[Federal Register Volume 63, Number 78 (Thursday, April 23, 1998)]
[Rules and Regulations]
[Pages 20103-20107]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-10151]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 88

[FRL-5994-5]
RIN 2060-AH56


Clean Fuel Fleet Program

AGENCY: Environmental Protection Agency.

ACTION: Direct final rule; delay of implementation date.

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SUMMARY: The provisions of subpart C of Title II of the Clean Air Act 
require states with certain ozone and carbon monoxide (CO) 
nonattainment areas to revise their State Implementation Plans (SIP) to 
incorporate a Clean Fuel Fleet

[[Page 20104]]

Program. Under this program, specified percentages of new vehicles 
acquired by covered fleet operators in certain ozone and CO 
nonattainment areas must meet EPA's clean-fuel vehicle (CFV) emissions 
standards. Today's action delays by one model year, the requirement 
that a covered area's State Implementation Plan implement a Clean Fuel 
Fleet Program (CFFP) fleet operator purchase requirement. As a result, 
EPA may approve a CFFP SIP revision which provides that covered fleet 
operators must include a certain percentage of CFVs in their fleet 
vehicle purchases each year beginning with model year 1999. This action 
is intended to ensure successful implementation of the CFFP, and to 
ensure that an adequate supply of appropriate vehicles is available for 
fleet operators to purchase and use once the program is underway, so 
that compliance with the mandatory purchase requirements will be 
possible and economically feasible for covered fleet operators.

DATES: This rule will become effective on June 8, 1998 unless the 
Agency receives relevant adverse comment by May 26, 1998. Should the 
Agency receive such comments, it will publish notification withdrawing 
this rule.

ADDRESSES: Interested parties may submit written comments in response 
to this rule (in duplicate if possible) to Public Docket No. A-97-53. 
It is requested that a duplicate copy may be submitted to Sally 
Newstead at the address in the FOR FURTHER INFORMATION CONTACT section 
below. The docket is located at the Air Docket, Room M-1500 (6102), 
Waterside Mall SW, Washington, DC 20460. The docket may be inspected 
between 8:00 a.m. and 5:30 p.m. on weekdays, excluding holidays. A 
reasonable fee may be charged for copying docket material.

FOR FURTHER INFORMATION CONTACT: Sally Newstead, Office of Mobile 
Sources, National Vehicle and Fuel Emissions Laboratory, 2565 Plymouth 
Road, Ann Arbor, Michigan 48105. Telephone (734) 668-4474.

SUPPLEMENTARY INFORMATION:

Statutory Authority

    The statutory authority for this action is provided by sections 246 
and 301 of the Clean Air Act.

