[Federal Register Volume 61, Number 37 (Friday, February 23, 1996)]
[Rules and Regulations]
[Pages 6949-6953]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-4039]



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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 86

[A-94-13; FRL-5425-9]
RIN 2060-AE07


Control of Air Pollution From New Motor Vehicles and New Motor 
Vehicle Engines; Nonconformance Penalties for 1996 and 1998 Model Year 
Emission Standards for Heavy-Duty Vehicles and Engines--Part II

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: This final rule makes nonconformance penalties (NCPs) 
available for the 1998 and later model year Heavy-Duty Engine (HDE) 
oxides of nitrogen (NOX) standard for Heavy-Duty Diesel Engines 
(HDDEs), the 1996 and later model year Light-Duty Truck 3 (LDT3) 
NOX standard, and the 1996 and later model year Urban Bus 
particulate matter (PM) standard. The availability of NCPs will allow 
manufacturers whose vehicles or engines fail to conform with these 
emission standards, but do not exceed a designated upper limit, to be 
issued a certificate of conformity upon payment of a monetary penalty. 
The associated upper limit will be the previous standard (5.0 grams per 
brake horsepower-hour (g/BHp-hr) NOX for HDDEs, 1.7 grams per mile 
(g/mi) NOX for LDT3s, and 0.07 g/BHp-hr PM for urban buses).
    A final rule published elsewhere in this Federal Register document 
addresses other emission standards for which NCPs have been considered 
and establishes NCPs for the 1996 PM standard for LDT3.

EFFECTIVE DATE: This final rule will be effective April 23, 1996 unless 
notice is received by March 25, 1996 that adverse or critical comments 
will be submitted or that an opportunity to submit such comments at a 
public hearing is requested. If such comments or a request for a public 
hearing are received by the Agency, EPA will then publish a subsequent 
Federal Register document withdrawing from this action only those items 
which are specifically listed in those comments or in the request for a 
public hearing.

ADDRESSES: Public Docket: Copies of materials relevant to this 
rulemaking proceeding are contained in Public Docket A-94-13 at the Air 
Docket of the US Environmental Protection Agency, Room M1500, 401 M 
Street, SW, Washington, DC 20460, and are available for review in Room 
M1500 between the hours of 8:00 a.m. and 5:30 p.m. on weekdays. As 
provided in 40 CFR Part 2, a reasonable fee may be charged for copying 
services.

FOR FURTHER INFORMATION CONTACT: Mr. Gregory Orehowsky, Manufacturers 
Operations Division [6405-J], US Environmental Protection Agency, 401 M 
Street, SW, Washington, DC 20460, telephone (202) 233-9292.

SUPPLEMENTARY INFORMATION: EPA believes that the use of a direct final 
rule is appropriate because the changes made are expected to be non-
controversial. The direct final rule will allow the Agency to finalize 
such changes in a timely manner, allowing NCPs to be available before 
the start of production of affected vehicles.

I. Statutory Authority

    Section 206(g) of the Clean Air Act (the Act), 42 U.S.C. 7525(g), 
requires EPA to issue a certificate of conformity for HDEs or Heavy-
Duty Vehicles (HDVs) which exceed an applicable section 202(a) 
emissions standard, but do not exceed an upper limit associated with 
that standard, if the manufacturer pays an NCP established by 
rulemaking. Congress adopted section 206(g) in the Clean Air Act 
Amendments of 1977 as a response to perceived problems with technology-
forcing heavy-duty emissions standards. (It should be noted, however, 
that the existence of NCPs does not change the criteria under which the 
standards have been and will be set under section 202.) Following 
International Harvester v. Ruckelshaus, 478 F.2d 615 (D.C. Cir. 1973), 
Congress realized the dilemma that technology-forcing standards were 
likely to cause. If strict standards were maintained, then some 
manufacturers, ``technological laggards,'' might be unable to comply 
initially and would be forced out of the marketplace. NCPs were 
intended to remedy this potential problem. The laggards would have a 
temporary alternative that would permit them to sell their engines or 
vehicles by payment of a penalty. This penalty is based in part, on the 
money saved from the production of non complying engines, would protect 
conforming manufacturers from the competitive disadvantage of making 
more costly 

