Draft EPA Response to Interagency Comments on Upstream GHG Emissions

Draft Preamble Section II.B.4.a (new language in bold, deleted language in strikeout):

a. Life-Cycle Fuel Production-Related GHG and Energy Issues

49 U.S.C. 32908(g)(1)(A)(i) states that NHTSA must require vehicles to be labeled with information “reflecting an automobile’s performance ... [with respect to] greenhouse gas ... emissions ... of the automobile.” 1 NHTSA and EPA propose that the greenhouse gas emissions represented on the label include vehicle tailpipe emissions of CO2, but not any GHG emissions generated upstream of the vehicle. However, the agencies recognize that all automotive fuels have upstream GHG emissions associated with the production and distribution of the fuel used by the motor vehicle. This includes gasoline, diesel, and other fuels such as natural gas, electricity, E85, and renewable biofuels. Operation of vehicles can result in GHG emissions from the vehicle itself as well as GHG emissions from the production and distribution of the fuel used by the
vehicle.

NHTSA believes that the EISA provision is somewhat ambiguous as written and thus provides a degree of discretion. One reasonable interpretation of this provision is that only information on the GHG emissions directly from the vehicle itself is required, because those are the direct “automobile’s performance” with respect to “greenhouse gas emissions.” If this approach was taken, the agencies could supplement the label information by providing extensive upstream emissions information on their websites. We note that this approach is also consistent with the joint EPA/DOT standards for fuel economy and greenhouse gas emissions from passenger cars and light trucks for model years 2012-2016, which treat GHG emissions for electric operation as zero up to a cumulative production cap per manufacturer. 2 Accordingly, the agencies propose that vehicle operation on grid electricity for those model years be reflected on the label as having tailpipe greenhouse gas emissions of zero, although the agencies may reconsider this approach in later model years.

However, NHTSA believes that it would also be reasonable to interpret the statutory language such that the required information on GHG emissions would include GHG emissions associated with the fuel used by the vehicle – that is, the upstream emissions from the production and distribution of fuel used to power a vehicle, whether that fuel is gasoline or ethanol or coal/petroleum/natural gas-fired electricity – because

1 32908(g)(1)(A)(ii) also refers to GHG “emissi ons of automobiles,” and further requires a designation of automobiles “with the lowest greenhouse gas emissions over the useful life of the vehicles.”

2 EPA placed a cumulative production cap on the total production of EVs, PHEVs, and FCVs for which an individual manufacturer can claim the zero grams/mile compliance value during model years 2012-2016. The cumulative production cap will be 200,000 vehicles, except th at those manufacturers that sell at least 25,000 EVs, PHEVs, and FCVs in MY 2012 will have a cap of 300,000 ve hicles for MY 2012-2016. See 75 FR 25436 (May 7, 2010)

1all of those GHG emissions are related to the automobile’s performance on GHG emissions. This could be particularly important for vehicles that run partially or completely on grid electricity.

As noted above, all fuels used by automobiles have associated upstream GHG emissions. The upstream GHG emissions are not the same for all of the different fuels, and may even vary regionally for the same fuel – for example, all of the GHG emissions associated with operating an EV occur upstream of the vehicle tailpipe, and lifecycle emissions for electricity generation (and, for that matter, renewable fuels as well) can vary significantly, based on the type of feedstock used to produce the fuel. This can potentially affect the accounting of upstream GHG emissions (for more information on lifecycle emissions from renewable fuels, see EPA's RFS2 rule; 75 FR 14670)

Thus, while the proposed labels would provide information on the GHG emissions from the vehicle itself, identified as “tailpipe only,” we nevertheless recognize that consumers may want to have access to information on the total GHG emissions associated with the operation of their vehicles, not just the tailpipe only emissions, and that access to such information can help consumers understand the GHG performance of the vehicle. Accordingly, while the agencies are proposing to include tailpipe-only GHG emissions on vehicle labels, the agencies invite comment on whether, and if so, how, the agencies should address upstream GHG emissions. The agencies recognize that accounting for upstream GHG emissions can be complex, and we encourage commenters to be as specific as possible with any recommendations on how to address upstream GHG emissions. Given that the label itself provides opportunity to provide only a limited amount of information, while much broader and detailed information can be provided on web sites, the agencies invite comment both on what kind of information should be provided to prospective purchasers, and where such information should be provided, the label or the web site. For example, the agencies invite comment on whether information on full lifecycle GHG emissions should be provided (on either the labels or the websites), and if so, for all fuels, or for just a subset of fuels? Should lifecycle emissions be calculated as full fuel lifecycle or should a more limited fuel life cycle emissions be used as discussed above for the light-duty CAFE and GHG rule? Should upstream emissions be provided specifically for the emissions associated with the combustion of fuel to produce electricity? Should upstream emissions be determined on a regional or a national basis? Should upstream emissions be provided as a relative comparison to a gasoline or diesel fuel, the current predominant fuels? Should any information on upstream emissions be provided on the label, or should the prospective purchaser be referred to the web site? If information is provided on the label, what information? If information is provided on the website, what information? For all of these, the agencies invite comment on the appropriate metrics to use and the specific suggestions for label content and design, if appropriate. For label, commenters should take into consideration the limited amount of information that can be provided.

23 For the convenience of commenters, we have prepared the Table below as an illustrative example of one way that some upstream emissions could be accounted for, based on the assumptions that follow: 3

Proposal

‐‐ Tailpipe

‐ Only Tailpipe + Upstream

Vehicle CO2/mile CO2/mile

EV 0 197

PHEV 1 89 210

PHEV 2 133 217

Toyota Prius HEV 178 224

Honda Civic HEV 212 266

Honda Insight HEV 217 273

Ford Fusion HEV 228 287

Smart 247 311

Lexus 250h HEV 254 320

Nissan Altima HEV 261 329

At minimum, the agencies plan to provide information on websites that will inform consumers of the projected upstream GHG emissions and energy impacts of vehicle operation, based on both national average values and, where appropriate because of regional variability, regional values as well.

3 The key assumptions underlying the illustrative numbers in the right-hand column are that:

• EV and PHEVs all assumed to use 200 Watt-hours per m ile when operating on electricity over the EPA test and assuming a 30% range (43% electricity consumption) shortfall from test to road.

• PHEV 1 assumed to operate on electricity 50% of the time.

• PHEV 2 assumed to operate on electricity 25% of the time.

• Uses 2005 nationwide average value of 0.642 gram s of upstream GHG per Watt-hour at power plant (adjusted to include GHG emissions from feedstock extraction, transportation, and processing as well) from MY2012-2016 light-duty vehicle GHG final rule (75 Federal Register 25437).

• Assumes typical 7% electricity grid transmission losses.

• Uses 2250 grams upstream GHG per gallon of gasoline.