With the exception of the small entity deferment option EPA is proposing, EPA’s emission standards, including the proposed greenhouse gas standards, would continue to apply as stated in the applicability sections of the relevant regulations. The proposed greenhouse gas standards are being incorporated into 40 CFR part 86, subpart S, the provisions of which include exhaust and evaporative emission standards for criteria pollutants. Subpart S includes requirements for new light-dutyvehicles, light-duty trucks, mediumduty passenger vehicles, Otto-cycle complete heavy-duty vehicles, and some incomplete light-duty trucks. Subpart S is currently specifically applicable to aftermarket conversion systems, aftermarket conversion installers, and aftermarket conversion certifiers, as
those terms are defined in 40 CFR

180 See CAA 206(f). 85.502. EPA expects that some aftermarket conversion companies would qualify for and seek the small entity deferment, but those that do not qualify would be required to meet the applicable emission standards, including the proposed greenhouse gas
standards.

9. Miscellaneous Revisions to Existing Regulations

a. Revisions and Additions to
Definitions

EPA is proposing to amend its definitions of ‘‘engine code,’’ ‘‘transmission class,’’ and ‘‘transmission configuration’’ in its vehicle certification regulations (Part 86) to
conform with the definitions for those terms in its fuel economy regulations (Part 600). The exact terms in Part 86 are used for reporting purposes and are not used for any compliance purpose ( e.g., an engine code would not determine
which vehicle was selected for emission testing). However, the terms are used for this purpose in Part 600 ( e.g., engine codes, transmission class, and transmission configurations are all
criteria used to determine which vehicles are to be tested for the purposes of establishing corporate average fuel economy). Here, EPA is proposing that
the same vehicles tested to determine corporate average fuel economy also be tested to determine fleet average CO 2 , so the same definitions should apply. Thus EPA is proposing to amend its Part 86
definitions of the above terms to
conform to the definitions in Part 600.

To bring EPA’s fuel economy regulations in Part 600 into conformity with this proposal for fleet average CO 2 and NHTSA’s reform truck regulations two amendments are proposed. First, the definition of ‘‘footprint’’ that is proposed in this rule is also being proposed for addition to EPA’s Part 86 and 600 regulations. This definition is based on the definition promulgated by NHTSA at 49 CFR 523.2. Second, EPA is proposing to amend its model year CAFE reporting regulations to include the footprint information necessary for
EPA to determine the reformed truck standards and the corporate average fuel economy. This same information is proposed to be included in this proposal for fleet average CO 2 and fuel economy compliance.

b. Addition of Ethanol Fuel Economy
Calculation Procedures

EPA is proposing to add calculation procedures to part 600 for determining
the carbon-related exhaust emissions and calculating the fuel economy of vehicles operating on ethanol fuel. Manufacturers have been using these procedures as needed, but the regulatory language—which specifies how to determine the fuel economy of gasoline, diesel, compressed natural gas, and
methanol fueled vehicles—has not previously been brought up-to-date to provide procedures for vehicles operating on ethanol. Thus EPA is proposing a carbon balance approach
similar to other fuels for the
determination of carbon-related exhaust emissions for the purpose of determining fuel economy and for compliance with the proposed fleet average CO 2 standards. The carbon
balance formula is similar to that for methanol, except that ethanol-fueled
vehicles must also measure the emissions of ethanol and acetaldehyde. The proposed carbon balance equation for determining fuel economy is as follows, where CWF is the carbon weight fraction of the fuel and CWF exHC is the carbon weight fraction of the exhaust hydrocarbons:

mpg = (CWF × SG × 3781.8)/((CWF exHC× HC)

+(0.429 × CO) + (0.273 × CO 2) + (0.375

× CH 3 OH) + (0.400 × HCHO) + (0.521 × C 2H 5 OH) + (0.545 × C 2H4 O)) The proposed equation for determining the total carbon-related exhaust emissions for compliance with
the CO 2 fleet average standards is the following, where CWF exHC is the carbon weight fraction of the exhaust hydrocarbons:

CO 2-eq = (CWF exHC× HC) + (0.429 × CO) + (0.375 × CH 3 OH) + (0.400 × HCHO) + (0.521 × C 2H 5 OH) + (0.545 × C 2H4 O) +

CO 2
. EPA requests comment on the use of
these formulae to determine fuel economy and carbon emissions.

c. Revision of Electric Vehicle Applicability Provisions

In 1980 EPA issued a rule that provided for the inclusion of electric vehicles in the CAFE program. 181 EPA now believes that certain provisions of the regulations should be updated to
reflect the current state of motor vehicle emission and fuel economy regulations. In particular, EPA believes that the exemption of electric vehicles in certain cases from fuel economy labeling and CAFE requirements should be
reevaluated and revised.

The rule created an exemption for electric vehicles from fuel economy labeling in the following cases: (1) If the electric vehicles are produced by a company that produces only electric vehicles; and (2) if the electric vehicles are produced by a company that

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produces fewer than 10,000 vehicles of
all kinds worldwide. EPA believes that this exemption language is no longer appropriate and proposes to delete it from the affected regulations. First, since 1980 many regulatory provisions have been put in place to address the
concerns of small manufacturers and enable them to comply with fuel economy and emission programs with
reduced burden. EPA believes that all
small volume manufacturers should compete on a fair and level regulatory playing field and that there is no longer
a need to treat small volume electric vehicles any differently than small volume manufacturers of other types of vehicles. Current regulations contain streamlined certification procedures for small companies, and because electric vehicles emit no direct pollution there is effectively no certification emission testing burden. For example, the proposed greenhouse gas regulations contain a provision allowing the exemption of certain small entities. Meeting the requirements for fuel economy labeling and CAFE will entail a testing, reporting, and labeling burden, but these burdens are not extraordinary and should be applied equally to all small volume manufacturers, regardless
of the fuel that moves their vehicles. EPA has been working with existing
electric vehicle manufacturers on fuel economy labeling, and EPA believes it is important for the consumer to have impartial, accurate, and useful label information regarding the energy consumption of these vehicles. Second, EPCA does not provide for an exemption of electric vehicles from NHTSA’s CAFE program, and NHTSA regulations regarding the applicability of the CAFE program do not provide an exemption for electric vehicles. Third, the blanket exemption for any manufacturer of only electric vehicles
assumed at the time that these companies would all be small, but the exemption language inappropriately did
not account for size and would allow large manufacturers to be exempt as well. Finally, because of growth expected in the electric vehicle market in the future, EPA believes that the labeling and CAFE regulations need to be designed to more specifically
accommodate electric vehicles and to require that consumers be provided with appropriate information regarding
these vehicles. For these reasons EPA is proposing revisions to 40 CFR Part 600 applicability regulations such that these electric vehicle exemptions are deleted starting with the 2012 model year. d. Miscellaneous Conforming Regulatory Amendments

Throughout the regulations EPA has
made a number of minor amendments to update the regulations as needed or to
conform with amendments discussed in this preamble. For example, for consistency with the ethanol fuel economy calculation procedures discussed above, EPA has amended regulations where necessary to require
the collection of emissions of ethanol and acetaldehyde. Other changes are made to applicability sections to remove obsolete regulatory requirements such as phase-ins related to EPA’s Tier 2 emission standards program, and still other changes are made to better
accommodate electric vehicles in EPA emission control regulations. Not all of
these minor amendments are noted in this preamble, thus the reader should carefully evaluate the proposed regulatory text to ensure a complete understanding of the regulatory changes being proposed by EPA.

10. Warranty, Defect Reporting, and Other Emission-Related Components

Provisions

Under section 207(a) of the CAA,
manufacturers must warrant that a vehicle is designed to comply with the
standards and will be free from defects that may cause it to not comply over the specified period which is 2 years/24,000 miles (whichever is first) or, for major emission control components, 8 years/ 80,000 miles. Under certain conditions, manufacturers may be liable to replace failed emission components at no expense to the owner. EPA regulations define ‘‘emission related parts’’ for the purpose of warranty. This definition includes parts which must function properly to assure continued compliance with the emission
standards. 182

The air conditioning system and its components have not previously been covered under the CAA warranty provisions. However, the proposed A/C leakage and A/C-related CO 2 emission standards are dependent upon the proper functioning of a number of components on the A/C system, such as rings, fittings, compressors, and hoses. Therefore, EPA is proposing that these components be included under the CAA section 207(a) emission warranty provisions, with a warranty of 2 years/ 24,000 miles.

EPA requests comment as to whether any other parts or components should be designated as ‘‘emission related parts’’ subject to warranty and defect

182 40 CFR 85.2102(14). reporting provisions under this proposal.

11. Light Duty Vehicles and Fuel Economy Labeling

American consumers need accurate and meaningful information about the environmental and fuel economy performance of new light vehicles. EPAbelieves it is important that the fueleconomy label affixed to the new vehicles provide consumers with the critical information they need to make smart purchase decisions. This is a special challenge in light of the expected increase in market share of electric and other advanced technology vehicles. Consumers may need new and different information than today’s vehicle labels provide in order to help them understand the energy use and associated cost of owning these electric and advanced technology vehicles. As discussed below, these two issues are key to determining whether the current MPG-based fuel-economy label is adequate.

Therefore, as part of this action, EPA seeks comments on issues surrounding consumer vehicle labeling in general, and labeling of advanced technology vehicles in particular. EPA also plans to initiate a separate rulemaking to explore in detail the information displayed on the fuel economy label and the methodology for deriving that information. The purposes of this new rulemaking would be to ensure that
American consumers continue to have the most accurate, meaningful, and
useful information available to them when purchasing new vehicles, and that the information is presented to them in
clear and understandable terms.

a. Background

EPA has considerable experience in providing vehicle information to consumers through its fuel-economy labeling activities and related web-based programs. Under 49 U.S.C. 32908(b) EPA is responsible for developing the fuel economy labels that are posted on window stickers of all new light duty cars and trucks sold in the U.S. and, beginning with the 2011 model year, on all new medium-duty passenger vehicles (a category that includes large sport-utility vehicles and passenger vans). The statutory requirements established by EPCA require that the label contain the following:

• The fuel economy of the vehicle; 183

• The estimated annual fuel cost of operating the vehicle;

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• The range of fuel economy of comparable vehicles among all manufacturers;

• A statement that a fuel economy booklet is available from the dealer; 184 and

• The amount of the ‘‘gas guzzler’’ tax imposed on the vehicle by the Internal

Revenue Service.

• Other information required or authorized by EPA that is related to the information required above.

Fuel economy is defined as the number of miles traveled by an automobile for each gallon of gasoline (or equivalent amount of other fuel). It is relatively easy to determine the miles per gallon (MPG) for vehicles that use liquid fuels ( e.g., gasoline or diesel), but an expression that uses gallons— whether miles per gallon or gallons per mile—may not be a useful metric for
vehicles that have limited to no operation on liquid fuel such as electric or compressed natural gas vehicles. The mpg metric is the one generally used today to provide comparative fuel economy information to consumers.

As part of its vehicle certification, CAFE, and fuel economy labeling authorities, EPA works with stakeholders on the testing and other regulatory requirements necessary to bring advanced technology vehicles to market. With increasing numbers of advanced technology vehicles beginning to be sold, EPA believes it is now appropriate to address potential regulatory and certification issues associated with these technologies including how best to provide relevant
consumer information about their environmental impact, energy consumption, and cost.

b. Test Procedures

As discussed in this notice, there are explicit and very long-standing test procedures and calculation methodologies associated with CAFEthat EPA uses to test conventionallyfueled vehicles and to calculate their fuel economy. These test procedures and calculations also generally apply to advanced technology vehicles ( e.g., an electric (EV) or plug-in hybrid vehicle (PHEV)).

The basic test procedure for an
electric vehicle follows a standardized practice—an EV is fully charged and then driven over the city cycle (Urban Dynamometer Drive Schedule) until the vehicle can no longer maintain the required drive cycle vehicle speed. For some vehicles, this could require operation over multiple drive cycles.

184 EPA and DOE jointly publish the annual Fuel Economy Guide and distribute it to dealers. The EV is then fully recharged and the AC energy to the charger is recorded.

To derive the CAFE value for electric vehicles, the amount of AC energy needed to recharge the battery is divided by the range the vehicle reached in the repeated city drive cycle. This calculation provides a raw CAFE energy consumption value expressed in kilowatt hours per 100 miles. The raw
CAFE number is then converted to miles per gallon of equivalent gasoline using a Department of Energy (DOE) conversion factor of 82,700 Kwhr/gallon of gasoline. 185 The DOE conversion factor combines several adjustments including: an adjustment similar to the statutory 6.67 multiplier credit 186 used in deriving the final CAFE value for alternative fueled vehicles; a factor representing the gasoline-equivalent energy content of electricity; and various adjustments to account for the relative efficiency of producing and transporting the electricity. The resulting value after the DOE conversion factor is applied becomes the final CAFE city value.

The label value calculation for an EV
uses a different conversion factor than the CAFE value calculation. To come up with the final city fuel economy label value for an EV, a conversion factor of 33,705 Kwhr/gallon of gasoline equivalent is applied to the raw consumption number instead of the 82,700 Kwhr/gallon used for CAFE. The conversion factor used for labelingpurposes represents only the gasolineequivalent energy content of electricity, without the multiplier credit and other adjustments used in the CAFE calculation. The consumption, now expressed as a fuel economy in miles per gallon equivalent, is then applied to the derived 5-cycle equation required under EPA’s fuel economy labeling regulations. The above process is then repeated for the EV highway fuel economy label number. Finally, the combined city/highway numbers for the EV use the same 55/45 weighting as
conventional vehicles to determine the final fuel economy label values. CAFE numbers end up being significantly higher for EVs than the associated fuel economy label values, both because a higher adjustment factor applies under CAFE regulations and also because other real-world adjustments such as the 5-cycle test are not applied to the CAFE
values.

For PHEVs, a similar process would be followed, except that PHEVs require testing in both charge sustain (CS) and charge depleting (CD) modes to capture

185 49 U.S.C. 32904 and 10 CFR 474.3.

186 49 U.S.C. 32905. how these vehicles operate. For charge sustain modes, PHEVs essentially operate as conventional Hybrid Electric Vehicles (HEVs). PHEVs therefore test in all 5-cycles (for further information on these test cycles, see Section III.C.4) just as HEVs do for CS fuel economy. For CD fuel economy, PHEVs are only required to test on the Urban Dynamometer Drive Schedule and Highway Fuel Economy cycles just like other alternative fueled vehicles—the 5-cycle fuel economy testing is optional in the CD mode. There are additional processes that address different PHEV modes, such as for PHEVs that operate solely on electricity throughout the CD mode.

As this discussion shows, the CAFE and fuel economy labeling test procedures and calculations for advanced technology vehicles such as EVs and PHEVs can be very complicated. EPA is interested in comments on these processes, including views on the appropriate use of adjustment factors. Currently in guidance, EPA references SAE J1634 for EV range and consumption test procedures. EPA currently includes the
‘‘California Exhaust Emission Standards
and Test Procedures for 2003 and Subsequent Model Zero-Emission Vehicles, in the Passenger Car, Light Truck, and Medium-duty Vehicle Classes’’ by reference in 40 CFR 86.1. As California requirements and SAE test procedures are updated these may be included by reference in the future.

c. Current Fuel Economy Label

In 2006 EPA redesigned the window
stickers to make them more informative for consumers. More particular, the redesigned stickers more prominently feature annual fuel cost information, to provide contemporary and easy-to-use graphics for comparing the fuel economy of different vehicles, to use clearer text, and to include a Web site
reference to www.fueleconomy.gov which provides additional information. In addition, EPA updated how the city and highway fuel economy values were calculated, to reflect typical real-world driving patterns. 187 This rulemaking involved significant stakeholder outreach in determining how best to calculate and display this new
information. The feedback EPA has received to date on the new label design and values has been generally very positive.

During the 2006 label rulemaking process EPA requested comments on

187 71 FR 77872 (December 27, 2006). Fuel Economy Labeling of Motor Vehicles: Revisions to Improve Calculations of Fuel Economy Estimates.

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how a fuel consumption metric (such as gallons per 100 miles) could be used and represented to the public, including presentation in the annual Fuel Economy Guide. EPA received a number
of comments from both vehicle
manufacturers and consumer organizations, suggesting that the MPG measures can be misleading and that a fuel consumption metric might be more meaningful to consumers than the
established MPG metric found on fuel economy labels. The reason is that fuel consumption metric, directly measures
the amount of fuel used and is thus directly related to cost that consumers incur when filling up. The problem with the MPG metric is that it is inversely related to fuel consumption and cost. As higher MPG values are reached, the relative impact of these higher values on fuel consumption and fuel costs decreases. For example, a 25 percent increase in gallons per 100 miles will always lead to a 25 percent increase in the fuel cost, but a similar 25 percent increase in MPG will have varying impacts on actual fuel cost depending on whether the percent increase occurs to a low or high MPG value. Many consumers do
not understand this nonlinear relationship between MPG and fuel costs. Evidence suggest that people tend to see the MPG as being linear with fuel cost, which will lead to erroneous decisions regarding vehicle purchases. Figure III.E.11–1 below illustrates the issue; one can see that changes in MPG at low MPG levels can result in large changes in the fuel cost, while changes in MPG values at high MPG levels result in small changes in the fuel cost. For example, a change from 10 to 15 MPG
will reduce the 10-mile fuel cost from $2.50 to $1.60, but a similar increase in MPG from 20 to 25 MPG will only reduce the 10-mile fuel cost by less than
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Because of the potential for
consumers to misunderstand this MPG/ cost relationship, commenters on the 2006 labeling rule universally agreed that any change to the label metric should involve a significant public education campaign directed toward
both dealers and consumers. In 2006, EPA did not include a consumption-based metric on the redesigned fuel economy label in 2006. It was concerned about potential confusion associated with introducing a second metric on the label (MPG is a required element, as noted above). EPA has developed an interactive feature on www.fueleconomy.gov which allows consumers, while viewing data on a specific vehicle, to switch units between the MPG and gallons per 100 miles metrics. The tool also displays the cost
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of the consequences of their purchasing decisions; a gallon-per mile measure would have significant advantages. EPA plans to seek comment and engage in extensive public debate about fuel consumption and other appropriate consumer information metrics as part of a new labeling rule initiative. EPA also welcomes comments on this topic in response to this GHG proposal.

d. Labeling for Advanced Technology
Vehicles

Even though a fuel consumption metric may more directly represent likely fuel costs than a fuel economy metric, any expression that uses gallons—whether miles per gallon or gallons per mile—is not a useful metric
for vehicles that have limited to no operation on liquid fuel ( e.g. , electricity or compressed natural gas). For example, PHEVs and extended range electric vehicles (EREVs) can use two types of energy sources: (1) An onboard battery, charged by plugging the vehicle into the electrical grid via a conventional wall outlet, to power an electric motor, as well as (2) a gas or diesel-powered engine to propel the vehicle or power a generator used to provide electricity to the electric motor. Depending on how these vehicles are operated, they can use electricity exclusively, never use electricity and operate like a conventional hybrid, or operate in some combination of these two modes. The use of a MPG figure
alone would not account for the electricity used to propel the vehicle.

EPA has worked closely with numerous stakeholders including vehicle manufacturers, the Society of Automotive Engineers (SAE), the State of California, the Department of Energy (DOE) and others to develop possible approaches for both estimating fuel economy and labeling vehicles that can operate using more than one energy source. At the present time, EPA believes the appropriate method for estimating fuel economy of PHEVs and EREVs would be a weighted average of fuel economy for the two modes of operation. A methodology developed by SAE and DOE to predict the fractions of
total distance driven in each mode of operation (electricity and gas) uses a term known as a utility factor (UF). By using a utility factor, it is possible to determine a weighted average for fuel economy of the electric and gasoline modes. For example, a UF of 0.8 would indicate that a PHEV or EREV operates in an all electric mode 80% of the time and uses the gasoline engine the other 20% of the time. In this example, the weighted average fuel economy value would be influenced more by the electrical operation than the gasoline operation.

