```

[Federal Register Volume 78, Number 116 (Monday, June 17, 2013)]
[Rules and Regulations]
[Pages 36369-36406]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-11980]

[[Page 36369]]

Vol. 78

Monday,

No. 116

June 17, 2013

Part IV

 Environmental Protection Agency

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40 CFR Parts 85, 86, 1036, et al.

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Department of Transportation

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National Highway Traffic Safety Administration

49 CFR Parts 523 and 535

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Heavy-Duty Engine and Vehicle, and Nonroad Technical Amendments; Final 
Rule

Federal Register / Vol. 78, No. 116 / Monday, June 17, 2013 / Rules 
and Regulations

[[Page 36370]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 85, 86, 1036, 1037, 1039, 1042, 1048, 1054, 1065, 
1066, 1068

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Parts 523 and 535

[EPA-HQ-OAR-2012-0102; NHTSA-2012-0152; FRL 9772-3]
RIN 2060-AR48; 2127-AL31

Heavy-Duty Engine and Vehicle, and Nonroad Technical Amendments

AGENCIES: Environmental Protection Agency (EPA) and National Highway 
Traffic Safety Administration (NHTSA), Department of Transportation.

ACTION: Direct final rule.

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SUMMARY: EPA and NHTSA, on behalf of the Department of Transportation, 
are each adopting corrections to provisions in our respective Medium- 
and Heavy-Duty Greenhouse Gas Emissions and Fuel Efficiency final rule 
issued on September 15, 2011. These amendments eliminate duplicative 
reporting requirements, reduce inadvertent minor differences between 
the EPA and NHTSA programs regarding such matters as voluntary early 
model year compliance, better align testing procedures to market 
realities, and reduce unnecessary testing burdens. This action also 
separately amends several regulations exclusive to EPA by: adjusting 
the provisions of the replacement engine exemption, expanding EPA's 
discretion to allow greater flexibility under the Transition Program 
for Equipment Manufacturers related to the Tier 4 standards for nonroad 
diesel engines, specifying multiple versions of the applicable SAE 
standard for demonstrating that fuel lines for nonroad spark-ignition 
engines above 19 kilowatts meet permeation requirements, and allowing 
for the use of the ethanol-based test fuel specified by the California 
Air Resources Board for nonroad spark-ignition engines at or below 19 
kilowatts. Some of the individual EPA-only provisions of this action 
may have minor impacts on the costs and emission reductions of the 
underlying regulatory programs amended in this action, though in most 
cases these are simple technical amendments. For those provisions that 
may have a minor impact on the costs or benefits of the amended 
regulatory program, any potential impacts would be small and we have 
not attempted to quantify the potential changes.

DATES: These rules are effective on August 16, 2013 without further 
notice, unless EPA or NHTSA receives adverse comment. If we receive 
relevant adverse comment on distinct elements of this rule by July 17, 
2013, we will publish a timely withdrawal in the Federal Register 
indicating which provisions we are withdrawing. The provisions that are 
not withdrawn will become effective on August 16, 2013 notwithstanding 
adverse comment on any other provision.
    The incorporation by reference of certain publications listed in 
this regulation is approved by the Director of the Federal Register as 
of August 16, 2013.

ADDRESSES: Submit your comments, identified by Docket ID No. NHTSA-
2012-0152 and/or EPA-HQ-OAR-2012-0102, by one of the following methods:
    www.regulations.gov: Follow the on-line instructions for 
submitting comments.
     Email: a-and-r-docket@epa.gov Fax: NHTSA: (202) 493-2251; EPA: (202) 566-9744.
     Mail:
    NHTSA: Docket Management Facility, M-30, U.S. Department of 
Transportation, West Building, Ground Floor, Rm. W12-140, 1200 New 
Jersey Avenue SE., Washington, DC 20590.
    EPA: Air and Radiation Docket and Information Center, Environmental 
Protection Agency, Air Docket, Mail-code 28221T, 1200 Pennsylvania Ave. 
NW., Washington, DC 20460.
    1. Hand Delivery:
    NHTSA: West Building, Ground Floor, Rm. W12-140, 1200 New Jersey 
Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m. Eastern 
Time, Monday through Friday, except Federal Holidays.
    EPA: EPA Docket Center (EPA/DC), EPA West, Room 3334, 1301 
Constitution Ave. NW., Washington, DC, Attention Docket ID No. EPA-HQ-
OAR-2012-0102. Such deliveries are only accepted during the Docket's 
normal hours of operation, and special arrangements should be made for 
deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. NHTSA-2012-0152 
and/or EPA-HQ-OAR-2012-0102. See the SUPPLEMENTARY INFORMATION section 
on ``Public Participation'' for additional instructions on submitting 
written comments.
    Docket: All documents in the docket are listed in the 
www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., information claimed as 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Certain other material, such as 
copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in www.regulations.gov or in hard copy at the following locations:
    NHTSA: Docket Management Facility, M-30, U.S. Department of 
Transportation, West Building, Ground Floor, Rm. W12-140, 1200 New 
Jersey Avenue SE., Washington, DC 20590. The Docket Management Facility 
is open between 9 a.m. and 5 p.m. Eastern Time, Monday through Friday, 
except Federal holidays.
    EPA: EPA Docket Center, EPA/DC, EPA West, Room 3334, 1301 
Constitution Ave. NW., Washington, DC. The Public Reading Room is open 
from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal 
holidays. The telephone number for the Public Reading Room is (202) 
566-1744, and the telephone number for the Air Docket is (202) 566-
1742.

FOR FURTHER INFORMATION CONTACT: Lily Smith, Office of Chief Counsel, 
National Highway Traffic Safety Administration, 1200 New Jersey Avenue 
SE., Washington, DC 20590; telephone: (202) 366-2992. Angela Cullen, 
Environmental Protection Agency, Office of Transportation and Air 
Quality, Assessment and Standards Division, 2000 Traverwood Drive, Ann 
Arbor, Michigan 48105; telephone number: 734-214-4419; email address: 
cullen.angela@epa.gov.

SUPPLEMENTARY INFORMATION:

A. Why are EPA and NHTSA publishing a direct final rule?

    The agencies have found that prior notice and comment is 
unnecessary for this action because it consists of minor amendments 
made for the following types of reasons: to eliminate duplicative 
reporting requirements, reduce inadvertent minor differences between 
the EPA and NHTSA programs regarding such matters as voluntary early 
model year compliance, better align testing procedures to market 
realities, reduce unnecessary testing burdens, and correct clear 
technical errors. As these amendments are not expected to be 
controversial or to result in adverse comment, the agencies believe 
that this action falls under the ``good cause'' exception to the 
Administrative Procedure Act

[[Page 36371]]

requirement for prior notice and comment.\1\
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    \1\ See 5 U.S.C. 553(b). The ``good cause'' exception provides 
that the requirement for prior notice and comment on a proposed 
action does not apply ``when the agency for good cause finds (and 
incorporates the finding and a brief statement of reasons therefore 
in the rules issued) that notice and public procedure thereon are 
impracticable, unnecessary, or contrary to the public interest.''
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    If no adverse comments are received within thirty days of 
publication, this rule will become effective as stated in the DATES 
section. In that case, approximately 30 days before the effective date, 
the agencies will publish a document in the Federal Register stating 
that no adverse comments were received and confirming that this rule 
will become effective as scheduled. The agencies would not consider 
frivolous or irrelevant comments to be adverse. The agencies would also 
not consider a comment recommending additional actions or changes to be 
adverse, unless the comment also states why the direct final rule would 
be ineffective without the additional action or change.
    If adverse comments are received to any part of this rule, that 
part will be withdrawn by publishing a timely notice in the Federal 
Register indicating which provisions are being withdrawn. The 
provisions that are not withdrawn will become effective on the date set 
out above, notwithstanding adverse comment on any other provision.
    If either or both agencies receive adverse comment to this rule, 
they will rely upon the agency-specific processes as follows, after the 
provision is withdrawn. If an adverse comment applies to a NHTSA 
provision of this rule, NHTSA will issue a notice of proposed 
rulemaking (NPRM) and provide another opportunity to comment. If EPA 
receives an adverse comment or a request for public hearing on a 
distinct EPA provision of this rulemaking, the related NPRM \2\ 
published in the ``Proposed Rules'' section of today's Federal Register 
will serve as the proposed rule to adopt the EPA provisions. If a 
public hearing is held on any provision that affects both agencies' 
regulations, both agencies will participate. EPA does not plan to 
institute a second comment period on this action. Any parties 
interested in commenting on EPA technical amendments must do so at this 
time. EPA would address all public comments in a subsequent final rule.
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    \2\ This document contains EPA revisions for heavy-duty engines 
and vehicles and the EPA provisions for replacement engines.
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    We request that commenters identify in their comments any portions 
of the action with which they agree and support as written, in addition 
to any comments regarding provisions with which they disagree. In this 
way, the agencies will be able to adopt those elements of this action 
that are fully supported and most needed today while properly 
considering and addressing any adverse comments through a ``notice and 
comment'' rulemaking. For further information about commenting on this 
rule, see the ADDRESSES section of this document.

B. Does this action apply to me?

    This action affects companies that manufacture, sell, or import 
into the United States new heavy-duty engines and new Class 2b through 
8 vehicles, including combination tractors, school and transit buses, 
vocational vehicles such as utility service trucks, as well as \3/4\-
ton and 1-ton pickup trucks and vans. The heavy-duty category 
incorporates all motor vehicles with a gross vehicle weight rating of 
8,500 pounds or greater, and the engines that power them, except for 
medium-duty passenger vehicles already covered by the greenhouse gas 
emissions standards and corporate average fuel economy standards issued 
for light-duty model year 2012-2016 vehicles (75 FR at 25324, May 7, 
2010).
    This action also affects nonroad engine manufacturers.
    Regulated categories and entities include the following:

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                                 NAICS       Examples of  potentially
           Category            Code \a\         affected  entities
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Industry.....................    336111  Motor Vehicle Manufacturers,
                                          Engine and Truck
                                          Manufacturers.
                                 336112
                                 333618
                                 336120
Industry.....................    541514  Commercial Importers of
                                 811112   Vehicles and Vehicle
                                 811198   Components.
Industry.....................    336111  Alternative Fuel Vehicle
                                 336112   Converters.
                                 422720
                                 454312
                                 541514
                                 541690
                                 811198
                                 336510
Industry.....................    811310  Engine Repair, Remanufacture,
                                          and Maintenance.
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Note:
\a\ North American Industry Classification System (NAICS).

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely covered by these rules. 
This table lists the types of entities that the agencies are aware may 
be regulated by this action. Other types of entities not listed in the 
table could also be regulated. To determine whether your activities are 
regulated by this action, you should carefully examine the 
applicability criteria in the referenced regulations. You may direct 
questions regarding the applicability of this action to the persons 
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

C. What should I consider as I prepare my comments?

    Comments that are submitted for consideration by one agency should 
be identified as such, and comments that are submitted for 
consideration by both agencies should be identified as such. Absent 
such identification, each agency will exercise its best judgment to 
determine whether a comment is submitted on its respective part of 
these rules.
    Further instructions for submitting comments to either the EPA or 
NHTSA docket are described below.
    NHTSA: Your comments must be written and in English. To ensure that 
your comments are correctly filed in the Docket, please include the 
Docket ID No. NHTSA-2012-0152 in your comments. By regulation, your 
comments must not be more than 15 pages long.\3\ NHTSA established this 
limit to encourage you to write your primary comments in a concise 
fashion. However, you may attach necessary additional documents to your 
comments. There is no limit on the length of the attachments. If you 
are submitting comments electronically as a PDF (Adobe) file, we ask 
that the documents submitted be scanned using the Optical Character 
Recognition (OCR) process, thus allowing the agencies to search and 
copy certain portions of your submissions.\4\ Please note that pursuant 
to the Data Quality Act, in order for the substantive data to be relied 
upon and used by the agencies, it must meet the information quality 
standards set forth in the Office of Management and Budget (OMB) and 
Department of Transportation (DOT) Data Quality Act guidelines. 
Accordingly, we encourage you to consult the guidelines in preparing 
your comments. OMB's guidelines may be accessed at http://www.whitehouse.gov/omb/fedreg/reproducible.html. DOT's guidelines may 
be accessed at http://regs.dot.gov.
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    \3\ See 49 CFR 553.21.
    \4\ Optical character recognition (OCR) is the process of 
converting an image of text, such as a scanned paper document or 
electronic fax file, into computer-editable text.
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    EPA: Direct your comments to Docket ID No. EPA-HQ-OAR-2012-0102.

[[Page 36372]]

EPA's policy is that all comments received will be included in the 
public docket without change and may be made available online at 
www.regulations.gov, including any personal information provided, 
unless the comment includes information claimed to be Confidential 
Business Information (CBI) or other information whose disclosure is 
restricted by statute. Do not submit information that you consider to 
be CBI or otherwise protected through www.regulations.gov or email. The 
www.regulations.gov Web site is an ``anonymous access'' system, which 
means EPA will not know your identity or contact information unless you 
provide it in the body of your comment. If you send an email comment 
directly to EPA without going through www.regulations.gov your email 
address will be automatically captured and included as part of the 
comment that is placed in the public docket and made available on the 
Internet. If you submit an electronic comment, EPA recommends that you 
include your name and other contact information in the body of your 
comment and with any disk or CD-ROM you submit. If EPA cannot read your 
comment due to technical difficulties and cannot contact you for 
clarification, EPA may not be able to consider your comment. Electronic 
files should avoid the use of special characters, any form of 
encryption, and be free of any defects or viruses. For additional 
information about EPA's public docket visit the EPA Docket Center 
homepage at http://www.epa.gov/epahome/dockets.htm.

(1) Tips for Preparing Your Comments

    When submitting comments, remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Follow directions--The agencies may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree, suggest alternatives, 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified in the DATES section above.

(2) How can I be sure that my comments were received?

    NHTSA: If you submit your comments by mail and wish Docket 
Management to notify you upon its receipt of your comments, enclose a 
self-addressed, stamped postcard in the envelope containing your 
comments. Upon receiving your comments, Docket Management will return 
the postcard by mail.

(3) How do I submit confidential business information?

    Any confidential business information (CBI) submitted to one of the 
agencies will also be available to the other agency.\5\ However, as 
with all public comments, any CBI only needs to be submitted to either 
one of the agencies' dockets and it will be available to the other. 
Following are specific instructions for submitting CBI to either 
agency.
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    \5\ This statement constitutes notice to commenters pursuant to 
40 CFR 2.209(c) that EPA will share confidential business 
information received with NHTSA unless commenters expressly specify 
that they wish to submit their CBI only to EPA and not to both 
agencies.
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    NHTSA: If you wish to submit any information under a claim of 
confidentiality, you should submit three copies of your complete 
submission, including the information you claim to be CBI, to the Chief 
Counsel, NHTSA, at the address given above under FOR FURTHER 
INFORMATION CONTACT, according the process outlined in 49 CFR part 512. 
When you send a comment containing CBI, you should include a cover 
letter setting forth the information specified in our CBI regulation. 
In addition, you should submit a copy from which you have deleted the 
claimed CBI to the Docket by one of the methods set forth above.
    EPA: Do not submit CBI to EPA through www.regulations.gov or email. 
Clearly mark the part or all of the information that you claim to be 
CBI. For CBI in a disk or CD ROM that you mail to EPA, mark the outside 
of the disk or CD ROM as CBI and then identify electronically within 
the disk or CD ROM the specific information that is claimed as CBI. In 
addition to one complete version of the comment that includes 
information claimed as CBI, a copy of the comment that does not contain 
the information claimed as CBI must be submitted for inclusion in the 
public docket. Information so marked will not be disclosed except in 
accordance with procedures set forth in 40 CFR part 2.

(4) Will the agencies consider late comments?

    NHTSA and EPA will consider all comments received before the close 
of business on the comment closing date indicated above under DATES. To 
the extent practicable, we will also consider comments received after 
that date. If interested persons believe that any new information the 
agency places in the docket affects their comments, they may submit 
comments after the closing date concerning how the agency should 
consider that information for the final rules. However, the agencies' 
ability to consider any such late comments in this rulemaking will be 
limited due to the time frame for issuing the final rules.
    If a comment is received too late for us to practicably consider in 
developing the final rules, we will consider that comment as an 
informal suggestion for future rulemaking action.

(5) How can I read the comments submitted by other people?

    You may read the materials placed in the dockets for this document 
(e.g., the comments submitted in response to this document by other 
interested persons) at any time by going to http://www.regulations.gov. 
Follow the online instructions for accessing the dockets. You may also 
read the materials at the NHTSA Docket Management Facility or the EPA 
Docket Center by going to the street addresses given above under 
ADDRESSES.

I. Technical Amendments to the Heavy-Duty Engine and Vehicle Greenhouse 
Gas and Fuel Efficiency Standards Rules

    EPA and NHTSA developed the first-ever program to reduce greenhouse 
gas (GHG) emissions and fuel consumption in the heavy-duty (HD) highway 
vehicle sector. The rulemaking was developed as a single, national 
program with both EPA and NHTSA promulgating complementary standards 
that allow manufacturers to build one set of vehicles to comply with 
both agencies' regulations. This broad heavy-duty sector--ranging from 
large pickups to sleeper-cab tractors--together represent the second 
largest contributor to oil consumption and GHG emissions from the 
mobile source sector, after light-duty passenger cars and trucks. The 
final rule was published in the Federal Register on September 15, 2011 
(76 FR 57106).

[[Page 36373]]

A. Background of the HD GHG and Fuel Efficiency Standards and 
Amendments

    EPA's GHG standards and NHTSA's fuel consumption standards apply to 
manufacturers of the following types of heavy-duty vehicles and their 
engines:
     Heavy-duty Pickup Trucks and Vans
     Combination Tractors
     Vocational Vehicles
    The rules include separate standards for the engines that power 
combination tractors and vocational vehicles. Certain parts of the 
program are exclusive to EPA's GHG standards. These include EPA's final 
hydrofluorocarbon standards to control leakage from air conditioning 
systems in combination tractors and in pickup trucks and vans. Also 
exclusive to the EPA rules are standards for nitrous oxide 
(N2O) and methane (CH4) emissions standards that 
apply to all heavy-duty engines and to pickup trucks and vans.
    EPA's final greenhouse gas emission standards for heavy-duty 
vehicles under the Clean Air Act will begin with model year 2014. 
NHTSA's final fuel consumption standards under the Energy Independence 
and Security Act of 2007 will be voluntary in model years 2014 and 
2015, becoming mandatory with model year 2016 for most regulatory 
categories. Both agencies allow manufacturers to comply early in model 
year 2013 and promote early compliance by providing incentives to do 
so.
    In the final rulemaking, EPA established all-new regulations in 40 
CFR parts 1036, 1037, and 1066. EPA also included changes to existing 
regulations in 40 CFR parts 85, 86, 1039, 1065, and 1068. Similarly, 
NHTSA modified its existing regulations in 49 CFR parts 523 and 534, 
and established an all-new regulation in 49 CFR part 535.
    After publication of the heavy-duty rule, EPA and NHTSA began an 
extensive outreach effort to aid in the rule's implementation. EPA and 
NHTSA held public workshops on November 3, 2011 and August 10, 2012. In 
the course of these efforts, the agencies received a series of comments 
on specific aspects of the rules and prepared question and answer 
responses.\6\ In some cases, it became clear that minor changes to the 
rules would better clarify the rule's intent, or amend the rule to make 
it more effective. The amendments adopted in this rule are largely 
based on these implementation discussions.
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    \6\ See U.S. EPA Web site at http://www.epa.gov/otaq/climate/regs-heavy-duty.htm.
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    The revisions related to the heavy-duty GHG emissions and fuel 
efficiency regulations in this direct final rule generally affect the 
joint heavy-duty program. Therefore, the agencies are issuing this 
joint rule to maintain a single, harmonized program. However, some of 
these technical amendments are unique to the rules of one or the other 
agency. Thus, this section is further divided into three subsections. 
First is the set of amendments that directly affect both EPA's and 
NHTSA's regulations, which are discussed in Section I.B below. Next, 
the technical amendments exclusive to NHTSA's regulations in 49 CFR 
parts 523 and 535 are discussed in Section I.C. Finally, EPA's unique 
amendments in 40 CFR parts 86, 1036, 1037, 1065, and 1066, are 
discussed in Section I.D.

B. Joint Heavy-Duty GHG and Fuel Efficiency Technical Amendments

    The following amendments correct minor, technical inconsistencies 
and add clarifications in the current regulatory text of both agencies. 
If adverse comment is received by either agency relative to any aspect 
of the joint technical amendments that directly affect both EPA's and 
NHTSA's regulations, then both agencies will withdraw that joint 
amendment. A comparison of the original and amended regulatory text is 
provided in a memorandum to the dockets for this rulemaking.\7\
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    \7\ Hicks, M. and A. Cullen. Memorandum to Dockets EPA-HQ-OAR-
2012-0102 and NHTSA-2012-0152. Heavy-Duty Engine and Vehicle 
Greenhouse Gas Emissions and Fuel Consumption Regulatory Changes. 
May 2013.
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(1) Hybrid Testing
    40 CFR 1036.525, 40 CFR 1036.615, and 49 CFR 535.7(e)(1)(ii) 
specify requirements for testing hybrid engines and engines with 
Rankine cycle waste heat recovery. The regulatory text includes 
references for testing ``post-transmission'' and ``pre-transmission'' 
hybrid systems in these sections. In a pre-transmission hybrid system, 
the energy from both the engine and motor is input into the drive shaft 
prior to the transmission. In a post-transmission hybrid system, the 
engine energy is input into the drive shaft prior to the transmission, 
but the motor energy is input into the drive shaft after the 
transmission. Since post-transmission hybrid systems are incompatible 
with engine testing, the agencies have decided to remove the reference 
to post-transmissions systems in the hybrid engine test requirements in 
40 CFR part 1036 and 49 CFR part 535. 40 CFR 1037.525, 40 CFR 1037.550, 
40 CFR 1037.615, and 49 CFR 535.7(e)(1)(i) include requirements for 
testing post-transmission hybrids using a vehicle test. The agencies 
anticipate that there will be no impact on manufacturers by the 
deletion of this text, since the vehicle test procedures set out in the 
regulation specify how to test post-transmission systems.
    Specifically, 40 CFR 1037.525, 40 CFR 1037.550, 40 CFR 1037.615, 
and 49 CFR 535.7(e)(1)(i) describe or reference the procedure to be 
used for testing hybrid systems with and without power take-off (PTO) 
devices on a vehicle test. Both pre- and post-transmission hybrid 
systems can use, and be tested with and without, PTO devices on a whole 
vehicle test. The current rule text states that manufacturers can test 
post-transmission hybrid systems on a whole vehicle test procedure to 
quantify CO2 and fuel consumption improvements resulting 
with and without PTO equipment, but inadvertently excludes pre-
transmission hybrid systems. Therefore, agencies are amending the 
language to allow these pre-transmission hybrid systems with and 
without PTO to be tested on the vehicle test procedures in 40 CFR 
1037.525, 40 CFR 1037.550, and 49 CFR 535.7(e)(1)(i). The agencies 
believe this is a non-controversial amendment that will allow the 
existing vehicle test procedure to appropriately apply to existing 
hybrid systems.
(2) Advanced Technology Improvement Factor
    40 CFR 1037.615 and 49 CFR 535.7(e)(1)(i) describe the procedure 
for measuring CO2 and fuel consumption improvements from 
vehicles with hybrid and other advanced technologies (such as Rankine 
engines, electric vehicles and fuel cell vehicles), in order to 
generate advanced technology credits.\8\ 40 CFR 1037.615 specifies how 
manufacturers can measure the effectiveness of the advanced system by 
chassis-testing a vehicle equipped with the advanced system and an 
equivalent conventional vehicle using the test procedures in 40 CFR 
part 1037, subpart F.
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    \8\ Advanced technology credits may be increased by a 1.5 
multiplier and applied to any heavy-duty vehicle or engine 
subcategory with certain maximum limits applying. See 40 CFR 
1036.740, 1037.740 and 49 CFR 535.7(e) for description of advanced 
technology credit program.
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    The effectiveness of the advanced system is calculated by measuring 
the CO2 output from chassis tests of the vehicle with the 
advanced system and an equivalent conventional vehicle, thereby 
obtaining the relative marginal improvement between the two vehicles 
(the ``improvement factor''). The ``benefit'' associated with the 
advanced

[[Page 36374]]

system is then calculated by multiplying the Greenhouse Gas Emissions 
Model (GEM) result for the vehicle with advanced technology by the 
dimensionless improvement factor. The benefit is then converted to 
advanced technology credits for the model year production volume of the 
vehicle subfamily with the advanced technology.
    The final rule specified the procedure for applying the improvement 
factor in simulating a chassis test with a post-transmission hybrid 
system for A to B testing (40 CFR 1037.550) across multiple vehicle 
configurations having the same advanced technology. However, the 
regulations for developing the improvement factor using the chassis 
test procedures (40 CFR 1037.615 and 49 CFR 535.7(e)(1)(i)(A)(3)), did 
not allow the improvement factor to be applied to multiple vehicle 
configurations having the same advanced technology. The agencies are, 
therefore, amending the regulatory text that describes the measurement 
of advanced technology improvement to include this optional 
specification as well (in effect, carrying over the specification from 
40 CFR 1037.550 to 40 CFR 1037.615 and 49 CFR 535.7(e)(1)(i)(A)(3)). 
The hybrid and advanced technology improvement factor can now be 
applied to multiple vehicle configurations using the same technology, 
as long as the value used for other configurations ``represents the 
vehicle configuration with the smallest potential reduction in 
greenhouse gas emissions as a result of the hybrid capability'' and is 
consistent with good engineering judgement. The agencies believe that 
no one will object to these changes.
    The agencies are therefore revising 40 CFR 1037.615 and 49 CFR 
535.7(e)(1)(i) to allow manufacturers, if they wish, to generate 
advanced technology credits from multiple heavy-duty vehicle 
configurations within a vehicle family group by testing a single 
vehicle of that group, provided the vehicle tested has the smallest 
potential reduction in fuel consumption of the vehicles with advanced 
technology capability. The agencies anticipate that this change may 
reduce testing and reporting costs for manufacturers while still 
allowing flexibility in choosing to test additional configurations 
within the family group. By limiting the use of this testing option to 
vehicles with the smallest potential reduction in emissions (or fuel 
consumption), fuel efficiency gains and emission reductions will not be 
compromised. Therefore, the agencies do not expect this change to be 
controversial.