Background

    EPA is publishing this rule without prior proposal because the 
Agency views this as a noncontroversial action and anticipates no 
adverse comments. However, in the proposed rules section of this 
Federal Register publication, EPA is publishing a separate document 
that will serve as the proposal for this action should relevant adverse 
comments be filed. This rule will be effective June 8, 1998 without 
further notice unless the Agency receives relevant adverse comments by 
May 26, 1998. If EPA receives such comments, EPA will publish a 
document withdrawing this final rule and informing the public that the 
rule did not take effect. All public comments received will then be 
addressed in a subsequent final rule based on the proposed rule. EPA 
will not institute a second comment period on the proposed rule.
    The Clean Air Act, as amended in 1990 (``CAA'' or ``the Act''), 
requires certain states to adopt and submit to EPA a State 
Implementation Plan (SIP) containing a CFFP for nonattainment areas 
with 1980 populations greater than 250,000 that are classified as 
serious or worse for ozone, or with a design value of at least 16.0 ppm 
for carbon monoxide (CO). The nonattainment areas currently covered by 
the requirement to adopt and submit a CFFP are Atlanta, Washington DC 
metropolitan area, Chicago-Gary-Lake Counties, Milwaukee-Racine, Baton 
Rouge, and Denver-Boulder.<SUP>1</SUP>
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    \1\ States with covered nonattainment areas may opt out of the 
CFFP with an adequate substitute program. See CAA Section 
182(c)(4)(B). Eleven states have opted out of the CFFP pursuant to 
this provision. Areas reclassified for ozone, that have a 1980 
population of at least 250,000, must also submit a SIP revision with 
a CFFP within one year of such reclassification. See CAA Section 
246(a)(3).
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    Section 246 of the CAA provides that a states' SIP submission must 
require fleet operators with 10 or more vehicles that are centrally 
fueled or capable of being centrally fueled, to include a specified 
percentage of clean-fuel vehicles (CFVs) in their new vehicle purchases 
each year. In addition, states CFFP SIP submissions must comply with 
other specifications in Section 246, including the requirement that 
covered fleet operators must operate their CFVs in covered 
nonattainment areas on a clean alternative fuel, defined as a fuel on 
which the vehicle meets EPA's CFV standards when using such fuel. EPA 
promulgated emissions standards for CFVs in September 1994. See 40 CFR 
Part 88. EPA estimates that demand for CFVs by covered fleets in model 
year <SUP>2</SUP> 1998 would be approximately 47,000 light duty 
vehicles and 12,000 heavy duty vehicles.
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    \2\ A ``model year'' for purposes of fleet operators' compliance 
with CFFP purchase requirements, and as used in this notice, is not 
the same as ``model year'' as defined for purposes of motor vehicle 
production. The definition of ``model year'' for the CFFP means 
September 1 of the preceding year through August 31 of the named 
year. Therefore, model year 1998 for the CFFP runs from September 1, 
1997 through August 31, 1998. See 40 CFR 88.302-94.
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Start Date for CFFP Purchase Requirement

    Section 246(c) of the CAA provides that the specified percentage of 
new light duty vehicle purchases by covered fleet operators that must 
be CFVs in a given model year shall be 30% in model year 1998, 50% in 
model year 1999, and 70% in model year 2000 and later years, if certain 
categories of new vehicles (light duty trucks (LDTs) below 6000 lbs 
gross vehicle weight rating (GVWR) and light duty vehicles (LDVs)) 
certified to the Phase II CFV exhaust emissions standards are offered 
for sale in California.<SUP>3</SUP> In March 1993, EPA stated its 
expectation that the vehicles specified in Section 246(c) would be 
offered for sale in California by model year 1997, and therefore 
states' SIP submissions should provide for implementation of the CFFP 
purchase requirement beginning in model year 1998. EPA also stated its 
intent to delay this implementation date if it later determined that 
the requisite vehicles would not be offered for sale in California in 
model year 1997. See 58 FR 11888 (March 1, 1993).
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    \3\ The Phase II CFV exhaust emissions standards are found in 
CAA Section 243(a)(2) and 243(b)(2), and include standards for non-
methane organic gases (NMOG), CO, oxides of nitrogen 
(NO<INF>X</INF>), particulate matter (PM), and formaldehyde that are 
identical to California's Low Emission Vehicle (LEV) exhaust 
emissions standards.
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    EPA cannot mandate that vehicle manufacturers produce CFVs for 
fleets to purchase to meet the CFFP requirements--Congress intended 
that the creation of a market for CFVs would provide an incentive for 
vehicle manufacturers to produce and sell such vehicles outside 
California, ultimately resulting in broader market penetration. The 
specification in section 246 (c) that certain vehicles meeting CFV 
exhaust emissions standards must be available for sale in California 
for implementation of the CFFP purchase requirement to begin in model 
year 1998 was intended to provide a minimum level of reasonable 
assurance that complying vehicle technology was available and being 
produced.<SUP>4</SUP> Without some such evidence of vehicle 
availability, fleet operators cannot realistically be expected to 
comply with the CFFP purchase requirements. However, Section 246 is not 
clear on the issue of how many of the vehicles specified in Section 
246(c) must be offered for sale in California before triggering