Under this approach, a UF could be assigned to each successive fuel economy test until the battery charge was depleted and the PHEV or EREV needed power from the gasoline engine to propel the vehicle or to recharge the battery. One minus the sum of all the utility factors would then represent the fraction of driving performed in this ‘‘gasoline mode.’’ Fuel economy could then be expressed as:



### 1

= FE MPG 

### UF 1 UF i i 

### − 

# ∑ ∑ + FE FE i gasoline
Likewise, the electrical consumption would be expressed by adding the fuel consumption from each mode. Since there is no electrical consumption in hybrid mode, the equation for electricity consumption would be as follows:

Utility factors could be cycle specific not only due to different battery ranges on different test cycles but also due to the fact that ‘‘highway’’ type driving may imply longer trips than urban driving. That is to say that the average city trip could be shorter than the average highway trip.

e. Request for Comments

EPA is interested in comments on both topics raised in this section. For the methodology, we are interested in comments addressing how the utility
factor is calculated and which data should be used in establishing the UF. Additionally, commenters should address: The appropriateness of this approach for estimating fuel economy for PHEVs and EREVs, including the concept of using a UF to determine the fuel economy for vehicles operated in multiple modes; the appropriate form and value of the factor, including the type of data that would be necessary to confidently develop it accurately; and availability of other potential methodologies for determining fuel economy for vehicles that can operate in multiple modes, such as ‘‘all electric’’ and ‘‘hybrid,’’ including the use of fuel consumption, cost, GHG emissions, or other metrics in addition to miles per gallon.

EPA is also requesting comment on how the agency can satisfy statutory labeling requirements while providing
relevant information to consumers. For example, the statute indicates that EPA may provide other related items on the label beyond those that are required. 188 EPA is interested in receiving comments on the potential approaches and supporting data we might consider for adding additional information regarding fuel economics while maintaining our statutory obligation to report MPG on
the label.

There are a number of different
metrics that are available that could be useful in this regard. Two possible options would be to show consumption in fuel use per distance ( e.g. , gallons/ 100 miles) or in cost per distance ( e.g. , $/100 miles). As discussed above, these two metrics have benefits over a straight mpg value in showing a more direct relationship between fuel consumption
and cost. The cost/distance metric has an added potential benefit of providing a common basis for comparing differently fueled or powered vehicles, for example being able to show the cost of gasoline used over a specified
distance or time for a conventional gasoline-powered vehicle in comparison to the gasoline and electricity used over the same period for a plug-in hybrid vehicle. Another approach would be to use a metric that provides information about a vehicle’s greenhouse gas emissions per unit of travel, such as carbon dioxide equivalent grams per mile (g CO 2 e/mi). This type of metric would allow consumers to directly compare among vehicles on the basis of their overall greenhouse gas impact. A total annual energy cost would be another way to look at this information, and is currently used on the fuel economy label. As is currently done,
EPA would need to determine and show
a common set of fuel costs used to calculate such values, recognizing that energy costs vary across the country.

The Agency is also interested in comments on the usefulness of adding other types of information, such as an estimated driving range for electric vehicles. The label design is also an important issue to consider and any changes to the existing label would need to show information in a technologically accurate, meaningful and understandable manner, while ensuring
that the label does not become
overcrowded and difficult for consumers to comprehend. EPA is also
interested in what and how other information paths, such as web-based programs, could be used to enhance the consumer education process.

188 49 U.S.C. 3290(b)(F).VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00129 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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### 49581

F. How Would This Proposal Reduce III.F–1 shows emissions of CO 2 , share is growing over time, reaching an
GHG Emissions and Their Associated methane, nitrous oxide and air estimated 20 percent of U.S. emissions Effects? conditioning refrigerants on a CO 2- by 2030 in the absence of control. As

This action is an important step equivalent basis for calendar years 2010, discussed later in this section, this towards curbing steady growth of GHG 2020, 2030, 2040 and 2050. U.S. GHGs steady rise in GHG emissions is emissions from cars and light trucks. In are estimated to make up roughly 15 associated with numerous adverse the absence of control, GHG emissions percent of total worldwide emissions, impacts on human health, food and worldwide and in the U.S. are projected and the contribution of direct emissions agriculture, air quality, and water and to continue steady growth; Table from cars and light trucks to this U.S. forestry resources.



### TABLE 

### III.F–1—R EFERENCE 

### C ASE 

### GHG E MISSIONS BY 

### C ALENDAR 

### Y EAR

[MMTCO 2 Eq]

2010 2020 2030 2040 2050

All Sectors (Worldwide) a

............................................................................................. All Sectors (U.S. Only) a

............................................................................................... U.S. Cars/Light Truck Only b

........................................................................................ 41,016 7,118 1,359 48,059 7,390 1,332 52,870 7,765 1,516 56,940 8,101 1,828 60,209 8,379 2,261

a ADAGE model projections, U.S. EPA. 189

b MOVES (2010), OMEGA Model (2020–50) U.S. EPA. See DRIA Chapter 5.3 for modeling details.

EPA’s proposed GHG rule, if finalized, will result in significant reductions as newer, cleaner vehicles come into the fleet, and the rule is estimated to have a measurable impact on world global temperatures. As discussed in Section I, this GHG proposal is part of a joint National Program such that a large majority of the projected benefits would be achieved jointly with NHTSA’s proposed CAFE
standards which are described in detail in Section IV of this preamble. EPA
estimates the reductions attributable to the GHG program over time assuming the proposed 2016 standards continue indefinitely post-2016, 190 compared to a
baseline scenario in which the 2011 model year fuel economy standards continue beyond 2011.

Using this approach, EPA estimates
these standards would cut annual fleetwide car and light truck tailpipe

CO 2 emissions 21 percent by 2030, when 90 percent of car and light truck miles will be travelled by vehicles meeting the new standards. Roughly 20 percent of these reductions are due to emission reductions from gasoline extraction, production and distribution processes as a result of reduced gasoline demand associated with this proposal.
Some of the overall emission reductions also come from projected improvements

189 U.S. EPA (2009). ‘‘EPA Analysis of the American Clean Energy and Security Act of 2009:

H.R. 2454 in the 111th Congress.’’ U.S. Environmental Protection Agency, Washington, DC, USA. ( www.epa.gov/climatechange/economics/ economicanalyses.html)

190 This analysis does not include the EISA requirement for 35 MPG through 2020 or California’s Pavley 1 GHG standards. The proposed standards are intended to supersede these requirements, and the baseline case for comparison
is the emissions that would result without further action above the currently promulgated fuel economy standards. in the efficiency of vehicle air conditioning systems, which will substantially reduce direct emissions of HFCs, one of the most potent greenhouse gases, as well as indirect emissions of tailpipe CO 2 emissions attributable to reduced engine load from air conditioning. In total, EPA estimates that compared to a baseline of indefinite 2011 model year standards, net GHG emission reductions from the proposed program would be 325 million metric

tons CO 2 -equivalent (MMTCO 2 eq) annually by 2030, which represents a reduction of 4 percent of total U.S. GHG emissions and 0.6 percent of total worldwide GHG emissions projected in that year. This estimate accounts for all upstream fuel production and distribution emission reductions, vehicle tailpipe emission reductions including air conditioning benefits, as
well as increased vehicle miles travelled (VMT) due to the ‘‘rebound’’ effect
discussed in Section III.H. EPA estimates this would be the equivalent of removing nearly 60 million cars and light trucks from the road in this
timeframe.

EPA projects the total reduction of the program over the full life of model year
2012–2016 vehicles is about 950

MMTCO 2 eq, with fuel savings of 76 billion gallons (1.8 billion barrels) of gasoline over the life of these vehicles, assuming that some manufacturers take advantage of low-cost HFC reduction strategies to help meet these proposed
standards.

These reductions are projected to reduce global mean temperature by approximately 0.007–0.016 ° C by 2100, and global mean sea level rise is projected to be reduced by approximately 0.06–0.15 cm by 2100. 1. Impact on GHG Emissions

a. Calendar Year Reductions Due to
GHG Standards

This action, if finalized, will reduce GHG emissions emitted directly from
vehicles due to reduced fuel use and more efficient air conditioning systems.
In addition to these ‘‘downstream’’ emissions, reducing CO 2 emissions translates directly to reductions in the emissions associated with the processes involved in getting petroleum to the pump, including the extraction and transportation of crude oil, and the production and distribution of finished gasoline (termed ‘‘upstream’’ emissions). Reductions from tailpipe GHG standards grow over time as the fleet turns over to vehicles affected by the standards, meaning the benefit of the program will continue as long as the oldest vehicles in the fleet are replaced by newer, lower CO 2 emitting vehicles.

EPA is not projecting any reductions in tailpipe CH4 or N 2O emissions as a result of these proposed emission caps, which are meant to prevent emission backsliding and to bring diesel vehicles equipped with advanced technology aftertreatment into alignment with current gasoline vehicle emissions.

As detailed in the DRIA, EPA estimated calendar year tailpipe CO 2reductions based on pre- and postcontrol CO 2 gram per mile levels from
EPA’s OMEGA model and assumed to continue indefinitely into the future, coupled with VMT projections from
AEO2009. These estimates reflect the
real-world CO 2 emissions reductions projected for the entire U.S. vehicle fleet in a specified calendar year, including the projected effect of air conditioning credits, TLAASP credits and FFV
credits. EPA also estimated full lifetime reductions for model years 2012–2016VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00130 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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using pre- and post-control CO 2 levels projected by the OMEGA model, coupled with projected vehicle sales and lifetime mileage estimates. These
estimates reflect the real-world CO 2 emissions reductions projected for model years 2012 through 2016 vehicles
over their entire life.

This proposal would allow
manufacturers to earn credits for improved vehicle air conditioning efficiency. Since these improvements are relatively low cost, EPA projects that manufacturers will take advantage of this flexibility, leading to reductions
from emissions associated with vehicle air conditioning systems. As explained above, these reductions will come from both direct emissions of air conditioning refrigerant over the life of the vehicle and tailpipe CO 2 emissions produced by the increased load of the A/C system on the engine. In particular, EPA estimates that direct emissions of HFCs, one of the most potent greenhouse gases, would be reduced 40 percent from light-duty vehicles when the fleet has turned over
to more efficient vehicles. The fuel savings derived from lower tailpipe CO 2 would also lead to reductions in upstream emissions. Our estimated reductions from the A/C credits program are based on our analysis of how manufacturers are expected to take advantage of this credit opportunity in complying with the CO 2 fleetwide average tailpipe standards.

Upstream emission reductions associated with the production and distribution of fuel were estimated using
emission factors from DOE’s GREET1.8 model, with some modifications as
detailed in the DRIA. These estimates
include both international and domestic emission reductions, since reductions in foreign exports of finished gasoline and/ or crude would make up a significant share of the fuel savings resulting from the proposed GHG standards. Thus, significant portions of the upstream
GHG emission reductions will occur outside of the U.S.; a breakdown of projected international versus domestic
reductions is included in the DRIA.

Table III.F.1–1 shows reductions estimated from these proposed GHG standards assuming a pre-control case of 2011 MY standards continuingindefinitely beyond 2011, and a postcontrol case in which 2016 MY standards continue indefinitely beyond
2016. These reductions are broken down by upstream and downstream components, including air conditioning improvements, and also account for the offset from a 10 percent VMT ‘‘rebound’’
effect as discussed in Section III.H. Including the reductions from upstream emissions, total reductions are
estimated to reach 325 MMTCO 2 eq annually by 2030 (a 21 percent reduction in U.S. car and light truck emissions), and grow to over 500

MMTCO 2 eq in 2050 as cleaner vehicles continue to come into the fleet (a 23 percent reduction in U.S. car and light truck emissions).



### TABLE 

### III.F.1–1—P ROJECTED 

### N ET 

### GHG R EDUCTIONS

[MMTCO 2 Eq per year]

Calendar year

2020 2030 2040 2050

Net Reduction Due to Tailpipe Standards * ..................................................... Tailpipe Standards

........................................................................................... A/C—indirect CO 2

............................................................................................ A/C—direct HFCs

............................................................................................ Upstream

......................................................................................................... Percent reduction relative to U.S. reference (cars + light trucks) ................... Percent reduction relative to U.S. reference (all sectors) ...............................
Percent reduction relative to worldwide reference .......................................... 165.2
107.7

11.0
13.5
33.1
12.4%
2.2%
0.3% 324.6

211.4

21.1

27.2
64.9
21.4%

4.2%
0.6% 417.5

274.1

27.3
32.1
84.1
22.8%

5.2%
0.7% 518.5
344.0

34.2
34.9
105.5
22.9%

6.2%
0.9%

* Includes impacts of 10% VMT rebound rate presented in Table III.F.1–3.

b. Lifetime Reductions for 2012–2016 2016 model year cars and trucks lifetime reductions of nearly 950
Model Years affected by this proposal. 191 These MMTCO 2 eq, with fuel savings of 76

EPA also analyzed the emission
reductions over the full life of the 2012– results, including both upstream and downstream GHG contributions, are presented in Table III.F.1–2, showing billion gallons (1.8 billion barrels) of gasoline.



### TABLE 

### III.F.1–2—P ROJECTED 

### N ET 

### GHG R EDUCTIONS

[MMTCO 2 Eq per year]

Lifetime GHG Lifetime fuel Model year reduction savings (MMT CO 2 EQ) (billion gallons)

2012 ...........................................................................................................................

...................................... 81.4 6.6
2013 ...........................................................................................................................

...................................... 125.0 10.0
2014 ...........................................................................................................................

...................................... 174.1 13.9
2015 ...........................................................................................................................

...................................... 243.2 19.5
2016 ...........................................................................................................................

...................................... 323.6 26.3

Total Program Benefit ..........................................................................................................

.................... 947.4 76.2

191 As detailed in the DRIA, for this analysis the lifetime mileages for cars (190,000 miles) and trucks through 2030, a function of how far vehicles drive full life of the vehicle is represented by average (221,000 miles) averaged over calendar years 2012 per year and scrappage rates.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00131 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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### 49583

c. Impacts of VMT Rebound Effect 	 increase in VMT. Results are shown in of VMT rebound for the final rule. Table III.F.1–3; using the 10 percent Although EPA has not directly As noted above and discussed more rebound rate results in an overall quantified the GHG emissions effect of fully in Section III.H., the effect of fuel cost on VMT (‘‘rebound’’) was emission increase of 26.4 MMTCO 2 eq using a lower rebound rate for this

accounted for in our assessment of annually in 2030 (this increase is analysis, lowering the rebound rate economic and environmental impacts of would reduce the emission increases in accounted for in the reductions presented in Tables III.F.1–1 and III.F.1– this proposed rule. A 10 percent Tables III.F.1–1 and III.F.1–2 in 2). Our estimated changes in CH4 or N 2O rebound case was used for this analysis, proportion (i.e. , zero rebound equals emissions as a result of these proposed meaning that VMT for affected model zero emissions effect), and, thus, would vehicle GHG standards are attributed years is modeled as increasing by 10 increase our estimates of emission solely to this rebound effect. percent as much as the increase in fuel reductions due to these proposed

economy; i.e. , a 10 percent increase in As discussed in Section III.H, EPA standards. fuel economy would yield a 1.0 percent will be reassessing the appropriate rate



### TABLE 

### III.F.1–3—GHG I MPACT OF 

### 10% VMT R EBOUND a
[MMTCO 2 Eq per year]

2020 2030 2040 2050

Total GHG Increase ................................................................................. Tailpipe & Indirect A/C CO 2

..................................................................... Upstream GHGs b

.................................................................................... Tailpipe N 2 O

............................................................................................ Tailpipe CH 4

............................................................................................. 13 .6
10.6

2.95
0.040
0.008 26 .4
20.6

5.74
0.085
0.016 34 .2
26.6

7

.43
0.113
0.021 42 .9
33.4

9.32
0.142
0.027

a These impacts are included in the reductions shown in Table III.F.1–1 and III.F.1–2.

b Upstream rebound impact calculated as upstream total CO 2 effect times ratio of downstream tailpipe rebound CO 2 effect to downstream tailpipe total CO 2 effect.

d. Analysis of Alternatives manufacturers would use air As in the primary scenario, EPA conditioning improvements in identical assumed that the fleet complied with EPA analyzed two alternative penetrations as in the primary scenario. the standards. For full details on scenarios, including 4% and 6% annual Under these assumptions, EPA expects modeling assumptions, please refer to increases in 2 cycle (CAFE) fuel achieved fleetwide average emission DRIA Chapter 5. economy. In addition to this annual levels of 254 g/mile CO 2 EQ (4%), and increase, EPA assumed that 230 g/mile CO 2 EQ (6%) in 2016.



### TABLE 

### III.F.1–4—CALENDAR 

### Y EAR 

### I MPACTS OF 

### A LTERNATIVE 

### S CENARIOS

Calendar year

Scenario CY 2020 CY 2030 CY 2040 CY 2050

Total GHG Reductions (MMT CO 2 EQ) ...........................

Fuel Savings (Billion Gallons Gasoline Equivalent) ....... Primary ...............................

4% ......................................
6% ...................................... Primary ...............................

4% ......................................
6% ...................................... 165.2
152.8
215.2

13.4

12.2
17.8 324.6
305.9
426.2

26.2
24.5
35.1 417.5
394.1
549.3

33.9
31.8
45.5 518.5
489.3
683.9

42.6
39.9
57.1



### TABLE 

### III.F.1–5—M ODEL 

### Y EAR 

### I MPACTS OF 

### A LTERNATIVE 

### S CENARIOS

Model year lifetime

Scenario MY 2012 MY 2013 MY 2014 MY 2015 MY 2016 Total

Total GHG Reductions (MMT Primary ............... 81.4 125.0 174.1 243.2 323.6 947.4

CO 2 EQ).

4% ...................... 41.8 93.5 160.8 231.0 305.2 832.3
6% ...................... 60.2 146.4 239.9 333.3 424.9 1,204.7 Fuel Savings (Billion Gallons Gaso- Primary ............... 6.6 10.0 13.9 19.5 26.3 76.2

line Equivalent).

4% ...................... 3.1 7.2 12.7 18.4 24.7 66.1
6% ...................... 4.7 11.9 19.7 27.4 35.2 99.0

2. Overview of Climate Change Impacts regulation can remain in the atmosphere their effects on climate are long lasting.

From GHG Emissions for decades to centuries, meaning that Greenhouse gas emissions come mainly (1)their concentrations become well-	 from the combustion of fossil fuels Once emitted, greenhouse gases mixed throughout the global atmosphere (coal, oil, and gas), with additional (GHG) that are the subject of this regardless of emission origin, and (2) contributions from the clearing ofVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00132 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

### 49584 Federal Register / Vol. 74, No. 186 / Monday, September 28, 2009 / Proposed Rules

forests and agricultural activities. The transportation sector accounts for a portion, 28%, of US GHG emissions. 192

This section provides a broad overview of some of the impacts of GHG
emissions. The best sources of information include the major assessment reports of both the Intergovernmental Panel on Climate Change (IPCC) and the U.S. Global Change Research Program (USGCRP, formerly referred to as the U.S. Climate Change Science Program). The IPCC and USGCRP assessments base their findingson the large body of individual, peerreviewed studies in the literature, and
then the IPCC and USGCRP assessments themselves go through a transparent peer-reviewed process. The USGCRP reports, where possible, are specific to impacts in the U.S. and therefore represent the best available syntheses of relevant impacts.