(3) Optional Certification for Up to Class 6 Spark-Ignition Engine 
Vehicles
    Heavy-duty pickup trucks and vans are pickup trucks and vans with a 
gross vehicle weight rating between 8,501 pounds and 14,000 pounds 
(Class 2b through 3 vehicles) manufactured as complete vehicles by a 
single or final stage manufacturer or manufactured as incomplete 
vehicles as designated by a manufacturer. Under the GHG rules and fuel 
efficiency rules, these vehicles are certified on a chassis dynamometer 
test, as opposed to the GEM simulation tool used to certify the 
vocational and tractor categories. NHTSA's current regulations allow 
Classes 4 and 5 spark-ignition vehicles the option of certifying on a 
chassis dynamometer test and to comply with heavy-duty pickup truck and 
van standards instead of vocational standards, as those vehicles may 
have more similar characteristics to Class 2b-3 pickups or vans than 
they do with other vocational vehicles in their class.\9\ At the time 
of the final rule, NHTSA was unaware of any higher class spark ignition 
vehicles that would be similarly appropriate to test on a chassis 
dynamometer. EPA's current regulations allow spark-ignition vehicles of 
all classes the option of certifying on a chassis dynamometer test and 
to the standards in 40 CFR 1037.104.\10\
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    \9\ See 49 CFR 523.7.
    \10\ See 40 CFR 1037.150(l).
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    This amendment will align the regulatory texts by closing the 
current gap in vehicle classes eligible for NHTSA's and EPA's optional 
certification provisions. The agencies are aware of several Class 4 and 
5 vehicles that could benefit from the optional certification path but 
now have identified one spark-ignition Class 6 vehicle for which the 
chassis dynamometer test would be appropriate. This vehicle is 
available in complete and cab-complete configurations. NHTSA has 
performed an analysis that supports that allowing this testing option 
up to and including Class 6 vehicles will reduce testing burden without 
resulting in a credit windfall or otherwise affecting the stringency of 
the standards.\11\ As the agencies are not aware of any spark-ignition 
vehicles above Class 6, we believe it is appropriate to limit this 
option to Classes 6 and below. Therefore, the agencies anticipate that 
this alignment will be non-controversial.
---------------------------------------------------------------------------

    \11\ NHTSA. Memorandum to Docket NHTSA-2012-0152. November 2012.
---------------------------------------------------------------------------

    The agencies are therefore allowing manufacturers of complete or 
cab-complete vehicles up to and including Class 6 vehicles that have 
spark-ignition engines the option of certifying using the chassis 
dynamometer test procedures and to the standards of 40 CFR 1037.104. 
The agencies are revising the requirements in 40 CFR 1037.104, 40 CFR 
1037.150, 49 CFR 523.7, and 49 CFR 535.5(a)(6) to reflect this 
alignment of provisions.
(4) Reporting for Heavy-Duty Pickup Truck and Van Manufacturers
    For model years 2013 and later, heavy-duty pickup truck and van 
(PUV) (i.e., Class 2b-3) manufacturers complying with NHTSA's voluntary 
and mandatory standards are required to submit two different reports 
after the end of the model year (49 CFR 535.8(d) and (e)). 
Manufacturers must submit an end-of-the-year-report (EOY report), 
including both GHG emissions and fuel consumption information, within 
90 days after the end of the given model year and no later than April 1 
of the next calendar year. Manufacturers must also submit a final 
report within 270 days after the end of the given model year and no 
later than October 1 of the next calendar year. Both EOY and final 
reports contain the same information, and are used by the agencies to 
review a manufacturer's final compliance data and to identify which 
manufacturers have a credit surplus or deficit for the given model 
year. Thus, NHTSA's final rule regulatory text requires that both a 
final and an EOY report be submitted from all heavy-duty PUV 
manufacturers. EPA requires one final report from the heavy-duty PUV 
manufacturers, specified in 40 CFR 86.1865-12(l)(2). This final report 
must be submitted no later than May 1 of the calendar year following 
the given model year.
    The final rule preamble discussed the agencies' intent to 
streamline final reports submitted to the agencies, consolidating the 
multiple and separate reports as proposed in the NPRM (see 76 FR 
57262). However, the agencies believed, and still believe that 
requiring two reports from manufacturers that have not previously been 
subject to fuel efficiency regulations will assist in assessing 
manufacturer compliance and will assist in the identification of any 
potential issues. That reasoning does not apply to PUV manufacturers, 
who are already regulated under the light-duty CAFE program and have 
well-established reporting systems. Further, for this joint national 
program, the agencies intended that PUV manufacturers would send single 
combined reports to satisfy the compliance needs of both agencies. The 
additional report presently required by the NHTSA regulation is 
inconsistent with this goal.

[[Page 36375]]

    NHTSA is therefore combining the EOY and final reporting 
requirements for heavy-duty pickup truck and van manufacturers in 49 
CFR 535.8(d) and (e). In parallel with the existing EPA regulations, 
those manufacturers will now only be required to submit a single final 
report. To supplement the existing reference to the provisions 
outlining this requirement, EPA and NHTSA are also adding another more 
specific reference in the regulations to clarify the alignment of the 
submission date for these reports with that of EOY reports from other 
heavy-duty vehicle and engine manufacturers (90 days after the end of 
the given model year and no later than April 1 of the next calendar 
year). This amendment will harmonize reporting requirements between the 
two agencies and reduce the compliance burden for manufacturers, 
without affecting the overall content reported, or the agencies' 
ability to effectively assess compliance. As such, the agencies do not 
expect that it will be controversial.
(5) Configuration and Subconfiguration Definitions
    The existing EPA and NHTSA regulations contain definitions for 
``configuration'' and ``subconfiguration,'' which define how to group 
vehicles by similar characteristics within a test group when conducting 
testing to determine CO2 emissions and fuel consumption 
rates for heavy-duty pickup trucks and vans. In each agency's 
regulations, ``configuration'' means a subclassification within a test 
group that is based on engine code, transmission type and gear ratios, 
final drive ratio and other parameters that EPA designates. Likewise, 
``subconfiguration'' means a unique combination within a vehicle 
configuration of equivalent test weight, road-load horsepower, and any 
other operational characteristics or parameters that EPA determines may 
significantly affect CO2 emissions within a vehicle 
configuration.
    The agencies believe the current definitions could be specified 
further according to established principles to prevent any ambiguity 
for manufacturers in conducting testing for heavy-duty pickup trucks 
and vans. The terms ``transmission type'' and ``engine code'' can be 
further defined in the definition for ``configuration,'' to reflect 
common industry understanding of the terms. In addition, the term 
``equivalent test weight'' could be further defined in the definition 
for ``subconfiguration'' to carryover the existing definition included 
in 40 CFR 1037.104(d)(11). Therefore, the agencies are adding these 
further details to clarify these terms in 40 CFR 1037.104(d)(12) and 49 
CFR 535.4. As both additions provide clarity to existing concepts, and 
do not introduce new meanings to the terms, the agencies believe they 
are non-controversial.
(6) Vocational Tractor Vehicle Families
    In the final rule, the regulatory text in 40 CFR 1037.230 related 
to vocational tractor families is unintentionally ambiguous, and is 
inconsistent with, the preamble and other regulatory text. In the 
vocational tractor provisions of 40 CFR 1037.630(b)(2), EPA requires 
that tractors ``reclassified under this provision must be certified as 
a separate vehicle family. However, they remain part of the vocational 
regulatory subcategory and averaging set that applies to their weight 
class.'' Although 40 CFR 1037.630(b)(2) requires two vocational tractor 
families dependent on the GVWR of the vehicle, the text in 40 CFR 
1037.230(a)(1) implies only a single vocational tractor family default. 
This inconsistency is the result of an oversight when provisions were 
added allowing tractors to certify as vocational vehicles, and it is 
inconsistent with the way vehicle families are treated throughout the 
program, where they are split by weight class (76 FR at 57240, 
September 15, 2011). Therefore, EPA is revising 40 CFR 1037.230(a)(1) 
to be consistent with 40 CFR 1037.630(b)(2) by splitting the vocational 
vehicles families into two groups, those above 33,000 pounds GVWR and 
those above 26,000 pounds GVWR and at or below 33,000 pounds GVWR.
    NHTSA is adding the same distinction in 49 CFR 535.5(c) to clarify 
how fuel consumption credits are generated and apply to averaging sets 
for these vehicles. As these clarifications align with the existing 
treatment of all vehicle families and the premise of the division of 
vehicle families, the agencies believe they are non-controversial.

C. NHTSA Regulatory Action on HD Fuel Efficiency Technical Amendments

    NHTSA seeks to correct technical errors, clarify requirements, and 
incorporate requirements that were inadvertently omitted in 49 CFR part 
535 in order to align with EPA's current regulatory text. As the 
following changes merely parallel existing EPA requirements that were 
more consistent with the intent of the final rule and will not result 
in additional requirements for manufacturers or in a change in the 
stringency of the standards, they are not anticipated to be 
controversial or to result in adverse comment.
    A side-by-side comparison of the original and amended regulatory 
text is provided in a memorandum to the dockets for this 
rulemaking.\12\
---------------------------------------------------------------------------

    \12\ Hicks, M. and A. Cullen. Memorandum to Dockets EPA-HQ-OAR-
2012-0102 and NHTSA-2012-0152. Heavy-Duty Engine and Vehicle 
Greenhouse Gas Emissions and Fuel Consumption Regulatory Changes. 
May 2013.
---------------------------------------------------------------------------

(1) Secondary Manufacturers
    Both fuel consumption and greenhouse gas emission standards apply 
to the manufacturer holding the EPA certificate of conformity. In the 
EPA regulatory text (40 CFR 1037.620(a) and (b)), a primary 
manufacturer has the option to transfer an uncertified incomplete 
tractor or vocational vehicle to a secondary manufacturer to be 
completed and sold in the United States so long as that secondary 
manufacturer has substantial control over the final design and 
completes assembly of the emission controls (ensuring that the engine 
and vehicle will conform to regulations in their final configurations). 
By agreement with the primary manufacturer, the secondary manufacturer 
may finish the assembly of the emission control systems of a partially 
complete vehicle and perform vehicle testing. In that case, the second 
stage manufacturer would apply for the vehicle's EPA certificate of 
conformity.
    The current NHTSA regulations do not specify the process by which a 
secondary stage manufacturer may become an EPA certificate holder, and 
thus subject to both greenhouse gas emissions and fuel consumption 
standards. Thus, if someone unfamiliar with the EPA process were to 
read the NHTSA regulations alone, it would not be clear how a secondary 
stage manufacturer could become subject to fuel consumption standards. 
Therefore, NHTSA is modifying its provisions in 49 CFR 535.3(b) and (c) 
to more clearly include secondary stage manufacturers meeting the EPA 
requirements in 40 CFR 1037.620 as subject to the fuel consumption 
standards. NHTSA is also modifying its provisions in 49 CFR 535.7(a) to 
clarify that either the primary or secondary manufacturer can generate 
fuel consumption credits for over-compliance and may use one or more of 
the program flexibilities in gaining credits.
    These clarifications will align NHTSA's regulations with EPA's. As 
the clarifications simplify the path a reader must take to understand 
how an entity becomes subject to the fuel consumption standards, and do 
not actually change the application of the standards, NHTSA does not 
expect this to be controversial.

[[Page 36376]]

(2) Credit Holders
    In the preamble to the final rule, the agencies stated that the 
NHTSA and EPA flexibility provisions (``ABT'' programs) \13\ are 
essentially identical in structure and function (see 76 FR 57127). The 
agencies also stated that they intended to allow a manufacturer to 
offset any credit shortfalls within an averaging set, by using 
``banked'' or ``traded'' credits received from another manufacturer. 
The EPA regulations (40 CFR 1036.701(e) and (h)) allow manufacturers to 
trade emissions credits generated from engines or vehicles to any 
purchaser other than manufacturers so long as those parties retire the 
credits. Likewise, trading is defined as ``the exchange of emission 
credits between manufacturers, or the transfer of credits to another 
party to retire them'' (40 CFR 1036.720(a) and 1037.720(a)). The 
current NHTSA regulations are silent on how parties other than 
manufacturers can acquire and trade credits.
---------------------------------------------------------------------------

    \13\ NHTSA and EPA flexibilities include: Averaging, banking, 
and trading (ABT) provisions; early credits; advanced technology 
credits (including hybrid powertrains); and innovative technology 
credit provisions.
---------------------------------------------------------------------------

    NHTSA believes that the existing EPA ABT provisions help to 
maximize the benefits of the standards achieved during this critical 
initial phase of the program by providing the means for manufacturers 
to take full advantage of the program flexibility to trade earned 
credits, while providing a path for this flexibility to result in 
continued gains in fuel efficiency. In addition, NHTSA did not envision 
differences between the EPA and NHTSA ABT programs. Therefore, NHTSA is 
adding requirements to 49 CFR part 535 that parallel EPA's treatment of 
non-manufacturers in the ABT program. NHTSA is adding a definition in 
49 CFR 535.4 for ``credit holder'' and adding requirements in 49 CFR 
535.7 to clarify the limitations for non-manufacturers to obtain and 
trade fuel consumption credits. These additions will complement the EPA 
requirements in 40 CFR 1036.701(h), 1036.720(a), 1037.701(e), and 
1037.720(a), and we do not expect anyone to object to this provision.
(3) Voluntary Compliance
    Manufacturers can voluntarily comply early with both the NHTSA and 
EPA standards for model year (MY) 2013, and with the NHTSA standards 
through MY 2015 (EPA's standards are mandatory beginning in MY 2014). 
For MYs 2013 and 2014, EPA provides additional flexibilities and 
specifications in 40 CFR 1037.150 to incentivize early compliance. 
NHTSA inadvertently omitted parallel provisions for its early 
compliance program. As described in the final rule preamble, 
manufacturers entering the early compliance program for NHTSA must do 
so ``exactly as implemented'' under EPA's early compliance program (see 
76 FR 57245). The purpose of the NHTSA early compliance provisions is 
to provide incentives for near-term fuel efficiency gains by allowing 
manufacturers to comply with both programs simultaneously in MYs 2013 
and 2014.
    EPA provisions in 40 CFR 1037.150(a)(2) limit the number of EPA 
credits a manufacturer can generate for heavy-duty pickup trucks and 
vans produced after MY 2013 begins. EPA specifies that for any test 
groups used to certify these vehicles produced after the start of the 
model year, a manufacturer may only generate credits for those vehicles 
that are produced after the last test groups has received an approved 
certificate by EPA. Therefore, for example, if a manufacturer produces 
three test groups in an averaging set and it receives certificates for 
those test groups on January 4, 2013, March 15, 2013, and April 24, 
2013, it may not generate credits for its MY 2013 production for any of 
the vehicles that are produced before April 24, 2013. The same 
limitation is provided for production tractors and vocational vehicles 
(40 CFR 1037.150(a)(1)). NHTSA is proposing to incorporate these 
provisions into its voluntary compliance sections (49 CFR 535.5(a)(4), 
(b)(2) and (c)(2)) in order to ensure harmonization between the two 
programs. Otherwise, manufacturers could gain credits under the NHTSA 
program that would be excluded by the EPA program.
    For MY 2013, EPA provisions allow manufacturers to certify their 
U.S.-directed production tractors and vocational vehicles within each 
regulatory subcategory separately (instead of certifying all the 
vehicles within a regulatory category) as an incentive for early 
introduction (40 CFR 1037.150(a)(1)). For example, a manufacturer could 
certify only its medium heavy-duty vocational vehicles in MY 2013 and 
then certify all of its three vocational vehicle subcategories starting 
in MY 2014. NHTSA provided parallel provisions in 49 CFR 535.5(b)(2) 
and (c)(2), but the current regulatory text would require manufacturers 
to comply with all the vehicles within each regulatory category. Thus, 
in this example, the vocational vehicle manufacturer would have to 
certify all of its U.S.-directed production vehicles in MY 2013 for 
NHTSA whereas it would only have to certify its medium heavy-duty 
vocational vehicles for EPA. The mismatch in certified vehicles under 
the EPA and NHTSA programs for MY 2013 could cause manufacturers to opt 
to comply with the EPA standards early, but to not opt into the NHTSA 
program or could disadvantage a manufacturer under the NHTSA program 
compared to the EPA program. NHTSA is therefore correcting 49 CFR 
535.5(b)(2) and (c)(2) to include the same provisions for regulatory 
sub-category compliance for MY 2013 as EPA.
    The definition of a model year in the final rule allows 
manufacturers to include vehicles in a given model year that are 
manufactured after January 1 of the previous calendar year for which 
the model year is named through December 31 of the corresponding year 
(see 40 CFR 1037.801 and 49 CFR 535.4). However, compliance with EPA 
standards for model year 2014 is optional for vehicles manufactured 
prior to January 1, 2014 (40 CFR 1037.150(g)). Thus, a manufacturer may 
choose to certify only vehicles produced from January 1, 2014 through 
December 31, 2014 and exclude model year 2014 vehicles produced between 
January 1, 2013 and December 31, 2013. NHTSA's requirements for the 
voluntary MY 2014 do not allow manufacturers this same flexibility. 
Instead, manufacturers choosing to comply with the NHTSA program in MY 
2014 must certify vehicles produced over the entire standard model year 
period. NHTSA intended that provisions for voluntary early compliance 
with its program align with the EPA program. NHTSA believes that the MY 
2014 EPA provisions are appropriate for that model year, the first 
mandatory year under the EPA program, particularly because they would 
lead to the least confusion among manufacturers. Aligning NHTSA's 
program provisions with EPA's will encourage manufactures to 
voluntarily opt in to the NHTSA program and enable manufacturers to 
generate similar credit balances in both programs, as intended. 
Therefore, NHTSA is modifying 49 CFR 535.5(a)(4), (b)(2) and (c)(2) to 
incorporate those provisions. As manufacturers typically lock their 
production plans anywhere from 18 to 24 months in advance of the 
production model year, they may not be able to bring early MY 2014 
production vehicles into compliance with the NHTSA program absent this 
change.
    As these corrections will align the NHTSA early compliance program 
to the specifications provided in the EPA

[[Page 36377]]

program, and thus also align the NHTSA program with the intent of 
harmonization expressed in the preamble, NHTSA does not expect these 
corrections to be controversial.
(4) Reporting
    The final rule preamble specifies that a manufacturer not 
participating in the ABT program is required to provide an end-of-the-
year (EOY) report after each model year. The EPA regulations (40 CFR 
1036.250 and 1037.250) require this report to be submitted within 90 
days after the calendar year ends. The NHTSA regulations require two 
reports for non-ABT participating manufacturers, an EOY report 
containing preliminary final estimates and a final report containing 
the final data. For this joint national program, the agencies developed 
their reporting requirements with the intent for manufacturers to send 
single combined reports to satisfy the compliance requirements of both 
agencies. The differences in the agencies' reporting requirements do 
not support this goal. Further, requiring non-ABT manufacturers to 
submit two reports would create unnecessary burden, as a single report 
would enable NHTSA to assess compliance for non-ABT manufacturers. 
Therefore, NHTSA is restructuring its reporting provisions (49 CFR 
535.8(d) and (e)) to align with EPA's by clarifying that non-ABT 
participating manufacturers are only required to provide one report 
with final data 90 days after the model year.
    For vehicle and engine manufacturers participating in the ABT 
program, EPA and NHTSA require EOY reports to be submitted with 
preliminary final estimates of compliance information 90 days after the 
model year ends. NHTSA is adding a clarification in 49 CFR 535.8(d) to 
specify that these EOY reports for participating manufacturers must 
contain preliminary data and for non-participating manufacturers must 
contain finalized data. Likewise, as discussed in Section I.B.4, 
clarifications will also be added for heavy-duty pickup truck and van 
manufacturers specifying that the EOY reports must contain finalized 
data.
    NHTSA is also clarifying requirements for submitting information on 
exempted vehicles for both participating and non-participating 
manufacturers. In the final rule, NHTSA regulations require 
manufacturers to provide a plan describing the vehicles exempted as 
off-road vehicles in the EOY and final reports. EPA regulations require 
the plan be submitted only in the EOY report with finalized data. NHTSA 
is modifying its regulations to align with the EPA provisions and will 
require information on exempted vehicles to be submitted only with the 
EOY report with finalized data. This single reporting will provide 
NHTSA with the information needed to assess compliance.
    As these clarifications are consistent with the agencies' intent as 
expressed in the final rule preamble (to consolidate duplicative 
reporting requirements), and the change will reduce reporting burdens 
without sacrificing necessary compliance data, NHTSA does not believe 
that this alignment with be controversial.
(5) Vocational Tractor Compliance
    The final rule allows tractors meeting the definition of vocational 
tractors in 49 CFR 523.2 to comply with requirements for heavy-duty 
vocational vehicles. However, if a manufacturer is found not to have 
applied this allowance in good faith in its application for 
certification, it may not use this compliance path (it must comply 
instead with the tractor standards). EPA provides the complete 
requirements for vocational tractors in 40 CFR 1037.630. However, the 
NHTSA regulations mistakenly reference EPA's vocational tractor 
provisions as 40 CFR 1037.610 (the regulation for ``vehicles with 
innovative technologies'') instead of 40 CFR 1037.630. Therefore, NHTSA 
is correcting the reference specified in 49 CFR 535.5(c)(5).
(6) Fuel Consumption Calculations and Credit Equations
    NHTSA is making a minor technical revision to address rounding 
inconsistencies when converting CO2 values to equivalent 
fuel consumption values in the Greenhouse Gas Emissions Model (GEM) 
simulation tool. The GEM is programmed to use manufacturer-provided 
vehicle specifications to derive the CO2 emissions (in grams 
CO2 per ton-mile) and fuel consumption performance (in 
gallons per 1000 ton-miles) of vehicles. Both the CO2 
emissions and fuel consumption values are calculated and rounded to 
eight decimal places and then round once again in accordance with each 
agency's regulations. For NHTSA, the equivalent fuel consumption value 
derived by the GEM must be rounded to the nearest 0.1 gallons per 1000 
ton-mile (49 CFR 535.6(b)(3)). For EPA, the CO2 emissions 
value must be rounded to the nearest 1 gram of CO2 per ton-
mile (40 CFR 1037.701). The rounding can cause differences in 
equivalency between the performance results in the EPA and NHTSA 
programs. For compliance, vehicles are grouped into subfamilies based 
upon the GEM-derived CO2 emissions value for the EPA program 
and the GEM-derived fuel consumption value for the NHTSA program. 
Rounding can cause differences in how vehicles are grouped in the EPA 
and NHTSA programs, creating compliance accounting differences that the 
agencies did not intend. The agencies intended that the same vehicles 
would be grouped in each subfamily for the EPA program and the NHTSA 
program. To address the rounding inconsistencies, NHTSA is amending 49 
CFR 535.6(b)(3) to clarify that equivalent fuel consumption values in 
the GEM must be derived from the CO2 value rounded to the 
nearest whole number and expressed to the nearest 0.1 gallons per 1000 
ton-mile. This change will ensure the same vehicles will be grouped 
into a single subfamily for compliance under both programs. Hence, the 
agencies are releasing a revised version of GEM, GEM v2.0.1, with this 
rulemaking which incorporates this change in conversion methodology.
    There is also a typographical error in the equations that are used 
to determine fuel consumption credits in the NHTSA regulations (49 CFR 
535.7). In the existing equations, fuel consumption credits for heavy-
duty vehicles and engines are calculated by multiplying by a factor of 
10\2\ for heavy-duty pickup trucks and vans and for engines, and by a 
factor of 10\3\ for vocational vehicles and tractors. However, the 
correct factors for multiplication should be 10-2 for heavy-
duty pickup trucks and vans and for engines and 10-3 for 
vocational vehicle and tractors. These factors ensure the proper 
conversion and alignment between EPA and NHTSA calculated credits. 
Therefore, NHTSA is amending its fuel consumption credit equations in 
49 CFR 535.7(b)(9), (c)(11) and (d)(11) to reflect the correct factors 
for multiplication and does not anticipate any objections to this.
(7) Definitions for Incomplete and Complete Heavy-Duty Pickup Trucks 
and Vans
    In the final rule, EPA included separate definitions to describe 
complete and incomplete vehicles in the vocational vehicle and tractor 
regulatory subcategories and for vehicles in the heavy-duty pickup 
truck and van subcategory. NHTSA included the same definitions for 
incomplete and complete vocational vehicle and tractors in its 
regulations but omitted the ones for pickup trucks and vans. Therefore, 
NHTSA is adding a reference to the EPA definitions for complete and 
incomplete pickup trucks and vans in 49 CFR part

[[Page 36378]]

523. NHTSA believes these changes are non-controversial as they will 
simply help to clarify characteristics in the construction of complete 
and incomplete heavy-duty pickup trucks and vans already existing in 
EPA's regulations.
(8) Off-Road Exclusion Petitioning Process
    EPA and NHTSA requirements specify that heavy-duty off-road 
vehicles meeting the criteria in 40 CFR 1037.631 and 49 CFR 535.3(g) 
are exempted without request from vehicle standards, and manufacturers 
with off-road vehicles not meeting the enumerated criteria may petition 
for exemption by describing how and why their vehicles should qualify 
for exclusion (49 CFR 535.8(h)(6)(ii)). While this voluntary process is 
already described in this provision, NHTSA believes that manufacturers 
would benefit from additional language highlighting timing 
considerations should they plan to rely upon such a petition. While a 
manufacturer may submit a petition at any time, NHTSA recommends that 
they be submitted early enough in advance of the model year to ensure 
that a determination can be made by the agencies, and should the 
vehicles fail to be excluded, the manufacturer has sufficient time to 
submit and obtain approved certificates of conformity from EPA required 
prior to first commercial sale. Therefore, NHTSA is adding this 
recommendation to the existing provision for off-road exemptions in 49 
CFR 535.8(a). As this amendment merely highlights existing timing 
considerations, and does not change any aspect of the process or 
requirements, NHTSA believes it will be non-controversial.