[[Page 20105]]

implementation of the CFFP purchase requirements.
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    \4\ See A Legislative History of the Clean Air Act Amendments of 
1990, Volume 1 at 903.
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    In today's action, EPA is delaying the start date that the SIP must 
contain for implementation of the CFFP purchase requirements from model 
year 1998 to model year 1999, and intends to approve state SIP 
submissions with CFFPs that start in model year 1999. EPA has received 
information from various stakeholders, including states, covered fleet 
operators, and vehicle manufacturers on this issue, and has concluded 
that a delay until model year 1999 will result in a successful, 
effective fleet program that advances the penetration of CFVs and clean 
alternative fuels into the national market, and is consistent with the 
provisions of Section 246(c) and with Congress' intent in adopting the 
CFFP provisions of the Act.
    The legislative history of the 1990 amendments to the CAA indicates 
that, in adopting the CFFP, Congress made a clear choice between two 
alternatives: requiring auto manufacturers to produce and sell CFVs, or 
creating a market for CFVs and for clean alternative fuels by requiring 
fleet operators to purchase such vehicles and operate on such fuels. In 
choosing the latter option, Congress attempted to minimize the burden 
on fleet operators by requiring some evidence of vehicle availability 
in California as a precondition to implementation of the purchase 
requirement before model year 2001. However, the Act does not provide a 
clear indication of Congressional intent regarding the number of 
vehicles in each weight category specified in Section 246(c) that must 
be offered for sale in California to trigger the fleet operators' 
purchase requirement. Because the CAA is silent on this particular 
issue, and in the absence of a clear indication of Congressional 
intent, it is appropriate for EPA to reasonably exercise its discretion 
in a way that furthers the goals of the CFFP provisions, and determine 
whether a sufficient number of requisite vehicle models are offered for 
sale in California to require that other states SIPs implement the CFFP 
in MY1998.
    Auto manufacturers have certified a number of vehicle models to the 
LEV standards in California on California reformulated gasoline, and 
EPA expects these vehicles could be certified as federal CFVs. However, 
because of the Act's requirement that fleet operators operate CFVs on 
clean alternative fuels, as defined in Section 241(b), fleet operators 
who purchase such CFVs to meet CFFP purchase requirements may have to 
operate these vehicles on California reformulated gasoline, which is 
generally not available outside California. EPA cannot conclude at this 
time that federal reformulated gasoline or federal conventional 
gasoline qualify as clean alternative fuels for CFVs certified to LEV 
standards on California reformulated gasoline, due to potential 
emissions differences resulting from differences in fuel composition 
between California reformulated gasoline and federal fuels. EPA expects 
that manufacturers could certify LEVs that have been certified to 
California LEV standards on California reformulated gasoline as federal 
CFVs on federal fuels--if manufacturers did so, fleet operators could 
purchase such vehicles to meet CFFP purchase requirements, and operate 
them on federal fuels in covered nonattainment areas without violating 
the fuel use requirement of the CFFP. Certain new light duty trucks 
(LDTs) below 6000 pounds GVWR and new light duty vehicles (LDVs) 
certified to LEV exhaust emissions standards are currently being 
offered for sale in California. However, only a limited number of LDTs 
below 6000 lbs. GVWR were certified to California's LEV standards and 
offered for sale in California in MY1997 as indicated in the following 
chart.

                                            List of Certified CA LEVs Offered for Sale in California in MY97                                            
                                                                   [As of April 1997]                                                                   
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           Manufacturer                Certification number               Models                    Type               Standard              Fuel       
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Ford..............................  FORD-LDV-97-01-00.........  Escort, Escort Wagon......  LDV                  LEV                  CA RFG.           
                                    FORD-LDV-97-38-00.........  Sable, Sable Wagon,         LDV                  LEV                  CA RFG.           
                                                                 Taurus, Taurus Wagon.                                                                  
General Motors....................  GM-LDT-97-29-00...........  Astro AWD (C&P)* Passenger  LDT                  LEV                  CA RFG.           
                                    GM-LDT-97-40-00...........  Safari AWD (P), Astro AWD   LDT                  LEV                  CA RFG.           
                                                                 (C&P).                                                                                 
Honda.............................  HONDA-LDV-97-19-00........  Civic, del Sol............  LDV                  LEV                  CA RFG.           
                                    HONDA-LDV-97-20-00........  Civic.....................  LDV                  LEV                  CA RFG.           
                                    HONDA-LDV-97-21-00........  Civic, del Sol............  LDV                  LEV                  CA RFG.           
                                    HONDA-LDV-97-22-00........  Civic.....................  LDV                  LEV                  CA RFG.           
Nissan............................  NISSN-LDV-97-06-00........  Sentra/200SX..............  LDV                  LEV                  CA RFG.           
Suzuki............................  SUZUK-LDV-97-05-00........  Metro.....................  LDV                  LEV                  CA RFG.           
                                    SUZUK-LDV-97-06-00........  Metro, Swift..............  LDV                  LEV                  CA RFG.           
Toyota............................  TOYOT-LDV-97-11-00........  Camry.....................  LDV                  LEV                  CA RFG.           
                                    TOYOT-LDV-97-12-00........  Camry.....................  LDV                  LEV                  CA RFG.           
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* P=Passenger, C=Cargo.                                                                                                                                 