Most recently, the USGCRP released a report entitled ‘‘Global Climate Change Impacts in the United States’’. 193 The report summarizes the science and the impacts of climate change on the United States, now and in the future. It focuses on climate change impacts in different regions of the U.S. and on various aspects of society and the economy such as energy, water, agriculture, and human health. It’s also a report written in plain language, with the goal of better informing public and private decision making at all levels. The foundation of this report is a set of 21 Synthesis and Assessment Products (SAPs), whichwere designed to address key policyrelevant issues in climate science. The report was extensively reviewed and
revised based on comments from experts and the public. The report was approved by its lead USGCRP Agency, the National Oceanic and Atmospheric Administration, the other USGCRP agencies, and the Committee on the
Environment and Natural Resources on
behalf of the National Science and Technology Council. This report meets all Federal requirements associated with the Information Quality Act, including those pertaining to public comment and transparency. Readers are encouraged to review this report.

The source document for the section below is the draft endangerment Technical Support Document (TSD). In

192 U.S. EPA (2008) Inventory of U.S. Greenhouse
Gas Emissions and Sinks: 1990–2006. EPA–430–R– 08–005, Washington, DC. http://www.epa.gov/ climatechange/emissions/usgginv

_archive.html.

193 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.). Cambridge University
Press, 2009. http://www.globalchange.gov/publications/reports/scientific-assessments/usimpacts. EPA’s Proposed Endangerment and Cause or Contribute Findings Under the Clean Air Act, 194 EPA provides a summary of the USGCRP and IPCC reports in a draft TSD. The draft TSD reviews observed and projected changes
in climate based on current and projected atmospheric GHG concentrations and emissions, as well as the related impacts and risks from climate change that are projected in the absence of GHG mitigation actions, including this proposal and other U.S. and global actions. The TSD serves as an important support document to EPA’s proposed Endangerment Finding; however, the document is a draft and is still undergoing comment and review as part of EPA’s rulemaking process, and is subject to change based upon comments to the final endangerment finding.

a. Changes in Atmospheric
Concentrations of GHGs From Global
and U.S. Emissions

Concentrations of six key GHGs (carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride) are at unprecedented levels compared to the recent and distant past. The global atmospheric CO 2 concentration has increased about 38% from pre-industrial levels to 2009, and almost all of the increase is due to anthropogenic

emissions.

Based on data from the most recent Inventory of U.S. Greenhouse Gas Emissions and Sinks (2008), 195 total

U.S. GHG emissions increased by 905.9 teragrams of CO 2-equivalent (Tg CO 2 Eq), or 14.7%, between 1990 and 2006.

U.S. transportation sources subject to control under section 202(a) of the Clean Air Act (passenger cars, light duty trucks, other trucks and buses, motorcycles, and cooling 196 ) emitted 1665 Tg CO 2 Eq in 2006, representing almost 24% of the total U.S. GHG emissions. Total global emissions, calculated by summing emissions of the six greenhouse gases by country, for 2005 was 38,725.9 Tg CO 2 Eq. This represents an increase of 26% from the 1990 level. See the EPA report ‘‘Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990–2006’’, 197

194 See Federal Register/Vol. 74, No. 78/Friday, April 24, 2009/Proposed Rules; also Docket Number EPA–HQ–OAR–2009–0171; FRL–8895–5.

195 U.S. EPA (2008) Inventory of U.S. Greenhouse
Gas Emissions and Sinks: 1990–2006. EPA–430–R– 08–005, Washington, DC.

196 Cooling refers to refrigerants/air conditioning from all transportation sources and is related to

HFCs.

197 U.S. EPA (2008) Inventory of U.S. Greenhouse
Gas Emissions and Sinks: 1990–2006. EPA–430–R– 08–005, Washington, DC. http://www.epa.gov/ climatechange/emissions/usgginv

_archive.html

. Section 2 of the proposed Endangerment TSD, and IPCC’s Working Group I (WGI) Fourth Assessment Report (AR4) 198 for a more complete discussion of GHG
emissions and concentrations.

b. Observed Changes in Climate

i. Temperature

The warming of the climate system is unequivocal, as is now evident from observations of increases in global air and ocean temperatures, widespread melting of snow and ice, and rising global average sea level. The global average net effect of the increase in atmospheric GHG concentrations, plus other human activities ( e.g. , land use change and aerosol emissions), on the global energy balance since 1750 has been one of warming. The global mean surface temperature 199 over the last 100 years (1906–2005) has risen by about

0.74 ° C (1.5 ° F) +/ ¥ 0.18 ° C, and climate model simulations suggest that natural variation alone ( e.g. , changes in solar irradiance) cannot explain the observed warming. The rate of warming over the last 50 years is almost double that over the last 100 years. Most of the observed increase in global mean surface temperature since the mid-20th century is very likely due to the observed increase in anthropogenic GHG

concentrations.

It can be stated with confidence that global mean surface temperature was higher during the last few decades of the 20th century than during any comparable period during the preceding four centuries. Like global mean surface temperatures, U.S. surface temperatures also warmed during the 20th and into the 21st century. U.S. average annual temperatures are now approximately

0.69 ° C (1.25 ° F) warmer than at the start of the 20th century, with an increased rate of warming over the past 30 years. Temperatures in winter have risen more than any other season, with winters in
the Midwest and northern Great Plains increasing more than 7 ° F. 200 Some of these changes have been faster than previous assessments had suggested.

For additional information, please see Section 4 of the proposed Endangerment

198 Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

199 Surface temperature is calculated by processing data from thousands of world-wide
observation sites on land and sea.

200 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.) Cambridge University
Press, 2009.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00133 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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### 49585

TSD, IPCC WGI AR4, 201 and the report ‘‘Global Climate Change Impacts in the
United States’’. 202

ii. Precipitation

Observations show that changes are occurring in the amount, intensity, frequency and type of precipitation. Global, long-term trends from 1900 to
2005 have been observed in the amount of precipitation over many large regions. Patterns in precipitation change are more spatially and seasonally variable than temperature change, but where significant precipitation changes do occur they are consistent with measured changes in stream flow. Significantly increased precipitation has been observed in eastern parts of North and South America, northern Europe and
northern and central Asia. 200 More intense and longer droughts have been
observed over wider areas since the 1970s, particularly in the tropics and subtropics. It is likely there has been an increase in heavy precipitation events ( e.g. , 95th percentile) within many land regions, even in those where there has been a reduction in total precipitation amount, consistent with a warming climate and observed significant increasing amounts of water vapor in the atmosphere. Rising temperatures have generally resulted in rain rather
than snow in locations and seasons such as in northern and mountainous regions where the average (1961–1990) temperatures were close to 0 ° C. Over the contiguous U.S., total annual precipitation increased at an average rate of 6.5% from 1901–2006, with the greatest increases in precipitation in the East and North Central climate regions (11.2% per century).

For additional information, please see Section 4 of the proposed Endangerment TSD, IPCC WGI AR4, 203 and the

201 Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

202 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.). Cambridge University
Press, 2009. http://www.globalchange.gov/publications/reports/scientific-assessments/usimpacts

.

203 Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA. USGCRP report ‘‘Global Climate Change Impacts in the United States’’. 204

iii. Extreme Events

Changes in climate extremes have been observed related to temperature, precipitation, tropical cyclones, and sea level. In the last 50 years, there have been widespread changes in extreme temperatures observed across the globe. For example, cold days, cold nights, and frost have become less frequent, while hot days, hot nights, and heat waves have become more frequent. Globally, a reduction in the number of daily cold
extremes has been observed in 70 to 75% of the land regions where data is available. Cold nights (lowest or coldest 10% of nights, based on the period 1961–1990) have become rarer over the last 50 years.

Observational evidence indicates an increase in intense tropical cyclone (i.e.

, tropical storms and/or hurricanes) activity in the North Atlantic. Since about 1970, increases in cyclone developments that affect the U.S. East
and Gulf Coasts have been correlated with increases of tropical sea surface temperatures In the contiguous U.S., studies find statistically significant increases in heavy precipitation (the heaviest 5%) and very heavy precipitation (the heaviest 1%) of 14 and 20%, respectively. Much of this increase occurred during the last three decades of the 20th century and is most apparent over the eastern parts of the country. Trends in drought also have strong regional variations. In much of the Southeast and large parts of the western U.S., the frequency of drought has increased coincident with rising temperatures over the past 50 years. Although there has been an overall increase in precipitation and no clear trend in drought for the nation as a whole, increasing temperatures have made droughts more severe and widespread than they would have
otherwise been.

For additional information, please see Section 4 of the proposed Endangerment TSD, the CCSP report ‘‘Weather and Climate Extremes in a Changing Climate. Regions of Focus: North America, Hawaii, Caribbean, and U.S.

204 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.). Cambridge University
Press, 2009. http://www.globalchange.gov/publications/reports/scientific-assessments/usimpacts

. Pacific Islands’’, 205 IPCC WGI AR4, 206 and the report ‘‘Global Climate Change Impacts in the United States’’. 207

iv. Physical and Biological Changes

Observations show that climate change is currently affecting U.S. physical and biological systems in significant ways. Observations of the cryosphere (the ‘‘frozen’’ component of the climate system) have revealed changes in sea ice, glaciers and snow cover, freezing and thawing, and permafrost. Satellite data since 1978 show that annual average Arctic sea ice extent has shrunk by 2.7% (+/ ¥ 0.6%) per decade, with larger decreases in summer. Subtropical and tropical corals in shallow waters have already suffered major bleaching events that are primarily driven by increases in sea surface temperatures. Heat stress from
warmer ocean water can cause corals to expel the microscopic algae that live
inside them which are essential to their
survival. Another stressor on coral populations is ocean acidification
which occurs as CO 2 is absorbed from the atmosphere by the oceans. About
one-third of the carbon dioxide emitted by human activities has been absorbed by the ocean, resulting in a decrease in the ocean’s pH. A lower pH affects the ability of living things to create and
maintain shells or skeletons of calcium
carbonate. Other documented biophysical impacts include a significant lengthening of the growing season and increase in net primary productivity 208 in higher latitudes of North America. Over the last 19 years, global satellite data indicate an earlier onset of spring across the temperate latitudes by 10 to 14 days.

205 Weather and Climate Extremes in a Changing Climate. Regions of Focus: North America, Hawaii, Caribbean, and U.S. Pacific Islands. A Report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research. [Thomas

R. Karl, Gerald A. Meehl, Christopher D. Miller, Susan J. Hassol, Anne M. Waple, and William L. Murray (eds.)]. Department of Commerce, NOAA’s National Climatic Data Center, Washington, D.C., USA, 164 pp.

206 Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

207 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.). Cambridge University
Press, 2009. http://www.globalchange.gov/publications/reports/scientific-assessments/usimpacts

.

208 Net primary productivity is the rate at which an ecosystem accumulates energy or biomass, excluding the energy it uses for the process of respiration.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00134 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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For additional information, please see Section 4 of the proposed Endangerment
TSD and IPCC WGI AR4. 209

c. Projected Changes in Climate

Most future scenarios that assume no explicit GHG mitigation actions (beyond those already enacted) project increasing global GHG emissions over the century, with corresponding climbing GHG concentrations. Carbon dioxide is expected to remain the dominant anthropogenic GHG over the course of the 21st century. The radiative forcing 210 associated with the non-CO 2 GHGs is still significant and increasing over time. As a result, warming over this century is projected to be considerably greater than over the last century and climate related changes are expected to continue while new ones develop. Described below are projected changes
in climate for the U.S.

See Section 6 of the proposed Endangerment TSD, IPCC WGI AR4, 211 the USGCRP report ‘‘Global Climate Change Impacts in the United States’’, 212 and the CCSP report
‘‘Weather and Climate Extremes in a Changing Climate, Regions of Focus: North America, Hawaii, Caribbean, and

U.S. Pacific Islands’’ 213 for a more complete discussion of projected changes in climate.

209 IPCC (2007a) Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M. Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

210 Radiative forcing is a measure of the change that a factor causes in altering the balance of incoming (solar) and outgoing (infrared and reflected shortwave) energy in the Earth-atmosphere system and thus shows the relative importance of
different factors in terms of their contribution to climate change.

211 Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [Solomon, S., D. Qin, M. Manning, Z. Chen, M. Marquis, K.B. Averyt, M.Tignor and H.L. Miller (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.

212 Global Climate Change Impacts in the United States, Thomas R. Karl, Jerry M. Melillo, and Thomas C. Peterson, (eds.). Cambridge University
Press, 2009. http://www.globalchange.gov/publications/reports/scientific-assessments/usimpacts

.

213 Weather and Climate Extremes in a Changing Climate. Regions of Focus: North America, Hawaii, Caribbean, and U.S. Pacific Islands. A Report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research. [Thomas

R. Karl, Gerald A. Meehl, Christopher D. Miller, Susan J. Hassol, Anne M. Waple, and William L. Murray (eds.)]. Department of Commerce, NOAA’s National Climatic Data Center, Washington, DC, USA, 164 pp. i. Temperature
Future warming over the course of the 21st century, even under scenarios of low emissions growth, is very likely to be greater than observed warming over the past century. The range of IPCC SRES scenarios provides a global warming range of 1.8 ° C to 4.0 ° C (3.2

° F to 7.2 ° F) with an uncertainty range
of 1.1 ° C to 6.4 ° C (2.0 ° F to 11.5 ° F). All of the U.S. is very likely to warm during this century, and most areas of the U.S. are expected to warm by more than the global average. The average warming in the U.S. through 2100 is projected by nearly all the models used
in the IPCC assessment to exceed 2 ° C (3.6 ° F) for all scenarios, with 5 out of 21 models projecting average warming
in excess of 4 ° C (7.2 ° F) for the midrange emissions scenario. The number of days with high temperatures above 90

° F is projected to increase throughout the U.S. Temperature increases in the next couple of decades will be primarilydetermined by past emissions of heattrapping gases. As a result, there is less difference in projected temperature scenarios in the near-term (around 2020) than in the middle (2050) and end of the century, which will be determined more by future emissions.

ii. Precipitation

Increases in the amount of precipitation are very likely in higher latitudes, while decreases are likely in most subtropical latitudes and the southwestern U.S., continuing observed patterns. The mid-continental area is expected to experience drying during the summer, indicating a greater risk of drought. Climate models project
continued increases in the heaviest downpours during this century, while the lightest precipitation is projected to
decrease. With more intense precipitation expected to increase, the risk of flooding and greater runoff and erosion will also increase. In contrast, droughts are likely to become more frequent and severe in some regions. The Southwest, in particular, is expected to experience increasing drought as changes in atmospheric circulation patterns cause the dry zone just outside the tropics to expand farther
northward into the United States.

iii. Extreme Events

It is likely that hurricanes will become more intense, especially along the Gulf and Atlantic coasts, with stronger peak winds and more heavy precipitation associated with ongoing increases of tropical sea surface temperatures. Heavy rainfall events are expected to increase, increasing the risk of flooding, greater runoff and erosion, and thus the potential for adverse water quality effects. These projected trends can increase the number of people at risk from suffering disease and injury due to floods, storms, droughts, and fires. Severe heat waves are projected tointensify, which can increase heatrelated mortality and sickness.

iv. Physical and Biological Changes

IPCC projects a six-inch to two-foot rise in sea level during the 21st century from processes such as thermal expansion of sea water and the melting of land-based polar ice sheets. Ocean acidification is projected to continue, resulting in the reduced biological production of marine calcifiers, including corals. In addition to ocean acidification, coastal waters are very likely to continue to warm by as much

as 4 to 8 ° F in this century, both in
summer and winter. This will result in a northward shift in the geographic distribution of marine life along the coasts. Warmer ocean temperatures will
also contribute to increased coral bleaching.

d. Key Climate Change Impacts and
Risks

The effects of climate changes observed to date and/or projected to occur in the future include: More frequent and intense heat waves, more wildfires, degraded air quality, more heavy downpours and flooding, increased drought, greater sea level rise, more intense storms, water quantity and quality problems, and negative impacts to human health, water supply, agriculture, forestry, coastal areas, wildlife and ecosystems, and many other aspects of society and the natural

environment.

i. Human Health

Warm temperatures and extreme weather already cause and contribute to
adverse human health outcomes through heat-related mortality and morbidity, storm-related fatalities and injuries, and disease. In the absence of effective adaptation, these effects are likely to increase with climate change. Health effects related to climate change include increased deaths, injuries, infectious diseases, and stress-related
disorders and other adverse effects associated with social disruption and migration from more frequent extreme
weather. Severe heat waves are projected to intensify in magnitude and duration over the portions of the U.S. where these events already occur, with potential increases in mortality and morbidity, especially among the elderly, young and other sensitive populations.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00135 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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However, reduced human mortality from cold exposure is projected through
2100. It is not clear whether reduced mortality from cold will be greater or
less than increased heat-related mortality, especially among the elderly, young and frail. Public health effects from climate change will likely disproportionately impact the health of certain segments of the population, such as the poor, the very young, the elderly, those already in poor health, the disabled, those living alone and/or indigenous populations dependent on
one or a few resources. Increases are expected in potential ranges and exposure of certain diseases affected by temperature and precipitation changes, including vector and waterborne diseases (i.e. , malaria, dengue fever, West Nile virus). See the CCSP Report ‘‘Analyses of the effects of global change
on human health and welfare and human systems’’, 214 IPCC’s Working Group II (WG2) AR4, 215 and Section 7 of the proposed Endangerment TSD for a more complete discussion regarding climate change and impacts on human
health.

ii. Air Quality

Climate change can be expected to
influence the concentration and distribution of air pollutants through a variety of direct and indirect processes, including the modification of biogenic emissions, the change of chemical reaction rates, wash-out of pollutants by precipitation, and modification of weather patterns that influence pollutant build-up. Higher temperatures and weaker circulation patterns associated with climate change are expected to worsen regional ozone pollution in the U.S., with associated risks in respiratory infection, aggravation of asthma, and premature
death. In addition to human health effects, elevated levels of tropospheric ozone have significant adverse effects on crop yields, pasture and forest growth, and species composition. See Section 8 of the proposed Endangerment TSD, EPA’s report ‘‘ Assessment of the Impacts of Global Change on Regional

U.S. Air Quality: A Synthesis of Climate

214 Analyses of the effects of global change on human health and welfare and human systems . A Report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research. [Gamble, J.L. (ed.), K.L. Ebi, F.G. Sussman, T.J. Wilbanks, (Authors)]. U.S. Environmental Protection Agency, Washington, DC, USA.

215 Climate Change 2007: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [M.L. Parry, O.F. Canziani, J.P. Palutikof, P.J. van der Linden and C.E. Hanson (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA. Change Impacts on Ground-Level

Ozone’’

, 216 the CCSP report ‘‘Analyses of the effects of global change on human
health and welfare and human systems’’ 217 and IPCC WGII AR4 218 for a more complete discussion regarding human health impacts resulting from climate change effects on air quality.

iii. Food and Agriculture

The CCSP concluded that, with
increased CO 2 and temperature, the life cycle of grain and oilseed crops will likely progress more rapidly. But, as temperature rises, these crops will increasingly begin to experience failure, especially if climate variability increases and precipitation lessens or becomes more variable. Furthermore, the marketable yield of many horticultural crops ( e.g. , tomatoes, onions, fruits) is very likely to be more sensitive to climate change than grain and oilseed crops. Higher temperatures will very likely reduce livestock production during the summer season, but these losses will very likely be partially offset by warmer temperatures during the winter season. Cold water fisheries will likely be negatively affected; warm-water fisheries will generally benefit; and the results for cool-water fisheries will be mixed, with gains in the northern and losses in the southern portions of ranges. See Section 9 of the proposed Endangerment TSD, the CCSP report ‘‘The Effects of Climate Change on Agriculture, Land Resources, Water Resources, and Biodiversity in the United States’’, and the USGCRP report ‘‘Global Climate Change Impacts
in the United States’’ for a more complete discussion regarding climate science and impacts to food production and agriculture.

iv. Forestry

Climate change has very likely
increased the size and number of forest fires, insect outbreaks, and tree

216 EPA (2009) Assessment of the Impacts of Global Change on Regional U.S. Air Quality: ASynthesis of Climate Change Impacts on GroundLevel Ozone . An Interim Report of the U.S. EPA Global Change Research Program. U.S. Environmental Protection Agency, Washington, DC,
EPA/600/R–07/094.