D. EPA Regulatory Action on HD GHG Amendments

    EPA is amending 40 CFR parts 86, 1036, 1037, 1065, and 1066 to 
correct typographical errors, clarify test procedures and certification 
procedures, and correct the regulations to make them consistent with 
the intent expressed in the preamble to the final rules (see 76 FR 
57106). If EPA receives adverse comment on a distinct EPA provision in 
this subsection, then EPA will publish a timely withdrawal in the 
Federal Register indicating which provisions EPA is withdrawing. The 
provisions that are not withdrawn will become effective on the date set 
out in the DATES section of this action. EPA would address all public 
comments in a subsequent final rule based on the EPA-proposed rule 
accompanying this joint direct final rule.
    A comparison of the original and amended regulatory text is 
provided in a memorandum to the dockets for this rulemaking.\14\
---------------------------------------------------------------------------

    \14\ Hicks, M. and A. Cullen. Memorandum to Dockets EPA-HQ-OAR-
2012-0102 and NHTSA-2012-0152. Heavy-Duty Engine and Vehicle 
Greenhouse Gas Emissions and Fuel Consumption Regulatory Changes. 
May 2013.
---------------------------------------------------------------------------

(1) Regulatory Changes to 40 CFR Part 1036
    EPA is revising portions of the regulations in 40 CFR part 1036, as 
described below.
     EPA is revising Sec. Sec.  1036.5, 1036.150, and 1036.615 
to address typographical issues to correct regulatory citations within 
the regulations.
     EPA is correcting Sec.  1036.150(g)(2) and (g)(3) to 
change the assigned additive deterioration factor (DF) for nitrous 
oxide (N2O) and methane (CH4) emissions from 0.02 
to 0.020 g/hp-hr to account for the appropriate number of significant 
digits.
     EPA is amending Sec.  1036.225 to clarify that the 
CO2 FEL is not required on the emission control information 
(ECI) label according to the provisions in Sec.  1036.135.
     EPA is clarifying that the CH4 and 
N2O emission standards apply to all testable configurations 
in Sec.  1036.205.
     EPA is adding a definition of ``preliminary approval'' to 
Sec.  1036.801.
(2) Regulatory Changes to 40 CFR Part 1037
    EPA is also revising portions of the regulations in 40 CFR part 
1037 to correct technical errors and provide additional clarity in the 
regulations.
     Heavy-Duty Pickup Truck and Van Regulations: EPA is 
amending several provisions in Sec. Sec.  1037.15 and 1037.104 to 
specify which parts of 40 CFR part 86 apply to these vehicles and to 
specifically reference portions of 40 CFR part 86 in 40 CFR part 1037. 
EPA also is revising the language in Sec.  1037.150(a)(2) to make it 
consistent with the preamble to the final rule which stipulates that 
the entire heavy-duty pickup truck and van fleet must be certified to 
qualify for early credits (see 76 FR 57245). Also, EPA is clarifying 
how heavy-duty pickup truck and van subconfigurations are selected for 
testing in Sec.  1037.104(d)(9)(i) through (iii). EPA is also revising 
Sec.  1037.104(g)(2)(ii), (g)(2)(iv), and (g)(5) to clarify the 
approach for estimating analytically derived CO2 emission 
rates (ADCs).
     Air Conditioning (A/C) Leakage Provisions: The MY2017-2025 
Light-Duty GHG and Fuel Economy Rule separated 40 CFR 86.1866 into four 
sections for clarity. The A/C leakage section moved to 40 CFR 86.1867-
12. Thus, EPA is amending Sec.  1037.115 to reflect this change. In 
addition, EPA is revising Sec.  1037.115 because the procedure for 
determining the hydrofluorocarbon (HFC) leakage rate for air 
conditioning systems with alternate refrigerants is already addressed 
in SAE J2727, which is incorporated by reference in 40 CFR 86.1, and 
therefore does not need to be included in Sec.  1037.115.
     Labeling clarification: EPA is clarifying in Sec.  
1037.135 that the emission control label for the vehicle only requires 
a statement regarding the size of the fuel tank for vehicles that 
contain an evaporative canister for controlling emissions.
     Typographical fixes: EPA is addressing the typographical 
errors in Sec.  1037.135 relative to labeling, Sec.  1037.501 related 
to the trailer specification, and Sec.  1037.520 which includes a 
weight reduction explanation.
     EPA is clarifying that the general requirements for 
obtaining a certificate of conformity and EPA's authority to perform 
confirmatory testing on vehicles, including the vehicles used to 
determine Falt-aero (see Sec.  1037.201).
     EPA is revising Sec.  1037.550 to change the nomenclature 
used for the vehicle speed variable from S to v to be consistent with 
40 CFR part 1065. EPA is also removing the torque control option for 
testing post-transmission hybrid systems because it causes testing 
issues when the vehicle is shifting and braking. In addition, removing 
torque control mode from the dynamometer control options reduces lab-
to-lab variability.
     EPA is clarifying the regulatory text in Sec.  
1037.620(a)(3) to cover instances where the secondary manufacturer who 
would hold the vehicle GHG certificate may be a small business that is 
exempted from the GHG regulations.
     EPA is revising Sec.  1037.660 related to the automatic 
engine shutdown (AES) provisions. Sec.  1037.660(c) currently allows 
manufacturers to obtain a discounted credit for installing AES systems 
that expire prior to the end of the vehicle's life based on the ratio 
of the set point relative to 1,259,000 miles.\15\ EPA is not revising 
that provision, except to change the regulatory provision numbering 
from Sec.  1037.660(c) to Sec.  1037.660(c)(1). However, similar to the 
reasons which

[[Page 36379]]

supported the development of vehicle speed limiter flexibilities, an 
automatic engine shutdown system can be developed to alleviate other 
potential concerns that impede its adoption. For example, some amount 
of idling may be needed for truckers who experience significant ambient 
temperature excursions that would necessitate extended idling or for 
idle reduction technologies, such as auxiliary power units, that 
malfunction and necessitate extended idling. A remedy to these concerns 
would be to design the AES such that it allows for a predetermined 
number of hours per year of idling. EPA is adding Sec.  1037.660(c)(2) 
to appropriately quantify the CO2 emissions and fuel 
consumption of a partial AES system by discounting the AES input to 
GEM. EPA is using an assumption of 1,800 hours as the annual idling 
time in the calculation, which is consistent with the final rule (76 FR 
57154). EPA used 1,800 hours as the annual idling time for sleeper cabs 
because it reasonably reflects the available range of idling time cited 
in several studies, as discussed in the preamble to the final rule and 
in the Final Regulatory Impact Analysis (pages 2-67 and 2-68).\16\ The 
1,800 hours of idling was used in the final rule to determine the 
credit of 5 grams of CO2 per ton-mile for the use of AES 
systems (page 2-68 of the Final Regulatory Impact Analysis). EPA is 
adding a provision to Sec.  1037.745. This new provision clarifies 
manufacturers' liability for offsetting debits (or deficit credits) 
after certifying with emissions above the standards for three years. We 
want to avoid claims that the statute of limitations starts to apply in 
the first year of using debits, since this could significantly limit 
our ability to adequately enforce the requirement. We have generally 
adopted this approach in other rules that allow debits to be carried 
forward a given number of model years and are later offset with credits 
(40 CFR 86.1861-04(e), 86.1864-10(o), and 86.1865-12(k)).
---------------------------------------------------------------------------

    \15\ The basis for the lifetime mileage assumption for heavy-
duty tractors is discussed in the Regulatory Impact Analysis for the 
Final Rule on page 2-69. Available in Docket  EPA-HQ-OAR-
2010-0162-3634.
    \16\ Regulatory Impact Analysis: Final Rulemaking to Establish 
Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for 
Medium- and Heavy-Duty Engines and Vehicles. August 2011. Available 
in Docket  EPA-HQ-OAR-2010-0162-3634.
---------------------------------------------------------------------------

     EPA is adding a definition of ``preliminary approval'' to 
Sec.  1037.801.
     EPA is revising the ``Regulatory Sub-category'' 
definitions in Sec.  1037.801 to match the definition of ``Class'' in 
40 CFR 1037.801, be consistent with DOT's Gross Vehicle Weight Rating 
Classes in Table II of 49 CFR 565.15, and aggregate the heavy-duty 
pickup truck and van sub-category to match the definition in 49 CFR 
535.4.
(3) 40 CFR Part 1037 Aerodynamic Assessment
    A vehicle's design impacts the amount of power that is required to 
move the vehicle down the road. Depending on the vehicle speed, two of 
the largest impacts on GHG emissions and fuel consumption are 
aerodynamics and tire rolling resistance. As part of the Heavy-Duty GHG 
and Fuel Efficiency rule, manufacturers are required to meet vehicle-
based GHG emissions and fuel efficiency standards. Compliance with the 
vehicle standard for combination tractors is determined based on a 
vehicle simulation tool called the Greenhouse Gas Emissions Model 
(GEM). Various characteristics of the vehicle are measured and these 
measurements are used as inputs to the model. These characteristics 
relate to key technologies appropriate for this subcategory of truck--
including aerodynamic features, weight reductions, tire rolling 
resistance, the presence of idle-reducing technology, and vehicle speed 
limiters. See generally 76 FR 57135.
    The aerodynamic drag of a vehicle is determined by the vehicle's 
coefficient of drag (Cd), frontal area, air density and speed. As noted 
in the Heavy-Duty GHG and Fuel Efficiency rule, quantifying truck 
aerodynamics as an input to the GEM presents technical challenges 
because of the proliferation of vehicle configurations, the lack of a 
clearly preferable standardized test method, and subtle variations in 
measured aerodynamic values among various test procedures. Id. at 76 FR 
57148-57151. Class 7 and 8 tractor aerodynamics are currently developed 
by manufacturers using a range of techniques, including wind tunnel 
testing, computational fluid dynamics, and constant speed tests.
    We developed a broad approach that allows manufacturers to use 
these multiple different test procedures to demonstrate aerodynamic 
performance of the tractor fleet given that no single test procedure is 
superior in all aspects to other approaches. Allowing manufacturers to 
use multiple test procedures and modeling coupled with good engineering 
judgment to determine aerodynamic performance is consistent with the 
current approach used in determining representative road load forces 
for light-duty vehicle testing (40 CFR 86.129-00(e)(1)). However, we 
also recognize the need for consistency and a level playing field in 
evaluating aerodynamic performance.
    The agencies developed a bin structure to group aerodynamic test 
results for the proposed rulemaking, and adjusted the method used to 
determine the bins in the final rule. The agencies, while working with 
industry, developed an approach for the final rulemaking which 
identified a reference aerodynamic test method and a procedure to align 
results from other aerodynamic test procedures with the reference 
method, an enhanced coastdown procedure. Manufacturers will be able to 
use any aerodynamic evaluation method in demonstrating a vehicle's 
aerodynamic performance as long as the method is aligned to the 
reference method.
    As discussed in the final rules, the agencies adopted aerodynamic 
technology bins which divide the wide spectrum of tractor aerodynamics 
into five bins (i.e., categories) for high roof tractors (see 76 FR 
57149). The first high roof category, Bin I, is designed to represent 
tractor bodies that prioritize appearance or special duty capabilities 
over aerodynamics. These Bin I trucks incorporate few, if any, 
aerodynamic features and may have several features that detract from 
aerodynamics, such as bug deflectors, custom sunshades, B-pillar 
exhaust stacks, and others. The second high roof aerodynamics category 
is Bin II, which roughly represents the aerodynamic performance of the 
average new tractor sold today. The agencies developed this bin to 
incorporate conventional tractors that capitalize on a generally 
aerodynamic shape and avoid classic features which increase drag. High 
roof tractors within Bin III build on the basic aerodynamics of Bin II 
tractors with added components to reduce drag in the most significant 
areas on the tractor, such as integral roof fairings, side extending 
gap reducers, fuel tank fairings, and streamlined grill/hood/mirrors/
bumpers, similar to SmartWay trucks today. The Bin IV aerodynamic 
category for high roof tractors builds upon the Bin III tractor body 
with additional aerodynamic treatments such as underbody airflow 
treatment, down exhaust, and lowered ride height, among other 
technologies. And finally, Bin V tractors incorporate advanced 
technologies that are currently in the prototype stage of development, 
such as advanced gap reduction, rearview cameras to replace mirrors, 
wheel system streamlining, and advanced body designs.
    The agencies developed the aerodynamic drag area, CdA, bin values 
for the tractor categories based on coastdown testing conducted by EPA 
using the enhanced coastdown test procedures adopted for the final HD

[[Page 36380]]

GHG and Fuel Efficiency rulemaking. EPA tested high roof sleeper cab 
combination tractors from each of the manufacturers in order to 
represent the aerodynamic performance that we would expect from a Bin 
III vehicle. The test results used for the HD GHG and Fuel Efficiency 
final rule are included in Table II-1 below.\17\
---------------------------------------------------------------------------

    \17\ U.S. EPA and NHTSA. Final Rulemaking to Establish 
Greenhouse Gas Emissions Standards and Fuel Efficiency Standards for 
Medium- and Heavy-Duty Engines and Vehicles--Regulatory Impact 
Analysis. August 2011. Page 2-48.

                            Table II-1--Tractor CdA Values Used in HD GHG Final Rule
----------------------------------------------------------------------------------------------------------------
                  Truck                          Expected bin                   Source              CdA (m\2\)
----------------------------------------------------------------------------------------------------------------
                                          Class 8 High Roof Sleeper Cab
----------------------------------------------------------------------------------------------------------------
B-3JM2-2H-TXCR..........................  Bin III...................  EPA Test Program..........             6.4
B-3JM2-4N-TXCR..........................  Bin III-IV................  EPA Test Program..........             5.7
B-3JM2-2K-TXCR..........................  Bin III...................  EPA Test Program..........             6.3
C-3JM2-1B-TXCR..........................  Bin III...................  EPA Test Program..........             6.2
C-3JE2-1F-TXCR..........................  Bin II-III................  EPA Test Program..........             6.7
----------------------------------------------------------------------------------------------------------------

    As part of EPA's quality checks to the enhanced coastdown test 
program, EPA supplied OEMs with the coastdown test data for their 
individual trucks. Through post-rulemaking work with one OEM, EPA found 
an error in the data attributable to a testing contractor. The 
contractor had entered the same coastdown run twice into the dataset 
provided to EPA for one of the trucks tested (one of 20 repeat runs was 
entered twice). As a result the truck appeared to have a CdA value of 
5.7, rather than its actual value of 6.6. As such, the data that should 
have been used to establish the aerodynamic bins for the high roof 
sleeper cabs are listed in Table II-2.

                                 Table II-2--Tractor CdA Values Used in This DFR
----------------------------------------------------------------------------------------------------------------
                  Truck                          Expected bin                   Source              CdA (m\2\)
----------------------------------------------------------------------------------------------------------------
                                          Class 8 High Roof Sleeper Cab
----------------------------------------------------------------------------------------------------------------
B-3JM2-2H-TXCR..........................  Bin III...................  EPA Test Program..........             6.4
B-3JM2-4N-TXCR..........................  Bin III...................  EPA Test Program..........             6.6
B-3JM2-2K-TXCR..........................  Bin III...................  EPA Test Program..........             6.3
C-3JM2-1B-TXCR..........................  Bin III-IV................  EPA Test Program..........             6.2
C-3JE2-1F-TXCR..........................  Bin II-III................  EPA Test Program..........             6.7
----------------------------------------------------------------------------------------------------------------

    Since the coastdown test is an input into the aerodynamic bins, EPA 
is correcting the CdA range for the affected bin levels. The adjustment 
to the ranges will allow Bin III, which represents a SmartWay truck, to 
still mean exactly what was intended in the HD GHG and Fuel Efficiency 
final rule. The Bins IV and V adjustments will require the same level 
of improvement we expected in the HD GHG and Fuel Efficiency final 
rule. This amendment is a correction, so will not change the standards 
or the costs or projected emissions reductions. The HD GHG and Fuel 
Efficiency rulemaking estimates of technology costs and the resulting 
aerodynamic efficiency improvements were made separately from the test 
procedure normalization reflected in the bin tables. Those cost and 
technical feasibility assessments set the absolute values of the steps 
in the table, where the testing results of the five tractors in Table 
II-2 set the range of Bin III against which the rest of the aerodynamic 
bins are defined. Since EPA is not changing either the technical 
descriptions of the bins or the estimates of the aerodynamic loss or 
benefits in moving between bins in the table, EPA is estimating no 
change in HD GHG and Fuel Efficiency final rulemaking costs or 
benefits. EPA is also not changing the input into GEM related to each 
aerodynamic bin; therefore, this change has no impact on the GHG or on 
fuel consumption standards.
    EPA is making the adjustments shown in Table II-3 to correct the 
technical error in the coastdown data used in the HD GHG and Fuel 
Efficiency final rule. Manufacturers will use these corrected 
aerodynamic bin levels in their end of year reports for all 2013 MY and 
later tractors.

             Table II-3--Revised Table in Sec.   1037.520(b)
------------------------------------------------------------------------
                         High-Roof Sleeper Cabs
-------------------------------------------------------------------------
                                                              Then your
 If your measured CDA (m\2\) is . .  Then your Bin Level is  CD input is
                 .                            . . .             . . .
------------------------------------------------------------------------
>= 7.6.............................  Bin I.................         0.75
6.8-7.5............................  Bin II................         0.68
6.3-6.7............................  Bin III...............         0.60
5.6-6.2............................  Bin IV................         0.52
2, N2O, and 
CH4 emissions. There is no need or benefit for manufacturers 
to submit greenhouse gas emission data in the model years before 
emission standards apply for those pollutants.
(7) Summary of Heavy-Duty GHG Amendments
    EPA does not expect that these minor revisions to 40 CFR parts 85, 
86, 1036, 1037, 1065, and 1066 will have any adverse cost impact to the 
manufacturers. There are no testing costs associated with the 
revisions. There is no environmental impact associated with this 
regulatory action because this rulemaking does not change the heavy-
duty engine and vehicle greenhouse gas emission standards that 
manufacturers have to meet; it simply makes some minor amendments to 
the regulations.

II. EPA Technical Amendments

A. Replacement Engines

    In 1996, EPA adopted a provision allowing manufacturers in limited 
circumstances to produce new, exempt engines for replacing failed 
engines (61 FR 58102, November 12, 1996). With this approach, 
manufacturers have been able to make new, exempt engines in cases where 
engines certified to current standards do not have the physical or 
performance characteristics needed to power the equipment with the old 
engine. Without this provision, some equipment owners would have been 
forced to prematurely scrap otherwise working equipment (sometimes 
worth millions of dollars), because no engine meeting current emission 
standards could be adapted for installation in the space occupied by 
the original engine.
    EPA later added language to the replacement engine exemption to 
address the complications related to producing partially complete 
engines for replacement purposes, and to address the need to produce 
and sell replacement engines such that they would be available to 
operators with a critical need to avoid extended downtime in the case 
of engine failure (73 FR 59034, October 8, 2008). This expanded 
approach allowed manufacturers to sell a limited number of new, exempt 
replacement engines without taking the steps that would otherwise be 
required to document the need for the exemption and to arrange for the 
proper disposition of the old engine. Along with this expanded 
approach, EPA added circumvention language to describe the overall 
purpose of the replacement engine exemption in an attempt to prevent 
manufacturers and operators from using exempted engines in ways that 
were unnecessary and/or detrimental to the environment. In particular, 
this text states that the provisions Sec.  1068.240 are ``intended to 
allow for replacement of engines that fail prematurely . . .'' This 
language has been interpreted to mean that replacement engines may be 
used for no other purpose.
    Since then, EPA has found that the circumvention language has had 
some unintended consequences. For example, California has adopted 
requirements for operators to reduce emissions from in-use equipment, 
which has led to a desire to install new replacement engines that are 
cleaner than the old engines. It is often the case that it is 
infeasible or impractical to install replacement engines certified to 
current standards, but suitable replacement engines designed to meet an 
intermediate level of emission standards are available. The 
circumvention language may prevent operators in California from 
achieving overall emission reductions that would result from upgrading 
their existing equipment with cleaner engines in this manner. It may 
also be the case that an engine will simply wear out, rather than 
experiencing premature failure, well before the equipment in which it 
is installed is at the end of its life. Under the current regulation, 
an operator under these circumstances would need to install a new 
engine certified to current standards, or find a used engine, to keep 
the equipment operating.
    EPA continues to believe that new, exempt replacement engines 
should only be used in cases where a currently certified engine cannot 
practically be installed to power the old equipment. EPA believes the 
regulatory language without our description of intent to prevent 
circumvention serves this purpose without the unintended consequences 
described above. EPA is therefore removing the circumvention provisions 
from the regulations in Sec.  1068.240. EPA expects manufacturers and 
operators following the regulations to continue to use the exemption 
provisions appropriately and not for the purpose of circumventing the 
emission standards. EPA is adding language to explicitly limit this 
provision to equipment that has been in service 25 years or less (at 
the point of installation) so that manufacturers and operators do not 
use this provision to keep in operation older dirtier, equipment beyond 
the normal lifetime of the equipment, by continually using new engines 
to replace old engines. EPA has adopted this same restriction for 
stationary engines under 40 CFR 60.4210(i), except that the maximum 
equipment age is 15 years. EPA will continue to monitor compliance with 
the exemption provisions and will consider any appropriate changes to 
the regulation in the future to ensure that the exemption is properly 
used toward this purpose. This 25-year limit does not apply for marine 
diesel engines, since those engines are subject to separate replacement 
engine provisions.
    The tracked option specified in Sec.  1068.240(b) also includes an 
additional step to qualify for the replacement engine exemption for 
equipment not experiencing premature engine failure. In particular, 
manufacturers would need to make a determination that the replacement 
engine is designed with the greatest degree of emission control that is 
available for the particular application. For example, if the engine 
being replaced was built before the Tier 1 standards started to apply 
and engines of that size are currently subject to Tier 2 standards, the 
manufacturer would need to also consider whether it produces any Tier 1 
or Tier 2 engines with the appropriate physical and performance 
characteristics for replacing the old engine. If the manufacturer 
produces a Tier 1 engine with the appropriate physical and performance 
characteristics, engines emitting at levels above the Tier 1 standards 
do not qualify for an exemption. The requirement to use the cleanest 
available engine fits with the intent of facilitating voluntary 
incentive programs involving replacement engine upgrades toward the 
goal of reducing emissions from in-use equipment, but without imposing 
a requirement that would involve new technology

[[Page 36382]]

development or impractical equipment design changes. This provision has 
already been in place for marine diesel engines in Sec.  1042.615. In 
the case of equipment experiencing premature engine failure, we will 
continue to apply the simpler requirement that the replacement engine 
must meet emission standards that are the same as or better than the 
standards that apply to the old engine.
    EPA is also adjusting the provisions related to the disposition of 
the old engine in Sec.  1068.240(b). To be re-introduced into U.S. 
commerce, the old engine must either meet current emission standards or 
qualify for an exemption as if it were a new engine. The old engine 
could be re-used as a replacement engine for a different piece of 
equipment. Under this approach, an engine made from all new parts and 
an engine built with a used engine block and any mix of new or used 
additional parts would be treated the same way. For example, the 
recycled replacement engine would be subject to all the demonstrations 
and documentation requirements of Sec.  1068.240(b), and it would count 
toward the allowance to produce a limited number of replacement engines 
under Sec.  1068.240(c). For engines that are not re-introduced into 
U.S. commerce, manufacturers must destroy the old engine or confirm 
that it has been destroyed. These changes will further address the 
concern expressed in the circumvention language described above; in 
particular, EPA believes it is necessary to prevent the possibility of 
these old engines being installed in new equipment.
    EPA is also adding some clarification to the regulations to address 
questions that have arisen, as well as making the following changes:
     Revising the labeling requirements to account for the 
possibility of using a new replacement engine to replace a previously 
exempted replacement engine. To the extent that the revised label 
statement differs from that specified by California ARB, we would 
expect to approve an adjusted statement that allows for a single, 50-
state label under Sec.  1068.201(c).
     Adjusting the reporting deadline for untracked replacement 
engines under Sec.  1068.240(c). This change would allow manufacturers 
some time after the end of the calendar year to make the determinations 
and to take the required steps to fulfill the tracking requirements for 
replacement engines under Sec.  1068.240(b). Any engines for which 
these steps and determinations are incomplete by the deadline for the 
report would need to be counted as untracked replacement engines. 
Further, to account for prevailing practices and typical timelines for 
replacement engines, we are moving back the deadline for this report 
from February 15 to March 31.
     Revising Sec.  1068.240(c)(1) to specify that 
manufacturers may base sales limits for the untracked option on total 
U.S. production of certified and exempted engines together (including 
stationary engines).
     Adding language to clarify that Sec.  1068.240(e) applies 
only for engines produced under a current, valid certificate. An 
exemption under Sec.  1068.240(b) or (c) would be required to produce 
an engine that is identical to one that is no longer certified, even if 
the engine was formerly certified to standards (or a Family Emission 
Limits) that are at least as stringent as the current standards.
     Clarifying that the provisions in Sec.  1068.240(d) 
related to partially complete engines also apply for ``current-tier'' 
replacement engines exempted under Sec.  1068.240(e).
     Adding a statement to Sec.  1042.615 for marine diesel 
engines to clarify our pre-determination that certified Tier 4 engines 
do not have the appropriate physical and performance characteristics 
for replacing older engines in marine vessels. This policy was 
established in our June 30, 2008 final rule (see 73 FR 37157).
    In addition, we are revising Sec.  1068.1 to correct two errors 
regarding the applicability of part 1068. First, we are restoring 
highway motorcycles to the list of categories that are not subject to 
part 1068. This was added, but then inadvertently removed, when we were 
completing two parallel rulemakings. Second, we are adding a reference 
to 40 CFR part 85 to identify how part 1068 applies in certain 
circumstances for heavy-duty highway engines. These changes are 
intended to clarify and reinforce existing requirements without 
modifying the underlying programs in any way.