[[Page 6950]]
engines which comply with technology forcing standards.
    Under section 206(g)(1) of the Clean Air Act, NCPs may be offered 
for HDVs or HDEs. The penalty may vary by pollutant and by class or 
category of vehicle or engine.
    HDVs are defined by section 202(b)(3)(C) of the Clean Air Act as 
vehicles in excess of 6,000 pounds gross vehicle weight rating (GVWR). 
The light-duty truck (LDT) classification includes trucks that have a 
GVWR of 8,500 lbs or less. Therefore, certain LDTs may be classified as 
HDVs. Historically, LDTs between 6,001 and 8,500 pounds GVWR have been 
considered Heavy Light Duty Trucks (HLDTs). Based on various new 
requirements established by the Clean Air Act Amendments of 1990, HLDTs 
have been further subdivided into groups by weight.
    The HLDTs are divided at 5750 lbs Adjusted Loaded Vehicle Weight 
(ALVW) which is the average of the curb weight and the GVWR. The HLDTs 
that are up through 5750 lbs ALVW are called Light Duty Trucks 3 
(LDT3). Those above 5750 lbs ALVW but less than or equal to 8500 lbs 
GVWR are Light Duty Trucks 4, or LDT4. The LDT3 and LDT4 subclasses 
make up the HLDT vehicle class. Since NCPs are only offered for heavy 
duty vehicles or engines, this notice addresses only emission standards 
for light duty trucks of the LDT3 and LDT4 categories.
    Section 206(g)(3) of the Clean Air Act requires that NCPs:
    (1) Account for the degree of emission nonconformity;
    (2) Increase periodically to provide incentive for nonconforming 
manufacturers to achieve the emission standards; and
    (3) Remove the competitive disadvantage to conforming 
manufacturers.
    Section 206(g) authorizes EPA to require testing of production 
vehicles or engines in order to determine the emission level on which 
the penalty is based. If the emission level of a vehicle or engine 
exceeds an upper limit of nonconformity established by EPA through 
regulation, the vehicle or engine would not qualify for an NCP under 
section 206(g) and no certificate of conformity could be issued to the 
manufacturer. If the emission level is below the upper limit but above 
the standard, that emission level becomes the ``compliance level,'' 
which is also the benchmark for warranty and recall liability; the 
manufacturer who elects to pay the NCP is liable for vehicles or 
engines that exceed the compliance level in-use, unless, for the case 
of HLDTs, the compliance level is below the in-use standard. The 
manufacturer does not have in-use warranty or recall liability for 
emissions levels above the standard but below the compliance level.