217 Analyses of the effects of global change on human health and welfare and human systems . A Report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research. [Gamble, J.L. (ed.), K.L. Ebi, F.G. Sussman, T.J. Wilbanks, (Authors)]. U.S. Environmental Protection Agency, Washington, DC, USA.

218 Climate Change 2007: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [M.L. Parry, O.F. Canziani, J.P. Palutikof, P.J. van der Linden and C.E. Hanson (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA. mortality in the interior west, the Southwest, and Alaska, and will
continue to do so. Disturbances like
wildfire and insect outbreaks are increasing and are likely to intensify in
a warmer future with drier soils and longer growing seasons. Although recent climate trends have increased vegetation growth, continuing increases in disturbances are likely to limit carbon storage, facilitate invasive species, and disrupt ecosystem services. Overall forest growth for North America as a whole will likely increase modestly (10– 20%) as a result of extended growing
seasons and elevated CO 2 over the next century, but with important spatial and temporal variation. Forest growth is slowing in areas subject to drought and has been subject to significant loss due insect infestations such as the spruce
bark beetle in Alaska. See Section 10 of the proposed Endangerment TSD, the CCSP report ‘‘The Effects of Climate Change on Agriculture, Land Resources, Water Resources, and Biodiversity in the United States’’, IPCC WGII, and the USGCRP report ‘‘Global Climate Change Impacts in the United States’’ for a more complete discussion regarding climate science and impacts to forestry.

v. Water Resources

The vulnerability of freshwater
resources in the United States to climate change varies from region to region. Climate change will likely further constrain already over-allocated water resources in some sections of the U.S., increasing competition among agricultural, municipal, industrial, and ecological uses. Although water management practices in the U.S. are generally advanced, particularly in the western U.S climate change may increasingly create conditions well
outside of historic observations impacting managed water systems. Rising temperatures will diminish snowpack and increase evaporation, affecting seasonal availability of water. Groundwater systems generally respond more slowly to climate change than surface water systems. In semi-arid and arid areas, groundwater resources are particularly vulnerable because of precipitation and stream flow areconcentrated over a few months, yearto-year variability is high, and deep groundwater wells or reservoirs generally do not exist. Availability of groundwater is likely to be influenced by changes in withdrawals (reflecting development, demand, and availability of other sources).

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hydropower generation, water transfers, and bi-national relationships. Decreased water supply and lower water levels are likely to exacerbate challenges relating to aquatic navigation. Higher water temperatures, increased precipitation intensity, and longer periods of low flows will exacerbate many forms of water pollution, potentially making attainment of water quality goals more difficult. As waters become warmer, the aquatic life they now support will be replaced by other species better adapted to warmer water. In the long-term, warmer water and changing flow may result in deterioration of aquatic ecosystems. See Section 11 of the proposed Endangerment TSD, the CCSP report ‘‘The Effects of Climate Change on Agriculture, Land Resources, Water Resources, and Biodiversity in the United States’’, IPCC WGII, and the USGCRP report ‘‘Global Change Impacts
in the United States’’ for a more complete discussion regarding climate science and impacts to water resources.

vi. Sea Level Rise and Coastal Areas

Warmer temperatures raise sea level by expanding ocean water, melting glaciers, and possibly increasing the rate at which ice sheets discharge ice and water into the oceans. Rising sea level and the potential for stronger storms pose an increasing threat to coastal cities, residential communities, infrastructure, beaches, wetlands, and ecosystems. Coastal communities and habitats will be increasingly stressed by climate change effects interacting with development and pollution. Sea level is rising along much of the U.S. coast, and the rate of change will increase in the future, exacerbating the impacts of progressive inundation, storm-surge flooding, and shoreline erosion. Studies find 75% of the shoreline removed from the influence of spits, tidal inlets and engineering structures is eroding along the U.S. East Coast probably due to sea level rise. Storm impacts are likely to be more severe, especially along the Gulf and Atlantic coasts. Salt marshes, estuaries, other coastal habitats, and dependent species will be further threatened by sea level rise. The
interaction with coastal zone development and climate change effects
such as sea level rise will further stress
coastal communities and habitats. Population growth and rising value of
infrastructure in coastal areas increases vulnerability and risk of climate variability and future climate change. Sea level rise and high rates of water withdrawal promote the intrusion of saline water in to groundwater supplies, which adversely affects water quality.

See Section 12 of the proposed Endangerment TSD, the CCSP report ‘‘Coastal Sensitivity to Sea Level Rise: A Focus on the Mid-Atlantic Region’’, 219 the USGCRP report ‘‘Global Change Impacts in the United States’’, and IPCC WGII for a more complete discussion regarding climate science and impacts
to sea level rise and coastal areas.

vii. Energy, Infrastructure and
Settlements

Most of the effects of climate change on the U.S. energy sector will be related to energy use and production. The research evidence is relatively clear that climate warming will mean reductions in total U.S. heating requirements and increases in total cooling requirements for building. These changes will vary by region and by season and will affect household and business energy costs. Studies project that temperature increases due to global warming are very likely to increase peak demand for electricity in most regions of the country as rising temperatures are expected to increase energy requirements for cooling residential and commercial buildings. An increase in peak demand for electricity can lead to a disproportionate increase in energy infrastructure
investment. Extreme weather events can threaten coastal energy infrastructures and electricity transmission and
distribution in the U.S. Increases in hurricane intensity are likely to cause further disruptions to oil and gas operations in the Gulf, like those experienced in 2005 with Hurricane Katrina. Climate change is likely to affect some renewable energy sources across the nation, such as hydropower production in regions subject to changing patterns of precipitation or snowmelt. The U.S. energy sector, which relies heavily on water for both hydropower and cooling capacity, may be adversely impacted by changes to water supply and quality in reservoirs
and other water bodies.

Water infrastructure, including drinking water and wastewater treatment plants, and sewer and storm water management systems, will be at greater risk of flooding, sea level rise and storm surge, low flows, and other factors that could impair performance. In addition, as water supply is
constrained and demand increases it will become more likely that water will

219 CCSP (2009) Coastal Sensitivity to Sea-Level Rise: A Focus on the Mid-Atlantic Region. A report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research. [James G. Titus (Coordinating Lead Author), K. Eric Anderson, Donald R. Cahoon, Dean B. Gesch, Stephen K. Gill, Benjamin T. Gutierrez, E. Robert Thieler, and S. Jeffress Williams (Lead Authors)],

U.S. Environmental Protection Agency, Washington DC, USA, 320 pp. have to be transported and moved which will require additional energy capacity. See Section 13 of the proposed Endangerment TSD, the CCSP reports ‘‘the Effects of Climate Change on Energy Production in the United

States’’ 220 and ‘‘Impacts of Climate Change and Variability on Transportation Systems and Infrastructure’’, 221 and the USGCRP report ‘‘Global Change Impacts in the United States’’ for a more complete discussion regarding climate science and impacts to energy, infrastructure
and settlements.

viii. Ecosystems and Wildlife

Disturbances such as wildfires and insect outbreaks are increasing in the

U.S. and are likely to intensify in a
warmer future with drier soils and longer growing seasons. Although recent climate trends have increased vegetation growth, continuing increases in disturbances are likely to limit carbon storage, facilitate invasive species, and disrupt ecosystem services. Over the 21st century, changes in climate will cause species to shift north and to higher elevations and fundamentally rearrange U.S. ecosystems. Differential capacities for range shifts are constrained by development, habitat fragmentation, invasive species, and broken ecological connections. IPCC consequently predicts significant disruption of ecosystem structure, function, and services. See Section 14 of the proposed Endangerment TSD, IPCC WGII, the CCSP report ‘‘The Effects of Climate Change on Agriculture, Land Resources, Water Resources, and Biodiversity in the United States’’, and the USGCRP report ‘‘Global Change Impacts in the United States’’ for a more complete discussion regarding climate science and impacts to ecosystems and
wildlife.

220 CCSP (2007): Effects of Climate Change on Energy Production and Use in the United States. A Report by the U.S. Climate Change Science Program and the subcommittee on Global Change Research. Thomas J. Wilbanks, Vatsal Bhatt, Daniel E. Bilello, Stanley R. Bull, James Ekmann, William C. Horak,

Y. Joe Huang, Mark D. Levine, Michael J. Sale, David K. Schmalzer, and Michael J. Scott). Department of Energy, Office of Biological & Environmental Research, Washington, DC, USA,
160 pp

.

221 CCSP (2008) Impacts of Climate Change and Variability on Transportation Systems and Infrastructure: Gulf Coast Study, Phase I. A Report by the U.S. Climate Change Science Program and the Subcommittee on Global Change Research [Savonis, M.J., V.R. Burkett, and J.R. Potter (eds.)]. Department of Transportation, Washington, DC, USA, 445 pp.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00137 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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3. Changes in Global Mean Temperature
and Sea Level Rise Associated With the Proposal’s GHG Emissions Reductions

EPA examined 222 the reductions in

CO 2 and other GHGs associated with the proposal and analyzed the projected effects on global mean surface temperature and sea level, two common indicators of climate change. The analysis projects that the proposal will reduce climate warming and sea level rise. Although the projected reductions are small in overall magnitude by themselves, they are quantifiable and would contribute to reducing climate change risks.

a. Estimated Projected Reductions in Global Mean Surface Temperatures and
Sea Level Rise

EPA estimated changes in the atmospheric CO 2 concentration, global mean surface temperature and sea level to 2100 resulting from the emissions reductions in this proposal using the
Model for the Assessment of
Greenhouse Gas Induced Climate Change (MAGICC, version 5.3). This widely used, peer reviewed modeling tool was also used to project temperature and sea level rise under
different emissions scenarios in the
Third and Fourth Assessments of the Intergovernmental Panel on Climate Change (IPCC).

GHG emissions reductions from Section III.F.1a were applied as net reductions to a peer reviewed global reference case (or baseline) emissions scenario to generate an emissions scenario specific to this proposal. For the proposal scenario, all emissions reductions were assumed to begin in 2012, with zero emissions change in 2011 (from the reference case) followed by emissions linearly increasing to equal the value supplied in Section

III.F.1.afor 2020 and then continuing to
2100. Details about the reference case
scenario and how the emissions reductions were applied to generate the proposal scenario can be found in the DRIA Chapter 7.

The atmospheric CO 2 concentration, temperature, and sea-level increases for both the reference case and the proposal emissions scenarios were computed using MAGICC. To compute the reductions in the atmospheric CO 2 concentrations as well as in temperature and sea level resulting from the proposal, the output from the proposal

222 Using the Model for the Assessment of Greenhouse Gas Induced Climate Change (MAGICC, http://www.cgd.ucar.edu/cas/wigley/magicc/ ), EPA estimated the effects of this action’s greenhouse gas emissions reductions on global mean temperature
and sea level. Please refer to Chapter 7.4 of the
DRIA for additional information. scenario was subtracted from an existing MiniCAM emission scenario. To capture some key uncertainties in the climate system with the MAGICC model, changes in temperature and sea-level rise were projected across the most current IPCC range for climate sensitivities which ranges from 1.5 ° C to

6.0 ° C (representing the 90% confidence interval). 223 This wide range reflects the uncertainty in this measure of how much the global mean temperature
would rise if the concentration of carbon dioxide in the atmosphere were to double. Details about this modeling analysis can be found in the DRIA Chapter 7.4.

The results of this modeling show small, but quantifiable, reductions in the atmospheric CO 2 concentration, the projected global mean surface temperature and sea level resulting from this proposal (assuming it is finalized),
across all climate sensitivities. As a result of this proposal’s emission reductions, the atmospheric CO 2 concentration is projected to be reduced by approximately 2.9 to 3.2 parts per million (ppm), the global mean temperature is projected to be reduced by approximately 0.007–0.016 ° C by 2100, and global mean sea level rise is projected to be reduced by approximately 0.06–0.15cm by 2100.
The reductions are small relative to the IPCC’s 2100 ‘‘best estimates’’ for global mean temperature increases (1.8–4.0 ° C) and sea level rise (0.20–0.59m) for all global GHG emissions sources for a range of emissions scenarios. EPA used a peer reviewed model, the MAGICC model, to do this analysis. This analysis is specific to the proposed rule and
therefore cannot come from some previously published work. The Agency
welcomes comment on the use of the MAGICC model for these purposes. Further discussion of EPA’s modeling analysis is found in Chapter 7 of the
Draft RIA.

As a substantial portion of CO 2 emitted into the atmosphere is not removed by natural processes for millennia, each unit of CO 2 not emitted into the atmosphere avoids essentially permanent climate change on centennial time scales. Though the magnitude of the avoided climate change projected

223 In IPCC reports, equilibrium climate sensitivity refers to the equilibrium change in the annual mean global surface temperature following a doubling of the atmospheric equivalent carbon
dioxide concentration. The IPCC states that climate sensitivity is ‘‘likely’’ to be in the range of 2 ° C to

4.5 ° C, ‘‘very unlikely’’ to be less than 1.5 ° C, and ‘‘values substantially higher than 4.5 ° C cannot be excluded.’’ IPCC WGI, 2007, Climate Change 2007—The Physical Science Basis, Contribution of Working Group I to the Fourth Assessment Report of the IPCC, http://www.ipcc.ch/. here is small, these reductions would represent a reduction in the adverse risks associated with climate change (though these risks were not formally estimated for this proposal) across all
climate sensitivities.

4. Weight Reduction and Potential Safety Impacts

In this section, EPA will discuss potential safety impacts of the proposed standards. In the joint technology analysis, EPA and NHTSA agree that automakers could reduce weight as one part of the industry’s strategy for meeting the proposed standards. As shown in table III.D.6–3, of this Preamble, EPA’s modeling projects that
vehicle manufacturers will reduce the weight of their vehicles by 4% on average between 2011 and 2016 although individual vehicles may have greater or smaller weight reduction (NHTSA’s results are similar using the Volpe model). The penetration and magnitude of these modeled changes are consistent with the public announcements made by many manufacturers since early 2008 and are consistent with meetings that EPA has had with senior engineers and technical leadership at many of the automotive companies during 2008 and 2009.

EPA also projects that automakers will not reduce footprint in order to meet the proposed CO 2 standards in our modeling analysis. NHTSA and EPA have taken two measures to help ensure that the proposed rules provide no
incentive for mass reduction to be accompanied by a corresponding decrease in the footprint of the vehicle (with its concomitant decrease in crush and crumple zones). The first design feature of the proposed rule is that the

CO 2 or fuel economy targets are based on the attribute of footprint (which is a surrogate for vehicle size). 224 The second design feature is that the shape of the footprint curve (or function) has been carefully chosen such that it neither encourages manufacturers to increase, nor decrease the footprint of their fleet. Thus, the standard curves are designed to be approximately ‘‘footprint neutral’’ within the sloped portion of
the function. 225 For further discussion on this, refer to Section II.C of the preamble, or Chapter 2 of the joint TSD. Thus the agencies are assuming in their

224 As the footprint attribute is defined as wheelbase times track width, the footprint target curves do not discourage manufacturers from reducing vehicle size by reducing front, rear, or side overhang, which can impact safety by resulting in less crush space.

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modeling analysis that the
manufacturers could reduce vehicle mass without reducing vehicle footprint as one way to respond to the proposed
rule. 226

In Section IV of this preamble, NHTSA presents a safety analysis of the proposed CAFE standards based on the 2003 Kahane analysis. As discussed in Section IV, NHTSA has developed a worse case estimate of the impact of weight reductions on fatalities. The underlying data used for that analysis does not allow NHTSA to analyze the specific impact of weight reduction at constant footprint because historically there have not been a large number of vehicles produced that relied substantially on material substitution. Rather, the data set includes vehicles that were either smaller and lighter or larger and heavier. The numbers in theNHTSA analysis predict the safetyrelated fatality consequences that would occur in the unlikely event that weight reduction for model years 2012–2016 is accomplished by reducing mass and reducing footprint. EPA concurs with NHTSA that the safety analysis conducted by NHTSA and presented in Section IV is a worst case analysis for fatalities, and that the actual impacts on vehicle safety could be much less. However, EPA and NHTSA are not able to quantify the lower-bound potential impacts at this time.

The agencies believe that reducing vehicle mass without reducing the size of the vehicle or the structural integrity is technically feasible in the rulemaking time frame. Many of the technical options for doing so are outlined in Chapter 3 of the joint TSD and in EPA’s DRIA. Weight reduction can be accomplished by the proven methods described below. Every manufacturer will employ these methodologies to some degree, the magnitude to which each will be used will depend on opportunities within individual vehicle design.

• Material Substitution: Substitution of lower density and/or higher strength materials in a manner that preserves or improves the function of the component. This includes substitution of high-strength steels, aluminum, magnesium or composite materials for components currently fabricated from mild steel ( e.g., the magnesium-alloy
front structure used on the 2009 Ford F150 pickups). 227 Light-weight

226 See Chapter 1 of the joint TSD for a description of potential footprint changes in the
2016 reference fleet.

227 We note that since these MY 2009 F150s haveonly begun to enter the fleet, there is little realworld crash data available to evaluate the safety impacts of this new design. materials with acceptable energy absorption properties can maintain structural integrity and absorption of crash energy relative to previous designs while providing a net decrease in component weight.

• Smart Design: Computer aided engineering (CAE) tools can be used to better optimize load paths within structures by reducing stresses and bending moments without adversely affecting structural integrity. This allows better optimization of the
sectional thicknesses of structural components to reduce mass while maintaining or improving the function of the component. Smart designs also integrate separate parts in a manner that reduces mass by combining functions or the reduced use of separate fasteners. In addition, some ‘‘body on frame’’ vehicles are redesigned with a lighter ‘‘unibody’’ construction with little compromise in vehicle functionality.

• Reduced Powertrain Requirements: Reducing vehicle weight sufficiently can allow for the use of a smaller, lighter and more efficient engine while maintaining or even increasing performance. Approximately half of the
reduction is due to these reduced powertrain output requirements from reduced engine power output and/or displacement, lighter weight transmission and final drive gear ratios. The subsequent reduced rotating mass ( e.g. transmission, driveshafts/ halfshafts, wheels and tires) via weight and/or size reduction of components are made possible by reduced torque output requirements.

• Mass Compounding: Following from the point above, the compounded weight reductions of the body, engine
and drivetrain can reduce stresses on the suspension components, steering components, brakes, and thus allow further reductions in the weight of these subsystems. The reductions in weight for unsprung masses such as brakes, control arms, wheels and tires can
further reduce stresses in the suspension mounting points which can allow still further reductions in weight. For example, lightweighting can allow
for the reduction in the size of the vehicle brake system, while maintaining the same stopping distance.

Therefore, EPA believes it is both technically feasible to reduce weight without reducing vehicle size, footprint or structural strength and manufacturers have indicated to the agencies that they will use these approaches to accomplish these tasks. We request written
comment on this assessment and this projection, including up-to-date plans regarding the extent of use by each manufacturer of each of the methodologies described above.

For this proposed rule, as noted earlier, EPA’s modeling analysis projects that weight reduction by model year 2016 on the order of 4% on average for the fleet will occur ( see Section

III.D.6for details on our estimated mass reduction). EPA believes that such modeled changes in the fleet could result in much smaller fatality impacts
than those in the worst case scenario presented in Section IV by NHTSA, since manufacturers have many safer options for reducing vehicle weight than doing so by simultaneously reducing footprint. The NHTSA analysis, based solely on 4-door vehicles, does not independently differentiate between weight reduction which comes from vehicle downsizing (a physically smaller vehicle) and vehicle weight reduction solely through design and material changes (i.e., making a vehicle weigh less without changing the size of the vehicle or reducing structural integrity).