B. Nonroad Diesel Engine Technical Hardship Program

    EPA is amending the nonroad diesel engine technical hardship 
program to facilitate EPA granting exemptions to address certain 
hardship circumstances that were not considered when the original 2004 
final rule was published. EPA adopted Tier 4 standards for nonroad 
diesel engines under 40 CFR part 1039 in 2004 (69 FR 38958, June 29, 
2004). To meet these standards, engine manufacturers are pursuing 
development of advanced technologies, including new approaches for 
exhaust aftertreatment. Equipment manufacturers will need to modify 
their equipment designs to accommodate these new engine technologies 
and the corresponding changes to engine operating parameters (such as 
operating temperatures and heat rejection rates). To provide 
flexibility for equipment manufacturers in their efforts to respond to 
these engine design changes, the Tier 4 standards included the 
Transition Program for Equipment Manufacturers. Flexibilities allowed 
under this program include delaying compliance with small-volume 
equipment models for several years or using allowances in the first 
year to manage the transition to the Tier 4 engines.
    The Transition Program for Equipment Manufacturers is intended to 
allow nonroad equipment manufacturers wide discretion to manage their 
product development timeline. Equipment manufacturers may comply either 
based on a percent of their production (generally for high-volume 
manufacturers, as described in Sec.  1039.625(b)(1)), or based on a 
maximum number of exempted pieces of equipment (generally for low-
volume manufacturers, as described in Sec.  1039.625(b)(2)). At the 
same time, the regulations include at Sec.  1039.625(m) an 
acknowledgement that equipment manufacturers might face a wide range of 
circumstances, including cases where engine manufacturers might be late 
in providing compliant engines to nonintegrated equipment manufacturers 
such that the specified allowances are insufficient to avoid a 
disruption in the equipment manufacturer's production schedule. The 
technical hardship provision at Sec.  1039.625(m) allows EPA to make a 
judgment that an equipment manufacturer that buys engines from another 
company, through no fault of its own, needs additional allowances to 
manage the transition to Tier 4 products. The regulation specifies a 
maximum allowance of 150 percent of a manufacturer's annual production 
(relative to Sec.  1039.625(b)(1)), or a total of 1,100 allowances 
(relative to Sec.  1039.625(b)(2)). The regulation also provides 
economic hardship provisions under Sec.  1068.255; however, eligibility 
depends on manufacturers showing that their solvency is in jeopardy 
without relief. Economic hardship therefore serves as a flexibility 
provision of last resort.
    As the compliance dates for the Tier 4 standards approach, 
equipment manufacturers have described several scenarios where the 
technical hardship provisions are too restrictive to address their 
circumstances. For example, engine manufacturers have in some

[[Page 36383]]

cases delayed delivery of Tier 4 engines until six or even twelve 
months after the Tier 4 standards start to apply, which could force 
equipment manufacturers to use up all their allowances under Sec.  
1039.625(b) in the first year of the new standards. The maximum number 
of allowances under Sec.  1039.625(m) would cover a good portion of the 
second year of the Tier 4 standards, but we have heard how this too is 
inadequate to allow equipment manufacturers to respond to late 
deliveries of compliant engines.
    As another example where additional flexibility may be warranted, 
corporate acquisitions can cause equipment manufacturers to find 
themselves disadvantaged with respect to allowances because two 
companies have become a single company for purposes of regulatory 
compliance. Taken to an extreme, the combined company could exceed its 
allowances under Sec.  1039.625(b) on the day of the merger because 
each of the separate companies may have used allowances that, taken 
together, exceed the specified thresholds for a single company. The 
combined company may apply for technical hardship under Sec.  
1039.625(m), but we have seen that this too can provide insufficient 
relief for equipment manufacturers trying to incorporate Tier 4 engines 
into their equipment.
    In these cases, the maximum allowable relief under Sec.  
1039.625(m) is insufficient to allow equipment manufacturers to 
transition to meeting Tier 4 requirements without disrupting their 
ability to continue producing their equipment models. There have also 
been cases where a company would meet the criteria to qualify for 
consideration for technical hardship under Sec.  1039.625(m) except 
that the regulation disallows technical hardship relief for all engines 
above 560 kW and provides only limited relief for engines above 37 kW. 
The regulation also provides only limited relief for companies that are 
not small businesses. In these cases, no additional relief is available 
under Sec.  1039.625(m), which again leaves equipment manufacturers 
unable to continue producing their equipment models. We are amending 
the Transition Program for Equipment Manufacturers in three ways to 
address these concerns. First, we are removing the qualifying criteria 
so that any equipment manufacturer may apply for technical hardship 
relief under Sec.  1039.625(m) for any size engine, rather than 
limiting the technical hardship relief to small businesses and to 
engines within certain power categories. We believe it is more 
appropriate to rely on our discretion to evaluate each hardship 
application on its merits rather than automatically precluding hardship 
relief based on certain characteristics of the engine or the company. 
If hardship relief is not appropriate because of an engine's power 
rating or a company's size or financial standing, we will not approve 
the request.
    Second, we are removing the maximum number of allowances we can 
approve under Sec.  1039.625(m), for both percent-of-production 
(currently 150 percent) and small-volume allowances (currently 1,100 
units), and we are removing the deadlines for exercising those 
additional allowances. We have learned that the specified restrictions 
on hardship allowances are in some cases too limiting to address the 
legitimate concerns raised by equipment manufacturers. Again, we 
believe it is most appropriate to resolve issues of extent of relief 
once an equipment manufacturer has demonstrated that relief is 
appropriate, rather than limiting it a priori. We will not approve a 
greater number of technical hardship allowances than is needed to meet 
the established objectives. Finally, for additional small-volume 
allowances under Sec.  1039.625(b)(2) and (m)(4), we may waive the 
annual limits on the number of allowances instead of or in addition to 
granting additional hardship allowances. There may be times when 
manufacturers only need approval to use up their regular allowances at 
a faster pace than the regulations currently allow.
    An additional concern has come to our attention as it relates to 
marine engines. Vessel manufacturers may use certified land-based 
engines in marine vessels as long as the engines are not modified from 
their certified configuration (see Sec.  1042.605). We adopted this 
provision with the understanding that, given the additional 
technological challenges of operating engines in a marine environment, 
marine standards are set to be no more stringent than land-based 
standards and are often set at a level somewhat less stringent than the 
standards that apply to the land-based engines. Vessel manufacturers 
have used these provisions extensively to access a wide range of engine 
models that are not available in a certified marine configuration. The 
part 1039 Tier 4 standards have made this more complicated. The Tier 4 
standards for most sizes of land-based engines are much more stringent 
than the Tier 3 marine standards, which will continue to apply for many 
Category 1 engines. Engine distributors supplying product to vessel 
manufacturers have reported that several engine models will not be 
available to them in the transition period. In that way, vessel 
manufacturers are much like nonroad equipment manufacturers, except 
that the vessels are not actually required to use engines meeting the 
more stringent standards now or, for engines below 600 kW, in the 
foreseeable future. It would be a natural solution to use allowances 
under Sec.  1039.625, but the regulations specifically require that 
vessel manufacturers may use only certified land-based engines under 
Sec.  1042.605. There is a risk that this gap would significantly limit 
their ability to continue producing vessels in the near term. We are 
addressing this by revising 40 CFR part 1042 to specifically allow 
vessel manufacturers to use allowances under Sec.  1039.625 for certain 
model year 2013 engines installed in marine vessels. This provision 
does not apply for engines at or below 19 kW, since the land-based and 
marine standards for those engines are very similar. This provision 
also does not apply for engines above 600 kW because the dynamic for 
designing and certifying those high-power engines allows for a greater 
expectation that they will be certified in a marine configuration. We 
expect no negative environmental impact because the engines will be 
meeting the nonroad Tier 3 standards, which will continue to be at 
least as stringent as the standards that currently apply for marine 
engines. Since this is only a temporary measure, vessel manufacturers 
will either need to use Tier 4 land-based engines or find certified 
Tier 3 marine engines starting with the 2014 model year.
    There are further minor changes to the regulations to clarify some 
of the detailed transition provisions for nonroad diesel engines, as 
follows:
     Revising Sec.  1039.104(g) to remove the limitations on 
the number of engines using the specified alternate FEL caps. 
Manufacturers have pointed out that this expanded flexibility would 
address the same concerns as described in this section for 
transitioning to the Tier 4 standards, but there would be no net 
environmental impact since manufacturers would need to produce low-
emission engines that generate emission credits to offset the 
additional credits used by transition engines certified to with higher 
FELs. We are also revising the regulation to specify that the same 
Temporary Compliance Adjustment Factor is the same whether an engine is 
subject to NOX + NMHC standards or NOX-only 
standards. The revision also addresses Tier 3 carry-over engines that 
would need to certify to the alternate FEL caps after the Tier 4 final 
standards take effect.

[[Page 36384]]

     Adding text to Sec.  1039.625(e) to clarify that exempted 
engines may meet standards that are more stringent than those specified 
in the regulation. This change is intended only to avoid the unintended 
consequence of disallowing a manufacturer from making an engine that 
was cleaner than it needed to be. Even though these engines are cleaner 
than they need to be under the replacement-engine exemption, it is 
still the case that these engines are being exempted from the standards 
that apply for certified engines; as such, it would be inappropriate 
for these engines to generate emission credits.
     Clarifying in Sec.  1039.625(e) which alternate standards 
apply to exempted engines in cases where there is more than one set of 
standards in a given model year. For example, the appropriate standards 
for 19-56 kW engines are the Option 1 standards specified in Sec.  
1039.102, and the appropriate standards for bigger engines are the 
phase-out standards specified in Sec.  1039.102.
     Adjusting the provision for using interim Tier 4 engines 
under Sec.  1039.625(a)(2) to require that manufacturers use engines 
that are identical to previously certified engines, rather than 
requiring that the exempt engines be certified for the new model year. 
This addresses an administrative complication related to certifying 
exempted engines, without changing the requirements that apply.

C. Large SI Fuel Line Permeation

    EPA is amending the required version of the SAE procedure for 
testing large SI fuel line permeation. In 2002 we adopted evaporative 
emission standards for nonroad spark-ignition engines above 19 kW 
(Large SI engines) (67 FR 68242, November 8, 2002). This rule included 
a requirement that engines meet a permeation control standard, that 
could be demonstrated by using fuel lines compliant with SAE J2260, the 
latest version of which had been completed in 1996 (see 40 CFR 
1048.105). This SAE standard effectively established a level of 
permeation control that had been widely used with automotive products. 
In adopting this requirement, we expected manufacturers to find ``off-
the-shelf'' automotive-grade products for the nonroad engines and 
equipment.
    In 2008, we revised this requirement by changing the regulation to 
reference the 2004 version of SAE J2260, which had been finalized after 
the initial rulemaking (73 FR 59034, October 8, 2008). As noted in our 
proposed rule, we understood the purpose and effect of the change in 
the SAE standard to be substantive with regard to the permeation 
measurement procedure, but not necessarily with regard to the 
stringency of the standard. The revised SAE protocol specifies a 
tighter numerical standard, but this corresponded to an offsetting 
change from a methanol-based test fuel to an ethanol-based test fuel. 
Switching to ethanol improves the representativeness of the procedure, 
and it is widely understood that ethanol permeates through fuel-system 
materials less aggressively than methanol. It is also clear the fuel 
change would have a non-uniform effect on different fuel-system 
materials, but our overall expectation was that fuel lines meeting the 
1996 version of the standard would also meet the 2004 version of the 
standard. Following the proposed rule, we received no comments either 
supporting or contradicting our understanding that updating to the new 
standard would have no significant effect on the stringency or 
practicability of the standard.
    Since completing the 2008 rulemaking, we have received information 
indicating that the revision of the regulation to refer to the newer 
version of SAE J2260 was having a substantive effect on manufacturers' 
ability to meet the standard. First, it seems that automotive 
manufacturers have moved beyond the SAE J2260 standard to develop their 
own proprietary methods of sourcing fuel lines from their suppliers. 
Since the evaporative emission standards for automotive products 
involve whole-vehicle measurements in an enclosure, manufacturers have 
the option to pursue different strategies of balancing emissions from 
fuel-line permeation with emissions from other sources. In effect, 
there is no longer a level of emission control or a type of fuel line 
that we can characterize simply as ``automotive-grade''. It is also the 
case that motor vehicle manufacturers buy fuel lines in large 
quantities of pre-formed parts, rather than buying large spools of fuel 
line that can be cut and formed for a particular application.
    Second, it appears that fuel line suppliers have a very limited 
ability or willingness to supply fuel lines that they will describe as 
meeting the 2004 version of SAE J2260. It is not clear whether this is 
a result of a difference in stringency between the two versions of the 
standard, or merely that fuel-line suppliers have moved beyond the SAE 
standard to conform to separate specifications from individual 
automotive manufacturers. In any case, Large SI equipment is not 
manufactured in sufficient numbers to greatly influence the fuel line 
manufacturers' activities, which has prevented Large SI equipment 
manufacturers from being able to find and use fuel lines meeting the 
exact specification in the regulations.
    We are addressing this by again revising the regulation, this time 
to specify that either the 1996 or 2004 version of SAE J2260 provides 
an acceptable level of control for producing compliant Large SI engines 
and equipment. We do not believe this will have a significant effect on 
the stringency of the standard. However, to the extent that this 
modifies the stringency of the existing fuel-line permeation standards 
at all, it only revises it back to the level of permeation control that 
we adopted originally in 2002. We note also that the regulations from 
the California Air Resources Board continue to rely on the 1996 version 
of SAE J2260. This change therefore allows for a unified national 
approach to fuel-line permeation standards.

D. Small SI Amendments

    Since the first emission standards for small spark-ignition (SI) 
engines (X exhaust emissions using CA RFG 3 will 
be comparable relative to results on Federal certification fuel. 
However, due to the presence of an oxygenate (approximately 3 percent) 
caused by the inclusion of E10 in CA RFG 3, tested CO emissions will be 
reduced when an engine is tested using CA RFG 3, compared to Indolene 
which includes no oxygenates (see 40 CFR 1065.710). EPA's official test 
fuel is Indolene and the level of the CO emission standards for small 
SI engines (see 40 CFR 1054.103 and 1054.105) is based on the use of 
that fuel. Therefore, EPA cannot fully accept test results using CA RFG 
3 as showing compliance with EPA CO standards, because CO test 
emissions showing compliance using CA RFG 3 do not guarantee that an 
engine will be able to comply with EPA's CO standard using Indolene.
    Therefore, EPA will retain the option to conduct any production 
line, confirmatory, and selective enforcement audit (SEA) testing on 
EPA test fuel as specified in 40 CFR 1065.710.\19\ However, as an 
option for the manufacturers, to bring some uniformity and certainty to 
the engine development and calibration, emissions testing, and 
emissions durability assessment processes, EPA will agree to use CA RFG 
3 test fuel for any production line, confirmatory, and SEA testing if a 
manufacturer(s) agree to meet a lower CO emission standard. These 
values, which substantially address the effect of oxygenate content on 
CO emission rates, are 549 g/kW-hr for Classes I and II (non handheld 
engines) and 536 g/kW-hr for Classes III-V (handheld engines). These 
values are the same as California's current CO emission standards 
(based on the use of CA RFG 2); they are 10-33 percent lower (depending 
on Class) than EPA's CO emission standards (see 40 CFR 1054.103 and 
1054.105) because they account for oxygenate content in that fuel. This 
does not represent a change in stringency, as the engine designs and 
calibration will not change, but CO emissions will decrease due to the 
oxygenate content of the California test fuel. This option would be 
available for Class I and II marine generators at a CO emission 
standard of 4.5 g/kW-hr. This value was derived based on the ratio of 
the California CO emission standards to the Federal emission standards 
for other Class I and II marine generators. This option is available on 
a family-by-family basis for all Classes of small SI engines. We 
consider these CO emission standards to be interim values for purposes 
of this option only. EPA may revise the level of its CO emission 
standard in the future if we propose to change the Federal test fuel 
specifications.
---------------------------------------------------------------------------

    \19\ EPA already requires a ten percent ethanol blend for 
evaporative emissions testing.
---------------------------------------------------------------------------

    Second, EPA has decided to continue accepting exhaust emissions 
data on CA RFG 2 after the 2012 model year (see 40 CFR 1054.145(k)). 
Manufacturers have provided data for both handheld and nonhandheld 
engines showing equivalent exhaust emission levels between CA RFG 2 and 
the gasoline specified in 40 CFR 1065.710 (Indolene). Furthermore, the 
move to CA RFG 3 sets in motion a process to eliminate CA RFG 2 
certifications in the future as would have been required under 40 CFR 
1054.145(k). Thus, to help enable an orderly and cost effective 
transition, EPA believes it is appropriate for us to continue to accept 
exhaust emission test data using CA RFG 2 for certification through the 
2019 model year. We will expect engine families certified using CA RFG 
2 carryover exhaust emission data to meet emissions standards on both 
CA RFG 2 and EPA certification test fuel as specified in 40 CFR 
1065.710 for any production line, SEA, or confirmatory testing.
    Both of these actions apply for certification for model years 2013 
to 2019, inclusive. EPA expects to revisit these provisions before 2020 
to determine if they should be extended or otherwise modified. The 
primary EPA program using Indolene test fuel and meeting the current 
EPA emission standards remains in place for Federal certification for 
2013 and beyond unless and until these provisions are otherwise 
modified.
    We are also taking the opportunity to revise the regulatory 
provision in Sec.  1054.145(c) describing requirements related to 
altitude kits for handheld engines. We adopted those specifications 
based on the expectation that the Phase 3 exhaust standards were 
unchanged from the Phase 2 exhaust standards. As such, the emission 
standards do not apply at altitudes for which the manufacturer would 
need to rely on an altitude kit. The regulation should therefore be 
revised to no longer refer to the manufacturer relying on an altitude 
kit ``to meet emission standards.'' This change in the regulations is 
not intended to change current requirements, but rather simply 
clarifies the proper relationship of the altitude kit to the certified 
configuration.

[[Page 36386]]

III. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this 
action is a ``significant regulatory action'' because it raises issues 
that may have a potential effect on actions taken or planned by another 
agency. Accordingly, EPA and NHTSA submitted this action to the Office 
of Management and Budget (OMB) for review under Executive Orders 12866 
and 13563 (76 FR 3821, January 21, 2011) and any changes made in 
response to OMB recommendations have been documented in the docket for 
this action.
    This direct final rule merely clarifies and corrects existing 
regulatory language. The agencies do not believe there will be costs 
associated with this rule because the costs in this program were 
previously accounted for under the existing rules (69 FR 38958, June 
29, 2004; 73 FR 59034, October 8, 2008; and 76 FR 57106, September 15, 
2011). This rule is not anticipated to create additional burdens to the 
existing requirements. As such, a regulatory impact evaluation or 
analysis is unnecessary. The agencies also do not expect this rule to 
have substantial Congressional or public interest.

B. Paperwork Reduction Act

    This action does not impose an information collection burden under 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. 
Burden is defined at 5 CFR 1320.3(b). The information collection 
requirements to ensure compliance with the provisions in these rules 
were covered under ICR (2394.02).
    The Office of Management and Budget (OMB) has previously approved 
the information collection requirements contained in the existing 
heavy-duty greenhouse gas emissions regulations under the provisions of 
the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned 
OMB Control Number 2060-0678. The OMB control numbers for EPA's 
regulations in title 40 of the Code of Federal Regulations are listed 
in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) as amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121, 
110 Stat. 857), generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice and comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute unless the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small organizations, and small 
governmental jurisdictions.
    For purposes of assessing the impacts of this rule on small 
entities, small entity is defined as: (1) A small business as defined 
by Small Business Administration regulations at 13 CFR 121.201; (2) a 
small governmental jurisdiction that is a government of a city, county, 
town, school district or special district with a population of less 
than 50,000; and (3) a small organization that is any not-for-profit 
enterprise which is independently owned and operated and is not 
dominant in its field.
    After considering the economic impacts of these rules on small 
entities, we concluded that this action will not have a significant 
economic impact on a substantial number of small entities.
    This direct final rule merely corrects and clarifies regulatory 
provisions. In particular, as already adopted in the heavy-duty vehicle 
GHG and fuel efficiency rules, EPA and NHTSA are deferring standards 
for manufacturers meeting the Small Business Administration's 
definition of small business as described in 13 CFR 121.201.
    There are no costs and therefore no regulatory burden associated 
with this rule. We have therefore concluded that this rule will not 
increase regulatory burden for affected small entities.

D. National Environmental Policy Act

    NHTSA has analyzed this direct final rule pursuant to the National 
Environmental Policy Act. This rule corrects technical inconsistencies 
and adds minor clarifications to the regulatory text of the heavy-duty 
fuel efficiency program, finalized by rule in August 2011. NHTSA 
analyzed the environmental impacts of that rule in a Final 
Environmental Impact Statement (EIS), issued in July 2011. The direct 
final rule we are issuing today is not anticipated to affect the 
stringency of the standards finalized in the August 2011 rule or to 
have environmental impacts other than those identified and analyzed in 
the Final EIS. Accordingly, today's rule will not have any significant 
impact on the quality of the human environment. Because no substantial 
changes have been made to the heavy-duty fuel-efficiency program that 
are relevant to environmental concerns, and in the absence of 
significant new circumstances or information relevant to environmental 
concerns and bearing on this action, NHTSA has concluded that no 
further action is required under the National Environmental Policy Act.

E. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for State, local, or tribal governments or the private 
sector. The action imposes no enforceable duty on any State, local or 
tribal governments or the private sector. Therefore, this action is not 
subject to the requirements of sections 202 or 205 of the UMRA.
    This action is also not subject to the requirements of section 203 
of UMRA because it contains no regulatory requirements that might 
significantly or uniquely affect small governments.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in Executive Order 13132. This direct final rule merely 
corrects and clarifies regulatory provisions. Thus, Executive Order 
13132 does not apply to this action.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). This direct 
final rule merely corrects and clarifies regulatory provisions. Tribal 
governments would be affected only to the extent they purchase and use 
regulated vehicles. Thus, Executive Order 13175 does not apply to this 
action.

H. Executive Order 13045: Protection of Children From Environmental 
Health and Safety Risks

    This action is not subject to Executive Order 13045 (62 FR 19885, 
April 23, 1997) because it is not economically significant as defined 
in Executive Order 12866, and because EPA and NHTSA do not believe the 
environmental health or safety risks addressed by this action present a 
disproportionate risk to children. This direct final rule merely 
corrects and clarifies regulatory provisions.

[[Page 36387]]

I. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This action is not subject to Executive Order 13211 (66 FR 28355, 
May 22, 2001), because it is not likely to have a significant adverse 
effect on the supply, distribution, or use of energy. This direct final 
rule merely corrects and clarifies regulatory provisions.

J. National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards bodies. NTTAA directs agencies to provide 
Congress, through OMB, explanations when the Agency decides not to use 
available and applicable voluntary consensus standards.
    This action slightly expands the use of voluntary consensus 
standards by adding a reference standard under 40 CFR 1048.105. Other 
amendments in this direct final rule do not involve application of new 
technical standards. However, the underlying regulations in many cases 
rely on voluntary consensus standards. For example, EPA and NHTSA 
included several voluntary consensus standards in the development of 
the Greenhouse Gas Emissions Standards and Fuel Efficiency Standards 
for Medium- and Heavy-Duty Engines and Vehicles (76 FR 57106, September 
15, 2011).

K. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 (59 FR 7629, February 16, 1994) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA and NHTSA have determined that this rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it merely 
corrects provisions for manufacturers to use to demonstrate compliance 
of heavy-duty engines and vehicles.

L. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA and NHTSA will submit reports containing this rule 
and other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A Major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective on August 16, 2013.

M. Executive Order 12988 (Civil Justice Reform)

    This direct final rule meets applicable standards in sections 3(a) 
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden.

IV. Statutory Authority

A. EPA

    Statutory authority for the vehicle controls is found in Clean Air 
Act section 202(a) (which authorizes standards for emissions of 
pollutants from new motor vehicles which emissions cause or contribute 
to air pollution which may reasonably be anticipated to endanger public 
health or welfare), sections 202(d), 203-209, 216, and 301 (42 U.S.C. 
7521(a), 7521(d), 7522, 7523, 7524, 7525, 7541, 7542, 7543, 7550, and 
7601).

B. NHTSA

    Statutory authority for the fuel consumption standards is found in 
section 103 (which authorizes a fuel efficiency improvement program, 
designed to achieve the maximum feasible improvement to be created for 
commercial medium- and heavy-duty on-highway vehicles and work trucks, 
to include appropriate test methods, measurement metrics, standards, 
and compliance and enforcement protocols that are appropriate, cost-
effective and technologically feasible) of the Energy Independence and 
Security Act of 2007, 49 U.S.C. 32902(k).

List of Subjects

40 CFR Part 85

    Confidential business information, Imports, Labeling, Motor vehicle 
pollution, Reporting and recordkeeping requirements, Research, 
Warranties.

40 CFR Part 86

    Administrative practice and procedure, Confidential business 
information, Labeling, Motor vehicle pollution, Reporting and 
recordkeeping requirements.

40 CFR Part 1036

    Administrative practice and procedure, Air pollution control, 
Confidential business information, Environmental protection, Labeling, 
Motor vehicle pollution, Reporting and recordkeeping requirements, 
Warranties.

40 CFR Part 1037

    Administrative practice and procedure, Air pollution control, 
Confidential business information, Environmental protection, 
Incorporation by reference, Labeling, Motor vehicle pollution, 
Reporting and recordkeeping requirements, Warranties.

40 CFR Part 1039

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Labeling, Penalties, Reporting and recordkeeping requirements, 
Warranties.

40 CFR Part 1042

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Labeling, Penalties, Vessels, Reporting and recordkeeping requirements, 
Warranties.

40 CFR Part 1048

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Incorporation by reference, Labeling, Penalties, Reporting and 
recordkeeping requirements, Warranties.

40 CFR Part 1054

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Confidential business information, Imports, 
Labeling, Penalties, Reporting and recordkeeping requirements, 
Warranties.

[[Page 36388]]

40 CFR Part 1065 and 1066

    Administrative practice and procedure, Air pollution control, 
Reporting and recordkeeping requirements, Research.

40 CFR Part 1068

    Environmental protection, Administrative practice and procedure, 
Confidential business information, Imports, Motor vehicle pollution, 
Penalties, Reporting and recordkeeping requirements, Warranties.

49 CFR Parts 523 and 535

    Fuel economy.