II. Background

A. The Generic Nonconformance Penalty Rule

    The generic NCP rule (Phase I) established three basic criteria for 
determining the eligibility of emission standards for nonconformance 
penalties in any given model year. See 40 CFR 1103-87. First, the 
emission standard in question must become more difficult to meet. This 
can occur in two ways, either by the emission standard itself becoming 
more stringent, or due to its interaction with another emission 
standard that has become more stringent.
    Second, substantial work must be required to meet the emission 
standard. EPA considers ``substantial work'' to mean the application of 
technology not previously used in that vehicle or engine class/
subclass, or a significant modification of existing technology, to 
bring that vehicle/engine into compliance. EPA does not consider minor 
modifications or calibration changes to be classified as substantial 
work.
    Third, a technological laggard must be likely to develop. A 
technological laggard is defined as a manufacturer who cannot meet a 
particular emission standard due to technological (not economic) 
difficulties and who, in the absence of NCPs, might be forced from the 
marketplace. EPA will make the determination that a technological 
laggard is likely to develop, based in large part on the above two 
criteria. However, these criteria are not always sufficient to 
determine the likelihood of the development of a technological laggard. 
An emission standard may become more difficult to meet and substantial 
work may be required for compliance, but if that work merely involves 
transfer of well-developed technology from another vehicle class, it is 
unlikely that a technological laggard would develop.
    The above three criteria were used to determine eligibility for 
NCPs in Phase II of the NCP rulemaking (50 FR 53454, December 31, 
1985), in Phase III of the NCP rulemaking (55 FR 46622, November 5, 
1990) concerning the 1991 model year HDE standards, and in Phase IV of 
the NCP rulemaking (58 FR 68532, December 28, 1993) concerning HDVs and 
HDEs subject to the 1994 and later model year emission standards for 
particulate matter (PM).
    As in the previous NCP rules, EPA is specifying values for the 
following parameters in the NCP formula for each standard: COC50, 
COC90, MC50, and F. The NCP formula is the same as that 
promulgated in the Phase I rule.
    COC50 is an estimate of the industry wide average incremental 
cost per engine (references to engines are intended to include vehicles 
as well) associated with meeting the standard for which an NCP is 
offered, compared with meeting the upper limit. COC50 is based on 
typical engine technology, as nearly as EPA can identify it. As in the 
previous NCP rules, costs include additional manufacturer costs and 
additional owner costs. The other NCP rules did not include 
certification costs in the calculation of COC50, and none will be 
allowed in this proposed rule because both complying and noncomplying 
manufacturers must incur certification costs.
    COC90 is EPA's best estimate of the 90th percentile 
incremental cost per engine associated with meeting the standard for 
which an NCP is offered, compared with meeting the associated upper 
limit. COC90 is based on a near worst case technology, as nearly 
as EPA can identify it. COC90, like COC50, includes both 
manufacturer and owner costs, but not certification costs.
    MC50 is an estimate of the industry wide average marginal cost 
of compliance per unit of reduced pollutant associated with the least 
cost effective emission control technology installed to meet the new 
standard. MC50 is measured in dollars per g/BHP-hr for HDEs and in 
dollars per gram per mile (g/mi) for LDTs.
    F is a factor used to derive MC90, the 90th percentile 
marginal cost of compliance with the NCP standard for engines in the 
NCP category. MC90 is defined as being the slope of the penalty 
rate curve near the standard and is equal to MC50 multiplied by F. 
For this rulemaking, as was the case in the previous NCP rules, EPA has 
determined that no reasonable estimate of MC90 can be made based 
on existing marginal cost data and has thus set F at a presumptive 
value of 1.2. This approach was generally supported by commentaries on 
the past NCP rulemakings.

B. Notice of Proposed Rulemaking

    In the Notice of Proposed Rulemaking (NPRM) (59 FR 43074, August 
22, 1994), EPA identified the Tier I Heavy Light-Duty Trucks (HLDT) 
NOX standard of 0.98 g/mi becoming effective in 1996, the 1998 HDE 
NOX standard of 4.0 g/

[[Page 6951]]
BHp-hr, and the 1996 Urban Bus PM standard of 0.05 g/BHp-hr as new 
standards for which it has statutory authority for considering NCPs. 
EPA did not propose to offer NCPs for these standards because, based on 
the information available at the time of the proposed rulemaking, these 
standards did not meet the criteria for offering NCPs.