    In order to meet the MY98 purchase requirements, fleet operators 
must have placed vehicle orders in April, 1997; however, the supply of 
federally certified CFVs at this time was limited. Based on the limited 
numbers of light duty vehicles and trucks offered for sale in 
California in MY1997, and particularly the limited number of LDTs <6000 
pounds GVWR, EPA believes that a short delay of the required 
implementation date of the CFFP for one model year is reasonable to 
avoid the potential for serious disruption of the initial 
implementation of this program from an inadequate supply of vehicles. 
Given the list of current federally certified CFVs, the available 
choices for passenger cars, pick-up trucks, vans and sport utility 
vehicles is limited to the following:

[[Page 20106]]



                                                     List of Certified CFVs Offered for Sale in MY97                                                    
                                                                 [As of April 30, 1997]                                                                 
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           Manufacturer                Certification number               Models                  Type                Standard               Fuel       
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                                                                       Light Duty                                                                       
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IMPCO Tech........................  IMPCO-LDCNGT-97-01........  Sierra C Pickup..........  LDT                 LEV                    CNG.              
Chrysler..........................  CHRYSLER-LDCLT-97-01-00...  Caravan(2WD),              LDCLT               ILEV+ULEV              CNG.              
                                                                 Voyager(2WD).                                                                          
                                    CHRYS-ZEV-97-01...........  Caravan(2WD),              LDT                 ZEV                    Electricity.      
                                                                 Voyager(2WD).                                                                          
Ford..............................  FORD-LDCNGV-97-01.........  Crown Victoria...........  LDV                 ILEV+ULEV              CNG.              
                                    FORD-LDCNGT-97-01.........  F250(2WD)................  LDT                 ILEV+ULEV              CNG.              
                                    FORD-LDCNGT-97-02.........  E250(2WD), E350(2WD).....  LDT                 ILEV+ULEV              CNG.              
General Motors....................  GM-ZEV-97-01..............  EV1......................  LDV                 ILEV+ZEV               Electricity.      
                                    GN-ZEV-LDT-97-01..........  S10 Pickup...............  LDT                 ILEV+ZEV               Electricity.      
Honda.............................  HN-ZEV-97-01..............  EV Plus..................  LDV                 ILEV+ZEV               Electricity.      
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           Manufacturer                     Certification number                       Models                        Standard                 Fuel      
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                                                                       Heavy Duty                                                                       
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Cummins...........................  CUMMINS-NGE (MHDD)-97-18............  B5.9-195G.......................  LEV                        CNG.             
                                    CUMMINS-NGE (MHDD)-97-19............  B5.9-195F.......................  LEV                        CNG.             
                                    CUMMINS-NGE (MHDD)-97-22............  C8.3-250G.......................  LEV                        CNG.             
                                    CUMMINS-NGE (MHDE)-97-01............  B5.9-195G.......................  ULEV                       CNG.             
Detroit Diesel....................  DDC-NGE (LHDDE)-97-01...............  Series 30G......................  LEV                        CNG.             
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SIP Revisions

    In light of this action, states with adopted CFFP SIPs may revise 
their SIPs to provide for a model year 1999 start date for the CFFP 
purchase requirements. Fleet operators may still earn credits for early 
purchase of CFVs that meet all applicable requirements, including the 
requirement that fleet operators operate their CFVs on clean 
alternative fuels when in the covered nonattainment area. The EPA 
believes this action will provide states and fleet owners the necessary 
flexibility in those areas that are unable to meet the CFF purchase 
requirements cited in the CAAA.