    For the reasons set forth in the preamble, the Environmental 
Protection Agency is amending title 40, chapter I of the Code of 
Federal Regulations as follows:

PART 85--CONTROL OF AIR POLLUTION FROM MOBILE SOURCES

0
1. The authority citation for part 85 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart F--[Amended]

0
2. Section 85.525 is amended by revising paragraph (a)(2)(i) 
introductory text and adding paragraph (a)(2)(iii) to read as follows:

Sec.  85.525  Applicable standards.

* * * * *
    (a) * * *
    (2) * * *
    (i) Subject to the following exceptions and special provisions, 
compliance with light-duty vehicle greenhouse gas emission standards is 
demonstrated by complying with the N2O and CH4 
standards and provisions set forth in 40 CFR 86.1818-12(f)(1) and the 
in-use CO2 exhaust emission standard set forth in 40 CFR 
86.1818-12(d) as determined by the OEM for the subconfiguration that is 
identical to the fuel conversion emission data vehicle (EDV):
* * * * *
    (iii) Subject to the following exceptions and special provisions, 
compliance with greenhouse gas emission standards for heavy-duty 
vehicles subject to 40 CFR 1037.104 is demonstrated by complying with 
the N2O and CH4 standards and provisions set 
forth in 40 CFR 1037.104 and the in-use CO2 exhaust emission 
standard set forth in 40 CFR 1037.104(b) as determined by the OEM for 
the subconfiguration that is identical to the fuel conversion emission 
data vehicle (EDV):
    (A) If the OEM complied with alternate standards for N2O 
and/or CH4, as allowed under 40 CFR 1037.104(c) you may 
demonstrate compliance with the same alternate standards.
    (B) If you are unable to meet either the N2O or 
CH4 standards and your fuel conversion CO2 
measured value is lower than the in-use CO2 exhaust emission 
standard, you may also convert the difference between the in-use 
CO2 exhaust emission standard and the fuel conversion 
CO2 measured value into GHG equivalents of CH4 
and/or N2O, using 298 g CO2 to represent 1 g 
N2O, and 25 g CO2 to represent 1 g 
CH4. You may then subtract the applicable converted values 
from the fuel conversion measured values of CH4 and/or 
N2O to demonstrate compliance with the CH4 and/or 
N2O standards.
    (C) You may alternatively comply with the greenhouse gas emission 
requirements by comparing emissions from the vehicle before and after 
the fuel conversion. This comparison must be based on FTP test result 
from the emission data vehicle (EDV) representing the pre-conversion 
test group. The sum of CO2, CH4, and 
N2O shall be calculated for pre- and post-conversion FTP 
test results, where CH4 and N2O are weighted by 
their global warming potentials of 25 and 298, respectively. The post-
conversion sum of these emissions must be lower than the pre-conversion 
greenhouse gas emission result. Calculate CO2 emissions as 
specified in 40 CFR 600.113. If we waive N2O measurement 
requirements based on a statement of compliance, disregard 
N2O for all measurements and calculations under this 
paragraph (a)(2)(iii)(C).
* * * * *

PART 86--CONTROL OF EMISSIONS FROM NEW AND IN-USE HIGHWAY VEHICLES 
AND ENGINES

0
3. The authority citation for part 86 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--[Amended]

Sec.  86.007-23  [Amended]

0
4. Section 86.007-23 is amended by removing paragraph (n).
0
5. Section 86.010-18 is amended by adding paragraph (q)(6) to read as 
follows:

Sec.  86.010-18  On-board Diagnostics for engines used in applications 
greater than 14,000 pounds GVWR.

* * * * *
    (q) * * *
    (6) Manufacturers that modify the engine's diagnostic system from 
the approved configuration to be compatible with a hybrid powertrain 
system under this paragraph (q) must add the following compliance 
statement to the ECI label: ``for use in hybrid applications only''.

Subpart S--[Amended]

Sec.  86.1844-01  [Amended]

0
6. Section 86.1844-01 is amended by removing paragraph (j).
0
7. Section 86.1865-12 is amended by:
0
a. Revising paragraph (a)(1) introductory text and adding paragraph 
(a)(1)(ii):
0
b. Revising paragraphs (j)(4)(i), (k)(4) introductory text, and 
(k)(8)(iv)(A); and
0
c. Revising paragraphs (l)(1)(i) introductory text, (l)(1)(ii) 
introductory text, and (l)(3).
    The revisions and additions read as follows:

Sec.  86.1865-12  How to comply with the fleet average CO2 
standards.

    (a) * * *
    (1) Unless otherwise exempted under the provisions of Sec.  
86.1801-12(j) or (k), CO2 fleet average exhaust emission 
standards of this subpart apply to:
* * * * *
    (ii) Heavy-duty vehicles subject to standards under 40 CFR 
1037.104.
* * * * *
    (j) * * *
    (4) * * *
    (i) Manufacturers must report in their annual reports to the Agency 
that they met the relevant corporate average standard by showing that 
their production-weighted average CO2 emission levels of 
passenger automobiles, light trucks, and heavy-duty vehicles, as 
applicable, are at or below the applicable fleet average standards; or
* * * * *
    (k) * * *
    (4) Credits are earned on the last day of the model year. 
Manufacturers must calculate, for a given model year and separately for 
passenger automobiles, light trucks, and heavy-duty vehicles (as 
specified in 40 CFR 1037.104), the number of credits or debits it has 
generated according to the following equation rounded to the nearest 
megagram:
* * * * *
    (8) * * *
    (iv) * * *
    (A) If a manufacturer ceases production of passenger automobiles, 
light trucks, or heavy-duty vehicles subject to the standards of 40 CFR 
1037.104, the manufacturer continues to be responsible for offsetting 
any debits outstanding within the required time period. Any failure to 
offset the debits

[[Page 36389]]

will be considered a violation of paragraph (k)(8)(i) of this section 
and may subject the manufacturer to an enforcement action for sale of 
vehicles not covered by a certificate, pursuant to paragraphs 
(k)(8)(ii) and (iii) of this section.
* * * * *
    (l) * * *
    (1) * * *
    (i) Manufacturers producing any light-duty vehicles, light-duty 
trucks, or medium-duty passenger vehicles subject to the provisions in 
this subpart or any heavy-duty vehicles subject to the standards of 40 
CFR 1037.104 must establish, maintain, and retain all the following 
information in adequately organized records for each model year:
* * * * *
    (ii) Manufacturers producing any passenger automobiles or light 
trucks subject to the provisions in this subpart and vehicles subject 
to the standards of 40 CFR 1037.104 must establish, maintain, and 
retain all the following information in adequately organized records 
for each passenger automobile or light truck subject to this subpart:
* * * * *
    (3) Notice of opportunity for hearing. Any voiding of the 
certificate under paragraph (l)(1)(vi) of this section will be made 
only after EPA has offered the affected manufacturer an opportunity for 
a hearing conducted in accordance with Sec.  86.614 and, if a 
manufacturer requests such a hearing, will be made only after an 
initial decision by the Presiding Officer.

PART 1036--CONTROL OF EMISSIONS FROM NEW AND IN-USE HEAVY-DUTY 
HIGHWAY ENGINES

0
8. The authority citation for part 1036 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--[Amended]

0
9. Section 1036.5 is amended by revising paragraph (b) to read as 
follows:

Sec.  1036.5  Which engines are excluded from this part's requirements?

* * * * *
    (b) Engines installed in heavy-duty vehicles that do not provide 
motive power are nonroad engines. The provisions of this part therefore 
do not apply to these engines. See 40 CFR part 1039, 1048, or 1054 for 
other requirements that apply for these auxiliary engines. See 40 CFR 
part 1037 for requirements that may apply for vehicles using these 
engines.
* * * * *

Subpart B--[Amended]

0
10. Section 1036.150 is amended by revising paragraphs (d), (g)(2), and 
(g)(3) to read as follows:

Sec.  1036.150  Interim provisions.

* * * * *
    (d) Small manufacturers. Manufacturers meeting the small business 
criteria specified for ``Gasoline Engine and Engine Parts 
Manufacturing'' or ``Other Engine Equipment Manufacturers'' in 13 CFR 
121.201 are not subject to the greenhouse gas emission standards in 
Sec.  1036.108. Qualifying manufacturers must notify the Designated 
Compliance Officer before importing or introducing into U.S. commerce 
excluded engines. This notification must include a description of the 
manufacturer's qualification as a small business under 13 CFR 121.201. 
You must label your excluded engines with the statement: ``THIS ENGINE 
IS EXCLUDED UNDER 40 CFR 1036.150(d).''
* * * * *
    (g) * * *
    (2) You may use an assigned additive DF of 0.020 g/hp-hr for 
N2O emissions from any engine.
    (3) You may use an assigned additive DF of 0.020 g/hp-hr for 
CH4 emissions from any engine.
* * * * *

Subpart C--[Amended]

0
11. Section 1036.205 is amended by revising paragraph (e) to read as 
follows:

Sec.  1036.205  What must I include in my application?

* * * * *
    (e) Identify the CO2 FCLs with which you are certifying 
engines in the engine family; also identify any FELs that apply for 
CH4 and N2O. The actual U.S.-directed production 
volume of configurations that have CO2 emission rates at or 
below the FCL and CH4 and N2O emission rates at 
or below the applicable standards or FELs must be at least one percent 
of your actual (not projected) U.S.-directed production volume for the 
engine family. Identify configurations within the family that have 
emission rates at or below the FCL and meet the one percent 
requirement. For example, if your U.S.-directed production volume for 
the engine family is 10,583 and the U.S.-directed production volume for 
the tested rating is 75 engines, then you can comply with this 
provision by setting your FCL so that one more rating with a U.S.-
directed production volume of at least 31 engines meets the FCL. Where 
applicable, also identify other testable configurations required under 
Sec.  1036.230(b)(2).
* * * * *

0
12. Section 1036.225 is amended by revising paragraph (f) introductory 
text to read as follows:

Sec.  1036.225  Amending my application for certification.

* * * * *
    (f) You may ask us to approve a change to your FEL in certain cases 
after the start of production, but before the end of the model year. If 
you change an FEL for CO2, your FCL for CO2 is 
automatically set to your new FEL divided by 1.03. The changed FEL may 
not apply to engines you have already introduced into U.S. commerce, 
except as described in this paragraph (f). You may ask us to approve a 
change to your FEL in the following cases:
* * * * *

Subpart F--[Amended]

0
13. Section 1036.525 is amended by revising paragraph (a) to read as 
follows:

Sec.  1036.525  Hybrid engines.

    (a) If your engine system includes features that recover and store 
energy during engine motoring operation test the engine as described in 
paragraph (d) of this section. For purposes of this section, features 
that recover energy between the engine and transmission are considered 
related to engine motoring.
* * * * *

Subpart G--[Amended]

0
14. Section 1036.615 is amended by revising paragraphs (a) introductory 
text and (c) to read as follows:

Sec.  1036.615  Engines with Rankine cycle waste heat recovery and 
hybrid powertrains.

* * * * *
    (a) Pre-transmission hybrid powertrains. Test pre-transmission 
hybrid powertrains with the hybrid engine test procedures of 40 CFR 
part 1065 or with the post-transmission test procedures in 40 CFR 
1037.550. Pre-transmission hybrid powertrains are those engine systems 
that include features to recover and store energy during engine 
motoring operation but not from the vehicle's wheels.
* * * * *
    (c) Calculating credits. Calculate credits as specified in subpart 
H of this part. Credits generated from engines and powertrains 
certified under this section

[[Page 36390]]

may be used in other averaging sets as described in Sec.  1036.740(c).
* * * * *

Subpart I--[Amended]

0
15. Section 1036.801 is amended by adding a definition for 
``Preliminary approval'' in alphabetical order to read as follows:

Sec.  1036.801  Definitions.

* * * * *
    Preliminary approval means approval granted by an authorized EPA 
representative prior to submission of an application for certification, 
consistent with the provisions of Sec.  1036.210.
* * * * *

PART 1037--CONTROL OF EMISSIONS FROM NEW HEAVY-DUTY MOTOR VEHICLES

0
16. The authority citation for part 1037 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart A--[Amended]

0
17. Section 1037.15 is amended by revising paragraph (c) to read as 
follows:

Sec.  1037.15  Do any other regulation parts apply to me?

* * * * *
    (c) Part 86 of this chapter applies for certain vehicles as 
specified in this part. For example, the test procedures and most of 
part 86, subpart S, apply for vehicles subject to Sec.  1037.104; 
including the following paragraphs of 40 CFR 86.1865-12 apply: (a), 
(h)(1), (h)(3), (j)(1), (j)(4), (k)(1) through (4), (k)(7)(ii), (k)(8), 
(k)(9), (l)(1), (l)(2)(i), (l)(2)(ii), (l)(2)(vi) through (viii), and 
(l)(3).
* * * * *

Subpart B--[Amended]

0
18. Section 1037.104 is amended by revising paragraphs (a)(2) 
introductory text, (d)(2), (d)(4), (d)(6), (d)(9), (d)(12), (d)(13), 
and (g) and adding paragraph (d)(15) to read as follows:

Sec.  1037.104  Exhaust emission standards for CO2, 
CH4, and N2O for heavy-duty vehicles at or below 
14,000 pounds GVWR.

* * * * *
    (a) * * *
    (2) Using the appropriate work factor, calculate a target value for 
each vehicle subconfiguration (or group of subconfigurations allowed 
under paragraph (a)(4) of this section) you produce using one of the 
following equations, or the phase-in provisions in Sec.  1037.150(b), 
rounding to the nearest 0.1 g/mile:
* * * * *
    (d) * * *
    (2) The following general credit provisions apply:
    (i) Credits you generate under this section may be used only to 
offset credit deficits under this section. You may bank credits for use 
in a future model year in which your average CO2 level 
exceeds the standard. You may trade credits to another manufacturer 
according to 40 CFR 86.1865-12(k)(8). Before you bank or trade credits, 
you must apply any available credits to offset a deficit if the 
deadline to offset that credit deficit has not yet passed.
    (ii) Vehicles subject to the standards of this section are included 
in a single greenhouse gas averaging set separate from any averaging 
set otherwise included in 40 CFR part 86.
    (iii) Banked CO2 credits keep their full value for five 
model years after the year in which they were generated. Unused credits 
expire at the end of this fifth model year.
* * * * *
    (4) The CO2, N2O, and CH4 
standards apply for a weighted average of the city (55%) and highway 
(45%) test cycle results. Note that this differs from the way the 
criteria pollutant standards apply for heavy-duty vehicles.
* * * * *
    (6) Credits are calculated using the useful life value (in miles) 
in place of ``vehicle lifetime miles'' specified in 40 CFR part 86, 
subpart S. Calculate a total credit or debit balance in a model year by 
adding credits and debits from 40 CFR 86.1865-12(k)(4), subtracting any 
CO2-equivalent debits for N2O or CH4 
calculated according to Sec.  1037.104(c), and adding any of the 
following credits:
    (i) Advanced technology credits according to paragraph (d)(7) of 
this section and Sec.  1037.150(i).
    (ii) Innovative technology credits according to paragraph (d)(13) 
of this section.
    (iii) Early credits according to Sec.  1037.150(a)(2).
* * * * *
    (9) Calculate your fleet-average emission rate consistent with good 
engineering judgment and the provisions of 40 CFR 86.1865. The 
following additional provisions apply:
    (i) Unless we approve a lower number, you must test at least ten 
subconfigurations. If you produce more than 100 subconfigurations in a 
given model year, you must test at least 25 subconfigurations or ten 
percent of your subconfigurations (whichever is less). For purposes of 
this paragraph (d)(9)(i), count carryover tests, but do not include 
analytically derived CO2 emission rates, data substitutions, 
or other untested allowances. We may approve a lower number of tests 
for manufacturers that have limited product offerings or low sales 
volumes. Note that good engineering judgment and other provisions of 
this part may require you to test more subconfigurations than these 
minimum values.
    (ii) The provisions of paragraph (g) of this section specify how 
you may use analytically derived CO2 emission rates.
    (iii) All final production volume at the subconfiguration level 
must be represented by test data (real, data substituted, or 
analytical).
    (iv) Perform fleet-average CO2 calculations as described 
in 40 CFR 86.1865 and 40 CFR part 600, with the following exceptions:
    (A) Use CO2 emissions values for all test results, 
intermediate calculations, and fleet average calculations instead of 
the carbon-related exhaust emission (CREE) values specified in 40 CFR 
parts 86 and 600.
    (B) Perform intermediate CO2 calculations for 
subconfigurations within each configuration using the subconfiguration 
and configuration definitions in paragraph (d)(12) of this section.
    (C) Perform intermediate CO2 calculations for 
configurations within each test group and transmission type (instead of 
configurations within each base level and base levels within each model 
type). Use the configuration definition in paragraph (d)(12)(i) of this 
section.
    (D) Do not perform intermediate CO2 calculations for 
each base level or for each model type. Base level and model type 
CO2 calculations are not applicable to heavy-duty vehicles 
subject to standards in this section.
    (E) Determine fleet average CO2 emissions for heavy-duty 
vehicles subject to standards in this section as described in 40 CFR 
600.510-12(j), except that the calculations must be performed on the 
basis of test group and transmission type (instead of the model-type 
basis specified in the light-duty vehicle regulations), and the 
calculations for dual fuel, multi-fuel, and flexible fuel vehicles must 
be consistent with the provisions of paragraph (d)(10)(i) of this 
section.
* * * * *
    (12) The following definitions apply for the purposes of this 
section:
    (i) Configuration means a subclassification within a test group 
based on engine code, transmission type and gear ratios, final drive 
ratio, and

[[Page 36391]]

other parameters we designate. Transmission type means the basic type 
of the transmission (e.g., automatic, manual, automated manual, semi-
automatic, or continuously variable) and does not include the drive 
system of the vehicle (e.g., front-wheel drive, rear-wheel drive, or 
four-wheel drive). Engine code means the combination of both ``engine 
code'' and ``basic engine'' as defined in 40 CFR 600.002. Note that 
this definition differs from the one in 40 CFR 86.1803.
    (ii) Subconfiguration means a unique combination within a vehicle 
configuration (as defined in this paragraph (d)(12)) of equivalent test 
weight, road-load horsepower, and any other operational characteristics 
or parameters that we determine may significantly affect CO2 
emissions within a vehicle configuration. Note that for vehicles 
subject to standards of this section, equivalent test weight (ETW) is 
based on the ALVW of the vehicle as outlined in paragraph (d)(11) of 
this section.
    (iii) The terms ``complete vehicle'' and ``incomplete vehicle'' 
have the meanings given for ``complete heavy-duty vehicle'' and 
``incomplete heavy-duty vehicle'', respectively, in 40 CFR 86.1803.
    (13) This paragraph (d)(13) applies for CO2 reductions 
resulting from technologies that were not in common use before 2010 
that are not reflected in the specified test procedures. We may allow 
you to generate emission credits consistent with the provisions of 40 
CFR 86.1869-12(c) and (d). You do not need to provide justification for 
not using the 5-cycle methodology.
* * * * *
    (15) You must submit a final report within 90 days after the end of 
the model year. Unless we specify otherwise, include applicable 
information identified in 40 CFR 86.1865-12(l), 40 CFR 600.512, and 49 
CFR 535.8(e). The final report must include at least the following 
information:
    (i) Model year.
    (ii) Applicable fleet-average CO2 standard.
    (iii) Calculated fleet-average CO2 value and all the 
values required to calculate the CO2 value.
    (iv) Number of credits or debits incurred and all values required 
to calculate those values.
    (v) Resulting balance of credits or debits.
    (vi) N2O emissions.
    (vii) CH4 emissions.
    (viii) HFC leakage score.
* * * * *
    (g) Analytically derived CO2 emission rates (ADCs). This 
paragraph (g) describes an allowance to use estimated (i.e., 
analytically derived) CO2 emission rates based on baseline 
test data instead of measured emission rates for calculating fleet-
average emissions. Note that these ADCs are similar to ADFEs used for 
light-duty vehicles. Note also that F terms used in this paragraph (g) 
represent coefficients from the following road load equation:

Force - (mass)(acceleration) = F0 + F1 [middot] (velocity) + F2 
[middot] (velocity)\2\

    (1) Except as specified in paragraph (g)(2) of this section, use 
the following equation to calculate the ADC of a new vehicle from road 
load force coefficients (F0, F1, F2), axle ratio, and test weight:

ADC = CO2base + 2.18 [middot] [Delta]F0 + 37.4 [middot] 
[Delta]F1 + 2257 [middot] [Delta]F2 + 189 [middot] [Delta]AR + 
0.0222 [middot] [Delta]ETW

Where:

ADC = Analytically derived combined city/highway CO2 
emission rate (g/mile) for a new vehicle.
CO2base = Combined city/highway CO2 emission 
rate (g/mile) of a baseline vehicle.
[Delta]F0 = F0 of the new vehicle--F0 of the baseline vehicle.
[Delta]F1 = F1 of the new vehicle--F1 of the baseline vehicle.
[Delta]F2 = F2 of the new vehicle--F2 of the baseline vehicle.
[Delta]AR = Axle ratio of the new vehicle--axle ratio of the 
baseline vehicle.
[Delta]ETW = ETW of the new vehicle--ETW of the baseline vehicle.

    (2) The purpose of this section is to accurately estimate 
CO2 emission rates.
    (i) You must apply the provisions of this section consistent with 
good engineering judgment. For example, do not use the equation in 
paragraph (g)(1) of this section where good engineering judgment 
indicates that it will not accurately estimate emissions. You may ask 
us to approve alternate equations that allow you to estimate emissions 
more accurately.
    (ii) The analytically derived CO2 equation in paragraph 
(g)(1) of this section may be periodically updated through publication 
of an EPA guidance document to more accurately characterize 
CO2 emission levels' for example, changes may be appropriate 
based on new test data, future technology changes, or to changes in 
future CO2 emission levels. Any EPA guidance document will 
determine the model year that the updated equation takes effect. We 
will issue guidance no later than eight months before the effective 
model year. For example, for 2014 models, the model year may start 
January 2, 2013, so guidance would be issued by May 1, 2012 for model 
year 2014.
    (3) You may select, without our advance approval, baseline test 
data if they meet all the following criteria:
    (i) Vehicles considered for the baseline test must comply with all 
applicable emission standards in the model year associated with the 
ADC.
    (ii) You must include in the pool of tests considered for baseline 
selection all official tests of the same or equivalent basic engine, 
transmission class, engine code, transmission code, engine horsepower, 
dynamometer drive wheels, and compression ratio as the ADC 
subconfiguration. Do not include tests in which emissions exceed any 
applicable standard.
    (iii) Where necessary to minimize the CO2 adjustment, 
you may supplement the pool with tests associated with worst-case 
engine or transmission codes and carryover or carry-across engine 
families. If you do, all the data that qualify for inclusion using the 
elected worst-case substitution (or carryover or carry-across) must be 
included in the pool as supplemental data (i.e., individual test 
vehicles may not be selected for inclusion). You must also include the 
supplemental data in all subsequent pools, where applicable.
    (iv) Except with our advance approval, tests previously used during 
the subject model year as baseline tests in 20 other ADC 
subconfigurations must be eliminated from the pool.
    (v) Select the tested subconfiguration with the smallest absolute 
difference between the ADC and the test CO2 emission rate 
for combined emissions. Use this as the baseline test for the target 
ADC subconfiguration.
    (4) You may ask us to allow you to use baseline test data not fully 
meeting the provisions of paragraph (g)(3) of this section.
    (5) Calculate the ADC rounded to the nearest 0.1 g/mile. Except 
with our advance approval, the downward adjustment of ADC from the 
baseline is limited to ADC values 20 percent below the baseline 
emission rate. The upward adjustment is not limited.
    (6) You may not submit an ADC if an actual test has been run on the 
target subconfiguration during the certification process or on a 
development vehicle that is eligible to be declared as an emission-data 
vehicle.
    (7) [Reserved]
    (8) Keep the following records for at least five years, and show 
them to us if we ask to see them:
    (i) The pool of tests.
    (ii) The vehicle description and tests chosen as the baseline and 
the basis for the selection.
    (iii) The target ADC subconfiguration.
    (iv) The calculated emission rates.

[[Page 36392]]

    (9) We may perform or order a confirmatory test of any 
subconfiguration covered by an ADC.
    (10) Where we determine that you did not fully comply with the 
provisions of this paragraph (g), we may require that you comply based 
on actual test data and that you recalculate your fleet-average 
emission rate.
* * * * *

0
19. Section 1037.115 is amended by revising paragraph (c) introductory 
text and removing and reserving paragraph (c)(2) to read as follows:

Sec.  1037.115  Other requirements.

* * * * *
    (c) Air conditioning leakage. Loss of refrigerant from your air 
conditioning systems may not exceed 1.50 percent per year, except as 
allowed by paragraph (c)(3) of this section. Calculate the total 
leakage rate in g/year as specified in 40 CFR 86.1867-12(a). Calculate 
the percent leakage rate as: [total leakage rate (g/yr)] / [total 
refrigerant capacity (g)] x 100. Round your leakage rate to the nearest 
one-hundredth of a percent. See Sec.  1037.150 for vocational vehicles.
* * * * *

0
20. Section 1037.135 is amended by revising paragraphs (c)(5) and 
(c)(9) to read as follows:

Sec.  1037.135  Labeling.

* * * * *
    (c) * * *
    (5) State the date of manufacture [DAY (optional), MONTH, and 
YEAR]. You may omit this from the label if you stamp, engrave, or 
otherwise permanently identify it elsewhere on the vehicle, in which 
case you must also describe in your application for certification where 
you will identify the date on the vehicle.
* * * * *
    (9) Include the following statement for vehicles with an 
evaporative canister for controlling diurnal emissions: ``THIS VEHICLE 
IS DESIGNED TO COMPLY WITH EVAPORATIVE EMISSION STANDARDS WITH UP TO x 
GALLONS OF FUEL TANK CAPACITY.'' Complete this statement by identifying 
the maximum specified fuel tank capacity associated with your 
certification.
* * * * *

0
21. Section 1037.150 is amended by revising paragraphs (a)(2), (l) 
introductory text, and (l)(1) to read as follows:

Sec.  1037.150  Interim provisions.