C. Summary and Analysis of Comments

    Based on comments to the NPRM received by EPA, EPA has decided to 
offer NCPs for the 1996 Light Duty Trucks 3 (LDT3) NOX standard of 
0.98 g/mi for diesel-fueled vehicles, the 1998 HDE NOX standard of 
4.0 g/BHp-hr for HDDEs, and the 1996 Urban Bus PM standard of 0.05 g/
BHp-hr.
1. Heavy Light Duty Trucks 3 NOX Standard
    General Motors, the only manufacturer in this market, commented 
that NCPs are justified for this standard since ``* * * the NOX 
standard change is large (1.7 g/mi to 0.98 g/mi) * * *'' and ``attempts 
to reach significantly lower NOX levels with the current 
technology results in very poor engine combustion control with 
significant increased smoke * * *'' GM goes on to state that new 
technology is required which ``concentrates on new EGR systems and 
control interfaces between this EGR technology and the fuel control 
system * * *''
    EPA agrees with GM's assessment that current EGR flow rates cannot 
be increased to limit NOX emissions without changes to the fuel 
control system. Driveabiliity problems will occur at higher EGR flow 
rates unless the fuel control system is adjusted to account for these 
higher EGR flow rates. EPA believes that GM will need to recalibrate 
the engine computer to better control fuel delivery rates to allow for 
improved driveability at increased EGR flow rates. EPA also believes 
that air-to-air aftercooling will be necessary to further reduce 
NOX emissions below the standard.
    EPA acknowledges that the stringency of the NOX standard for 
this class of trucks has increased. Also, significant work will be 
involved in developing the appropriate fuel system calibration to allow 
for increased EGR flow. Further work will be necessary to develop air-
to-air aftercooling which is new to this segment of the truck market. 
Since the previously mentioned technology may not be developed by the 
start of the 1996 model year, a technological laggard may develop. For 
these reasons, EPA is offering NCPs for 1996 LTD3 NOX standard.
2. 1996 HDDE Urban Bus PM Standard
    Detroit Diesel Corporation (DDC) commented that they are capable of 
achieving 0.05 g/BHp-hr in development engines using only a catalytic 
converter, but they need new technology to ensure that production 
engines would be capable of satisfying the new standard during 
Selective Enforcement Audit (SEA) testing. The Engine Manufacturers 
Association (EMA) stated that for the 1996 model year Urban Bus Engine 
PM standard the three criteria for offering NCPs are met.
    In the 1996 model year the PM standard applicable to Urban Bus 
Engines becomes more stringent. EPA acknowledges that new technologies 
need to be developed to provide for a compliance margin for SEA 
testing. These technologies include improving aftertreatment devices 
such as catalysts and traps and new turbocharger designs. EPA believes 
that substantial work will be involved in developing this diesel fueled 
technology. Particulate traps have not proven to be durable. Catalysts 
have reduced PM emissions but further reductions are necessary. Low 
inertia turbochargers are being developed but have yet to be offered in 
the urban bus market and their effectiveness is uncertain.
    EPA believes that Urban Bus Engine manufacturers will need to 
employ the unproven technology mentioned in the preceding paragraph to 
ensure compliance with this standard, thus; EPA believes a 
technological laggard is likely to develop and will be offering NCPs.
3. 1998 HDE NOX Standard
    EMA commented that ``based on the information presently available, 
it is likely that certain engine manufacturers and/or certain engine 
families may not be able to meet the 4.0 g/bhp-hr NOX standard in 
1998''. Mack Truck suggested that NCPs should be offered for this 
standard since they were offered for the 1988 and 1991 NOX 
standards. DDC commented that several of their most advanced engines 
are using credits to meet the 1994 standards. Because of the NOX-
PM trade off and the stringency of the 1994 PM standard, none of their 
engines are capable of generating NOX credits which could be used 
toward the 1998 NOX standard. This could result in DDC having to 
discontinue several of its engine ratings in 1998. Navistar commented 
that a commercially important engine may not be finished in time 
causing an interruption in manufacturing. Navistar stated that NCPs 
would allow such an engine to be put into commerce.
    In the 1998 model year the NOX standard applicable to HDEs 
will become more stringent. EPA believes that this increase in 
stringency will require the HDE manufacturers to employ new emission 
control technology (e.g., oxidation catalysts, improved turbochargers, 
modifications to the fuel injection systems, or engine calibration 
changes). These new technologies will require substantial work. Also 
based on manufacturers' comments to the Notice of Proposed Rulemaking 
(59 FR 43074, August 22, 1994), EPA now believes that a technological 
laggard may develop. Therefore, EPA has decided to offer NCPs for the 
1998 model year HDE NOX standard.