Dynamic Research Incorporated (DRI) has assessed the independent effects of vehicle weight and size on safety in
order to determine if there are tradeoffs between improving vehicle safety and fuel consumption. In their 2005
studies 228 229 one of which was published as a Society of Automotive Engineers Technical Paper and received peer review through that body, DRI presented results that indicate that vehicle weight reduction tends to decrease fatalities, but vehicle
wheelbase and track reduction tends to
increase fatalities. The DRI work focused on four major points, with #1 and #4 being discussed with additional
detail below:

1. 2–Door vehicles represented a significant portion of the light duty fleet and should not be ignored.

2. Directional control and therefore crash avoidance improves with a reduction in curb weight.

3. The occupants of the impacted vehicle, or ‘‘collision partner’’ benefit from being impacted by a lighter
vehicle.

4. Rollover fatalities are reduced by a reduction in curb weight due to lower centers of gravity and lower loads on the
roof structures.

228 ‘‘Supplemental Results on the Independent Effects of Curb Weight, Wheelbase and Track on Fatality Risk’’, Dynamic Research, Inc., DRI–TR– 05–01, May 2005.

229 ‘‘An Assessment of the Effects of Vehicle Weight and Size on Fatality Risk in 1985 to 1998 Model Year Passenger Cars and 1985 to 1997 Model Year’’, M. Van Auken and J. Zellner, Dynamic Research Inc., Society of Automotive Engineers Technical Paper 2005–01–1354.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00139 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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The data used for the DRI analysis
was similar to NHTSA’s 2003 Kahane study, using Fatality Analysis Reporting System (FARS) data for vehicle model years 1985 through 1998 for cars, and 1985 through 1997 trucks. This data overlaps Kahane’s FARS data on model year 1991 to 1999 vehicles. However, DRI included 2-door passenger cars, whereas the Kahane study excluded all 2-door vehicles. The 2003 Kahane study excluded 2-door passenger cars because
it found that for MY 1991–1999 vehicles, sports and muscle cars constituted a significant proportion of
those vehicles. These vehicles have relatively high weight relative to their wheelbase, and are also disproportionately involved in crashes. Thus, Kahane concluded that including these vehicles in the analysis excessively skewed the regression results. However, as of July 1, 1999, 2- door passenger cars represented 29% of the registered cars in the United States. DRI’s position was that this is a significant portion of the light duty fleet, too large to be ignored, and conclusions regarding the effects of weight and safety should be based on data for all cars, not just 4-doors. DRI
did state in their conclusions that the results are sensitive to removing data for 2-doors and wagons, and that the results for 4-door cars with respect to the
effects of wheelbase and track width were no longer statistically significant
when 2-door cars were removed. EPA and NHTSA recognize that it is important to properly account for 2-door cars in a regression analysis evaluating the impacts of vehicle weight on safety. Thus, the agencies seek comment on how to ensure that any analysis supporting the final rule accounts as fully as possible for the range of safety impacts due to weight reduction on the variety of vehicles regulated under these proposed standards.

The DRI and Kahane studies also differ with respect to the impact of vehicle weight on rollover fatalities. The Kahane study treated curb weight as a surrogate for size and weight and analyzed them as a single variable. Using this method, the 2003 Kahane analysis indicates that curb weight
reductions would increase fatalities due to rollovers. The DRI study differed by analyzing curb weight, wheelbase, and track as multiple variables and concluded that curb weight reduction would decrease rollover fatalities, and
wheelbase and track reduction would
increase rollover fatalities. DRI offers two potential root causes for higher curb weight resulting in higher rollover
fatalities. The first is that a taller vehicle tends to be heavier than a shorter vehicle; therefore heavier vehicles may be more likely to rollover because the vehicle height and weight are correlated with vehicle center of gravity height.
The second is that FMVSS 216 for roof crush strength requirements for passenger cars of model years 1995 through 1999 were proportional to the unloaded vehicle weight if the weight is less than 3,333 lbs, however they were a constant if the weight is greater than 3,333 lbs. Therefore heavier vehicles may have had relatively less rollover
crashworthiness.

NHTSA has rejected the DRI analysis,
and has not relied on it for its evaluation of safety impact changes in
CAFE standards. See Section IV.G.6 of this Notice, as well as NHTSA’s March 2009 Final Rulemaking for MY2011 CAFE standards (see 74 FR at 14402– 05).

The DRI and Kahane analyses of the FARS data appear similar in one respect because the results are reproducible between the two studies when using aggregated vehicle attributes for 4-door

cars. 230 231 232 However, when DRI and NHTSA separately analyzed individual vehicle attributes of mass, wheelbase and track width, DRI and NHTSA obtained different results for passenger
cars. NHTSA has raised this as a concern with the DRI study. When 2-
door vehicles are removed from the data
set EPA is concerned that the results may no longer be statistically significant with respect to independent vehicle attributes due to the small remaining data set, as DRI stated in the 2005 study.

The DRI analysis concluded that there
would be a small reduction in fatalities for cars and for trucks for a 100 pound reduction in curb weight without accompanied vehicle footprint or size changes. EPA notes that if DRI’s results were to be applied using the curb weight reductions predicted by the OMEGA model, an overall reduction in fatalities would be predicted. EPA invites comment on all aspects of the issue of the impact of this kind of weight reduction on safety, including the usefulness of the DRI study in evaluating this issue.

The agencies are committed to continuing to analyze vehicle safety
issues so a more informed evaluation

230 ‘‘Supplemental Results on the Independent Effects of Curb Weight, Wheelbase and Track on Fatality Risk’’, Dynamic Research, Inc., DRI–TR– 05–01, May 2005.

231 ‘‘An Assessment of the Effects of Vehicle Weight and Size on Fatality Risk in 1985 to 1998 Model Year Passenger Cars and 1985 to 1997 Model Year’’, M. Van Auken and J. Zellner, Dynamic Research Inc., Society of Automotive Engineers Technical Paper 2005–01–1354.

232 FR Vol. 74, No. 59, beginning on pg. 14402. can be made. We request comment on
this issue. These comments should include not only further discussion and analysis of the relevant studies but data and analysis which can allow the agencies to more accurately quantify any potential safety issues with the proposed standards.

G. How Would the Proposal Impact
Non-GHG Emissions and Their Associated Effects?

In addition to reducing the emissions of greenhouse gases, this proposal
would influence the emissions of ‘‘criteria’’ air pollutants and air toxics (i.e., hazardous air pollutants). The criteria air pollutants include carbon monoxide (CO), fine particulate matter (PM 2.5 ), sulfur dioxide (SO X) and the ozone precursors hydrocarbons (VOC) and oxides of nitrogen (NO X); the air toxics include benzene, 1,3-butadiene, formaldehyde, acetaldehyde, and
acrolein. Our estimates of these nonGHG emission impacts from the proposed program are shown by pollutant in Table III.G–1 and Table III.G–2 in total, and broken down by the two drivers of these changes: (a) ‘‘Upstream’’ emission reductions due to decreased extraction, production and distribution of motor gasoline; and (b) ‘‘downstream’’ emission increases, reflecting the effects of VMT rebound (discussed in Sections III.F and III.H). Total program impacts on criteria and toxics emissions are discussed below, followed by individual discussions of the upstream and downstream impacts. Those are followed by discussions of the effects on air quality, health, and other
environmental concerns.

As discussed in Chapter 5 of the DRIA, the impacts presented here are only from petroleum (i.e., EPA assumes that total volumes of ethanol and other renewable fuels will remain unchanged due to this program). Ethanol use was modeled at the volumes projected in
AEO2007 for the reference and control case; thus no changes are projected in upstream emissions related to ethanol production and distribution. However, due to the decreased gasoline volume associated with this proposal, a greater market share of E10 is expected relative to E0, which would be expected to havesome effect on fleetwide average nonGHG emission rates. This effect, which is likely small relative to the other effects considered here, has not been
accounted for in the downstream emission modeling conducted for this proposal, but EPA does plan to address it in the final rule air quality analysis, for which localized impacts could be more significant. A more comprehensive analysis of the impacts of differentVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00140 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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ethanol and gasoline volume scenarios is being prepared as part of EPA’s RFS2 rulemaking package. 233

As shown in Table III.G–1, EPA estimates that this program would result
in reductions of NO X , VOC, PM and

SO X , but would increase CO emissions.

For NO X , VOC, PM and SO X , we estimate net reductions in criteria pollutant emissions because the emissions reductions from upstream sources are larger than the emission increases due to additional driving (i.e., the ‘‘rebound effect’’). In the case of CO, we estimate slight emission increases, because there are relatively small reductions in upstream emissions, and thus the projected emission increases due to additional driving are greater than the projected emission decreases due to reduced fuel production. EPA estimates that the proposed program would result in small changes for toxic emissions compared to total U.S.
inventories across all sectors. For all pollutants the overall impact of the program would be relatively small

233 74 FR 24904. See also Docket EPA–HQ–OAR–

2005–0161. compared to total U.S. inventories
across all sectors. In 2030 EPA estimates the proposed program would reduce
these total NO X , PM and SO X inventories by 0.2 to 0.3 percent and reduce the VOC inventory by 1.2 percent, while increasing the total national CO inventory by 0.4 percent.

As shown in Table III.G–2, EPA estimates that the proposed program would result in small changes for toxic emissions compared to total U.S.
inventories across all sectors. In 2030 EPA estimates the program would reduce total benzene and formaldehyde by 0.04 percent. Total acrolein, acetaldehyde, and 1,3-butadiene would increase by 0.03 to 0.2 percent.

Other factors which may impact nonGHG emissions, but are not estimated in this analysis, include:

• Vehicle technologies used to reduce tailpipe CO 2 emissions; because the regulatory standards for non-GHG emissions are the primary driver for these emissions, EPA expects the impactof this program to be negligible on nonGHG emission rates per mile.

• The potential for increased market penetration of diesel vehicles; because these vehicles would be held to the
same certification and in-use standards for criteria pollutants as their gasoline counterparts, EPA expects their impact to be negligible on criteria pollutants
and other non-GHG emissions.

• Early introduction of electric vehicles and plug-in hybrid electric vehicles, which would reduce criteria emissions in cases where they are able to certify to lower certification standards. It would also likely reduce gaseous air toxics.

• Reduced refueling emissions due to less frequent refueling events and reduced annual refueling volumes resulting from the GHG standards.

• Increased hot soak evaporative emissions due to the likely increase in number of trips associated with VMT rebound modeled in this proposal.

• Increased market share of E10
relative to E0 due to the decreased overall gasoline consumption of this proposal combined with an unchanged
fuel ethanol volume.

EPA invites comments on the possible
contribution of these factors to non-GHG

emissions.

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1. Upstream Impacts of Program

Reducing tailpipe CO 2 emissions from light-duty cars and trucks through tailpipe standards and improved A/C efficiency will result in reduced fuel
demand and reductions in the emissions associated with all of the processes involved in getting petroleum to the pump. These upstream emission impacts on criteria pollutants are
summarized in Table III.G–1. The upstream reductions grow over time as
the fleet turns over to cleaner CO 2 vehicles, so that by 2030 VOC would decrease by 148,000 tons, NO X by 43,000 tons, and PM2.5 by 6,000 tons. Table III.G–2 shows the corresponding impacts on upstream air toxic emissions in 2030. Formaldehyde decreases by 112 tons, benzene by 320 tons, acetaldehyde by 15 tons, acrolein by 2 tons, and 1,3- butadiene by 3 tons.

To determine these impacts, EPA estimated the impact of reduced petroleum volumes on the extraction and transportation of crude oil as well as the production and distribution of finished gasoline. For the purpose of assessing domestic-only emission reductions it was necessary to estimate the fraction of fuel savings attributable to domestic finished gasoline, and of this gasoline what fraction is produced from domestic crude. For this analysis EPA estimated that 50 percent of fuel savings is attributable to domestic finished gasoline and that 90 percent of this gasoline originated from imported
crude. Emission factors for most upstream emission sources are based on the GREET1.8 model, developed by DOE’s Argonne National Laboratory, 234 but in some cases the GREET values were modified or updated by EPA to be
consistent with the National Emission Inventory (NEI). 235 The primary updates for this analysis were to incorporate newer information on gasoline
distribution emissions for VOC from the NEI, which were significantly higher than GREET estimates; and the incorporation of upstream emission
factors for the air toxics estimated in this analysis: benzene, 1,3-butadiene, acetaldehyde, acrolein, and

234 Greenhouse Gas, Regulated Emissions, and Energy Use in Transportation model (GREET), U.S. Department of Energy, Argonne National Laboratory, http://www.transportation.anl.gov/ modeling

_simulation/GREET/

.

235 EPA. 2002 National Emissions Inventory (NEI) Data and Documentation, http://www.epa.gov/ttn/ chief/net/2002inventory.html.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00142 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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formaldehyde. The development of
these emission factors is detailed in DRIA Chapter 5.

2. Downstream Impacts of Program

As discussed in more detail in Section III.H, the effect of fuel cost on VMT (‘‘rebound’’) was accounted for in our
assessment of economic and environmental impacts of this proposed rule. A 10 percent rebound case was used for this analysis, meaning that VMT for affected model years is modeled as increasing by 10 percent as much as the increase in fuel economy;

i.e. , a 10 percent increase in fuel economy would yield a 1.0 percent

increase in VMT.

Downstream emission impacts of the
rebound effect are summarized in Table III.G–1 for criteria pollutants and precursors and Table III.G–2 for air
toxics. The emission increases from the rebound effect grow over time as the
fleet turns over to cleaner CO 2 vehicles, so that by 2030 VOC would increase by 5,500 tons, NO X by 16,000 tons, and PM2.5 by 570 tons. Table III.G–2 shows the corresponding impacts on air toxic emissions. The most noteworthy of these impacts in 2030 are 40 additional tons of 1,3-butadiene, 75 tons of acetaldehyde, 240 tons of benzene, 96 tons of formaldehyde, and 4 tons of
acrolein.

For this analysis the reference case non-GHG emissions for light duty vehicles and trucks were derived using
EPA’s MOtor Vehicle Emission Simulator (MOVES) model for VOC, CO,

NO X , PM and air toxics. PM2.5 emission
estimates include additional adjustments for low temperatures,
discussed in detail in the DRIA. Because this modeling was based on calendar year estimates, estimating the rebound effect required a fleet-weighted rebound factor to be calculated for calendar years 2020 and 2030; these factors are presented in DRIA Chapter 5.

As discussed in Section III.H, EPA will be taking comment on the appropriate level of rebound rate for this analysis. The sensitivity of the
downstream emission increases shown
in Tables III.G–1 and III.G–2 to the level
of rebound would be in direct proportion to the rebound rate itself;
since zero rebound would result in zero emission increase, the downstream results presented in Table III.G–1 and Table III.G–2 can be directly scaled to
estimate the effect of lower rebound

rates. 3. Health Effects of Non-GHG Pollutants

a. Particulate Matter

i. Background

Particulate matter is a generic term for a broad class of chemically and physically diverse substances. It can be principally characterized as discrete particles that exist in the condensed (liquid or solid) phase spanning several orders of magnitude in size. Since 1987,
EPA has delineated that subset of inhalable particles small enough to penetrate to the thoracic region (including the tracheobronchial and alveolar regions) of the respiratory tract (referred to as thoracic particles). Current NAAQS use PM 2.5 as the indicator for fine particles (with PM 2.5 referring to particles with a nominal mean aerodynamic diameter less than or equal to 2.5 μm), and use PM 10 as the indicator for purposes of regulating the
coarse fraction of PM 10 (referred to asthoracic coarse particles or coarsefraction particles; generally including particles with a nominal mean aerodynamic diameter greater than 2.5

μm and less than or equal to 10 μm, or PM 10–2.5 ). Ultrafine particles are a subset of fine particles, generally less than 100 nanometers (0.1 μm) in aerodynamic
diameter.

Fine particles are produced primarily by combustion processes and by transformations of gaseous emissions ( e.g., SO X , NO X and VOC) in the atmosphere. The chemical and physical properties of PM 2.5 may vary greatly with time, region, meteorology, and source category. Thus, PM 2.5 may include a complex mixture of different pollutants including sulfates, nitrates, organic compounds, elemental carbon and metal compounds. These particles can remain in the atmosphere for days
to weeks and travel hundreds to
thousands of kilometers.

ii. Health Effects of PM

Scientific studies show ambient PM is
associated with a series of adverse
health effects. These health effects are
discussed in detail in EPA’s 2004 Particulate Matter Air Quality Criteria Document (PM AQCD) and the 2005 PM Staff Paper. 236 237 238 Further discussion

236 U.S. EPA (2004). Air Quality Criteria for
Particulate Matter. Volume I EPA600/P–99/002aF
and Volume II EPA600/P–99/002bF. Retrieved on March 19, 2009 from Docket EPA–HQ–OAR–2003–

0190 at http://www.regulations.gov/.

237 U.S. EPA. (2005). Review of the National Ambient Air Quality Standard for Particulate Matter: Policy Assessment of Scientific and Technical Information, OAQPS Staff Paper. EPA– 452/R–05–005a. Retrieved March 19, 2009 from http://www.epa.gov/ttn/naaqs/standards/pm/data/ pmstaffpaper

_20051221.pdf. of health effects associated with PM can
also be found in the DRIA for this rule.

Health effects associated with shortterm exposures (hours to days) to ambient PM include premature mortality, aggravation of cardiovascular and lung disease (as indicated by increased hospital admissions and emergency department visits), increased respiratory symptoms including cough and difficulty breathing, decrements in lung function, altered heart rate rhythm, and other more subtle changes in blood
markers related to cardiovascular
health. 239 Long-term exposure to PM 2.5 and sulfates has also been associated with mortality from cardiopulmonary disease and lung cancer, and effects on the respiratory system such as reduced lung function growth or development of respiratory disease. A new analysis shows an association between long-term

PM 2.5 exposure and a measure of atherosclerosis development. 240 241

Studies examining populations exposed over the long term (one or more years) to different levels of air pollution, including the Harvard Six Cities Study

238 The PM NAAQS is currently under review and the EPA is considering all available science on PM health effects, including information which has been published since 2004, in the development of the upcoming PM Integrated Science Assessment Document (ISA). A second draft of the PM ISA was completed in July 2009 and was submitted for review by the Clean Air Scientific Advisory Committee (CASAC) of EPA’s Science Advisory Board. Comments from the general public have also been requested. For more information, see http:// cfpub.epa.gov/ncea/cfm/ recordisplay.cfm?deid=210586.

239 U.S. EPA. (2006). National Ambient Air Quality Standards for Particulate Matter; Proposed
Rule. 71 FR 2620, January 17, 2006.

240 Ku  ̈ nzli, N., Jerrett, M., Mack, W.J., et al. (2004). Ambient air pollution and atherosclerosis in Los Angeles . Environ Health Perspect., 113, 201–

206.

