Ceres 

Testimony of Ceres Regarding EPA and NHTSA's Proposed Phase 2 

Greenhouse Gas Emission Standards and Fuel Efficiency Standards for 

Medium- and Heavy-Duty Vehicles, Engines, and Trailers 

August 18, 2015 

My name is Kirsten James, and I am the Senior Manager of California 

Policy and Partnerships at Ceres; our organization's mission is to mobilize 

investors and business leaders to build a thriving, sustainable global 

economy. Ceres coordinates three networks of investors and business 

leaders: (1) The first is the Investor Network on Climate Risk (I NCR) which 

consists of more than 110 institutional investors, with assets exceeding $13 

trillion, (2) the second, Businesses for Innovative Climate and Energy 

Policy (BICEP), is an advocacy coalition of leading businesses committed 

to working with policy makers to enact meaningful energy and climate 

legislation, (3) and finally, Ceres's company network, which includes nearly 

70 member companies, over half of which are listed on the S&P500 Index. 

Ceres commends EPA and NHTSA for taking action to address fuel 

efficiency and GHG emissions associated with the medium- and heavyduty vehicle sector, and for its thorough and inclusive rulemaking process. 

We urge EPA and NHTSA to strengthen the proposed Phase 2 standard 

under consideration today.by adopting a standard requiring a 40°/o 

reduction in fuel consumption compared to 2010 by 2025; Alternative 4 

comes closest to that standard. 

Freight trucks currently account for over half a billion tons of GHG 

emissions per year and are the fastest growing single source of GHG 

emissions in the United States. Strict standards will catalyze investment in 

high efficiency truck technologies, thereby serving to retain the U.S. 

leadership position in this sector, save businesses money, promote energy 

security and reduce climate risk. 

Such standards would be important drivers of economic growth, benefiting 

business, the trucking industry, and American consumers. Despite higher 

upfront costs, advanced fuel-efficient trucks will more than pay for 

themselves over a typical ownership period due to fuel cost savings. A joint 

analysis by Ceres and the Environmental Defense Fund found these 
standards would reduce freight costs by 3% in 2030 and 7% in 2040, an 

estimated $34 billion annual saving potential. 1 Furthermore, these benefits 

would accrue to the greater economy and American consumers; as 

operating costs come down due to more fuel-efficient trucks, business 

owners and consumers will reinvest that money in goods and services 

throughout the economy. Under stricter standards, the average U.S. 

household stands to save $250 per year in lower priced goods. 2 

I'd also like to highlight the Global Investor Statement submitted with my 

testimony, which was coordinated by Ceres. The statement was signed by 

285 investors, both owners and asset managers, representing assets of 

over $20 trillion, and included a call for strict vehicle standards as a means 

of both minimizing climate risk and helping provide a long-term policy 

framework that will shift the investment risk-reward balance in favor of less 

carbon-intensive investment. 

Strict standards are also key to retaining the US leadership position in 

efficient truck manufacturing, and expanding job opportunities in that 

sector. We are currently the world leader in the development, production 

and use of energy efficient and hybrid trucks. Without strong standards in 

place, companies and investors will lack the requisite certainty to invest in 

the development and production of new technologies that will allow us to 

retain our primary position and increase job growth. 

Strong standards are also critical to national energy security. We are 

increasingly dependent on trucking , and need to minimize our vulnerability 

to fuel price volatility. Standards requiring the use of existing and emerging 

technologies would significantly reduce our dependence on oil. According 

to 2014 study by organizations including the Union of Concerned Scientists 

and the American Council for an Energy-Efficient Economy, a stronger 

standard requiring a 40°/o reduction in fuel consumption by 2025-would 

decrease daily oil consumption by 1.4 million barrels per day by 2030. 3 

1 M. J. Bradley and Associates LLC, "EPA/NHTSA Phase 2 Fuel Efficiency & GHG Standards for Freight Trucks: 

Projected Effect on Freight Costs." May 2015. Web. http://www.ceres.org/trucksavings 2 Cooper, Mark Dr. and Gillis, Jack. "The Consumer Benefits of Increasing the Fuel Economy of Medium and Heavy 

Duty Trucks." The Consumer Federation of America. February 201 4. Web. http://www.consumerfed.org/pdfs!Payingthe-Freight..Qdf 

3 American Council for an Energy-Efficient Economy (ACEEE), Environmental Defense Fund (EDF), Natural 

Resources Defense Council (NRDC), Sierra Club, and Union of Concerned Scientists (UCS). 2014. Big fuel savings 

available in new trucks. Web. http://aceee.orglfiles/pdflfact-shee!Aruck-savings-0614.pdf, accessed June 29, 201 5. 
Ceres agrees with the California Air Resources Board (CARS), which 

recommends the adoption of the Alternative 4 standards at a minimum, 

stating this option is both technology forcing and technologically feasible. 

Accelerating the timeline to require compliance by MY2024 is a costeffective way to rapidly reduce emissions. A recent CARS report indicates 

vehicle technology payback periods under Alternative 4 remain virtually 

unchanged compared to Alternative 3, with the exception of pickups and 

vans, which stand to gain just a single year.

4 

Finally, companies in a variety of sectors are increasingly interested in 

tracking Scope 3 emissions, including GHG emissions associated with 

transportation and freight movement, as part of their publicly disclosed 

GHG assessment. Thus, a growing number of companies support policies 

such as strict truck standards that would help them achieve their own GHG 

emission reduction goals as well as save money. A recent Wall Street 

Journal op-ed co-authored by lndra K. Nooyi, Chairman and CEO of 

PepsiCo, takes the position that better standards are better for the 

environment and businesses, explaining that strong standards will cut costs 

and allow companies to reinvest in their products and compete in their 

industry.

5 Likewise, a recent article written by Jostein Solheim, the CEO of 

Ben & Jerry's, in the Guardian describes simi lar benefits for companies that 

rely on trucking to get their products to market. Notably, Mr. Solheim calls 

for a 40% reduction in heavy truck fuel consumption by 2025.6 

In sum, we urge EPA and NHTSA to adopt standards requiring a 40% 

reduction in fuel use by 2025. Such technology forcing standards would 

drive innovation, catalyze investment in high efficiency truck and supplier 

manufacturing, as well as promote energy security and reduce climate risk. 

It is time to move forward aggressively with policies that will optimize 

private investment in a low carbon economy, cut freight costs, and reduce 

GHG emissions from the trucking sector. 

Thank you for the opportunity to speak today, and your leadership on this 

important issue. 

4 California Environmental Protection Agency Air Resources Board, Update on the Proposed Federal Phase 2 GHG 

and Fuel Efficiency Standards for Medium- and Heavy-Duty Vehicles. July 23. 2015. Sacramento, California. Web. 

http://insideepa.com//siteslinsideepa.comlfiles/documentsftul201 5/epa2015 1591 .pdf 5 Nooyi, lndra K., and Fred Krupp. "Delivering a Greener Fleet of Trucks." WSJ. N.p., 19 June. 2015. Web. 6 Jostein Solheim. "I Scream, You Scream, We All Scream-For Higher Fuel Emissions Standards." The Guardian. 

N.p., 3 July. 2015. Web. 
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