III. Standards Addressed in a Concurrent NCP Rulemaking

a. 1996 Tier 1 Standards for LDT3 other than diesel NOX
b. 1996 Tier 1 Standards for LDT4

IV. Penalty Rates and Upper Limits

    This rule is the most recent in a series of NCP rulemakings. The 
discussion of penalty rates in the Phase IV rulemaking (58 FR 68532, 
December 28, 1993), Phase III rulemaking (55 FR 46622, November 5, 
1990), the Phase II rulemaking (50 FR 53454, December 31, 1985) as well 
as the Phase I rulemaking (50 FR 35374, August 30, 1985) are 
incorporated by reference.
    The derivation of the proposed cost parameters is described in a 
support document entitled ``Calculation of Nonconformance Penalty Rates 
for 1996 and Later Model Year LDT3 Particulate Matter (PM), LDT3 Oxides 
of Nitrogen (NOX), 1996 and Later Model Year Urban Bus Particulate 
Matter (PM), and 1998 and Later Model Year HDDE Oxides of Nitrogen 
(NOX) Standards'' which is available in the public docket for this 
rulemaking. The associated upper limits of 1.7 g/mi NOX and 0.12 
g/mi PM for diesel LDT3, 5.0 g/BHp-hr NOX for HDDEs, and 0.07 g/
BHp-hr PM for urban bus engines were determined from the previous 
standards as per Section 86.1104-91 of the Code of Federal Regulations 
(CFR).

V. Administrative Designation and Regulatory Analysis

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), EPA 
must determine whether the regulatory action is ``significant'' and 
therefore subject to 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: 

[[Page 6952]]
(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 budgetary impact of entitlements, 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, it has been 
determined that this rule is not a ``significant regulatory action.'' 
This regulation will not have an annual effect on the economy in excess 
of $100 million and will not cause a major increase in the price of 
HDEs above those that would otherwise occur from compliance with the 
emission standards themselves. This regulation is intended to assist 
manufacturers that are having difficulty developing and marketing 
vehicles which comply with the 1996 Tier 1 PM standard for LDT3s. 
Without this rule, a manufacturer experiencing difficulty in complying 
with this new emission standard (after the use of credits) has only two 
alternatives: fix the nonconforming engines for the associated model 
years or not sell them at all. NCPs provide manufacturers with 
additional time to bring their engines into conformity.
    In addition, NCPs are calculated to deprive nonconforming 
manufacturers of any cost savings and competitive advantages stemming 
from marketing a nonconforming engine. Thus, NCPs will not have 
significant adverse effects on competition, employment, investment, 
productivity, innovation or on the ability of United States-based 
enterprises to compete with foreign-based enterprises in domestic or 
export markets.

VI. Economic Impact

    Because the use of NCPs is optional, manufacturers have the 
flexibility and will likely choose whether or not to use NCPs based on 
their ability to comply with emissions standards. If a HDE manufacturer 
elects not to use NCPs, the manufacturer and its customers will not 
incur any additional costs related to NCPs. NCPs remedy the potential 
problem of having a manufacturer forced out of the marketplace due to 
that manufacturer's inability to conform to new, strict emission 
standards in a timely manner. Without NCPs, a manufacturer which has 
difficulty certifying HDEs in conformance with emission standards or 
whose engines fail a SEA has only two alternatives: fix the 
nonconforming engines, perhaps at a prohibitive cost, or prevent their 
introduction into commerce. The availability of NCPs provides 
manufacturers with a third alternative: continue production and 
introduce into commerce upon payment of a penalty for an engine that 
exceeds the standard until an emission conformance technique is 
developed.
    Therefore, NCPs represent a regulatory mechanism that allows 
affected manufacturers to have increased flexibility. A decision to use 
NCPs may be a manufacturer's only way to continue to introduce HDEs 
into commerce. Hence, NCPs may be considered to have no adverse 
economic impact.

VII. Environmental Impact

    When evaluating the environmental impact of this rule, one must 
keep in mind that, under the Clean Air Act, NCPs are a consequence of 
enacting new, more stringent emissions requirements for heavy duty 
engines. Emission standards are set at a level that most, but not 
necessarily all, manufacturers can achieve by the model year in which 
the standard becomes effective. Following International Harvester v. 
Ruckelshaus, 478 F.2d 615 (D.C. Cir. 1973), Congress realized the 
dilemma that technology-forcing standards were likely to cause, and 
allowed manufacturers of heavy-duty engines to certify nonconforming 
vehicles/engines upon the payment of an NCP, under certain conditions. 
This mechanism would allow a manufacturer(s) who cannot meet 
technology-forcing standards immediately to continue to manufacture 
these nonconforming engines while they tackle the technological 
problems associated with meeting new emission standard(s). Thus, as 
part of the statutory structure to force technological improvements 
without driving manufacturers out of the market, NCPs provide 
flexibility that fosters long-term emissions improvement through the 
setting of lower emission standards at an earlier date than could 
otherwise be possible. By design, NCPs encourage the technological 
laggard that is using NCPs to reduce emission levels to the more 
stringent standard as quickly as possible.