241 This study is included in the 2006 Provisional
Assessment of Recent Studies on Health Effects of Particulate Matter Exposure. The provisional assessment did not and could not (given a very short timeframe) undergo the extensive critical review by CASAC and the public, as did the PM AQCD. The provisional assessment found that the ‘‘new’’ studies expand the scientific information and provide important insights on the relationship between PM exposure and health effects of PM. The provisional assessment also found that ‘‘new’’ studies generally strengthen the evidence that acute and chronic exposure to fine particles and acute exposure to thoracic coarse particles are associated with health effects. Further, the provisional science assessment found that the results reported in the studies did not dramatically diverge from previous findings, and taken in context with the findings of the AQCD, the new information and findings did not materially change any of the broad scientific conclusions regarding the health effects of PM exposure made in the AQCD. However, it is important to note that this assessment was limited to screening, surveying, and preparing a provisional
assessment of these studies. For reasons outlined in Section I.C of the preamble for the final PM NAAQS rulemaking in 2006 ( see 71 FR 61148–49, October 17, 2006), EPA based its NAAQS decision on the science presented in the 2004 AQCD.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00143 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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and the American Cancer Society Study, show associations between long-term exposure to ambient PM 2.5 and both total and cardiopulmonary premature mortality. 242 243 244 In addition, an
extension of the American Cancer Society Study shows an association
between PM 2.5 and sulfate concentrations and lung cancer mortality. 245

b. Ozone

i. Background

Ground-level ozone pollution is typically formed by the reaction of VOC
and NO X in the lower atmosphere in the presence of heat and sunlight. These pollutants, often referred to as ozone precursors, are emitted by many types of pollution sources, such as highway and nonroad motor vehicles and engines, power plants, chemical plants, refineries, makers of consumer and commercial products, industrial facilities, and smaller area sources.

The science of ozone formation, transport, and accumulation is complex. 246 Ground-level ozone is produced and destroyed in a cyclical set of chemical reactions, many of which are sensitive to temperature and sunlight. When ambient temperatures and sunlight levels remain high for several days and the air is relatively stagnant, ozone and its precursors can build up and result in more ozone thantypically occurs on a single hightemperature day. Ozone can be transported hundreds of miles downwind of precursor emissions, resulting in elevated ozone levels even

242 Dockery, D.W., Pope, C.A. III, Xu, X, et al. (1993). An association between air pollution and mortality in six U.S. cities. N Engl J Med, 329, 1753–1759. Retrieved on March 19, 2009 from http://content.nejm.org/cgi/content/full/329/24/

1753.

243 Pope, C.A., III, Thun, M.J., Namboodiri, M.M., Dockery, D.W., Evans, J.S., Speizer, F.E., and Heath, C.W., Jr. (1995). Particulate air pollution as a predictor of mortality in a prospective study of U.S.
adults. Am. J. Respir. Crit. Care Med, 151, 669–674.

244 Krewski, D., Burnett, R.T., Goldberg, M.S., et al. (2000). Reanalysis of the Harvard Six Cities study and the American Cancer Society study of particulate air pollution and mortality. A special report of the Institute’s Particle Epidemiology Reanalysis Project. Cambridge, MA: Health Effects Institute. Retrieved on March 19, 2009 fromhttp://es.epa.gov/ncer/science/pm/hei/ReanExecSumm.pdf.

245 Pope, C.A., III, Burnett, R.T., Thun, M. J., Calle, E.E., Krewski, D., Ito, K., Thurston, G.D., (2002). Lung cancer, cardiopulmonary mortality, and long-term exposure to fine particulate air pollution. J. Am. Med. Assoc., 287, 1132–1141.

246 U.S. EPA. (2006). Air Quality Criteria for Ozone and Related Photochemical Oxidants (Final). EPA/600/R–05/004aF-cF. Washington, DC: U.S. EPA. Retrieved on March 19, 2009 from Docket EPA–HQ–OAR–2003–0190 at http:// www.regulations.gov/. in areas with low local VOC or NO X emissions.

ii. Health Effects of Ozone

The health and welfare effects of
ozone are well documented and are assessed in EPA’s 2006 Air Quality Criteria Document (ozone AQCD) and 2007 Staff Paper. 247 248 Ozone can irritate the respiratory system, causing coughing, throat irritation, and/or
uncomfortable sensation in the chest. Ozone can reduce lung function and make it more difficult to breathe deeply; breathing may also become more rapid and shallow than normal, thereby limiting a person’s activity. Ozone can also aggravate asthma, leading to more asthma attacks that require medical
attention and/or the use of additional medication. In addition, there is suggestive evidence of a contribution of
ozone to cardiovascular-related morbidity and highly suggestive evidence that short-term ozone exposuredirectly or indirectly contributes to nonaccidental and cardiopulmonary-related mortality, but additional research is needed to clarify the underlying mechanisms causing these effects. In arecent report on the estimation of ozonerelated premature mortality published by the National Research Council (NRC), a panel of experts and reviewers concluded that short-term exposure to ambient ozone is likely to contribute to premature deaths and that ozone-related mortality should be included in
estimates of the health benefits of reducing ozone exposure. 249 Animal toxicological evidence indicates that with repeated exposure, ozone can inflame and damage the lining of the lungs, which may lead to permanent changes in lung tissue and irreversible reductions in lung function. People who are more susceptible to effects associated with exposure to ozone can include children, the elderly, and individuals with respiratory disease such as asthma. Those with greater exposures to ozone, for instance due to time spent outdoors ( e.g., children and

247 U.S. EPA. (2006). Air Quality Criteria for Ozone and Related Photochemical Oxidants (Final). EPA/600/R–05/004aF–cF. Washington, DC: U.S. EPA. Retrieved on March 19, 2009 from Docket EPA–HQ–OAR–2003–0190 at http:// www.regulations.gov/.

248 U.S. EPA. (2007). Review of the National Ambient Air Quality Standards for Ozone: Policy
Assessment of Scientific and Technical Information, OAQPS Staff Paper. EPA–452/R–07–

003. Washington, DC. U.S. EPA. Retrieved on March 19, 2009 from Docket EPA–HQ–OAR–2003–

0190 at http://www.regulations.gov/.

249 National Research Council (NRC), 2008. Estimating Mortality Risk Reduction and Economic Benefits from Controlling Ozone Air Pollution. The National Academies Press: Washington, DC. outdoor workers), are of particular

concern.

The 2006 ozone AQCD also examined
relevant new scientific information that has emerged in the past decade, including the impact of ozone exposure on such health effects as changes in lung structure and biochemistry, inflammation of the lungs, exacerbation and causation of asthma, respiratory illness-related school absence, hospital admissions and premature mortality. Animal toxicological studies have suggested potential interactions between ozone and PM with increased responses
observed to mixtures of the two pollutants compared to either ozone or PM alone. The respiratory morbidity observed in animal studies along with the evidence from epidemiologic studies supports a causal relationship between acute ambient ozone exposures and increased respiratory-related emergency room visits and hospitalizations in the warm season. In addition, there is suggestive evidence of a contribution of
ozone to cardiovascular-related morbidity and non-accidental and cardiopulmonary mortality.

c. NO X and SO X

i. Background

Nitrogen dioxide (NO 2) is a member of
the NO X family of gases. Most NO 2 is formed in the air through the oxidation of nitric oxide (NO) emitted when fuel is burned at a high temperature. SO 2 , a member of the sulfur oxide (SO X) family of gases, is formed from burning fuels containing sulfur ( e.g., coal or oil derived), extracting gasoline from oil, or extracting metals from ore.

SO 2 and NO 2 can dissolve in water vapor and further oxidize to form
sulfuric and nitric acid which react with ammonia to form sulfates and nitrates, both of which are important components of ambient PM. The health
effects of ambient PM are discussed in Section III.G.3.a of this preamble. NO X along with non-methane hydrocarbon (NMHC) are the two major precursors of
ozone. The health effects of ozone are
covered in Section III.G.3.b.

ii. Health Effects of NO 2

Information on the health effects of

NO 2 can be found in the U.S. Environmental Protection Agency Integrated Science Assessment (ISA) for Nitrogen Oxides. 250 The U.S. EPA has concluded that the findings of epidemiologic, controlled human

250 U.S. EPA (2008). Integrated Science Assessment for Oxides of Nitrogen—Health Criteria (Final Report). EPA/600/R–08/071. Washington, DC: U.S. EPA. Retrieved on March 19, 2009 from http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?
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exposure, and animal toxicological studies provide evidence that is sufficient to infer a likely causal relationship between respiratory effects
and short-term NO 2 exposure. The ISA concludes that the strongest evidence for such a relationship comes from epidemiologic studies of respiratory effects including symptoms, emergency department visits, and hospital
admissions. The ISA also draws two broad conclusions regarding airway responsiveness following NO 2 exposure. First, the ISA concludes that NO 2 exposure may enhance the sensitivity to allergen-induced decrements in lungfunction and increase the allergeninduced airway inflammatory response at exposures as low as 0.26 ppm NO 2 for 30 minutes. Second, exposure to NO 2 has been found to enhance the inherent responsiveness of the airway to subsequent nonspecific challenges in controlled human exposure studies of asthmatic subjects. Enhanced airway responsiveness could have important clinical implications for asthmatics since transient increases in airway responsiveness following NO 2 exposure have the potential to increase symptoms and worsen asthma control. Together, the epidemiologic and experimental data sets form a plausible, consistent, and coherent description of a relationship between NO 2 exposures and an array of adverse health effects that range from the onset of respiratory symptoms to hospital admission.

Although the weight of evidence supporting a causal relationship is
somewhat less certain than that associated with respiratory morbidity,

NO 2 has also been linked to other health endpoints. These include all-cause (nonaccidental) mortality, hospital admissions or emergency department visits for cardiovascular disease, and decrements in lung function growth associated with chronic exposure.

iii. Health Effects of SO 2

Information on the health effects of

SO 2 can be found in the U.S. Environmental Protection Agency Integrated Science Assessment for
Sulfur Oxides. 251 SO 2 has long been known to cause adverse respiratory health effects, particularly among
individuals with asthma. Other potentially sensitive groups include children and the elderly. During periods of elevated ventilation, asthmatics may

251 U.S. EPA. (2008). Integrated Science Assessment (ISA) for Sulfur Oxides—Health Criteria (Final Report). EPA/600/R–08/047F. Washington, DC: U.S. Environmental Protection Agency. Retrieved on March 18, 2009 from http:// cfpub.epa.gov/ncea/cfm/recordisplay. cfm?deid=198843. experience symptomatic bronchoconstriction within minutes of exposure. Following an extensive
evaluation of health evidence from epidemiologic and laboratory studies,
the EPA has concluded that there is a causal relationship between respiratory health effects and short-term exposure

to SO 2 . Separately, based on an evaluation of the epidemiologic
evidence of associations between shortterm exposure to SO 2 and mortality, the
EPA has concluded that the overall evidence is suggestive of a causal relationship between short-term exposure to SO 2 and mortality.

d. Carbon Monoxide

Carbon monoxide (CO) forms as a result of incomplete fuel combustion. CO enters the bloodstream through the lungs, forming carboxyhemoglobin and reducing the delivery of oxygen to the body’s organs and tissues. The health
threat from CO is most serious for those who suffer from cardiovascular disease, particularly those with angina or peripheral vascular disease. Healthy individuals also are affected, but only at higher CO levels. Exposure to elevated CO levels is associated with impairment of visual perception, work capacity, manual dexterity, learning ability and performance of complex tasks. Carbon
monoxide also contributes to ozone
nonattainment since carbon monoxide reacts photochemically in the atmosphere to form ozone. 252 Additional information on CO related
health effects can be found in the Carbon Monoxide Air Quality Criteria Document (CO AQCD). 253 254

e. Air Toxics

Motor vehicle emissions contribute to
ambient levels of air toxics known or suspected as human or animal carcinogens, or that have noncancer health effects. The population experiences an elevated risk of cancer
and other noncancer health effects from

252 U.S. EPA (2000). Air Quality Criteria for Carbon Monoxide, EPA/600/P–99/001F. This document is available in Docket EPA–HQ–OAR–

2004–0008.

253 U.S. EPA (2000). Air Quality Criteria for Carbon Monoxide, EPA/600/P–99/001F. This document is available in Docket EPA–HQ–OAR–

2004–0008.

254 The CO NAAQS is currently under review and the EPA is considering all available science on CO health effects, including information which has been published since 2000, in the development of the upcoming CO Integrated Science Assessment Document (ISA). A first draft of the CO ISA was completed in March 2009 and was submitted for review by the Clean Air Scientific Advisory Committee (CASAC) of EPA’s Science Advisory Board. For more information, see http:// cfpub.epa.gov/ncea/cfm/ recordisplay.cfm?deid=203935. exposure to air toxics. 255 These compounds include, but are not limited to, benzene, 1,3-butadiene, formaldehyde, acetaldehyde, acrolein, polycyclic organic matter (POM), and naphthalene. These compounds, except acetaldehyde, were identified as national or regional risk drivers in the
2002 National-scale Air Toxics Assessment (NATA) and have significant inventory contributions from
mobile sources. 256 Emissions and ambient concentrations of compounds are discussed in the DRIA chapter on emission inventories and air quality (Chapters 5 and 7, respectively).

i. Benzene The EPA’s IRIS database lists benzene as a known human carcinogen (causing leukemia) by all routes of exposure, and concludes that exposure is associated with additional health effects, including genetic changes in both humans and animals and increased proliferation of
bone marrow cells in mice. 257 258 259 EPA states in its IRIS database that data indicate a causal relationship between benzene exposure and acute lymphocytic leukemia and suggest a relationship between benzene exposure and chronic non-lymphocytic leukemia and chronic lymphocytic leukemia. The International Agency for Research on Carcinogens (IARC) has determined that benzene is a human carcinogen and the

U.S. Department of Health and Human Services (DHHS) has characterized
benzene as a known human carcinogen. 260 261

A number of adverse noncancer health effects including blood disorders, such as preleukemia and aplastic anemia, have also been associated with

255 U. S. EPA. 2002 National-Scale Air Toxics

Assessment. http://www.epa.gov/ttn/atw/
nata12002/risksum.html.

256 U.S. EPA. 2009. National-Scale Air Toxics
Assessment for 2002. http://www.epa.gov/ttn/atw/
nata2002/.

257 U.S. EPA. 2000. Integrated Risk Information System File for Benzene. This material is available electronically at http://www.epa.gov/iris/subst/
0276.htm

.

258 International Agency for Research on Cancer (IARC). 1982. Monographs on the evaluation of carcinogenic risk of chemicals to humans, Volume

29. Some industrial chemicals and dyestuffs, World Health Organization, Lyon, France, p. 345–389.

259 Irons, R.D.; Stillman, W.S.; Colagiovanni, D.B.; Henry, V.A. 1992. Synergistic action of the benzene metabolite hydroquinone on myelopoietic stimulating activity of granulocyte/macrophage colony-stimulating factor in vitro, Proc. Natl. Acad.

Sci. 89:3691–3695.

260 International Agency for Research on Cancer (IARC). 1987. Monographs on the evaluation of carcinogenic risk of chemicals to humans, Volume

29. Supplement 7, Some industrial chemicals and dyestuffs, World Health Organization, Lyon, France.

261 U.S. Department of Health and Human Services National Toxicology Program 11th Report on Carcinogens available at http:// www.ntp.niehs.nih.gov/go/16183

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long-term exposure to benzene. 262 263 The most sensitive noncancer effect observed in humans, based on current data, is the depression of the absolute lymphocyte count in blood. 264 265 In addition, recent work, including studies sponsored by the Health Effects Institute (HEI), provides evidence that biochemical responses are occurring at lower levels of benzene exposure than previously know 266 267 268 269 EPA’s IRIS program has not yet evaluated these
new data.

ii. 1,3-Butadiene

EPA has characterized 1,3-butadiene as carcinogenic to humans by
inhalation. 270 271 The IARC has determined that 1,3-butadiene is a human carcinogen and the U.S. DHHS has characterized 1,3-butadiene as a known human carcinogen. 272 273 There

262 Aksoy, M. (1989). Hematotoxicity and carcinogenicity of benzene. Environ. Health Perspect. 82: 193–197.

263 Goldstein, B.D. (1988). Benzene toxicity. Occupational medicine. State of the Art Reviews. 3:

541–554.

264 Rothman, N., G.L. Li, M. Dosemeci, W.E. Bechtold, G.E. Marti, Y.Z. Wang, M. Linet, L.Q. Xi,

W. Lu, M.T. Smith, N. Titenko-Holland, L.P. Zhang,

W. Blot, S.N. Yin, and R.B. Hayes (1996) Hematotoxicity among Chinese workers heavily exposed to benzene. Am. J. Ind. Med. 29: 236–246.

265 U.S. EPA (2002) Toxicological Review of Benzene (Noncancer Effects). Environmental Protection Agency, Integrated Risk Information System (IRIS), Research and Development, National Center for Environmental Assessment, Washington DC. This material is available electronically at http://www.epa.gov/iris/subst/0276.htm.

266 Qu, O.; Shore, R.; Li, G.; Jin, X.; Chen, C.L.; Cohen, B.; Melikian, A.; Eastmond, D.; Rappaport, S.; Li, H.; Rupa, D.; Suramaya, R.; Songnian, W.; Huifant, Y.; Meng, M.; Winnik, M.; Kwok, E.; Li, Y.; Mu, R.; Xu, B.; Zhang, X.; Li, K. (2003) HEI Report 115, Validation & Evaluation of Biomarkers in Workers Exposed to Benzene in China.

267 Qu, Q., R. Shore, G. Li, X. Jin, L.C. Chen, B. Cohen, et al. (2002) Hematological changes among Chinese workers with a broad range of benzene exposures. Am. J. Industr. Med. 42: 275–285.

268 Lan, Qing, Zhang, L., Li, G., Vermeulen, R., et al. (2004) Hematotoxically in Workers Exposed to
Low Levels of Benzene. Science 306: 1774–1776.

269 Turtletaub, K.W. and Mani, C. (2003) Benzene
metabolism in rodents at doses relevant to human exposure from Urban Air. Research Reports Health Effect Inst. Report No.113.

270 U.S. EPA (2002) Health Assessment of 1,3– Butadiene. Office of Research and Development, National Center for Environmental Assessment, Washington Office, Washington, DC. Report No.
EPA600–P–98–001F. This document is available electronically at http://www.epa.gov/iris/supdocs/ buta-sup.pdf.

271 U.S. EPA (2002) Full IRIS Summary for 1,3- butadiene (CASRN 106–99–0). Environmental Protection Agency, Integrated Risk Information System (IRIS), Research and Development, National Center for Environmental Assessment, Washington,

DC http://www.epa.gov/iris/subst/0139.htm.

272 International Agency for Research on Cancer (IARC) (1999) Monographs on the evaluation of carcinogenic risk of chemicals to humans, Volume 71, Re-evaluation of some organic chemicals, hydrazine and hydrogen peroxide and Volume 97 (in preparation), World Health Organization, Lyon,

France. are numerous studies consistently demonstrating that 1,3-butadiene is metabolized into genotoxic metabolites by experimental animals and humans. The specific mechanisms of 1,3- butadiene-induced carcinogenesis are unknown; however, the scientific evidence strongly suggests that the carcinogenic effects are mediated by genotoxic metabolites. Animal data suggest that females may be more
sensitive than males for cancer effects associated with 1,3-butadiene exposure;
there are insufficient data in humans
from which to draw conclusions about sensitive subpopulations. 1,3-butadiene also causes a variety of reproductive and developmental effects in mice; no
human data on these effects are
available. The most sensitive effect was ovarian atrophy observed in a lifetime bioassay of female mice. 274

iii. Formaldehyde

Since 1987, EPA has classified formaldehyde as a probable human carcinogen based on evidence in humans and in rats, mice, hamsters, and monkeys. 275 EPA is currently reviewing recently published epidemiological data. For instance, research conducted by the National Cancer Institute (NCI)
found an increased risk of nasopharyngeal cancer and lymphohematopoietic malignancies such as leukemia among workers exposed to formaldehyde. 276 277 In an analysis of the lymphohematopoietic cancer mortality from an extended follow-up of these workers, NCI
confirmed an association between lymphohematopoietic cancer risk and peak exposures. 278 A recent National Institute of Occupational Safety and

273 U.S. Department of Health and Human Services (2005) National Toxicology Program 11th Report on Carcinogens available at: ntp.niehs.nih.gov/index.cfm?objectid=32BA9724-

F1F6-975E-7FCE50709CB4C932.