* * * * *
    (a) * * *
    (2) This paragraph (a)(2) applies for regulatory sub-categories 
subject to the standards of Sec.  1037.104. To generate early credits 
under this paragraph (a)(2) for any vehicles other than electric 
vehicles, you must certify your entire U.S.-directed fleet to these 
standards. If you calculate a separate fleet average for advanced-
technology vehicles under Sec.  1037.104(c)(7), you must certify your 
entire U.S.-directed production volume of both advanced and 
conventional vehicles within the fleet. Except as specified in 
paragraph (a)(4) of this section, if some test groups are certified 
after the start of the model year, you may generate credits only for 
production that occurs after all test groups are certified. For 
example, if you produce three test groups in an averaging set and you 
receive your certificates for those test groups on January 4, 2013, 
March 15, 2013, and April 24, 2013, you may not generate credits for 
model year 2013 for vehicles from any of the test groups produced 
before April 24, 2013. Calculate credits relative to the standard that 
would apply in model year 2014 using the applicable equations in 40 CFR 
part 86 and your model year 2013 U.S.-directed production volumes. 
These credits may be used to show compliance with the standards of this 
part for 2014 and later model years. We recommend that you notify us of 
your intent to use this provision before submitting your applications.
* * * * *
    (l) Optional certification under Sec.  1037.104. You may certify 
certain complete or cab-complete vehicles to the standards of Sec.  
1037.104. All vehicles optionally certified under this paragraph (l) 
are deemed to be subject to the standards of Sec.  1037.104. Note that 
for vehicles above 14,000 pounds GVWR and at or below 26,000 pounds 
GVWR, certification under this paragraph (l) does not affect how you 
may or may not certify with respect to criteria pollutants. For 
example, certifying a Class 4 vehicle under this paragraph (l) does not 
allow you to chassis-certify these vehicles with respect to criteria 
pollutants.
    (1) You may certify any complete or cab-complete spark-ignition 
vehicles above 14,000 pounds GVWR and at or below 26,000 pounds GVWR to 
the standards of Sec.  1037.104 even though Sec.  1037.104 specifies 
that you may certify vehicles to the standards of that section only if 
they are chassis-certified for criteria pollutants.
* * * * *

Subpart C--[Amended]

0
22. Section 1037.201 is amended by revising paragraph (g) to read as 
follows:

Sec.  1037.201  General requirements for obtaining a certificate of 
conformity.

* * * * *
    (g) We may perform confirmatory testing on your vehicles; for 
example, we may test vehicles to verify drag areas or other GEM inputs. 
This includes vehicles used to determine Falt-aero under 
Sec.  1037.521. We may require you to deliver your test vehicles to a 
facility we designate for our testing. Alternatively, you may choose to 
deliver another vehicle that is identical in all material respects to 
the test vehicle. Where certification is based on testing components 
such as tires, we may require you to deliver test components to a 
facility we designate for our testing.

0
23. Section 1037.230 is amended by revising paragraph (a)(1)(xiii) and 
adding paragraph (a)(1)(xiv) to read as follows:

Sec.  1037.230  Vehicle families, sub-families, and configurations.

    (a) * * *
    (1) * * *
    (xiii) Vocational tractors above 26,000 pounds GVWR and at or below 
33,000 pounds GVWR. Note that vocational tractor provisions do not 
apply for vehicles at or below 26,000 pounds GVWR.
    (xiv) Vocational tractors above 33,000 pounds GVWR.
* * * * *

Subpart F--[Amended]

0
24. Section 1037.501 is amended by revising paragraph (g)(1)(iv) to 
read as follows:

Sec.  1037.501  General testing and modeling provisions.

* * * * *
    (g) * * *
    (1) * * *
    (iv) It includes dual 22.5 inch wheels, standard mudflaps, and 
standard landing gear. The centerline of the rear tandem axle must be 
146 +/- 4 inches from the rear of the trailer.
* * * * *

0
25. Section 1037.520 is amended by revising the section heading, the 
introductory text, Table 1 in paragraph (b)(2), and paragraph (e)(1) 
before the table to read as follows:

Sec.  1037.520  Modeling CO[bdi2] emissions to show compliance.

    This section describes how to use the Greenhouse gas Emissions 
Model (GEM) simulation tool (incorporated by

[[Page 36393]]

reference in Sec.  1037.810) to show compliance with the CO2 
standards of Sec. Sec.  1037.105 and 1037.106. Use good engineering 
judgment when demonstrating compliance using the GEM.
* * * * *
    (b) * * *
    (2) * * *

       Table 1 to Sec.   1037.520--High-Roof Day and Sleeper Cabs
------------------------------------------------------------------------
                                              If your
                                           measured CDA    Then your  CD
                Bin level                  (m\2\) is . .  input is . . .
                                                 .
------------------------------------------------------------------------
                           High-Roof Day Cabs
------------------------------------------------------------------------
Bin I...................................          >= 8.0            0.79
Bin II..................................         7.1-7.9            0.72
Bin III.................................         6.2-7.0            0.63
Bin IV..................................         5.6-6.1            0.56
Bin V...................................          = 7.6            0.75
Bin II..................................         6.8-7.5            0.68
Bin III.................................         6.3-6.7            0.60
Bin IV..................................         5.6-6.2            0.52
Bin V...................................           = 0.970.
------------------------------------------------------------------------

    (f) Send a brake signal when throttle position is equal to zero and 
vehicle speed is greater than the reference vehicle speed from the test 
cycle. Set a delay before changing the brake state to prevent the brake 
signal from dithering, consistent with good engineering judgment.
    (g) The driver model should be designed to follow the cycle as 
closely as possible and must meet the requirements of Sec.  1037.510 
for steady-state testing and 40 CFR 1066.430(e) for transient testing. 
The driver model should be designed so that the brake and throttle are 
not applied at the same time.
* * * * *

Subpart G--[Amended]

0
28. Section 1037.615 is amended by revising paragraph (b)(1), 
redesignating paragraph (b)(3) as (b)(4), and adding a new paragraph 
(b)(3) to read as follows:

Sec.  1037.615  Hybrid vehicles and other advanced technologies.

* * * * *
    (b) * * *
    (1) Measure the effectiveness of the advanced system by chassis 
testing a vehicle equipped with the advanced system and an equivalent 
conventional vehicle, or by testing the hybrid systems and the 
equivalent non-hybrid systems as described in Sec.  1037.550. Test the 
vehicles as specified in subpart F of this part. For purposes of this 
paragraph (b), a conventional vehicle is considered to be equivalent if 
it has the same footprint (as defined in 40 CFR 86.1803), vehicle 
service class, aerodynamic drag, and other relevant factors not 
directly related to the hybrid powertrain. If you

[[Page 36394]]

use Sec.  1037.525 to quantify the benefits of a hybrid system for PTO 
operation, the conventional vehicle must have the same number of PTO 
circuits and have equivalent PTO power. If you do not produce an 
equivalent vehicle, you may create and test a prototype equivalent 
vehicle. The conventional vehicle is considered Vehicle A and the 
advanced vehicle is considered Vehicle B. We may specify an alternate 
cycle if your vehicle includes a power take-off.
* * * * *
    (3) If you apply an improvement factor to multiple vehicle 
configurations using the same advanced technology, use the vehicle 
configuration with the smallest potential reduction in greenhouse gas 
emissions resulting from the hybrid capability.
* * * * *

0
29. Section 1037.620 is amended by revising paragraph (a)(3) to read as 
follows:

Sec.  1037.620  Shipment of incomplete vehicles to secondary vehicle 
manufacturers.

* * * * *
    (a) * * *
    (3) Uncertified vehicles that will be certified by secondary 
vehicle manufacturers. Manufacturers may introduce into U.S. commerce 
partially complete vehicles for which they do not hold a certificate of 
conformity only as allowed by paragraph (b) of this section; however, 
the requirements of this section do not apply if vehicles produced by a 
secondary vehicle manufacturer are excluded from the standards of this 
part under Sec.  1037.150(c).
* * * * *

0
30. Section 1037.660 is amended by revising the introductory text and 
paragraph (c) to read as follows:

Sec.  1037.660  Automatic engine shutdown systems.

    This section specifies requirements that apply for certified 
automatic engine shutdown (AES) systems modeled under Sec.  1037.520. 
It does not apply for AES systems you do not model under Sec.  
1037.520.
* * * * *
    (c) Adjustments to AES systems. (1) The AES system may include an 
expiration point (in miles) after which the AES system may be disabled. 
If your vehicle is equipped with an AES system that expires before 
1,259,000 miles, adjust the model input as follows, rounded to the 
nearest 0.1 g/ton-mile: AES Input = 5 g CO2/ton-mile x 
(miles at expiration/1,259,000 miles)
    (2) For AES systems designed to limit idling to a specific number 
of hours less than 1,800 hours over any 12-month period, calculate an 
adjusted AES input using the following equation, rounded to the nearest 
0.1 g/ton-mile: AES Input = 5 g CO2/ton-mile x (1-(maximum 
allowable number of idling hours per year/1,800 hours)). This is an 
annual allowance that starts when the vehicle is new and resets every 
12 months after that. Manufacturers may propose an alternative method 
based on operating hours or miles instead of years.
* * * * *

Subpart H--[Amended]

0
31. Section 1037.745 is amended by revising the section heading and 
adding paragraph (d) to read as follows:

Sec.  1037.745  End-of-year CO2 credit deficits.

* * * * *
    (d) For purposes of calculating the statute of limitations, the 
following actions are all considered to occur at the expiration of the 
deadline for offsetting debits as specified in paragraph (a) of this 
section:
    (1) Failing to meet the requirements of paragraph (a) of this 
section.
    (2) Failing to satisfy the conditions upon which a certificate was 
issued relative to offsetting debits.
    (3) Selling, offering for sale, introducing or delivering into U.S. 
commerce, or importing vehicles that are found not to be covered by a 
certificate as a result of failing to offset debits.

Subpart I--[Amended]

0
32. Section 1037.801 is amended by adding a definition for 
``Preliminary approval'' in alphabetical order and revising the 
definition for ``Regulatory sub-category'' to read as follows:

Sec.  1037.801  Definitions.

* * * * *
    Preliminary approval means approval granted by an authorized EPA 
representative prior to submission of an application for certification, 
consistent with the provisions of Sec.  1037.210.
* * * * *
    Regulatory sub-category means one of the following groups:
    (1) All vehicles subject to the standards of Sec.  1037.104. Note 
that this category includes most gasoline-fueled and diesel-fueled 
heavy-duty pickup trucks and vans.
    (2) [Reserved]
    (3) Vocational vehicles at or below 19,500 pounds GVWR.
    (4) Vocational vehicles above 19,500 pounds GVWR but at or below 
33,000 pounds GVWR.
    (5) Vocational vehicles over 33,000 pounds GVWR.
    (6) Low-roof tractors above 26,000 pounds GVWR but at or below 
33,000 pounds GVWR.
    (7) Mid-roof tractors above 26,000 pounds GVWR but at or below 
33,000 pounds GVWR.
    (8) High-roof tractors above 26,000 pounds GVWR but at or below 
33,000 pounds GVWR.
    (9) Low-roof day cab tractors above 33,000 pounds GVWR.
    (10) Low-roof sleeper cab tractors above 33,000 pounds GVWR.
    (11) Mid-roof day cab tractors above 33,000 pounds GVWR.
    (12) Mid-roof sleeper cab tractors above 33,000 pounds GVWR.
    (13) High-roof day cab tractors above 33,000 pounds GVWR.
    (14) High-roof sleeper cab tractors above 33,000 pounds GVWR.
* * * * *

0
33. Section 1037.805 is amended by adding an entry for ``AES'' in 
alphabetical order to read as follows:

Sec.  1037.805  Symbols, acronyms, and abbreviations.

* * * * *
AES Automatic engine shutdown.
* * * * *

0
34. Section 1037.810 is amended by revising paragraph (c)(1) to read as 
follows:

Sec.  1037.810  Incorporation by reference.

* * * * *
    (c) * * *
    (1) Greenhouse gas Emissions Model (GEM) simulation tool, Version 
2.0.1, September 2012; IBR approved for Sec.  1037.520. The computer 
code for this model is available as noted in paragraph (a) of this 
section. A working version of this software is also available for 
download at http://www.epa.gov/otaq/climate/gem.htm.
* * * * *

PART 1039--CONTROL OF EMISSIONS FROM NEW AND IN-USE NONROAD 
COMPRESSION-IGNITION ENGINES

0
35. The authority citation for part 1039 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart B--[Amended]

0
36. Section 1039.104 is amended by revising paragraph (g) to read as 
follows:

Sec.  1039.104  Are there interim provisions that apply only for a 
limited time?

* * * * *

[[Page 36395]]

    (g) Alternate FEL caps. You may certify engines to the FEL caps in 
Table 1 of this section instead of the otherwise applicable FEL caps in 
Sec.  1039.101(d)(1), Sec.  1039.102(e), or Sec.  1039.102(g)(2) for 
the indicated model years, subject to the following provisions:
    (1) [Reserved]
    (2) If your engine is not certified to transient emission standards 
under the provisions of Sec.  1039.102(a)(1)(iii), you must adjust your 
FEL upward by a temporary compliance adjustment factor (TCAF) before 
calculating your negative emission credits under Sec.  1039.705, as 
follows:
    (i) The temporary compliance adjustment factor for NOX 
and for NOX + NMHC is 1.1.
    (ii) The temporary compliance adjustment factor for PM is 1.5.
    (iii) The adjusted FEL (FELadj) for calculating emission 
credits is determined from the steady-state FEL (FELss) 
using the following equation:

FELadj = (FELss) x (TCAF)

    (iv) The unadjusted FEL (FELss) applies for all purposes 
other than credit calculation.
    (3) These alternate FEL caps may not be used for phase-in engines.
    (4) Do not apply TCAFs to gaseous emissions for phase-out engines 
that you certify to the same numerical standards (and FELs if the 
engines are certified using ABT) for gaseous pollutants as you 
certified under the Tier 3 requirements of 40 CFR part 89.

                                 Table 1 of Sec.   1039.104--Alternate FEL Caps
----------------------------------------------------------------------------------------------------------------
                                                                    Model years                     Model years
                                                  PM FEL cap,  g/     for the      NOX FEL cap,       for the
              Maximum engine power                     kW-hr       alternate PM     g/kW-hr \1\    alternate NOX
                                                                      FEL cap                         FEL cap
----------------------------------------------------------------------------------------------------------------
19  560 \6\....................................            0.10       2015-2018             3.5       2015-2018
----------------------------------------------------------------------------------------------------------------
\1\ The FEL cap for engines demonstrating compliance with a NOX + NMHC standard is equal to the previously
  applicable NOX + NMHC standard specified in 40 CFR 89.112 (generally the Tier 3 standards).
\2\ For manufacturers certifying engines under Option 1 of Table 3 of Sec.   1039.102, these alternate
  FEL caps apply to all 19-56 kW engines for model years from 2013 through 2016 instead of the years indicated
  in this table. For manufacturers certifying engines under Option 2 of Table 3 of Sec.   1039.102,
  these alternate FEL caps do not apply to 19-37 kW engines except in model years 2013 to 2015.
\3\ For engines below 75 kW, the FEL caps are 0.40 g/kW-hr for PM emissions and 4.4 g/kW-hr for NOX emissions.
\4\ For manufacturers certifying engines in this power category using a percentage phase-in/phase-out approach
  instead of the alternate NOX standards of Sec.   1039.102(e)(1), the alternate NOX FEL cap in the table
  applies only in the 2014-2015 model years if certifying under Sec.   1039.102(d)(1), and only in the 2015
  model year if certifying under Sec.   1039.102(d)(2).
\5\ For manufacturers certifying engines in this power category using the percentage phase-in/phase-out approach
  instead of the alternate NOX standard of Sec.   1039.102(e)(2), the alternate NOX FEL cap in the table applies
  only for the 2014 model year.
\6\ For engines above 560 kW, the provision for alternate NOX FEL caps is limited to generator-set engines.

    (5) You may certify engines under this paragraph (g) in any model 
year provided for in Table 1 of this section without regard to whether 
or not the engine family's FEL is at or below the otherwise applicable 
FEL cap. For example, a 200 kW engine certified to the NOX + 
NMHC standard of Sec.  1039.102(e)(3) with an FEL equal to the FEL cap 
of 2.8 g/kW-hr may nevertheless be certified under this paragraph (g).
    (6) For engines you produce under this paragraph (g) after the Tier 
4 final standards take effect, you may certify based on a 
NOX + NMHC FEL as described in Table 1 of this section. 
Calculate emission credits for these engines relative to the applicable 
NOX standard in Sec.  1039.101 or Sec.  1039.102, plus 0.1 
g/kW-hr.
* * * * *

Subpart G--[Amended]

0
37. Section 1039.625 is amended by revising paragraphs (e), (j), and 
(m) to read as follows:

Sec.  1039.625  What requirements apply under the program for 
equipment-manufacturer flexibility?

* * * * *
    (e) Standards. If you produce equipment with exempted engines under 
this section, the engines must meet emission standards specified in 
this paragraph (e), or more stringent standards. Note that we consider 
engines to be meeting emission standards even if they are certified 
with a family emission limit that is higher than the emission standard 
that would otherwise apply.
    (1) If you are using the provisions of paragraph (d)(4) of this 
section, engines must meet the applicable Tier 1 or Tier 2 emission 
standards described in 40 CFR 89.112.
    (2) If you are using the provisions of paragraph (a)(2) of this 
section, engines must be identical in all material respects to engines 
certified under this part 1039 as follows:

------------------------------------------------------------------------
                                             Must meet all standards and
 Engines in the  following power  category  requirements that applied in
                   . . .                    the following model year . .
                                                          .
------------------------------------------------------------------------
(i) 19  560.............................  2011.
------------------------------------------------------------------------

    (3) In all other cases, engines at or above 56 kW and at or below 
560 kW must meet the appropriate Tier 3 standards described in 40 CFR 
89.112. Engines below 56 kW and engines above 560 kW must meet the 
appropriate Tier 2 standards described in 40 CFR 89.112.
* * * * *
    (j) Provisions for engine manufacturers. As an engine manufacturer, 
you may produce exempted engines as needed under this section. You do 
not have to request this exemption for your engines, but you must have 
written assurance from equipment manufacturers that they need a certain 
number of exempted engines under this section. Send us an annual report 
of the engines you produce under this section, as described in Sec.  
1039.250(a). Exempt engines must meet the emission standards in 
paragraph (e) of this section and you must meet all the requirements of 
40 CFR 1068.265, except that engines produced under the provisions of 
paragraph (a)(2) of this section must be identical in all material 
respects to engines previously certified under this part 1039. If you 
show under 40 CFR 1068.265(c) that the engines are identical in all 
material respects to engines that you have previously

[[Page 36396]]

certified to one or more FELs above the standards specified in 
paragraph (e) of this section, you must supply sufficient credits for 
these engines. Calculate these credits under subpart H of this part 
using the previously certified FELs and the alternate standards. You 
must meet the labeling requirements in 40 CFR 89.110 or Sec.  1039.135, 
as applicable, with the following exceptions:
* * * * *
    (m) Additional exemptions for technical or engineering hardship. 
You may request additional engine allowances under paragraph (b) of 
this section; however, you may use these extra allowances only for 
those equipment models for which you, or an affiliated company, do not 
also produce the engine. Additional allowances under this paragraph (m) 
must be used within the specified seven-year period. After considering 
the circumstances, we may permit you to introduce into U.S. commerce 
equipment with such engines that do not comply with Tier 4 emission 
standards, as follows:
    (1) We may approve additional exemptions if extreme and unusual 
circumstances that are clearly outside your control and that could not 
have been avoided with reasonable discretion have resulted in technical 
or engineering problems that prevent you from meeting the requirements 
of this part. You must show that you exercised prudent planning and 
have taken all reasonable steps to minimize the scope of your request 
for additional allowances.
    (2) To apply for exemptions under this paragraph (m), send the 
Designated Compliance Officer a written request as soon as possible 
before you are in violation. In your request, include the following 
information:
    (i) Describe your process for designing equipment.
    (ii) Describe how you normally work cooperatively or concurrently 
with your engine supplier to design products.
    (iii) Describe the engineering or technical problems causing you to 
request the exemption and explain why you have not been able to solve 
them. Describe the extreme and unusual circumstances that led to these 
problems and explain how they were unavoidable.
    (iv) Describe any information or products you received from your 
engine supplier related to equipment design--such as written 
specifications, performance data, or prototype engines--and when you 
received it.
    (v) Compare the design processes of the equipment model for which 
you need additional exemptions and that for other models for which you 
do not need additional exemptions. Explain the technical differences 
that justify your request.
    (vi) Describe your efforts to find and use other compliant engines, 
or otherwise explain why none is available.
    (vii) Describe the steps you have taken to minimize the scope of 
your request.
    (viii) Include other relevant information. You must give us other 
relevant information if we ask for it.
    (ix) Estimate the increased percent of production you need for each 
equipment model covered by your request, as described in paragraph 
(m)(3) of this section. Estimate the increased number of allowances you 
need for each equipment model covered by your request, as described in 
paragraph (m)(4) of this section.
    (3) We may approve your request to increase the allowances under 
paragraph (b)(1) of this section, subject to the following limitations:
    (i) You must use up the allowances under paragraph (b)(1) of this 
section before using any additional allowance under this paragraph (m).
    (ii) You may use these allowances only for the specific equipment 
models covered by your request.
    (4) We may approve your request to increase the small-volume 
allowances under paragraph (b)(2) of this section, subject to the 
following limitations:
    (i) You are eligible for additional allowances under this paragraph 
(m)(4) only if you do not use the provisions of paragraph (m)(3) of 
this section to obtain additional allowances within a given power 
category.
    (ii) We may approve additional allowances in the form of waiving 
the annual limits specified in paragraph (b)(2) of this section instead 
of or in addition to increasing the total number of allowances under 
this paragraph (m)(4).
    (iii) If we increase the total number of allowances, you may use 
these allowances only for the specific equipment models covered by your 
request.

PART 1042--CONTROL OF EMISSIONS FROM NEW AND IN-USE MARINE 
COMPRESSION-IGNITION ENGINES AND VESSELS

0
38. The authority citation for part 1042 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart B--[Amended]

0
39. Section 1042.145 is amended by adding paragraph (j) to read as 
follows:

Sec.  1042.145  Interim provisions.

* * * * *
    (j) Vessel manufacturers and marine equipment manufacturers may 
apply the provisions of Sec.  1042.605 to land-based engines with 
maximum engine power at or above 19 kW and below 600 kW produced under 
the allowances provided in 40 CFR 1039.625 for model year 2013 marine 
engines. All the provisions of Sec.  1042.605 apply as if those engines 
were certified to emission standards under 40 CFR part 1039. Similarly, 
engine manufacturers, vessel manufacturers, and marine equipment 
manufacturers must comply with all the provisions of 40 CFR 1039.625 as 
if those engines were installed in land-based equipment.

Subpart G--[Amended]

0
40. Section 1042.615 is amended as follows:
0
a. By revising the introductory text and paragraphs (a) introductory 
text and (a)(1).
0
b. By redesignating paragraphs (b) through (d) as paragraphs (c) 
through (e).
0
c. By adding a new paragraph (b).

Sec.  1042.615  Replacement engine exemption.

    For Category 1 and Category 2 replacement engines, the provisions 
of 40 CFR 1068.240 apply except as described in this section. In 
unusual circumstances, you may ask us to allow you to apply these 
provisions for a new Category 3 engine.
    (a) This paragraph (a) applies instead of the provisions of 40 CFR 
1068.240(b)(2). The prohibitions in 40 CFR 1068.101(a)(1) do not apply 
to a new replacement engine if all the following conditions are met:
    (1) You use good engineering judgment to determine that no engine 
certified to the current requirements of this part is produced by any 
manufacturer with the appropriate physical or performance 
characteristics to repower the vessel. We have determined that engines 
certified to Tier 4 standards do not have the appropriate physical or 
performance characteristics to replace uncertified engines or engines 
certified to emission standards that are less stringent than the Tier 4 
standards.
* * * * *
    (b) The 25-year limit specified in 40 CFR 1068.240(a) does not 
apply for engines subject to this part 1042. You may accordingly omit 
the statement on the permanent labels specified in 40 CFR 1068.240 
describing this limitation.
* * * * *

[[Page 36397]]

PART 1048--CONTROL OF EMISSIONS FROM NEW, LARGE NONROAD SPARK-
IGNITION ENGINES

0
41. The authority citation for part 1048 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart B--[Amended]

0
42. Section 1048.105 is amended by revising paragraph (a) to read as 
follows:

Sec.  1048.105  What evaporative emission standards and requirements 
apply?

* * * * *
    (a) Fuel line permeation. For nonmetallic fuel lines, you must 
specify and use products that meet the Category 1 specifications for 
permeation in the November 1996 or November 2004 versions of SAE J2260 
(both incorporated by reference in Sec.  1048.810).
* * * * *

Subpart I--[Amended]

0
43. Section 1048.810 is revised to read as follows:

Sec.  1048.810  What materials does this part reference?

    (a) Certain material is incorporated by reference into this part 
with the approval of the Director of the Federal Register under 5 
U.S.C. 552(a) and 1 CFR part 51. To enforce any edition other than that 
specified in this section, the Environmental Protection Agency must 
publish a notice of the change in the Federal Register and the material 
must be available to the public. All approved material is available for 
inspection at U.S. EPA, Air and Radiation Docket and Information 
Center, 1301 Constitution Ave. NW., Room B102, EPA West Building, 
Washington, DC 20460, (202) 202-1744, and is available from the sources 
listed below. It is also available for inspection at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to 
http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (b) Society of Automotive Engineers, 400 Commonwealth Dr., 
Warrendale, PA 15096-0001, (877) 606-7323 (U.S. and Canada) or (724) 
776-4970 (outside the U.S. and Canada), http://www.sae.org.
    (1) SAE J2260, Nonmetallic Fuel System Tubing with One or More 
Layers, November 2004; IBR approved for Sec.  1048.105(a).
    (2) SAE J2260, Nonmetallic Fuel System Tubing with One or More 
Layers, November 1996; IBR approved for Sec.  1048.105(a).