VIII. Compliance With Regulatory Flexibility Act

    Under section 605 of the Regulatory Flexibility Act, 5 U.S.C. 601, 
et seq., the Administrator is required to either perform a regulatory 
flexibility analysis or certify that this regulation will not have a 
significant impact on a substantial number of small business entities. 
None of the affected manufacturers could be classified as small. 
Moreover, as already discussed, the NCP program can be expected to 
benefit manufacturers.
    Some small entities do exist as manufacturers' contractors for the 
testing of engines for Production Compliance Audits (PCAs). It is EPA's 
practice to conduct PCA scheduling (namely, tests per day limitations) 
in such a way as to consider the staff and manpower capabilities of 
such contractors and avoid any problems. The result is that these 
entities are not adversely affected. Thus, I certify that this rule 
will not have any adverse economic impact on a substantial number of 
small entities.

IX. Information Collection Requirements

    This rule requires that manufacturers perform certain record 
keeping and submit certain reports to EPA. The Paperwork Reduction Act 
of 1980, 44 U.S.C. 3501, et seq., provides that reporting and record 
keeping requirements be approved by OMB before they can be enforced by 
EPA. The information collection requirements in this proposed rule have 
been addressed in previous rulemaking and approved by OMB (OMB control 
no. 2060-0132). However, any person wishing to comment on these 
requirements is invited to do so. Comments on these requirements should 
be submitted to Chief, Information Policy Branch, Mail Code 2136, U.S. 
Environmental Protection Agency, 401 M St., S.W., Washington, DC 20460 
and to Office of Management and Budget (OMB), Office of Information and 
Regulatory Affairs, 726 Jackson Place, NW, Washington, DC 20503, marked 
``Attention: Desk Officer for EPA.''

X. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), P.L. 
104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, EPA 
generally must prepare a written statement, including a cost benefit 
analysis, for proposed and final rules 

[[Page 6953]]
with ``Federal mandates'' that may result in expenditures to State, 
local, and tribal governments, in the aggregate, or to the private 
sector, of $100 million or more in any one year. Before promulgating an 
EPA rule for which a written statement is needed, section 205 of the 
UMRA generally requires EPA to identify and consider a reasonable 
number of regulatory alternative and adopt the least costly, most cost 
effective, or least burdensome alternative that achieves the objectives 
of the rule. The provisions of section 205 do not apply when they are 
inconsistent with applicable law. Moreover, section 205 allows EPA to 
adopt an alternative other than the least costly, most cost-effective, 
or least burdensome alternative if the Administrator publishes with the 
final rule an explanation why that alternative was not adopted. Before 
EPA establishes any regulatory requirements that may significantly or 
uniquely affect small governments, including tribal governments, it 
must have developed under section 203 of the UMRA a small government 
agency plan. The plan must provide for notifying potentially affected 
small governments, enabling officials of affected small governments to 
have meaningful and timely input in the development of EPA regulatory 
proposals with significant Federal intergovernmental mandates, and 
informing, educating, and advising small governments on compliance with 
the regulatory requirements.
    Today's rule contains no federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local, or tribal 
governments or the private sector. The rule imposes no enforceable 
duties on any of these governmental entities or the private sector. In 
addition, the UMRA excludes from the definition of ``Federal private 
sector mandate'' duties that arise from participation in a voluntary 
federal program. Thus, this rule is not subject to the requirements of 
sections 202 and 205 of the UMRA.