274 Bevan, C.; Stadler, J.C.; Elliot, G.S.; et al. (1996) Subchronic toxicity of 4-vinylcyclohexene in rats and mice by inhalation. Fundam. Appl.
Toxicol. 32:1–10.

275 U.S. EPA (1987) Assessment of Health Risks
to Garment Workers and Certain Home Residents from Exposure to Formaldehyde, Office of Pesticides and Toxic Substances, April 1987.

276 Hauptmann, M.; Lubin, J. H.; Stewart, P. A.; Hayes, R. B.; Blair, A. 2003. Mortality from lymphohematopeotic malignancies among workers in formaldehyde industries. Journal of the National

Cancer Institute 95: 1615–1623.

277 Hauptmann, M.; Lubin, J. H.; Stewart, P. A.; Hayes, R. B.; Blair, A. 2004. Mortality from solid cancers among workers in formaldehyde industries. American Journal of Epidemiology 159: 1117–1130.

278 Beane Freeman, L. E.; Blair, A.; Lubin, J. H.; Stewart, P. A.; Hayes, R. B.; Hoover, R. N.; Hauptmann, M. 2009. Mortality from lymphohematopoietic malignancies among workers in formaldehyde industries: The National Cancer Institute cohort. J. National Cancer Inst. 101: 751–

761. Health (NIOSH) study of garment
workers also found increased risk of death due to leukemia among workers exposed to formaldehyde. 279 Extended follow-up of a cohort of British chemical
workers did not find evidence of an increase in nasopharyngeal or lymphohematopoietic cancers, but a continuing statistically significant excess in lung cancers was reported. 280 Recently, the IARC re-classified formaldehyde as a human carcinogen (Group 1). 281

Formaldehyde exposure also causes a range of noncancer health effects, including irritation of the eyes (burning and watering of the eyes), nose and throat. Effects from repeated exposure in humans include respiratory tract irritation, chronic bronchitis and nasal epithelial lesions such as metaplasia and loss of cilia. Animal studies suggest that formaldehyde may also cause airway inflammation—including eosinophil infiltration into the airways. There are several studies that suggest that formaldehyde may increase the risk of asthma—particularly in the

young. 282 283

iv. Acetaldehyde

Acetaldehyde is classified in EPA’s IRIS database as a probable human carcinogen, based on nasal tumors in rats, and is considered toxic by the inhalation, oral, and intravenous

routes. 284 Acetaldehyde is reasonably anticipated to be a human carcinogen by the U.S. DHHS in the 11th Report on Carcinogens and is classified as possibly carcinogenic to humans (Group 2B) by

279 Pinkerton, L. E. 2004. Mortality among a cohort of garment workers exposed to formaldehyde: an update. Occup. Environ. Med. 61:

193–200.

280 Coggon, D, EC Harris, J Poole, KT Palmer. 2003. Extended follow-up of a cohort of British chemical workers exposed to formaldehyde. J
National Cancer Inst. 95:1608–1615.

281 International Agency for Research on Cancer (IARC). 2006. Formaldehyde, 2–Butoxyethanol and 1-tert-Butoxypropan-2-ol. Volume 88. (in preparation), World Health Organization, Lyon,

France.

282 Agency for Toxic Substances and Disease Registry (ATSDR). 1999. Toxicological profile for Formaldehyde. Atlanta, GA: U.S. Department of Health and Human Services, Public Health Service. http://www.atsdr.cdc.gov/toxprofiles/tp111.html.

283 WHO (2002) Concise International Chemical Assessment Document 40: Formaldehyde. Published under the joint sponsorship of the United Nations Environment Programme, the International Labour Organization, and the World Health Organization, and produced within the framework of the Inter-Organization Programme for the Sound Management of Chemicals. Geneva.

284 U.S. EPA. 1991. Integrated Risk Information System File of Acetaldehyde. Research and Development, National Center for Environmental Assessment, Washington, DC. This material is available electronically at http://www.epa.gov/iris/
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the IARC. 285 286 EPA is currently conducting a reassessment of cancer risk from inhalation exposure to acetaldehyde. The primary noncancer effects of exposure to acetaldehyde vapors include irritation of the eyes, skin, and respiratory tract. 287 In shortterm (4 week) rat studies, degeneration of olfactory epithelium was observed at
various concentration levels of acetaldehyde exposure. 288 289 Data from these studies were used by EPA to develop an inhalation reference
concentration. Some asthmatics have
been shown to be a sensitive subpopulation to decrements in functional expiratory volume (FEV1 test) and bronchoconstriction upon acetaldehyde inhalation. 290 The agency is currently conducting a reassessment
of the health hazards from inhalation exposure to acetaldehyde.

v. Acrolein

Acrolein is extremely acrid and irritating to humans when inhaled, with acute exposure resulting in upper respiratory tract irritation, mucus hypersecretion and congestion. Levels considerably lower than 1 ppm (2.3 mg/

m 3 ) elicit subjective complaints of eye
and nasal irritation and a decrease in the respiratory rate. 291 292 Lesions to the lungs and upper respiratory tract of rats, rabbits, and hamsters have been observed after subchronic exposure to acrolein. Based on animal data, individuals with compromised respiratory function ( e.g. , emphysema,

285 U.S. Department of Health and Human Services National Toxicology Program 11th Report on Carcinogens available at: ntp.niehs.nih.gov/index.cfm?objectid=32BA9724-F1F6-975E7FCE50709CB4C932.

286 International Agency for Research on Cancer (IARC). 1999. Re-evaluation of some organic chemicals, hydrazine, and hydrogen peroxide. IARC Monographs on the Evaluation of Carcinogenic Risk of Chemical to Humans, Vol. 71. Lyon, France.

287 U.S. EPA. 1991. Integrated Risk Information System File of Acetaldehyde. This material is available electronically at http://www.epa.gov/iris/
subst/0290.htm.

288 Appleman, L. M., R. A. Woutersen, V. J. Feron,

R. N. Hooftman, and W. R. F. Notten. 1986. Effects of the variable versus fixed exposure levels on the toxicity of acetaldehyde in rats. J. Appl. Toxicol. 6:

331–336.

289 Appleman, L.M., R.A. Woutersen, and V.J. Feron. 1982. Inhalation toxicity of acetaldehyde in
rats. I. Acute and subacute studies. Toxicology. 23:

293–297.

290 Myou, S.; Fujimura, M.; Nishi K.; Ohka, T.; and Matsuda, T. 1993. Aerosolized acetaldehyde
induces histamine-mediated bronchoconstriction in
asthmatics. Am. Rev. Respir. Dis. 148(4 Pt 1): 940–

3.

291 Weber-Tschopp, A; Fischer, T; Gierer, R; et al. (1977) Experimentelle reizwirkungen von Acrolein auf den Menschen. Int Arch Occup Environ Hlth 40(2):117–130. In German

292 Sim, VM; Pattle, RE. (1957) Effect of possible smog irritants on human subjects. J Am Med Assoc 165(15):1908–1913. asthma) are expected to be at increased risk of developing adverse responses to strong respiratory irritants such as
acrolein. This was demonstrated in mice with allergic airway-disease by comparison to non-diseased mice in a study of the acute respiratory irritant
effects of acrolein. 293 The intense irritancy of this carbonyl has been demonstrated during controlled tests in human subjects, who suffer intolerable eye and nasal mucosal sensory reactions within minutes of exposure. 294

EPA determined in 2003 that the human carcinogenic potential of
acrolein could not be determined
because the available data were inadequate. No information was available on the carcinogenic effects of
acrolein in humans and the animal data provided inadequate evidence of carcinogenicity. 295 The IARC
determined in 1995 that acrolein was not classifiable as to its carcinogenicity
in humans. 296

vi. Polycyclic Organic Matter (POM)

POM is generally defined as a large class of organic compounds which have multiple benzene rings and a boiling point greater than 100 degrees Celsius. Many of the compounds included in the class of compounds known as POM are classified by EPA as probable human carcinogens based on animal data. One of these compounds, naphthalene, is discussed separately below. Polycyclic aromatic hydrocarbons (PAHs) are a subset of POM that contain only hydrogen and carbon atoms. A number of PAHs are known or suspected carcinogens. Recent studies have found that maternal exposures to PAHs (a subclass of POM) in a population of pregnant women were associated with several adverse birth outcomes, including low birth weight and reduced length at birth, as well as impaired cognitive development at age

293 Morris JB, Symanowicz PT, Olsen JE, et al. 2003. Immediate sensory nerve-mediated respiratory responses to irritants in healthy and allergic airway-diseased mice. J Appl Physiol 94(4):1563–1571.

294 Sim VM, Pattle RE. Effect of possible smog irritants on human subjects JAMA165: 1980–2010,

1957.

295 U.S. EPA. 2003. Integrated Risk Information System File of Acrolein. Research and Development, National Center for Environmental Assessment, Washington, DC. This material is
available at http://www.epa.gov/iris/subst/
0364.htm.

296 International Agency for Research on Cancer (IARC). 1995. Monographs on the evaluation of carcinogenic risk of chemicals to humans, Volume 63, Dry cleaning, some chlorinated solvents and other industrial chemicals, World Health Organization, Lyon, France. three. 297 298 EPA has not yet evaluated
these recent studies.

vii. Naphthalene

Naphthalene is found in small quantities in gasoline and diesel fuels. Naphthalene emissions have been measured in larger quantities in both gasoline and diesel exhaust compared with evaporative emissions from mobile sources, indicating it is primarily a product of combustion. EPA released an
external review draft of a reassessment of the inhalation carcinogenicity of naphthalene based on a number of recent animal carcinogenicity
studies. 299 The draft reassessment completed external peer review. 300 Based on external peer review comments received, additional analyses are being undertaken. This external review draft does not represent official agency opinion and was released solely for the purposes of external peer review and public comment. Once EPA evaluates public and peer reviewer comments, the document will be revised. The National Toxicology Program listed naphthalene as ‘‘reasonably anticipated to be a human carcinogen’’ in 2004 on the basis of bioassays reporting clear evidence of carcinogenicity in rats and some evidence of carcinogenicity in mice. 301 California EPA has released a new risk assessment for naphthalene, and the IARC has reevaluated naphthalene and re-classified it as Group 2B: possibly carcinogenic to humans. 302 Naphthalene
also causes a number of chronic noncancer effects in animals, including

297 Perera, F.P.; Rauh, V.; Tsai, W–Y.; et al. (2002) Effect of transplacental exposure to environmental pollutants on birth outcomes in a multiethnic population. Environ Health Perspect. 111: 201–205.

298 Perera, F.P.; Rauh, V.; Whyatt, R.M.; Tsai, W.Y.; Tang, D.; Diaz, D.; Hoepner, L.; Barr, D.; Tu, Y.H.; Camann, D.; Kinney, P. (2006) Effect of prenatal exposure to airborne polycyclic aromatic hydrocarbons on neurodevelopment in the first 3 years of life among inner-city children. Environ Health Perspect 114: 1287–1292.

299 U. S. EPA. 2004. Toxicological Review of Naphthalene (Reassessment of the Inhalation Cancer Risk), Environmental Protection Agency, Integrated Risk Information System, Research and Development, National Center for Environmental Assessment, Washington, DC. This material is available electronically at http://www.epa.gov/iris/
subst/0436.htm.

300 Oak Ridge Institute for Science and Education. (2004). External Peer Review for the IRIS Reassessment of the Inhalation Carcinogenicity of Naphthalene. August 2004. http://cfpub.epa.gov/ ncea/cfm/recordisplay.cfm?deid=84403.

301 National Toxicology Program (NTP). (2004). 11th Report on Carcinogens. Public Health Service,

U.S. Department of Health and Human Services, Research Triangle Park, NC. Available from: http://ntp-server.niehs.nih.gov.

302 International Agency for Research on Cancer (IARC). (2002). Monographs on the Evaluation of the Carcinogenic Risk of Chemicals for Humans. Vol. 82. Lyon, France.VerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00147 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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abnormal cell changes and growth in respiratory and nasal tissues. 303

viii. Other Air Toxics

In addition to the compounds described above, other compounds in gaseous hydrocarbon and PM emissions from vehicles will be affected by this proposed action. Mobile source air toxic compounds that would potentially be impacted include ethylbenzene, polycyclic organic matter, propionaldehyde, toluene, and xylene. Information regarding the health effects of these compounds can be found in
EPA’s IRIS database. 304

4. Environmental Effects of Non-GHG
Pollutants

a. Visibility

Visibility can be defined as the degree to which the atmosphere is transparent to visible light. Airborne particles degrade visibility by scattering and absorbing light. Visibility is important because it has direct significance to people’s enjoyment of daily activities in all parts of the country. Individuals value good visibility for the well-being it provides them directly, where they live and work and in places where they enjoy recreational opportunities. Visibility is also highly valued in significant natural areas such as national parks and wilderness areas and special emphasis is given to protecting visibility in these areas. For more information on visibility, see the final 2004 PM AQCD as well as the 2005 PM Staff Paper. 305 306

EPA is pursuing a two-part strategy to address visibility. First, to address the welfare effects of PM on visibility, EPA has set secondary PM 2.5 standards which act in conjunction with the establishment of a regional haze program. In setting this secondary standard, EPA has concluded that PM 2.5 causes adverse effects on visibility in

303 U. S. EPA. 1998. Toxicological Review of Naphthalene, Environmental Protection Agency, Integrated Risk Information System, Research and Development, National Center for Environmental Assessment, Washington, DC. This material is available electronically at http://www.epa.gov/iris/
subst/0436.htm.

304 U.S. EPA Integrated Risk Information System (IRIS) database is available at: www.epa.gov/iris

.

305 U.S. EPA. (2004). Air Quality Criteria for Particulate Matter (AQCD). Volume I Document No.
EPA600/P–99/002aF and Volume II Document No. EPA600/P–99/002bF. Washington, DC: U.S. Environmental Protection Agency. Retrieved on March 18, 2009 from http://cfpub.epa.gov/ncea/ cfm/recordisplay.cfm?deid=87903.

306 U.S. EPA. (2005). Review of the National Ambient Air Quality Standard for Particulate Matter: Policy Assessment of Scientific and Technical Information, OAQPS Staff Paper. EPA– 452/R–05–005. Washington, DC: U.S. Environmental Protection Agency. various locations, depending on PM
concentrations and factors such as chemical composition and average relative humidity. Second, section 169 of the Clean Air Act provides additional authority to address existing visibility impairment and prevent future visibility impairment in the 156 national parks, forests and wilderness areas categorized as mandatory class I Federal areas (62 FR 38680–81, July 18, 1997). 307 In July 1999, the regional haze rule (64 FR 35714) was put in place to protect the visibility in mandatory class I Federal areas. Visibility can be said to be impaired in both PM 2.5 nonattainment areas and mandatory class I Federal

areas.

b. Plant and Ecosystem Effects of Ozone

Elevated ozone levels contribute to environmental effects, with impacts to plants and ecosystems being of most concern. Ozone can produce both acute and chronic injury in sensitive species depending on the concentration level and the duration of the exposure. Ozone
effects also tend to accumulate over the growing season of the plant, so that even low concentrations experienced for a longer duration have the potential to create chronic stress on vegetation. Ozone damage to plants includes visible injury to leaves and impaired photosynthesis, both of which can lead to reduced plant growth and reproduction, resulting in reduced crop yields, forestry production, and use of sensitive ornamentals in landscaping. In addition, the impairment of photosynthesis, the process by which the plant makes carbohydrates (its source of energy and food), can lead to a subsequent reduction in root growth and carbohydrate storage below ground, resulting in other, more subtle plant and ecosystems impacts.

These latter impacts include increased susceptibility of plants to insect attack, disease, harsh weather, interspecies competition and overall decreased plant vigor. The adverse
effects of ozone on forest and other natural vegetation can potentially lead to species shifts and loss from the affected ecosystems, resulting in a loss or reduction in associated ecosystem goods and services. Lastly, visible ozone injury to leaves can result in a loss of aesthetic value in areas of special scenic significance like national parks and
wilderness areas. The final 2006 ozone AQCD presents more detailed

307 These areas are defined in section 162 of the Act as those national parks exceeding 6,000 acres, wilderness areas and memorial parks exceeding 5,000 acres, and all international parks which were in existence on August 7, 1977. information on ozone effects on vegetation and ecosystems.

c. Atmospheric Deposition

Wet and dry deposition of ambient particulate matter delivers a complex mixture of metals ( e.g. , mercury, zinc, lead, nickel, aluminum, cadmium), organic compounds ( e.g. , POM, dioxins, furans) and inorganic compounds ( e.g. , nitrate, sulfate) to terrestrial and aquatic ecosystems. The chemical form of the compounds deposited depends on a variety of factors including ambient conditions ( e.g. , temperature, humidity, oxidant levels) and the sources of the material. Chemical and physical transformations of the compounds occur in the atmosphere as well as the media onto which they deposit. These
transformations in turn influence the fate, bioavailability and potential toxicity of these compounds. Atmospheric deposition has been identified as a key component of the
environmental and human health hazard posed by several pollutants including mercury, dioxin and PCBs. 308

Adverse impacts on water quality can occur when atmospheric contaminants deposit to the water surface or when material deposited on the land enters a water body through runoff. Potential impacts of atmospheric deposition to
water bodies include those related to both nutrient and toxic inputs. Adverse
effects to human health and welfare can
occur from the addition of excess nitrogen via atmospheric deposition. The nitrogen-nutrient enrichment contributes to toxic algae blooms and zones of depleted oxygen, which can lead to fish kills, frequently in coastal waters. Deposition of heavy metals or other toxins may lead to the human ingestion of contaminated fish, human ingestion of contaminated water, damage to the marine ecology, and
limits to recreational uses. Several
studies have been conducted in U.S.
coastal waters and in the Great Lakes Region in which the role of ambient PM deposition and runoff is investigated. 309 310 311 312 313

308 U.S. EPA (2000) Deposition of Air Pollutants to the Great Waters: Third Report to Congress. Office of Air Quality Planning and Standards. EPA–
453/R–00–0005. This document is available in Docket EPA–HQ–OAR–2003–0190.

309 U.S. EPA (2004) National Coastal Condition Report II. Office of Research and Development/
Office of Water. EPA–620/R–03/002. This document is available in Docket EPA–HQ–OAR–2003–0190.

310 Gao, Y., E.D. Nelson, M.P. Field, et al. 2002. Characterization of atmospheric trace elements on

PM 2.5 particulate matter over the New York-New Jersey harbor estuary. Atmos. Environ. 36: 1077–

1086.

311 Kim, G., N. Hussain, J.R. Scudlark, and T.M. Church. 2000. Factors influencing the atmospheric

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Atmospheric deposition of nitrogen and sulfur contributes to acidification, altering biogeochemistry and affecting animal and plant life in terrestrial and aquatic ecosystems across the U.S. The sensitivity of terrestrial and aquatic ecosystems to acidification from nitrogen and sulfur deposition is predominantly governed by geology. Prolonged exposure to excess nitrogen and sulfur deposition in sensitive areas acidifies lakes, rivers and soils. Increased acidity in surface waters creates inhospitable conditions for biota
and affects the abundance and nutritional value of preferred prey species, threatening biodiversity and ecosystem function. Over time, acidifying deposition also removes essential nutrients from forest soils, depleting the capacity of soils to neutralize future acid loadings and negatively affecting forest sustainability. Major effects include a decline in sensitive forest tree species, such as red spruce (Picea rubens) and sugar maple (Acer saccharum ), and a loss of biodiversity of fishes, zooplankton, and
macro invertebrates.