Administrative Requirements

A. Administrative Designation

    Under Executive Order 12866, (58 FR 51735 (October 4, 1993)) the 
Agency must determine whether the regulatory action is ``significant'' 
and therefore subject to Office of Management and Budget (OMB) review 
and the requirements of the Executive Order. The Order defines 
``significant regulatory action'' as one that is likely to result in a 
rule that may:
    (1) Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another Agency;
    (3) Materially alter the budget impact of entitlement, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    Pursuant to the terms of Executive Order 12866, EPA believes that 
this final action is not a significant regulatory action and therefore 
not subject to OMB review. Approvals of SIP submittals under section 
110 and subchapter I, part D of the Clean Air Act do not create any new 
requirements but simply approve requirements that the State is already 
imposing. This action simply revises regulations governing the 
requirements states' CFFP SIP submissions must meet. It serves to delay 
states' required implementation of CFFP purchase requirements. 
Therefore, it has been determined that this action does not constitute 
a ``major'' regulation.

B. Reporting and Recordkeeping Requirement

    There are no information requirements in this direct final rule 
which require the approval of the Office of Management and Budget under 
the Paperwork Reduction Act 44 U.S.C. 3501 et seq.

C. Regulatory Flexibility

    EPA has determined that it is not necessary to prepare a regulatory 
flexibility analysis in connection with this final rule. EPA has also 
determined that this rule will not have significant economic impact on 
a substantial number of small entities. This is based on the fact that 
this action does not impose any new requirements, but simply delays the 
applicable start date of the CFFP purchase requirements that must be 
included in certain state's SIPs, pursuant to the CAA. Thus, the impact 
created by the proposed action does not increase the preexisting burden 
of the existing rules which this proposal seeks to amend.

D. Submission to Congress

    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 will submit a report 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. This rule is not a 
``major rule'' as defined by 5 U.S.C. 804(2).

[[Page 20107]]

E. Unfunded Mandates Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule where the estimated costs to State, local, or tribal 
governments, or to the private sector, will be $100 million or more. 
Under section 205, EPA must select the most cost-effective and least 
burdensome alternative that achieves the objective of the rule and is 
consistent with statutory requirements. Section 203 requires EPA to 
establish a plan for informing and advising any small governments that 
may be significantly impacted by the rule. To the extent that the rules 
being adopted in this action would impose any mandate at all as defined 
in section 101 of the Unfunded Mandates Act upon the state, local, or 
tribal governments, or the private sector, as explained above, this 
rule is not estimated to impose costs in excess of $100 million. EPA 
has determined that today's action simply delays the purchase 
requirements under state CFFPs and does not impose additional costs or 
regulatory burdens. In fact, the one-year delay of implementation of 
the purchase requirements is expected to reduce costs of compliance and 
ease regulatory burdens.

List of Subjects in 40 CFR Part 88

    Environmental protection, Labeling, Motor vehicle pollution, 
Reporting and recordkeeping requirements.

    Dated: April 3, 1998.
Carol M. Browner,
Administrator.

    For the reasons set out in the preamble, 40 CFR part 88 is amended 
as follows:

PART 88--[AMENDED]

    1. The authority citation for part 88 continues to read as follows:

    Authority: 42 U.S.C. 7410, 7418, 7581, 7582, 7583, 7584, 7586, 
7588, 7589, 7601(a).

    2. Section 88.308.94 is amended by designating the existing text as 
paragraph (a) and by adding paragraph (b) to read as follows:


Sec. 88.308.94  Programmatic requirements for clean-fuel fleet 
vehicles.

* * * * *
    (b) Program start date. The SIP revision shall provide that the 
clean fuel vehicle purchase requirements begin to apply no later than 
model year 1999.

[FR Doc. 98-10151 Filed 4-22-98; 8:45 am]
BILLING CODE 6560-50-P