List of Subjects in 40 CFR Part 86

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Gasoline, Motor vehicles, Labeling, Motor 
vehicle pollution, Reporting and recordkeeping requirements.

    Dated: February 12, 1996.
Carol M. Browner,
Administrator.

    For the reasons set forth in the preamble, 40 CFR part 86, is 
amended as follows:

PART 86-CONTROL OF AIR POLLUTION FROM NEW AND IN-USE MOTOR VEHICLES 
AND NEW AND IN-USE MOTOR VEHICLE ENGINES: CERTIFICATION AND TEST 
PROCEDURES

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

    Authority: Secs. 202, 203, 206, 207, 208, 215, 216, 217, 301(a), 
Clean Air Act as amended (42 U.S.C. 7521, 7522, 7524, 7525, 7541, 
7542, 7549, 7550, 7552, and 7601(a)).

    2. Section 86.1105-87 of subpart L is amended by adding paragraphs 
(g)(2) and (3) and paragraph (h), reading as follows:


Sec. 86.1105-87  Emission standards for which nonconformance penalties 
are available.

* * * * *
    (g) * * *
    (2) Light-duty truck 3 diesel-fueled vehicle at full useful life 
(as defined in Sec. 86.094-2) oxides of nitrogen emission standard of 
0.98 g/mi.
    (i) The following values shall be used to calculate an NCP for the 
standard set forth in Sec. 86.094-9(a)(1)(ii) in accordance with 
Sec. 86.1113-87(a):
    (A) COC50: $654.
    (B) COC90: $779.
    (C) MC50: $908 per gram per mile.
    (D) F: 1.2.
    (ii) The following factor shall be used to calculate the 
engineering and development component of the NCP for the standard set 
forth in Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h): 
0.082.
    (3) 1996 Urban Bus (as defined in Sec. 86.094-2) particulate matter 
emission standard of 0.05 g/BHp-hr.
    (i) The following values shall be used to calculate an NCP for the 
standard set forth in Sec. 86.094-9(a)(1)(ii) in accordance with 
Sec. 86.1113-87(a):
    (A) COC50: $576.
    (B) COC90: $6,569.
    (C) MC50: $28,800 per gram per brake horsepower-hour.
    (D) F: 1.2.
    (ii) The following factor shall be used to calculate the 
engineering and development component of the NCP for the standard set 
forth in Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h): 
0.500.
    (h) Effective in the 1998 model year, NCPs will be available for 
the following emission standard:
    (1) Petroleum-fueled diesel heavy-duty engine oxides of nitrogen 
standard of 4.0 grams per brake horsepower-hour.
    (i) For petroleum-fueled light heavy-duty diesel engines:
    (A) The following values shall be used to calculate an NCP in 
accordance with Sec. 86.1113-87(a):
    (1) COC50: $833.
    (2) COC90: $1,513.
    (3) MC50: $833 per gram per brake horsepower-hour.
    (4) F: 1.2.
    (B) The following factor shall be used to calculate the engineering 
and development component of the NCP for the standard set forth in 
Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h): 0.039.
    (ii) For petroleum-fueled medium heavy-duty diesel engines:
    (A) The following values shall be used to calculate an NCP in 
accordance with Sec. 86.1113-87(a):
    (1) COC50: $444.
    (2) COC90: $1,368.
    (3) MC50: $444 per gram per brake horsepower-hour.
    (4) F: 1.2.
    (B) The following factor shall be used to calculate the engineering 
and development component of the NCP for the standard set forth in 
Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h): 0.043.
    (iii) For petroleum-fueled heavy heavy-duty diesel engines:
    (A) The following values shall be used to calculate an NCP in 
accordance with Sec. 86.1113-87(a):
    (1) COC50: $1,086.
    (2) COC90: $2,540.
    (3) MC50: $1,086 per gram per brake horsepower-hour
    (4) F: 1.2.
    (B) The following factor shall be used to calculate the engineering 
and development component of the NCP for the standard set forth in 
Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h): 0.039.
    (2) [Reserved]

[FR Doc. 96-4039 Filed 2-22-96; 8:45 am]
BILLING CODE 6560-50-P