In addition to the role nitrogen deposition plays in acidification, nitrogen deposition also causes ecosystem nutrient enrichment leading to eutrophication that alters biogeochemical cycles. Excess nitrogen also leads to the loss of nitrogen sensitive lichen species as they are outcompeted by invasive grasses as well as altering the biodiversity of terrestrial ecosystems, such as grasslands and meadows. For a broader explanation of the topics treated here, refer to the description in Chapter 7 of the DRIA.

Adverse impacts on soil chemistry and plant life have been observed for areas heavily influenced by atmospheric deposition of nutrients, metals and acid species, resulting in species shifts, loss of biodiversity, forest decline and damage to forest productivity. Potential impacts also include adverse effects to human health through ingestion of contaminated vegetation or livestock (as in the case for dioxin deposition), reduction in crop yield, and limited use
of land due to contamination.

Atmospheric deposition of pollutants can reduce the aesthetic appeal of buildings and culturally important

depositional fluxes of stable Pb, 210Pb, and 7Be into Chesapeake Bay. J. Atmos. Chem. 36: 65–79.

312 Lu, R., R.P. Turco, K. Stolzenbach, et al. 2003. Dry deposition of airborne trace metals on the Los Angeles Basin and adjacent coastal waters. J. Geophys. Res. 108(D2, 4074): AAC 11–1 to 11–24.

313 Marvin, C.H., M.N. Charlton, E.J. Reiner, et al.
2002. Surficial sediment contamination in Lakes Erie and Ontario: A comparative analysis. J. Great
Lakes Res. 28(3): 437–450. articles through soiling, and can contribute directly (or in conjunction with other pollutants) to structural damage by means of corrosion or erosion. Atmospheric deposition may affect materials principally by promoting and accelerating the corrosion of metals, by degrading paints, and by deteriorating building materials
such as concrete and limestone.
Particles contribute to these effects because of their electrolytic, hygroscopic, and acidic properties, and their ability to adsorb corrosive gases (principally sulfur dioxide). The rate of metal corrosion depends on a number of factors, including the deposition rate and nature of the pollutant; the influence of the metal protective corrosion film; the amount of moisture present; variability in the electrochemical reactions; the presence
and concentration of other surface electrolytes; and the orientation of the
metal surface.

d. Environmental Effects of Air Toxics

Fuel combustion emissions contribute to ambient levels of pollutants that
contribute to adverse effects on vegetation. Volatile organic compounds (VOCs), some of which are considered air toxics, have long been suspected to play a role in vegetation damage. 314 In laboratory experiments, a wide range of
tolerance to VOCs has been observed. 315 Decreases in harvested seed pod weight have been reported for the more sensitive plants, and some studies have reported effects on seed germination, flowering and fruit ripening. Effects of
individual VOCs or their role in conjunction with other stressors ( e.g. , acidification, drought, temperature extremes) have not been well studied. In a recent study of a mixture of VOCs including ethanol and toluene on herbaceous plants, significant effects on seed production, leaf water content and photosynthetic efficiency were reported for some plant species. 316

Research suggests an adverse impact of vehicle exhaust on plants, which has
in some cases been attributed to aromatic compounds and in other cases

314 U.S. EPA. 1991. Effects of organic chemicals in the atmosphere on terrestrial plants. EPA/600/3–
91/001.

315 Cape JN, ID Leith, J Binnie, J Content, M Donkin, M Skewes, DN Price AR Brown, AD Sharpe. 2003. Effects of VOCs on herbaceous plants in an open-top chamber experiment. Environ.
Pollut. 124:341–343.

316 Cape JN, ID Leith, J Binnie, J Content, M Donkin, M Skewes, DN Price AR Brown, AD Sharpe. 2003. Effects of VOCs on herbaceous plants in an open-top chamber experiment. Environ.
Pollut. 124:341–343. to nitrogen oxides. 317 318 319 The impacts of VOCs on plant reproduction may have long-term implications for biodiversity and survival of native species near major roadways. Most of the studies of the impacts of VOCs on vegetation have focused on short-term exposure and few studies have focused on long-term effects of VOCs on vegetation and the potential for metabolites of these compounds to
affect herbivores or insects.

5. Air Quality Impacts of Non-GHG
Pollutants

a. Current Levels of PM 2.5 , Ozone, CO and Air Toxics

This proposal may have impacts on
levels of PM 2.5 , ozone, CO and air toxics. Nationally, levels of PM 2.5 , ozone, CO and air toxics are declining. 320 321 However, in 2005 EPA designated 39
nonattainment areas for the 1997 PM 2.5 National Ambient Air Quality Standard (NAAQS) (70 FR 943, January 5, 2005). These areas are composed of 208 full or partial counties with a total population exceeding 88 million. The 1997 PM 2.5 NAAQS was recently revised and the
2006 24-hour PM 2.5 NAAQS became effective on December 18, 2006. The numbers above likely underestimate the number of counties that are not meeting
the PM 2.5 NAAQS because the
nonattainment areas associated with the more stringent 2006 24-hour PM 2.5 NAAQS have not yet been designated. Area designations for the 2006 24-hour

PM 2.5 NAAQS are expected to be promulgated in 2009 and become effective 90 days after publication in the Federal Register

.

In addition, the U.S. EPA has recently amended the ozone NAAQS (73 FR 16436, March 27, 2008). That final 2008 ozone NAAQS rule set forth revisions to the previous 1997 NAAQS for ozone to provide increased protection of public health and welfare. As of June 5, 2009, there are 55 areas designated as

317 Viskari E-L. 2000. Epicuticular wax of Norway spruce needles as indicator of traffic pollutant deposition. Water, Air, and Soil Pollut. 121:327–

337.

318 Ugrekhelidze D, F Korte, G Kvesitadze. 1997. Uptake and transformation of benzene and toluene by plant leaves. Ecotox. Environ. Safety 37:24–29.

319 Kammerbauer H, H Selinger, R Rommelt, A Ziegler-Jons, D Knoppik, B Hock. 1987. Toxic components of motor vehicle emissions for the spruce Pciea abies. Environ. Pollut. 48:235–243.

320 U.S. EPA (2008) National Air Quality Status and Trends through 2007. Office of Air Quality Planning and Standards, Research Triangle Park,
NC. Publication No. EPA 454/R–08–006. http:// epa.gov/airtrends/2008/index.html.

321 U.S. EPA (2007) Final Regulatory Impact Analysis: Control of Hazardous Air Pollutants from Mobile Sources, Office of Transportation and Air Quality, Ann Arbor, MI, Publication No. EPA420–

R–07–002. http://www.epa.gov/otaq/toxics.htm

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nonattainment for the 1997 8-hour ozone NAAQS, comprising 290 full or partial counties with a total population of approximately 132 million people.
These numbers do not include the people living in areas where there is a future risk of failing to maintain or attain the 1997 8-hour ozone NAAQS. The numbers above likely
underestimate the number of counties that are not meeting the ozone NAAQS
because the nonattainment areas associated with the more stringent 2008 8-hour ozone NAAQS have not yet been designated.

The proposed vehicle standards may also impact levels of ambient CO, a criteria pollutant (see Table III.G–1 above for co-pollutant emission impacts). As of June 5, 2009 there are approximately 479,000 people living in a portion of Clark Co., NV which is currently the only area in the country that is designated as nonattainment for

CO. 322

Further, the majority of Americans continue to be exposed to ambient
concentrations of air toxics at levels which have the potential to cause
adverse health effects. 323 The levels of air toxics to which people are exposed vary depending on where people live
and work and the kinds of activities in which they engage, as discussed in
detail in U.S. EPA’s recent mobile
source air toxics rule. 324

b. Impacts of Proposed Standards on
Future Ambient PM 2.5 , Ozone, CO and

Air Toxics

Full-scale photochemical air quality modeling is necessary to accurately project levels of PM 2.5 , ozone, CO andair toxics. For the final rule, a nationalscale air quality modeling analysis will be performed to analyze the impacts of
the vehicle standards on PM 2.5 , ozone, and selected air toxics (i.e. , benzene, formaldehyde, acetaldehyde, acrolein and 1,3-butadiene). The length of time needed to prepare the necessary emissions inventories, in addition to the processing time associated with the modeling itself, has precluded us from performing air quality modeling for this proposal.

Section III.G.1 of the preamble presents projections of the changes in criteria pollutant and air toxics emissions due to the proposed vehicle

322 Carbon Monoxide Nonattainment Area Summary: http://www.epa.gov/air/oaqps/greenbk/
cnsum.html

.

323 U.S. Environmental Protection Agency (2007).
Control of Hazardous Air Pollutants from Mobile Sources; Final Rule. 72 FR 8434, February 26, 2007.

324 U.S. Environmental Protection Agency (2007).
Control of Hazardous Air Pollutants from Mobile Sources; Final Rule. 72 FR 8434, February 26, 2007. standards; the basis for those estimates is set out in Chapter 5 of the DRIA. The atmospheric chemistry related to
ambient concentrations of PM 2.5 , ozone and air toxics is very complex, and making predictions based solely on emissions changes is extremely difficult. However, based on the magnitude of the emissions changes predicted to result from the proposed vehicle standards, EPA expects that there will be an improvement in ambient air quality, pending a more comprehensive analysis
for the final rule.

For the final rule, EPA intends to use a 2005-based Community Multi-scale Air Quality (CMAQ) modeling platform as the tool for the air quality modeling. The CMAQ modeling system is acomprehensive three-dimensional gridbased Eulerian air quality model designed to estimate the formation and fate of oxidant precursors, primary and secondary PM concentrations and deposition, and air toxics, over regional and urban spatial scales ( e.g. over the contiguous U.S.). 325 326 327 The CMAQ
model is a well-known and wellestablished tool and is commonly used by EPA for regulatory analyses, for instance the recent ozone NAAQS proposal, and by States in developing
attainment demonstrations for their State Implementation Plans. 328 TheCMAQ model (version 4.6) was peerreviewed in February of 2007 for EPA as reported in ‘‘Third Peer Review of CMAQ Model,’’ and the EPA Office of Research and Development (ORD) peer review report which includes version

4.7is currently being finalized. 329

CMAQ includes many science modules that simulate the emission, production, decay, deposition andtransport of organic and inorganic gasphase and particle-phase pollutants in the atmosphere. EPA intends to use the most recent CMAQ version (version

325 U.S. Environmental Protection Agency, Byun, D.W., and Ching, J.K.S., Eds, 1999. Science algorithms of EPA Models-3 Community Multiscale Air Quality (CMAQ modeling system, EPA/600/R– 99/030, Office of Research and Development).

326 Byun, D.W., and Schere, K.L., 2006. Review of the Governing Equations, ComputationalAlgorithms, and Other Components of the Models3 Community Multiscale Air Quality (CMAQ) Modeling System, J. Applied Mechanics Reviews, 59 (2), 51–77.

327 Dennis, R.L., Byun, D.W., Novak, J.H., Galluppi, K.J., Coats, C.J., and Vouk, M.A., 1996. The next generation of integrated air quality modeling: EPA’s Models-3, Atmospheric Environment, 30, 1925–1938.

328 U.S. EPA (2007). Regulatory Impact Analysis of the Proposed Revisions to the National Ambient Air Quality Standards for Ground-Level Ozone. EPA document number 442/R–07–008, July 2007.

329 Aiyyer, A., Cohan, D., Russell, A., Stockwell, W., Tanrikulu, S., Vizuete, W., Wilczak, J., 2007. Final Report: Third Peer Review of the CMAQ Model. p. 23. 4.7), which was officially released by
EPA’s Office of Research and Development (ORD) in December 2008 and reflects updates to earlier versions in a number of areas to improve the underlying science. These include (1) enhanced secondary organic aerosol (SOA) mechanism to include chemistryof isoprene, sesquiterpene, and aged incloud biogenic SOA in addition to terpene; (2) improved vertical convective mixing; (3) improved heterogeneous reaction involving nitrate formation; and (4) an updated gas-phase chemistry mechanism, Carbon Bond 05 (CB05), with extensions to model explicit concentrations of air toxic species as well as chlorine and mercury. This mechanism, CB05-toxics, also computes concentrations of species that are involved in aqueous chemistry and that are precursors to aerosols.

H. What Are the Estimated Cost, Economic, and Other Impacts of the Proposal?

In this section, EPA presents the costs and impacts of EPA’s proposed GHG program. It is important to note that
NHTSA’s CAFE standards and EPA’s GHG standards will both be in effect,
and each will lead to increases in average fuel economy and CO 2 emissions reductions. The two agencies’ standards comprise the National Program, and this discussion of costs
and benefits of EPA’s GHG standard does not change the fact that both the CAFE and GHG standards, jointly, are
the source of the benefits and costs of the National Program.

This section outlines the basis for assessing the benefits and costs of these standards and provides estimates of
these costs and benefits. Some of these effects are private, meaning that they affect consumers and producers directly in their sales, purchases, and use of vehicles. These private effects include the costs of the technology, fuel savings, and the benefits of additional driving and reduced refueling. Other costs and benefits affect people outside the markets for vehicles and their use; these effects are termed external costs, because they affect people external to
the market. The external effects includethe climate impacts, the effects on nonGHG pollutants, and the effects on traffic, accidents, and noise due to additional driving. The sum of the private and external benefits and costs is the net social benefits of the program.
There is some debate about the role of private benefits in assessing the benefits and costs of the program: If consumers have full information and perfect foresight in their vehicle purchase decisions, it is possible that they haveVerDate Nov<24>2008 23:31 Sep 25, 2009 Jkt 217001 PO 00000 Frm 00150 Fmt 4701 Sfmt 4702 E:\FR\FM\28SEP2.SGM 28SEP2mstockstill on DSKH9S0YB1PROD with PROPOSALS 

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already considered these benefits in their vehicle purchase decisions. If so, then the inclusion of private benefits in the net benefits calculation may be inappropriate. If these conditions do not hold, then the private benefits may be a part of the net benefits. Section III.H.1 discusses this issue more fully.

EPA’s proposed program costs consist of the vehicle program costs (costs of complying with the vehicle CO 2 standards, taking into account FFV credits through 2015, the temporary
lead-time alternative allowance standard program (TLAASP), full car/ truck trading, and the A/C credit program), along with the fuel savings associated with reduced fuel usage resulting from the proposed program. These proposed program costs also
include external costs associated with noise, congestion, accidents, time spent refueling vehicles, and energy securityimpacts. EPA also presents the costeffectiveness of the proposed standards and our analysis of the expected economy-wide impacts. The projected monetized benefits of reducing GHG emissions and co-pollutant health and environmental impacts are also presented. EPA also presents our estimates of the impact on vehicle miles traveled and the impacts associated
with those miles as well as other societal impacts of the proposed program, including energy security impacts.

The total monetized benefits (excluding fuel savings) under the proposed program are projected to be $21 to $54 billion in 2030, assuming a 3 percent discount rate and depending
on the value used for the social cost of carbon. The costs of the proposed program in 2030 are estimated to be approximately $18 billion for new vehicle technology less $90 billion in savings realized by consumers through fewer fuel expenditures (calculated using pre-tax fuel prices).

EPA has undertaken an analysis of the economy-wide impacts of the proposed GHG tailpipe standards as an exploratory exercise that EPA believes could provide additional insights into the potential impacts of the proposal. 330 These results were not a factor regarding the appropriateness of the proposed GHG tailpipe standards. It is important to note that the results of this modeling exercise are dependent on the assumptions associated with how consumers will respond to increases in higher vehicle costs and improved

330 See Memorandum to Docket, ‘‘Economy-Wide Impacts of Proposed Greenhouse Gas Tailpipe Standards,’’ September 14, 2009 (Docket EPA–HQ– OAR–2009–0472). vehicle fuel economy as a result of the proposal. Section III.H.1 discusses the underlying distinctions and implications of the role of consumer response in economic impacts.

Further information on these and other aspects of the economic impacts of our proposed rule are summarized in the following sections and are presented
in more detail in the DRIA for this rulemaking. EPA requests comment on all aspects of the cost, savings, and benefits analysis presented here and in the DRIA. EPA also requests comment on the inputs used in these analyses as described in the Draft Joint TSD.

1. Conceptual Framework for Evaluating Consumer Impacts

For this proposed rule, EPA projects significant private gains to consumers in three major areas: (1) Reductions in spending on fuel, (2) time saved due to less refueling, and (3) welfare gains from additional driving that results from the rebound effect. In combination, these private savings, mostly from fuel savings, appear to outweigh by a large margin the costs of the program, even without accounting for externalities.

Admittedly, these findings pose a conundrum. On the one hand, consumers are expected to gain significantly from the proposed rules, as
the increased cost of fuel efficient cars appears to be far smaller than the fuel savings (assuming modest discount rates). Yet fuel efficient cars are currently offered for sale, and consumers’ purchasing decisions may suggest a preference for lower fuel economy than the proposed rule mandates. Assuming full information and perfect foresight, standard economic theory suggests that the private gains to consumers, large as they are, must therefore be accompanied by
a consumer welfare loss. This
calculation assumes that consumers accurately predict all the benefits they will get from a new vehicle, even if they underestimated fuel savings at the time of purchase. Even if there is some such loss, EPA believes that under realistic assumptions, the private gains from the proposed rule, together with the social gains (in the form of reduction of externalities), significantly outweigh the
costs. But EPA seeks comments on the underlying issue.

The central conundrum has been referred to as the Energy Paradox in this setting (and in several others). 331 In short, the problem is that consumers

331 Jaffe, A.B., & Stavins, R.N. (1994). The Energy
Paradox and the Diffusion of Conservation Technology. Resource and Energy Economics, 16(2),

91–122. appear not to purchase products that are
in their economic self-interest. There are strong theoretical reasons why this might be so. 332 Consumers might bemyopic and hence undervalue the longterm; they might lack information or a full appreciation of information even when it is presented; they might be especially averse to the short-term losses associated with energy efficient products (the behavioral phenomenon of ‘‘loss aversion’’); even if consumers have relevant knowledge, the benefits of energy efficient vehicles might not be sufficiently salient to them at the time of purchase. A great deal of work in
behavioral economics identifies factors of this sort, which help account for the Energy Paradox. 333 This point holds in the context of fuel savings (the main focus here), but it applies equally to the other private benefits, including reductions in refueling time and additional driving. 334

Considerable research suggests that the Energy Paradox is real and significant due to consumers’ inability to value future fuel savings appropriately. For example, Sanstad and Howarth (1994) argue that consumers optimize behavior without full information by resorting to imprecise
but convenient rules of thumb. Larrick and Soll (2008) find evidence that
consumers do not understand how to translate changes in miles-per-gallon into fuel savings (a concern that EPA is continuing to attempt to address). 335 If these arguments are valid, then there will be significant gains to consumers of the government mandating additional fuel economy.

The evidence from consumer vehicle choice models indicates a huge range of estimates for consumers’ willingness to pay for additional fuel economy. Because consumer surplus estimates
from consumer vehicle choice models depend critically on this value, EPA would consider any consumer surplus
estimates of the effect of our rule from
such models to be unreliable. In addition, the predictive ability of consumer vehicle choice models may be
limited. While vehicle choice models

332 For an overview, see id

.

333 Id. ; Thaler, Richard. Quasi-Rational Economics. New York: Russell Sage, 1993.

334 For example, it might be maintained that at the time of purchase, consumers take full account of the time potentially saved by fuel-efficient cars, but it might also be questioned whether they have adequate information to do so, or whether that factor is sufficiently salient to play the proper role in purchasing decisions.

335 Sanstad, A., and R. Howarth (1994). ‘‘ ‘Normal’ Markets, Market Imperfections, and Energy Efficiency.’’ Energy Policy 22(10): 811–818; Larrick, R.P., and J.B. Soll (2008). ‘‘The MPG illusion.’’

Science 320: 1593–1594.