    (c) International Organization for Standardization, Case Postale 
56, CH-1211 Geneva 20, Switzerland, (41) 22749 0111, http://www.iso.org, or central@iso.org.
    (1) ISO 9141-2 Road vehicles--Diagnostic systems-- Part 2: CARB 
requirements for interchange of digital information, February 1994; IBR 
approved for Sec.  1048.110(g).
    (2) ISO 14230-4 Road vehicles--Diagnostic systems--Keyword Protocol 
2000--Part 4: Requirements for emission-related systems, June 2000; IBR 
approved for Sec.  1048.110(g).

PART 1054--CONTROL OF EMISSIONS FROM NEW, SMALL NONROAD SPARK-
IGNITION ENGINES AND EQUIPMENT

0
44. The authority citation for part 1054 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart B--[Amended]

0
45. Section 1054.145 is amended by revising paragraphs (c)(3) and (n) 
to read as follows:

Sec.  1054.145  Are there interim provisions that apply only for a 
limited time?

* * * * *
    (c) * * *
    (3) Engines subject to Phase 3 emission standards must meet the 
standards at or above barometric pressures of 96.0 kPa in the standard 
configuration and are not required to meet emission standards at lower 
barometric pressures. This is intended to allow testing under most 
weather conditions at all altitudes up to 1,100 feet above sea level. 
In your application for certification, identify the altitude above 
which you rely on an altitude kit and describe your plan for making 
information and parts available such that you would reasonably expect 
that altitude kits would be widely used at all such altitudes.
* * * * *
    (n) California test fuel. Through model year 2019, you may perform 
testing with a fuel meeting the requirements for certifying the engine 
in California instead of the fuel specified in Sec.  1054.501(b)(2), as 
follows:
    (1) You may certify individual engine families using data from 
testing conducted with California Phase 2 test fuel. Any EPA testing 
with such an engine family may use either this same certification fuel 
or the test fuel specified in Sec.  1054.501.
    (2) Starting in model year 2013, you may certify individual engine 
families using data from testing conducted with California Phase 3 test 
fuel. Any EPA testing with such an engine family may use either this 
same certification fuel or the test fuel specified in Sec.  1054.501, 
unless you certify to the more stringent CO standards specified in this 
paragraph (n)(2). If you meet these alternate CO standards, we will 
also use California Phase 3 test fuel for any testing we perform with 
engines from that engine family. The following alternate CO standards 
apply instead of the CO standards specified in Sec.  1054.103 or Sec.  
1054.105:

   Table 1 to Sec.   1054.145--Alternate CO Standards for Testing With
                      California Phase 3 Test Fuel
                                [g/kW-hr]
------------------------------------------------------------------------
                                                           Alternate CO
                       Engine type                           standard
------------------------------------------------------------------------
Class I.................................................             549
Class II................................................             549
Class III...............................................             536
Class IV................................................             536
Class V.................................................             536
Marine generators.......................................             4.5
------------------------------------------------------------------------

* * * * *

Subpart F--[Amended]

0
46. Section 1054.501 is amended by revising paragraph (b)(2) to read as 
follows:

Sec.  1054.501  How do I run a valid emission test?

* * * * *
    (b) * * *
    (2) Use the appropriate fuels and lubricants specified in 40 CFR 
part 1065, subpart H, for all the testing we require in this part. 
Except as specified in paragraph (d) of this section, use gasoline 
specified for general testing. For service accumulation, use the test 
fuel or any commercially available fuel that is representative of the 
fuel that in-use engines will use. Note that Sec.  1054.145(n) allows 
for testing with gasoline test fuels specified by the California Air 
Resources Board for any individual engine family through model year 
2019.
* * * * *

PART 1065--Engine-Testing Procedures

0
47. The authority citation for part 1065 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

[[Page 36398]]

Subpart C--[Amended]

0
48. Section 1065.275 is amended by revising the section heading to read 
as follows:

Sec.  1065.275  N2O measurement devices.

* * * * *

Subpart G--[Amended]

0
49. Section 1065.610 is amended by revising paragraph (c)(3) to read as 
follows:

Sec.  1065.610  Duty cycle generation.

* * * * *
    (c) * * *
    (3) Intermediate speed. If your normalized duty cycle specifies a 
speed as ``intermediate speed,'' use your torque-versus-speed curve to 
determine the speed at which maximum torque occurs. This is peak torque 
speed. If maximum torque occurs in a flat region of the torque-versus-
speed curve, your peak torque speed is the midpoint between the lowest 
and highest speeds at which the trace reaches the flat region. For 
purposes of this paragraph (c)(3), a flat region is one in which 
measured torque values are within 2% of the maximum recorded value. 
Identify your reference intermediate speed as one of the following 
values:
    (i) Peak torque speed if it is between (60 and 75) % of maximum 
test speed.
    (ii) 60% of maximum test speed if peak torque speed is less than 
60% of maximum test speed.
    (iii) 75% of maximum test speed if peak torque speed is greater 
than 75% of maximum test speed.
* * * * *

PART 1066--VEHICLE-TESTING PROCEDURES

0
50. The authority citation for part 1066 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart D--[Amended]

0
51. Section 1066.310 is amended by:
0
a. Revising the section heading and the introductory text;
0
b. Revising paragraphs (b)(2), (b)(3) introductory text, and (b)(3)(i);
0
c. Removing and reserving paragraph (b)(3)(ii);
0
d. Revising paragraphs (b)(6) and (b)(7); and
0
e. Adding paragraph (b)(8) to read as follows:

Sec.  1066.310  Coastdown procedures for vehicles with GVWR above 
14,000 lbs.

    This section describes coastdown procedures that are unique to 
heavy-duty vehicles with GVWR above 14,000 lbs. These procedures are 
valid for calculating road-load coefficients for chassis and post-
transmission powerpack testing and for calculating drag area 
(CDA) for use in the Greenhouse gas Emissions Model (GEM) 
simulation tool under 40 CFR part 1037.
* * * * *
    (b) * * *
    (2) Operate the vehicle at a top speed above 70 mph, or at its 
maximum achievable speed if it cannot reach 70 mph. If a vehicle is 
equipped with a vehicle speed limiter that is set for a maximum speed 
below 70 mph, you must disable the vehicle speed limiter. Start the 
test at or above 70 mph or at the vehicle's maximum achievable speed if 
it cannot reach 70 mph. Data collection must occur through a minimum 
speed at or below 15 mph. Data analysis for valid coastdown runs must 
include a maximum speed as described in this paragraph (b)(2) and a 
minimum speed of 15 mph.
    (3) Gather data regarding wind speed and direction, in coordination 
with time-of-day data, using at least one stationary electro-mechanical 
anemometer and suitable data loggers meeting the specifications of SAE 
J1263, as well as the following additional specifications for the 
anemometer placed adjacent to the test surface:
    (i) Calibrate the equipment by running the zero-wind and zero-angle 
calibrations within 24 hours before conducting the coastdown 
procedures. If the coastdown procedures are not complete 24 hours after 
calibrating the equipment, repeat the calibration for another 24 hours 
of data collection.
    (ii) [Reserved]
* * * * *
    (6) All valid coastdown run times in each direction must be within 
2.0 standard deviations of the mean of the valid coastdown run times 
(from 70 mph down to 15 mph) in that direction. Eliminate runs outside 
this range. After eliminating these runs you must have at least eight 
valid runs in each direction. You may use coastdown run times that do 
not meet these standard deviation requirements if we approve it in 
advance. In your request, describe why the vehicle is not able to meet 
the specified standard deviation requirements and propose an 
alternative set of requirements.
    (7) Analyze data for chassis and post-transmission powerpack 
testing or for use in the GEM simulation tool as follows:
    (i) Follow the procedures specified in Section 10 of SAE J1263 or 
Section 11 of SAE J2263 to calculate coefficients for chassis and post-
transmission powerpack testing.
    (ii) For the GEM simulation tool, determine drag area, 
CDA, as follows instead of using the procedure specified in 
Section 10 of SAE J1263:
    (A) Measure vehicle speed at fixed intervals over the coastdown run 
(generally at 10 Hz), including speeds at or above 15 mph and at or 
below 70 mph. Establish the height or altitude corresponding to each 
interval as described in SAE J2263 if you need to incorporate the 
effects of road grade.
    (B) Calculate the vehicle's effective mass, Me, in kg by 
adding 56.7 kg to the vehicle mass for each tire making road contact. 
This accounts for the rotational inertia of the wheels and tires.
    (C) Calculate the road-load force for each measurement interval, 
Fi, using the following equation:
[GRAPHIC] [TIFF OMITTED] TR17JN13.004

Where:

Me = the vehicle's effective mass, expressed to the 
nearest 0.1 kg.
v = vehicle speed at the beginning and end of the measurement 
interval. Let v0 = 0 m/s.
[Delta]t = elapsed time over the measurement interval, in seconds.

    (D) Plot the data from all the coastdown runs on a single plot of 
Fi vs. vi\2\ to determine the slope correlation, 
D, based on the following equation:
[GRAPHIC] [TIFF OMITTED] TR17JN13.005

Where:

g = gravitational acceleration = 9.81 m/s\2\.
[Delta]h = change in height or altitude over the measurement 
interval, in m. Assume [Delta]h = 0 if you are not correcting for 
grade.
[Delta]s = distance the vehicle travels down the road during the 
measurement interval, in m.
Am = the calculated value of the y-intercept based on the 
curve-fit.
(E) Calculate drag area, CDA, in m\2\ using the following 
equation:
[GRAPHIC] [TIFF OMITTED] TR17JN13.006

Where:

[rho] = air density at reference conditions = 1.17 kg/m\3\.
[GRAPHIC] [TIFF OMITTED] TR17JN13.007

T = average ambient temperature during testing, in K.
PB = average ambient pressuring during the test, in kPa.

[[Page 36399]]

    (8) Determine the A, B, and C coefficients identified in Sec.  
1066.210 as follows:
    (i) For chassis and post-transmission powerpack testing, follow the 
procedures specified in Section 10 of SAE J1263 or Section 12 of SAE 
J2263.
    (ii) For the GEM simulation tool, use the following values:

A = Am
B = 0
C = Dadj

PART 1068--GENERAL COMPLIANCE PROVISIONS FOR HIGHWAY, STATIONARY, 
AND NONROAD PROGRAMS

0
52. The authority citation for part 1068 continues to read as follows:

    Authority:  42 U.S.C. 7401-7671q.

Subpart A--[Amended]

0
53. Section 1068.1 is amended by revising paragraph (b) to read as 
follows:

Sec.  1068.1  Does this part apply to me?

* * * * *
    (b) This part does not apply to any of the following engine or 
vehicle categories:
    (1) Light-duty motor vehicles (see 40 CFR part 86).
    (2) Highway motorcycles (see 40 CFR part 86).
    (3) Heavy-duty motor vehicles and motor vehicle engines, except as 
specified in 40 CFR parts 85 and 86.
    (4) Aircraft engines, except as specified in 40 CFR part 87.
    (5) Land-based nonroad compression-ignition engines we regulate 
under 40 CFR part 89.
    (6) Small nonroad spark-ignition engines we regulate under 40 CFR 
part 90.
    (7) Marine spark-ignition engines we regulate under 40 CFR part 91.
    (8) Locomotive engines we regulate under 40 CFR part 92.
    (9) Marine compression-ignition engines we regulate under 40 CFR 
parts 89 or 94.
* * * * *

Subpart C--[Amended]

0
54. Section 1068.240 is revised to read as follows:

Sec.  1068.240  What are the provisions for exempting new replacement 
engines?

    The prohibitions in Sec.  1068.101(a)(1) do not apply to a new 
engine if it is exempt under this section as a replacement engine. For 
purposes of this section, a replacement engine is a new engine that is 
used to replace an engine that has already been placed into service 
(whether the previous engine is replaced in whole or in part with a new 
engine).
    (a) General provisions. You are eligible for the exemption for new 
replacement engines only if you are a certificate holder. Note that 
this exemption does not apply for locomotives (40 CFR 1033.601) and 
that unique provisions apply to marine compression-ignition engines (40 
CFR 1042.615).
    (1) Paragraphs (b), (c), and (d) of this section describe different 
approaches for exempting new replacement engines where the engines are 
specially built to correspond to an engine model from an earlier model 
year that was subject to less stringent standards than those that apply 
for current production (or is no longer covered by a certificate of 
conformity).
    (2) Paragraph (e) of this section describes a simpler approach for 
exempting partially complete new replacement engines that are built 
under a certificate of conformity that is valid for producing engines 
for the current model year.
    (3) For all the different approaches described in paragraphs (b) 
through (e) of this section, the exemption applies only for equipment 
that is 25 years old or less at the time of installation.
    (b) Previous-tier replacement engines with tracking. You may 
produce any number of new engines to replace an engine already placed 
into service in a piece of equipment, as follows:
    (1) The engine being replaced must have been either not originally 
subject to emission standards or originally subject to less stringent 
emission standards than those that apply to a new engine meeting 
current standards. The provisions of this paragraph (b) also apply for 
engines that were originally certified to the same standards that apply 
for the current model year if you no longer have a certificate of 
conformity to continue producing that engine configuration.
    (2) The following requirements and conditions apply for engines 
exempted under this paragraph (b):
    (i) You must determine that you do not produce an engine certified 
to meet current requirements that has the appropriate physical or 
performance characteristics to repower the equipment. If the engine 
being replaced was made by a different company, you must make this 
determination also for engines produced by this other company.
    (ii) In the case of premature engine failure, if the old engine was 
subject to emission standards, you must make the new replacement engine 
in a configuration identical in all material respects to the old engine 
and meet the requirements of Sec.  1068.265. You may alternatively make 
the new replacement engine in a configuration identical in all material 
respects to another certified engine of the same or later model year as 
long as the engine is not certified with a family emission limit higher 
than that of the old engine.
    (iii) For cases not involving premature engine failure, you must 
make a separate determination for your own product line addressing 
every tier of emission standards that is more stringent than the 
emission standards for the engine being replaced. For example, if the 
engine being replaced was built before the Tier 1 standards started to 
apply and engines of that size are currently subject to Tier 3 
standards, you must also consider whether any Tier 1 or Tier 2 engines 
that you produce have the appropriate physical and performance 
characteristics for replacing the old engine; if you produce a Tier 2 
engine with the appropriate physical and performance characteristics, 
you must use it as the replacement engine.
    (iv) You must keep records to document your basis for making the 
determinations in paragraphs (b)(2)(i) and (iii) of this section.
    (3) The old engine block may be reintroduced into U.S. commerce as 
part of an engine that meets either the current standards for new 
engines, the provisions for new replacement engines in this section, or 
another valid exemption. Otherwise, you must destroy the old engine 
block or confirm that it has been destroyed.
    (4) If the old engine was subject to emission standards, the 
replacement engine must meet the appropriate emission standards as 
specified in Sec.  1068.265. This generally means you must make the new 
replacement engine in a previously certified configuration.
    (5) Except as specified in paragraph (d) of this section, you must 
add a permanent label, consistent with Sec.  1068.45, with your 
corporate name and trademark and the following additional information:
    (i) Add the following statement if the new engine may only be used 
to replace an engine that was not subject to any emission standards 
under this chapter:
    THIS REPLACEMENT ENGINE IS EXEMPT UNDER 40 CFR 1068.240. SELLING OR 
INSTALLING THIS ENGINE FOR ANY PURPOSE OTHER THAN TO REPLACE AN 
UNREGULATED ENGINE MAY BE A VIOLATION OF FEDERAL LAW SUBJECT TO CIVIL 
PENALTY. THIS ENGINE MAY NOT BE INSTALLED IN

[[Page 36400]]

EQUIPMENT THAT IS MORE THAN 25 YEARS OLD AT THE TIME OF INSTALLATION.
    (ii) Add the following statement if the new engine may replace an 
engine that was subject to emission standards:
    THIS ENGINE COMPLIES WITH U.S. EPA EMISSION REQUIREMENTS FOR 
[Identify the appropriate emission standards (by model year, tier, or 
emission levels) for the replaced engine] ENGINES UNDER 40 CFR 
1068.240. SELLING OR INSTALLING THIS ENGINE FOR ANY PURPOSE OTHER THAN 
TO REPLACE A [Identify the appropriate emission standards for the 
replaced engine, by model year(s), tier(s), or emission levels)] ENGINE 
MAY BE A VIOLATION OF FEDERAL LAW SUBJECT TO CIVIL PENALTY. THIS ENGINE 
MAY NOT BE INSTALLED IN EQUIPMENT THAT IS MORE THAN 25 YEARS OLD AT THE 
TIME OF INSTALLATION.
    (6) Engines exempt under this paragraph (b) may not be introduced 
into U.S. commerce before you make the determinations under paragraph 
(b)(2) of this section, except as specified in this paragraph (b)(6). 
We may waive this restriction for engines excluded under paragraph 
(c)(5) of this section that you ship to a distributor. Where we waive 
this restriction, you must take steps to ensure that the engine is 
installed consistent with the requirements of this paragraph (b). For 
example, at a minimum you must report to us annually whether engines we 
allowed you to ship to a distributor under this paragraph (b)(6) have 
been placed into service or remain in inventory. After an engine is 
placed into service, your report must describe how the engine was 
installed consistent with the requirements of this paragraph (b). Send 
these reports to the Designated Compliance Officer by the deadlines we 
specify.
    (c) Previous-tier replacement engines without tracking. You may 
produce a limited number of new replacement engines that are not from a 
currently certified engine family under the provisions of this 
paragraph (c). If you produce new engines under this paragraph (c) to 
replace engines subject to emission standards, the new replacement 
engine must be in a configuration identical in all material respects to 
the old engine and meet the requirements of Sec.  1068.265. You may 
make the new replacement engine in a configuration identical in all 
material respects to another certified engine of the same or later 
model year as long as the engine is not certified with a family 
emission limit higher than that of the old engine. The provisions of 
this paragraph (c) also apply for engines that were originally 
certified to the same standards that apply for the current model year 
if you no longer have a certificate of conformity to continue producing 
that engine configuration. This would apply, for example, for engine 
configurations that were certified in an earlier model year but are no 
longer covered by a certificate of conformity. You must comply with the 
requirements of paragraph (b) of this section for any number of 
replacement engines you produce in excess of what we allow under this 
paragraph (c). Engines produced under this paragraph (c) may be 
redesignated as engines subject to paragraph (b) of this section, as 
long as you meet all the requirements and conditions of paragraph (b) 
of this section before the deadline for the report specified in 
paragraph (c)(3) of this section. The following provisions apply to 
engines exempted under this paragraph (c):
    (1) You may produce a limited number of replacement engines under 
this paragraph (c) representing 0.5 percent of your annual production 
volumes for each category and subcategory of engines identified in 
Table 1 to this section (1.0 percent through 2013). Calculate this 
number by multiplying your annual U.S.-directed production volume by 
0.005 (or 0.01 through 2013) and rounding to the nearest whole number. 
Determine the appropriate production volume by identifying the highest 
total annual U.S.-directed production volume of engines from the 
previous three model years for all your certified engines from each 
category or subcategory identified in Table 1 to this section, as 
applicable. In unusual circumstances, you may ask us to base your 
production limits on U.S.-directed production volume for a model year 
more than three years prior. You may include stationary engines and 
exempted engines as part of your U.S.-directed production volume. 
Include U.S.-directed engines produced by any parent or subsidiary 
companies and those from any other companies you license to produce 
engines for you.
    (2) Count every exempted new replacement engine from your total 
U.S.-directed production volume that you produce in a given calendar 
year under this paragraph (c), including partially complete engines, 
except for the following:
    (i) Engines built to specifications for an earlier model year under 
paragraph (b) of this section.
    (ii) Partially complete engines exempted under paragraph (e) of 
this section.
    (3) Send the Designated Compliance Officer a report by March 31 of 
the year following any year in which you produced exempted replacement 
engines under this paragraph (c). In your report include the total 
number of replacement engines you produce under this paragraph (c) for 
each category or subcategory, as appropriate, and the corresponding 
total production volumes determined under paragraph (c)(1) of this 
section. If you send us a report under this paragraph (c)(3), you must 
also include the total number of replacement engines you produced under 
paragraphs (b), (d), and (e) of this section. You may include this 
information in production reports required under the standard-setting 
part.
    (4) Add a permanent label as specified in paragraph (b)(5) of this 
section. For partially complete engines, you may alternatively add a 
permanent or removable label as specified in paragraph (d) of this 
section.
    (5) You may not use the provisions of this paragraph (c) for any 
engines in the following engine categories or subcategories:
    (i) Land-based nonroad compression-ignition engines we regulate 
under 40 CFR part 1039 with a per-cylinder displacement at or above 7.0 
liters.
    (ii) Marine compression-ignition engines we regulate under 40 CFR 
part 1042 with a per-cylinder displacement at or above 7.0 liters.
    (iii) Locomotive engines we regulate under 40 CFR part 1033.
    (d) Partially complete engines. The following requirements apply if 
you ship a partially complete replacement engine under this section:
    (1) Provide instructions specifying how to complete the engine 
assembly such that the resulting engine conforms to the applicable 
certificate of conformity or the specifications of Sec.  1068.265. 
Where a partially complete engine can be built into multiple different 
configurations, you must be able to identify all the engine models and 
model years for which the partially complete engine may properly be 
used for replacement purposes. Your instructions must make clear how 
the final assembler can determine which configurations are appropriate 
for the engine they receive.
    (2) You must label the engine as follows:
    (i) If you have a reasonable basis to believe that the fully 
assembled engine will include the original emission control information 
label, you may add a removable label to the engine with your corporate 
name and trademark and the statement: ``This replacement engine is 
exempt under 40 CFR 1068.240.'' This

[[Page 36401]]

would generally apply if all the engine models that are compatible with 
the replacement engine were covered by a certificate of conformity and 
they were labeled in a position on the engine or equipment that is not 
included as part of the partially complete engine being shipped for 
replacement purposes. Removable labels must meet the requirements 
specified in Sec.  1068.45.
    (ii) If you do not qualify for using a removable label in paragraph 
(d)(1) of this section, you must add a permanent label in a readily 
visible location, though it may be obscured after installation in a 
piece of equipment. Include on the permanent label your corporate name 
and trademark, the engine's part number (or other identifying 
information), and the statement: ``THIS REPLACEMENT ENGINE IS EXEMPT 
UNDER 40 CFR 1068.240; IT MAY NOT BE INSTALLED IN EQUIPMENT THAT IS 
MORE THAN 25 YEARS OLD AT THE TIME OF INSTALLATION.'' If there is not 
enough space for this statement, you may alternatively add: 
``REPLACEMENT'' or ``SERVICE ENGINE''. For purposes of this paragraph 
(d)(2), engine part numbers permanently stamped or engraved on the 
engine are considered to be included on the label.
    (e) Partially complete current-tier replacement engines. The 
provisions of paragraph (d) of this section apply for partially 
complete engines you produce from a current line of certified engines 
or vehicles. This applies for engine-based and equipment-based 
standards as follows:
    (1) Where engine-based standards apply, you may introduce into U.S. 
commerce short blocks or other partially complete engines from a 
currently certified engine family as replacement components for in-use 
equipment powered by engines you originally produced. You must be able 
to identify all the engine models and model years for which the 
partially complete engine may properly be used for replacement 
purposes.
    (2) Where equipment-based standards apply, you may introduce into 
U.S. commerce engines that are identical to engines covered by a 
current certificate of conformity by demonstrating compliance with 
currently applicable standards where the engines will be installed as 
replacement engines. These engines might be fully assembled, but we 
would consider them to be partially complete engines because they are 
not yet installed in the equipment.
    (f) Emission credits. Replacement engines exempted under this 
section may not generate or use emission credits under the standard-
setting part nor be part of any associated credit calculations.

  Table 1 to Sec.   1068.240--Engine Categories and Subcategories for New Replacement Engines Exempted Without
                                                    Tracking
----------------------------------------------------------------------------------------------------------------
                                        Standard-setting part
           Engine category                       \1\                          Engine subcategories
----------------------------------------------------------------------------------------------------------------
Highway CI...........................  40 CFR part 86.........  disp. cyl.
                                                                0.6 cyl.
                                                                disp. >= 1.2 L/cyl.
----------------------------------------------------------------------------------------------------------------
Nonroad CI, Stationary CI, and Marine  40 CFR part 1039, or 40  disp. cyl.
 CI.                                    CFR part 1042.          0.6 cyl.
                                                                1.2 cyl.
                                                                2.5 cyl.
----------------------------------------------------------------------------------------------------------------
Marine SI............................  40 CFR part 1045.......  outboard.
                                                                personal watercraft.
Large SI, Stationary SI, and Marine    40 CFR part 1048 or 40   all engines.
 SI (sterndrive/inboard only).          CFR part 1045.
----------------------------------------------------------------------------------------------------------------
Recreational vehicles................  40 CFR part 1051.......  off-highway motorcycle.
                                                                all-terrain vehicle.
                                                                snowmobile.
Small SI and Stationary SI...........  40 CFR part 1054.......  handheld.
                                                                Class I.
                                                                Class II.
----------------------------------------------------------------------------------------------------------------
\1\ Include an engine as being subject to the identified standard-setting part if it will eventually be subject
  to emission standards under that part. For example, if you certify marine compression-ignition engines under
  part 94, count those as if they were already subject to part 1042.

    For the reasons set forth in the preamble, the National Highway 
Traffic Safety Administration is amending title 49, chapter V of the 
Code of Federal Regulations as follows:

PART 523--VEHICLE CLASSIFICATION

0
55. The authority citation for part 523 is revised to read as follows:

    Authority:  49 U.S.C. 32901, delegation of authority at 49 CFR 
1.95

0
56. Section 523.2 is amended by revising the definitions of ``Complete 
vehicle'' and ``Incomplete vehicle'' to read as follows:

Sec.  523.2  Definitions.

* * * * *
    Complete vehicle means a vehicle, other than in Sec.  523.7, that 
requires no further manufacturing operations to perform its intended 
function and is a functioning vehicle that has the primary load 
carrying device or container (or equivalent equipment) attached or that 
is designed to pull a trailer. Examples of equivalent equipment would 
include fifth wheel trailer hitches, firefighting equipment, and 
utility booms.
* * * * *
    Incomplete vehicle means a vehicle, other than in Sec.  523.7, 
which does not have the primary load carrying device or container 
attached when it is first sold as a vehicle or any vehicle that does 
not meet the definition of a complete vehicle. This may include 
vehicles sold to secondary vehicle manufacturers. Incomplete vehicles 
include cab-complete vehicles.
* * * * *

0
57. Section 523.7 is revised to read as follows:

Sec.  523.7  Heavy-duty pickup trucks and vans.

    Heavy-duty pickup trucks and vans are pickup trucks and vans with a 
gross vehicle weight rating between 8,501 pounds and 14,000 pounds 
(Class 2b

[[Page 36402]]

through 3 vehicles) manufactured as complete vehicles by a single or 
final stage manufacturer or manufactured as incomplete vehicles as 
designated by a manufacturer. A manufacturer may also optionally 
designate as a heavy-duty pickup truck or van any cab-complete or 
complete vehicle having a GVWR over 14,000 pounds and below 26,001 
pounds equipped with a spark ignition engine or any spark ignition 
engine certified and sold as a loose engine manufactured for use in a 
heavy-duty pickup truck or van. See references in 49 CFR 535.5(a), 40 
CFR 1037.104 and 40 CFR 1037.150. Complete and incomplete vehicles 
between 8,501 pounds and 14,000 pounds have the meaning for complete 
and incomplete heavy-duty vehicles given in 40 CFR 86.1803.

PART 535--MEDIUM- AND HEAVY-DUTY VEHICLE FUEL EFFICIENCY PROGRAM

0
58. The authority citation for part 535 is revised to read as follows:

    Authority:  49 U.S.C 32901, delegation of authority at 49 CFR 
1.95.

0
56. Revise Sec.  535.3(b) and (c) to read as follows:

Sec.  535.3  Applicability.

* * * * *
    (b) Complete vehicle manufacturers, for the purpose of this part, 
include primary and secondary stage manufacturers meeting the criteria 
in 40 CFR 1037.620 that produce heavy-duty pickup trucks and vans or 
truck tractors as complete vehicles and, that hold the EPA certificate 
of conformity.
    (c) Chassis manufacturers, for the purpose of this part, include 
primary and secondary stage manufacturers meeting the criteria in 40 
CFR 1037.620 that produce incomplete vehicles constructed for use as 
heavy-duty pickup trucks or vans or heavy-duty vocational vehicles and 
that hold the EPA certificate of conformity. Some vocational vehicle 
manufacturers are both chassis and complete vehicle manufacturers. 
These manufacturers will be regulated as chassis manufacturers under 
this program.
* * * * *

0
57. Amend Sec.  535.4 by adding a definition of ``Credit holder'' in 
alphabetical order and revising the definitions for ``Configuration'' 
and ``Subconfiguration'' to read as follows:

Sec.  535.4  Definitions.

* * * * *
    Configuration means a subclassification within a test group which 
is based on engine code, transmission type and gear ratios, final drive 
ratio and other parameters which EPA designates. Transmission type 
means the basic type of the transmission (e.g. automatic, manual, 
automated manual, semi-automatic, or continuously variable) and does 
not include the drive system of the vehicle (e.g. front-wheel drive, 
rear-wheel drive, and four-wheel drive). Engine code means the 
combination of both ``engine code'' and ``basic engine'' as defined in 
the provisions of 40 CFR 600.002.
    Credit holder (or holder) means a legal person that has credits, 
either because they are the manufacturer who earned the credits by 
exceeding the applicable fuel consumption standard and are the 
certificate holder, or because they are a designated recipient who has 
received credits from another holder. Credit holders need not be 
manufacturers but credit holders that are not manufacturers may only 
purchase and hold credits for the purpose of retiring them as specified 
in 40 CFR 1036.701(h) and 1037.701(e).
* * * * *
    Subconfiguration means a unique combination within a vehicle 
configuration of equivalent test weight, road-load horsepower, and any 
other operational characteristics or parameters that EPA determines may 
significantly affect CO2 emissions within a vehicle 
configuration. Note that for vehicles subject to heavy-duty pickup 
truck and van standards, equivalent test weight (ETW) is based on the 
ALVW of the vehicle as outlined in paragraph 40 CFR 1037.104(d)(11).
* * * * *

0
58. Amend Sec.  535.5 by:
0
a. Revising paragraph (a)(4)(i) and adding paragraphs (a)(4)(v) and 
(vi);
0
b. Revising paragraph (a)(6);
0
c. Revising paragraph (b)(2)(i) and adding paragraphs (b)(2)(iii) and 
(iv); and
0
d. Revising paragraph (c)(2)(i) and adding paragraphs (c)(2)(iii), 
(c)(2)(iv), and (c)(5).
    The revisions and additions read as follows:

Sec.  535.5  Standards.

    (a) * * *
    (4) * * *. (i) Manufacturers may choose voluntarily to comply early 
with fuel consumption standards for model years 2013 through 2015, as 
determined in paragraphs (a)(4)(iii) and (iv) of this section, for 
example, in order to begin accumulating credits through over-compliance 
with the applicable standard. A manufacturer choosing early compliance 
must comply with all the vehicles and engines it manufactures in each 
regulatory category for a given model year except as provided in 
paragraphs (a)(4)(v) and (vi) of this section.
* * * * *
    (v) For model year 2013, a manufacturer can choose to comply with 
the standards in paragraph (a) of this section and generate early 
credits under Sec.  535.7(b) by using the entire U.S.-directed 
production volume of vehicles other than electric vehicles as specified 
in 40 CFR 1037.150. The model year 2014 standards in paragraph (a) of 
this section apply for vehicles complying in model year 2013. If some 
test groups are certified by EPA after the start of the model year, the 
manufacturer may only generate credits under Sec.  535.7(b) for the 
production that occurs after all test groups are certified in 
accordance with 40 CFR 1037.150 (a)(2).
    (vi) For model year 2014, a manufacturer producing model year 2014 
vehicles before January 1, 2014, may optionally elect to comply with 
these standards for a partial model year that begins on January 1, 
2014, and ends on the day the manufacturer's model year would normally 
end if it meets the provisions in 40 CFR 1037.150(g).
* * * * *
    (6) Optional certification under this section. A manufacturer may 
optionally certify any spark ignition (or gasoline) cab-complete or 
complete vehicle weighing over 14,000 pounds GVWR and below 26,001 
pounds GVWR to the requirements under this paragraph (a) that applies 
to a comparable complete sister vehicle as determined in accordance 
with 40 CFR 1037.150(l). Calculate the target standard value under 
paragraph (a)(2) of this section based on the same work factor value 
that applies for the complete sister vehicle.
* * * * *
    (b) * * *
    (2) * * * (i) For model years 2013 through 2015, a manufacturer may 
choose voluntarily to comply early with the fuel consumption standards 
provided in paragraph (b)(3) of this section. For example, a 
manufacturer may choose to comply early in order to begin accumulating 
credits through over-compliance with the applicable standards. A 
manufacturer choosing early compliance must comply with all the 
vehicles and engines it manufacturers in each regulatory category for a 
given model year except as provided in paragraphs (b)(2)(iii) through 
(iv) of this section.
* * * * *

[[Page 36403]]

    (iii) For model year 2013, a manufacturer can choose to comply with 
the standards in paragraph (b) of this section and generate early 
credits under 535.7(c) by using the entire U.S.-directed production 
volume within any of its regulatory sub-categories of vehicles other 
than electric vehicles as specified in 40 CFR 1037.150. The model year 
2014 standards in paragraph (b) of this section apply for vehicles 
complying in model year 2013. If some vehicle families within a 
regulatory subcategory are certified by EPA after the start of the 
model year, manufacturers may generate credits under Sec.  535.7(c) 
only for production that occurs after all families are certified in 
accordance with 40 CFR 1037.150(a)(1).
    (iv) For model year 2014, a manufacturer producing model year 2014 
vehicles before January 1, 2014, may optionally elect to comply with 
these standards for a partial model year that begins on January 1, 
2014, and ends on the day the manufacturer's model year would normally 
end if it meets the provisions in 40 CFR 1037.150(g).
* * * * *
    (c) * * *
    (2) * * * (i) For model years 2013 through 2015, a manufacturer may 
choose voluntarily to comply early with the fuel consumption standards 
provided in paragraph (c)(3) of this section. For example, a 
manufacturer may choose to comply early in order to begin accumulating 
credits through over-compliance with the applicable standards. A 
manufacturer choosing early compliance must comply with all the 
vehicles and engines it manufacturers in each regulatory category for a 
given model year except as provided in paragraphs (c)(2)(iii) through 
(iv) of this section.
* * * * *.
    (iii) For model year 2013, a manufacturer can choose to comply with 
the standards in paragraph (c) of this section and generate early 
credits under Sec.  535.7(c) by using the entire U.S.-directed 
production volume within any of its regulatory sub-categories of 
vehicles other than electric vehicles as specified in 40 CFR 1037.150. 
The model year 2014 standards in paragraph (c) of this section apply 
for vehicles complying in model year 2013. If some vehicle families 
within a regulatory subcategory are certified by EPA after the start of 
the model year, manufacturers may generate credits under Sec.  535.7(c) 
only for production that occurs after all families are certified in 
accordance with 40 CFR 1037.150(a)(1).
    (iv) For model year 2014, a manufacturer producing model year 2014 
vehicles before January 1, 2014, may optionally elect to comply with 
these standards for a partial model year that begins on January 1, 
2014, and ends on the day the manufacturer's model year would normally 
end if it meets the provisions in 40 CFR 1037.150(g).
* * * * *
    (5) Vocational tractors. Tractors meeting the definition of 
vocational tractors in 49 CFR 523.2 for purposes of certifying vehicles 
to fuel consumption standards, are divided into families of vehicles as 
specified in 40 CFR 1037.230(a)(1) and must comply with standards for 
heavy-duty vocational vehicles and engines of the same weight class 
specified in paragraphs (b) and (d) of this section. Class 7 and Class 
8 tractors certified or exempted as vocational tractors are limited in 
production to no more than 21,000 vehicles in any three consecutive 
model years. If a manufacturer is determined as not applying this 
allowance in good faith by the EPA in its applications for 
certification in accordance with 40 CFR 1037.205 and 1037.630, a 
manufacturer must comply with the tractor fuel consumption standards in 
paragraph (c)(3) of this section. Vocational tractors generating 
credits can trade and transfer credits in the same averaging sets as 
tractors and vocational vehicles in the same weight class.
* * * * *

0
59. Revise Sec.  535.6(b)(3) to read as follows:

Sec.  535.6  Measurement and calculation procedures.

* * * * *
    (b) * * *
    (3) From the GEM results, select the CO2 family 
emissions level (FEL) and equivalent fuel consumption values for 
vocational vehicle and tractor families in each regulatory 
subcategories for each model year. Equivalent fuel consumption FELs are 
derived in GEM from the CO2 FEL value rounded to the nearest 
whole number and are expressed to the nearest 0.1 gallons per 1000 ton-
mile. For families containing multiple subfamilies, identify the FELs 
for each subfamily.
* * * * *

0
60. Amend Sec.  535.7 by revising paragraphs (a), (b)(9), (c)(11)(i), 
(d)(11)(i), (e)(1)(i), (e)(1)(ii)(A) introductory text, 
(e)(1)(ii)(A)(1), (e)(1)(ii)(A)(2), and (e)(1)(ii)(B) to read as 
follows:

Sec.  535.7  Averaging, banking, and trading (ABT) program.

    (a) Fuel consumption credits (FCC). At the end of each model year, 
primary and secondary manufacturers as specified in Sec.  535.3 may 
earn credits for heavy-duty vehicles and engines exceeding the fuel 
consumption standards in Sec.  535.5 or by using one or more of the 
flexibilities in this paragraph (a) to gain credits. Manufacturers may 
average, bank, and trade fuel consumption credits for purposes of 
complying with fuel consumption standards. The following criteria and 
restrictions apply to averaging, banking and trading FCC.
    (1) Averaging. Averaging is the exchange of FCC among a 
manufacturer's engines or vehicle families or test groups within an 
averaging set. With the exception of FCC earned for advance 
technologies as further clarified below, a manufacturer may average FCC 
only within the same averaging set. The principle averaging sets are 
defined in Sec.  535.4.
    (2) Banking. Banking is the retention of surplus FCC by the 
manufacturer generating the credits for use in future model years for 
averaging or trading. Banked FCC retain the designation from the 
averaging set and model year in which they were generated and expire 
after five model years.
    (3) Trading. Trading is a transaction that moves FCC between 
manufacturers for averaging, banking, or further trading transactions. 
Traded FCC, other than advanced technology credits, may be used by a 
manufacturer only within the averaging set in which they were 
generated. Entities other than manufacturers may only obtain traded FCC 
for the purpose of retiring them.
    (b) * * *
    (9) Calculate the value of credits generated in a model year for 
this regulatory subcategory or averaging set using the following 
equation:

Total MY Fleet FCC (gallons) = (Std - Act) x (Volume) x (UL) x 
(10-2)

Where:

Std = Fleet average fuel consumption standard (gal/100 mile).
Act = Fleet average actual fuel consumption value (gal/100 mile).
Volume = the total U.S.-directed production of vehicles in the 
regulatory subcategory.
UL = the useful life for the regulatory subcategory (120,000 miles).
* * * * *
    (c) * * *
    (11) * * *
    (i) Calculate the value of credits generated in a model year for 
each vehicle family or subfamily within an averaging set using the 
following equation:

[[Page 36404]]

Vehicle Family FCC (gallons) = (Std - FEL) x (Payload) x (Volume) x 
(UL) x (10-3)

Where:

Std = the standard for the respective vehicle family regulatory 
subcategory (gal/1000 ton-mile).
FEL = family emissions limit for the vehicle family or subfamily 
(gal/1000 ton-mile).
Payload = the prescribed payload in tons for each regulatory 
subcategory as shown in the following table:

------------------------------------------------------------------------
                                                              Payload
                 Regulatory subcategory                       (tons)
------------------------------------------------------------------------
LHD Vocational Vehicles.................................            2.85
MHD Vocational Vehicles.................................            5.60
HHD Vocational Vehicles.................................            7.5
Class 7 Tractor.........................................           12.50
Class 8 Tractor.........................................           19.00
------------------------------------------------------------------------

Volume = the number of U.S. directed production volume of vehicles 
in the corresponding vehicle family.
UL = the useful life for the regulatory subcategory (miles) as shown 
in the following table:

------------------------------------------------------------------------
                 Regulatory subcategory                     UL  (miles)
------------------------------------------------------------------------
LHD Vocational Vehicles.................................         110,000
MHD Vocational Vehicles.................................         185,000
HHD Vocational Vehicles.................................         435,000
Class 7 Tractor.........................................         185,000
Class 8 Tractor.........................................         435,000
------------------------------------------------------------------------

* * * * *
    (d) * * *
    (11) * * *
    (i) The value of credits generated in a model year for each engine 
family within a regulatory subcategory equals:

Engine Family FCC (gallons) = (Std - FCL) x (CF) x (Volume) x (UL) x 
(10-\2\)

Where:
Std = the standard for the respective engine regulatory subcategory 
(gal/100 bhp-hr).
FCL = family certification level for the engine family (gal/100 bhp-
hr).
CF = a transient cycle conversion factor in bhp-hr/mile which is the 
integrated total cycle brake horsepower-hour divided by the 
equivalent mileage of the applicable test cycle. For spark-ignition 
heavy-duty engines, the equivalent mileage is 6.3 miles. For 
compression-ignition heavy-duty engines, the equivalent mileage is 
6.5 miles.
Volume = the number of engines in the corresponding engine family.
UL = the useful life of the given engine family (miles) as shown in 
the following table:

------------------------------------------------------------------------
                 Regulatory subcategory                     UL  (miles)
------------------------------------------------------------------------
Class 2b-5 Vocational Vehicles, Spark Ignited (SI), and          110,000
 Light Heavy-Duty Diesel Engines........................
Class 6-7 Vocational Vehicles and Medium Heavy-Duty              185,000
 Diesel Engines.........................................
Class 8 Vocational Vehicles and Heavy Heavy-Duty Diesel          435,000
 Engines................................................
------------------------------------------------------------------------

------------------------------------------------------------------------
                 Regulatory subcategory                     UL  (miles)
------------------------------------------------------------------------
Class 7 Tractors and Medium Heavy-Duty Diesel Engines...         185,000
Class 8 Tractors and Heavy Heavy-Duty Diesel Engines....         435,000
------------------------------------------------------------------------

* * * * *
    (e) * * *
    (1) * * *
    (i) Heavy-duty vehicles. (A) This paragraph (e)(1)(i) specifies how 
to generate advanced technology-specific fuel consumption credits for 
hybrid vehicles, vehicles equipped with Rankine-cycle engines and fuel 
cell vehicles (or other vehicle specific advanced technologies) for 
which the manufacturer is requesting a vehicle certificate from EPA. 
Calculate the advanced technology credits as follows:
    (1) Determine the equivalent fuel consumption for hybrid systems 
with power take-off devices either from chassis or powertrain testing 
emissions rates derived in accordance with 40 CFR 1037.525. Determine 
the equivalent fuel consumption for hybrid systems with pre- or post-
transmissions and for vehicles with other non-hybrid advanced 
technology systems from chassis testing emissions rates derived in 
accordance with 40 CFR 1037.550. Determine the equivalent fuel 
consumption in accordance with this paragraph unless EPA approves an 
alternative test procedure for the manufacturer. Measure the 
effectiveness of the advanced system by chassis testing a vehicle 
equipped with the advanced system and an equivalent conventional system 
in accordance with 40 CFR 1037.525, 1037.550 and 1037.615.
    (2) For purposes of this paragraph (e)(1)(i) a conventional vehicle 
is considered to be equivalent if it has the same footprint, intended 
vehicle service class, aerodynamic drag, and other relevant factors not 
directly related to the advanced system powertrain. If there is no 
equivalent vehicle, the manufacturer may create and test a prototype 
equivalent vehicle. The conventional vehicle is considered Vehicle A, 
and the advanced technology vehicle is considered Vehicle B.
    (3) The benefit associated with the advanced system for fuel 
consumption is determined from the weighted fuel consumption results 
from the chassis tests of each vehicle using the following equation:

Benefit (gallon/1000 ton mile) = Improvement Factor x GEM Fuel 
Consumption Result--B

Where:

Improvement Factor = (Fuel Consumption--A - Fuel Consumption--B)/
(Fuel Consumption--A)
Fuel Consumption Rates A and B are the gallons per 1000 ton-mile of 
the conventional and advanced vehicles, respectively as measured 
under the test procedures specified by EPA.
GEM Fuel Consumption Result B is the estimated gallons per 1000 ton-
mile rate resulting from emission modeling of the advanced vehicle 
as specified in 40 CFR 1037.520 and Sec.  535.6(b).

    (4) The manufacturer may apply the improvement factor to multiple 
vehicle configurations, if it uses the vehicle configuration with the 
smallest potential reduction in fuel consumption performance as a 
result of the hybrid capability.
    (5) Calculate the benefit in credits using the equation in 
paragraph (c)(11) of this section and replacing the term (Std-FEL) with 
the benefit.
    (B) For electric vehicles calculate the fuel consumption credits 
using an FEL of 0 g/1000 ton-mile.
    (ii) Heavy-duty engines. (A) This paragraph (e)(1)(ii) specifies 
how to generate advanced technology-specific fuel consumption credits 
for hybrid engines and for engines that include Rankine-cycle (or other 
bottoming cycle) exhaust energy recovery systems for which the 
manufacturer is requesting an engine certificate from EPA. Calculate 
the advanced technology credits as follows:
    (1) Determine the equivalent fuel consumption for hybrid engine 
systems

[[Page 36405]]

with features that recover and store energy during engine motoring 
operation from the emissions rates derived in accordance with 40 CFR 
1036.525.
    (2) Determine the equivalent fuel consumption for hybrid pre-
transmission powertrains that include energy storage systems and 
regenerative braking (including regenerative engine braking) and for 
engines that include Rankine-cycle exhaust energy recovery systems from 
the emissions rates derived in accordance with 40 CFR 1036.615. Hybrid 
pre-transmission powertrains are engine systems that include features 
that recover and store energy during engine motoring operation but not 
from the vehicle wheels. Determine the equivalent fuel consumption of 
hybrid engines in accordance with this paragraph unless EPA approves an 
alternative test procedure for the manufacturer.
* * * * *
    (B) Calculate credits as specified in paragraph (d) of this 
section. Credits generated from engines complying with this section may 
be used in other averaging sets as described in 40 CFR 1036.740(d).
* * * * *

0
61. Amend Sec.  535.8 by:
0
a. Adding paragraph (a)(4); and
0
b. Revising paragraphs (d) introductory text, (d)(2), (e) introductory 
text, and (e)(2).
    The additions and revisions read as follows:

Sec.  535.8  Reporting requirements.

    (a) * * *
    (4) Manufacturers submitting petitions for the off-road exemption 
in paragraph (h) of this section should consider the timing to submit 
petitions early enough in advance of the model year to ensure that a 
determination can be made by the agencies and should a vehicle fail to 
be excluded the manufacturer has sufficient time to submit and obtain 
approval from EPA for the certificate of conformity required in 40 CFR 
1037.201 prior to first commercial sale of the vehicle.
* * * * *
    (d) End-of-the-year-report. Heavy-duty vehicle and engine 
manufacturers participating and not-participating in the ABT program 
are required to submit an end-of-the-year (EOY) report containing 
information for NHTSA as specified in paragraph (d)(2) of this section 
and in accordance with 40 CFR 1036.250, 1036.730, 1037.104, 1037.250 
and 1037.730. The EOY reports are used to review a manufacturer's 
preliminary or final compliance information and to identify 
manufacturers that might have a credit deficit for the given model 
year. For model years 2013 and later, heavy-duty vehicle and engine 
manufacturers complying with NHTSA's voluntary and mandatory standards 
must submit EOY reports through the EPA database including both GHG 
emissions and fuel consumption information for each given model year.
* * * * *
    (2) Contents. Each EOY report must be submitted including the 
following fuel consumption information for each model year. EOY reports 
for manufacturers participating in the ABT program must include 
preliminary final estimates. EOY reports for manufacturers not 
participating in the ABT program and for heavy-duty pickup truck and 
van manufacturers must include finalized data.
    (i) Engine and vehicle family designations and averaging sets.
    (ii) Engine and vehicle regulatory subcategory and fuel consumption 
standards including any alternative standards used.
    (iii) Engine and vehicle family FCLs and FELs in terms of fuel 
consumption.
    (iv) Production volumes for engines and vehicles.
    (v) A credit plan (for manufacturers participating in the ABT 
program) identifying the manufacturers actual fuel consumption credit 
balances, credit flexibilities, credit trades and a credit deficit plan 
if needed demonstrating how it plans to resolve any credit deficits 
that might occur for a model year within a period of up to three model 
years after that deficit has occurred.
    (vi) A final summary as specified in paragraph (h)(6) of this 
section describing the vocational vehicles and vocational tractors that 
were exempted as heavy-duty off-road vehicles. This applies to 
manufacturers participating and not participating in the ABT program.
    (vii) A summary describing any advanced or innovative technology 
engines or vehicles including alternative fueled vehicles that were 
produced for the model year identifying the approaches used to 
determinate compliance and the production volumes.
    (viii) A list of each unique subconfiguration included in a 
manufacturer's fleet of heavy-duty pickup trucks and vans identifying 
the attribute based-values (GVWR, GCWR, Curb Weight and drive 
configurations) and standards. This provision applies only to 
manufacturers producing heavy-duty pickup trucks and vans.
    (ix) The fuel consumption fleet average standard derived from the 
unique vehicle configurations. This provision applies only to 
manufacturers producing heavy-duty pickup trucks and vans.
    (x) The subconfiguration and test group production volumes. This 
provision applies only to manufacturers producing heavy-duty pickup 
trucks and vans.
    (xi) The fuel consumption test group results and fleet average 
performance. This provision applies only to manufacturers producing 
heavy-duty pickup trucks and vans.
    (xii) Under limited conditions, NHTSA may also ask a manufacturer 
to provide additional information directly to the Administrator if 
necessary to verify the fuel consumption requirements of this 
regulation.
* * * * *
    (e) Final reports. Manufacturers participating in the ABT program 
are required to submit year end final reports in accordance with 40 CFR 
1036.730 and 1037.730 to NHTSA and EPA. Manufacturers of heavy-duty 
pickup trucks and vans are excluded from this requirement and are 
required to submit only one EOY report as specified in paragraph (d) of 
this section. The final reports are used to review a manufacturer's 
final data and to identify manufacturers that might have a credit 
deficit for the given model year. For model years 2013 and later, 
heavy-duty vehicle and engine manufacturers complying with NHTSA's 
voluntary and mandatory standards must submit final reports through the 
EPA database including both GHG emissions and fuel consumption 
information for each given model year.
* * * * *
    (2) Contents. Each final report must be submitted including the 
following fuel consumption information for each model year.
    (i) Final engine and vehicle family designations and averaging 
sets.
    (ii) Final engine and vehicle fuel consumption standards including 
any alternative standards used.
    (iii) Final engine and vehicle family FCLs and FELs in terms of 
fuel consumption.
    (iv) Final production volumes for engines and vehicles.
    (v) A final credit plan identifying the manufacturers actual fuel 
consumption credit demonstrating how it plans to resolve any credit 
deficits that might occur for a model year within a period of up to 
three model years after that deficit has occurred.
    (vi) A final plan describing any advanced or innovative technology

[[Page 36406]]

engines or vehicles including alternative fueled vehicles that were 
produced for the model year identifying the approaches used to 
determinate compliance and the production volumes.
    (vii) Under limited conditions, NHTSA may also ask a manufacturer 
to provide additional information directly to the Administrator if 
necessary to verify the fuel consumption requirements of this part.
* * * * *

    Dated: May 9, 2013.
Ray LaHood,
Secretary, Department of Transportation.

    Dated: May 9, 2013.
Bob Perciasepe,
Acting Administrator, Environmental Protection Agency.
[FR Doc. 2013-11980 Filed 6-14-13; 8:45 am]
BILLING CODE P
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